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POL Government Elected Officials Auditor Griffin-Valade Divisions Ombudsman Reports Formal Investigations
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Portland, OR 97204
phone: 503-823-0144
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Ombudsman's Investigation Report, Case # 2002-J-57

Ombudsman's Investigation

Case Number: 2002-J-57
Complaint
 
Complainant, Mr. Dryden, alleges that stormwater charges applied to his property and that of his neighbor, Mr. Eckelman, since 1998 are unfair, and that the alternative of reimbursement was denied because BES failed to notify him of the application period. He alleges that he was offered a permanent exemption from stormwater fees as an inducement to construct a soakage trench that would stop water from running into Johnson Creek. The exemption was discontinued along with thousands of others without a specific determination regarding his unique situation. Despite assurances that special arrangements would be made, he was not informed of a reimbursement program he might have been eligible for until after the deadline.

Case History
 
According to Mr. Dryden, in late 1992 or the spring of 1993, a City employee invited him to view a soakage trench built at the neighboring Leach Botanical Gardens to filter run-off from the parking lot. Mr. Dryden does not remember to whom he spoke at the Gardens but he believes it was someone with the Bureau of Environmental Services. He was asked to construct a similar project on his own property adjacent to the park, to be used as part of the demonstration project to show how facilities such as the one at Leach Gardens could be built on private property.
 
He had been very involved in getting the land donated by others to the City for the Leach Botanical Gardens and was enthusiastic about the idea of following-up on the demonstration project there using the new stormwater treatment techniques. In 1993, Mr. Dryden sold some of his land to Mr. Eckelman to build a house. Mr. Eckelman had permission to proceed with building the house uphill from Mr. Dryden’s property and an easement to drain directly into the sewers and the creek. Although the soakage trench added more expense to the costs of constructing the house, when Mr. Dryden proposed that they work together to construct the soakage trench, Mr. Eckelman agreed. The plans were changed to accommodate the stormwater from the second property.
 
In 1992 the City of Portland had created a Stormwater Drainage Discount program. The Bureau of Environmental Services (BES) accepted and granted thousands of applications for discounts of up to 100% of the stormwater fees for property owners who could show that their stormwater was not entering the City sewer system.
 
Mr. Dryden worked with a Bureau of Buildings employee who designed the soakage trench and he recalls receiving the stormwater discount form at that time. We called the employee to verify the facts but he stated that he could not remember the specifics of this case. The understanding of both Mr. Dryden and Mr. Eckelman, based on Mr. Dryden’s initial discussions regarding the project, was that they would bear the cost of the project in exchange for a permanent exemption from stormwater fees.
 
Mr. Dryden and Mr. Eckelman have documented nearly $6,000 of costs for equipment materials and labor. Mr. Eckelman, a contractor, paid for materials, rented equipment and hired workers. Mr. Dryden purchased some materials and provided sweat equity transporting wheelbarrows full of rock to the site. At the rate of $8 per month of fee exemptions for each property (the approximate cost in 1994 when the project was completed), it would have taken them 31 years to recover their expenses.
 
In April of 1995 the ad hoc Drainage Subcommittee of the Public Utilities Review Board issued a report that identified problems with the drainage discounts. They recommended that the discounts be discontinued but that compensation be given to current discount holders and qualified applicants to “fulfill a moral obligation of the City.” Council followed with a plan to phase out the discounts, provide certain reimbursements and to evaluate and reform stormwater rates. While new applications were not accepted for the discount program after 1995, the actual discounts on the sewer bills continued through 1998.
 
In April of 1995, Mr. Dryden received a “Dear Customer” letter and saw an article in the paper that indicated that the City was considering ending the discount program. The letter stated that there would be compensation of up to $212.50, far less than the costs of the soakage trench. Mr. Dryden was alarmed, concerned that the City might be considering ending his fee exemption. He went in person and made phone calls to BES but did not get anything in writing. He recalls being assured that the work he had done was recognized as beyond the normal steps people had taken to reduce stormwater drainage and not to worry, either his exemption would be continued or that he would get compensation.
 
