Rain Tax - Maryland Taxes

A rain tax is a tax or fee imposed on real estate owners for pollution in stormwater drainage.

Italy

Such taxes have been collected in regions of Italy, acquiring international attention, and challenging Italian tax morale.

United States

Maryland

A stormwater management fee was established via House Bill 987 (April 2012) and signed into law by then-governor Martin O'Malley, affecting the largest urban jurisdictions in Maryland (nine counties and the City of Baltimore) in order to meet the requirements of the federal Clean Water Act as it concerns the Chesapeake Bay watershed. The Tax Foundation states House Bill 987 "was passed in response to a decree by the Environmental Protection Agency (EPA) formally known as the Chesapeake Bay Total Maximum Daily Load, which identified mandatory reductions in nitrogen, phosphorus, and sediment that damage the Chesapeake Bay." This mandate from the EPA was mandated to the states of Maryland, New York, Pennsylvania, West Virginia, and the District of Columbia. Maryland is the only state that has levied a tax to meet the EPA’s standards. According to the Chesapeake Bay Foundation, the fastest-growing source of bay water pollution from Maryland is currently stormwater runoff. This tax, of course, does not tax rain but has been implemented in varying ways at the county level, such as a flat fee per property owner, or based on impervious surface square footage.

The law specifies that accrued funds must be used for specified stormwater pollution-related purposes.

This law was modified in 2015 to make the county-assessed fees optional rather than mandatory while still holding the counties responsible for making progress on managing polluted runoff.

Illinois

HB1522 (August, 2013) provides DuPage and Peoria counties with the option of charging fees to residents whose property benefits from county stormwater management. HB1522 allows the counties to assess the tax in a nonuniform manner, based on their own rules, exemptions and special considerations. Home rule municipalities in Illinois have always had the ability to establish special fees under their own ordinances.

The City of Elgin, Illinois was planning to assess the Stormwater Utility Tax in 2014, but an outraged public and decisive election results caused the Elgin City Council to unanimously reject the tax.

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