He was aware that thousands of people in circumstances different from his own were upset when it was announced that the discount program would be phased out and he did not want to pressure the staff at the time. He states that no one ever indicated anything other than that when the dust settled from the Mid-County sewer customers who had been given discounts for existing dry wells, the implementation of the downspout disconnect program and rate reform that the issue of his fee exemption would be resolved. A BES employee contacted during this investigation confirmed that staff was overwhelmed by the workload during this period.
 
Mr. Dryden received another “Dear Customer” letter dated July 3, 1995, which states that BES would be “developing a claims process for those who installed drainage facilities for the sole purpose of the discount program, but will not recoup their investment through the existing program.” It further stated, “We’ll keep you informed about our progress and additional opportunities for input.” A reimbursement form was not sent to Mr. Dryden within the application period despite the assurance in the July 3rd letter that BES would keep him informed.
 
Mr. Dryden was concerned that Mr. Eckelman had not received the “Dear Customer” letters and encouraged Mr. Eckelman to reapply for the stormwater discount program. According to BES, the application was denied as being untimely. There is no copy of a denial letter sent out or received by Mr. Eckelman. BES states that Mr. Eckelman was not charged any stormwater fees until September 1999, not because the soakage trench project qualified him for a discount, but because of a billing error. BES records show that Mr. Eckelman was sent a claim form for a reimbursement program on July 14, 1995. Mr. Eckelman. does not recall receiving this form. It is his recollection that he filed a form at Mr. Dryden’s suggestion some time in 1995. He seems to have relied upon Mr. Dryden’s efforts to resolve the exemption issue.
 
When he returned from his annual summer camp work, Mr. Dryden again contacted BES. BES notes indicate that Mr. Dryden was sent a reimbursement form on October 9, 1995 and told that the date for the reimbursement program was past. Mr. Dryden’s notes indicate that after he received the reimbursement request form, he called again to inquire how to make the request on behalf of the two-property project, but that he never received a response.
 
At the time neither property was being charged stormwater fees. The reimbursement would have been more costly for the City than extending the exemption. Mr. Dryden relied on verbal assurances and an assumption of the City’s good faith that the issue of stormwater charges for these two properties would be individually addressed at some point.
 
He recalls the name of the staff person at BES with whom he had the most contact. She was contacted at a job in another city bureau in May of 2002 regarding this matter. She responded that she would not be able to recall something that happened so far in the past.
 
Discontinuing the discounts was controversial and in 1999 the City undertook a review of stormwater rates. Current stormwater rates are now charged in two sections, one charge for the individual property’s impervious surface (35%) and one for impervious surfaces throughout the city (65%). A discount for ratepayers whose runoff does not go into the storm sewer system, the Clean River Incentive and Discount Program was authorized effective January 12, 2001 but has not yet been implemented. BES has indicated that Mr. Dryden and Mr. Eckelman can apply for this discount sometime in the future, when the computer billing system is stabilized.
 
When he first got charged for stormwater fees on his water bill in 1999, Mr. Dryden contacted and spoke to people at BES, the Water Bureau, and with Commissioners’ staff. In September of 1999 a staff person with a Commissioner asked him to submit proof of the expenses of the project, which he did on behalf of himself and Mr. Eckelman. At this point he put his concerns in writing for the first time. The matter was referred to a staff person at BES. Mr. Dryden was assured that the matter would be reviewed fairly, once the issue of the thousands of customers in Mid-County and the Downspout Disconnect target areas were addressed.
 
After waiting more than two years, he contacted the Office of the Ombudsman in February 2002. He was upset because his neighbor Mr. Eckelman had been paying the charges and he felt responsible for making the deal with the City for both of them. We contacted BES and were told that a response was being prepared.
 
In March 2002, BES sent Mr. Dryden and Eckelman a response. The substance of the reply was that their request for reimbursement was denied because there was no evidence that either of them had applied for a reimbursement of the costs of the soakage trench prior to September 1995. It goes on to state that there is no special exemption program for stormwater management fees. The response stated that when the Clean River Incentive and Discount Program goes into effect they would receive applications in the mail. It did not mention the Leach Botanical Gardens at all.
 
Investigation
 
This office interviewed the property owners, BES, OPDR and Leach Gardens staff, reviewed documents provided by the complainant, searched records in the City archives and background information on the internet. BES’s failure to respond to Mr. Dryden’s inquiries sooner makes reconstructing the history difficult. Many people involved do not recall what happened. Mr. Dryden has a file but many of the facts are based on his recollections. The full BES file regarding the matter was not reviewed. Although requests were made for access to the BES files, there was no response as of the date of this report.
 
Findings
 
Mr. Dryden came into contact with BES during four distinct occasions:
1) 1993-1994 when the soakage trench project was proposed, revised, and completed;
2) 1995 when the stormwater discount was discontinued and a reimbursement program offered;
3) 1999 when the stormwater fees began to be charged to the property; and
4) 2002 when BES responded to Mr. Dryden’s 1999 inquiries.
 
During this ten-year period Mr. Dryden and his special project were caught up in the City’s search for an equitable policy regarding stormwater management, and a series of ambiguous or undocumented commitments by BES employees. At none of these times did BES clearly confirm or deny Mr. Dryden’s assertion that he and Mr. Eckelman had a permanent exemption from stormwater fees as a result of building the soakage trench. Yet we found evidence to indicate that Mr. Dryden received some assurances that his efforts would earn him financial benefits or at least not a loss.
 
In 1993 City personnel approached him about the stormwater trench, offering their technical assistance, providing him with the stormwater discount forms to submit, and granting the exemption for six years - all actions that could have created the impression that the project received special attention. Mr. Dryden maintained regular contact with BES staff and sought and believed he received regular assurances that his case would be appropriately addressed in the future. He contacted them in 1995 and in July received a letter stating that a claims process was being developed and he would be kept informed.
 
In 1999 upon receiving a bill for stormwater services, Mr. Dryden again contacted BES and he was told that he could ignore the stormwater fees while an evaluation of his situation was made. He was not told at that time that an exemption was out of the question or that the reimbursement period had passed. Three years later, March 2002, BES belatedly but only partially responded to his appeal, stating that he had missed the 1995 deadline for reimbursement, without fully addressing the question of his exemption from the stormwater drainage fees.
 
There is no doubt that BES was administratively overwhelmed by the burdens of the various discount and reimbursement programs relating to stormwater management fees, the downspout disconnect program and rate reform throughout this period. And, Mr. Dryden’s decision to handle matters on a gentleman’s handshake basis rather than confirming his understandings in writing certainly contributed to his problems. However, BES could have responded more quickly and completely. There is sufficient evidence of the singularity of this case to warrant more attention than a simple denial on a technicality. Rather than resolving the matter, the 2002 response made Mr. Dryden more angry and frustrated. As a result, Mr. Dryden is now driven more by the principle of fairness than monetary compensation.
 
Recommendations
 
There are two alternative recommendations.
 
Alternative 1: Mr. Dryden has been withholding the entire amount of the Stormwater Management charges from his water bill since 1999. He should pay the amount attributed to the City streets and be credited the amount charged for his property, as should Mr. Eckelman. He should not be charged any late fees or penalties. BES should continue this exemption for both until the new Clean Rivers Discount has been implemented and both have an opportunity to apply for the new discount. BES should provide him written documentation regarding its commitment to grant a credit to Mr. Dryden and Mr. Eckelman for their stormwater management project.
 
Alternative 2: BES could accept a late filing and reimburse the costs expended by Mr. Dryden and Mr. Eckelman or some mutually agreeable amount.
 
Response
 
The Bureau accepted our second recommendation. Director Dean Marriott responded as follows:
 
“Thank you for providing the Bureau an opportunity to review your draft investigative report on the case noted above. We find your draft report to be substantially consistent with all available records on this matter.
 
Based on your draft report and a further review of our records, we find that Mr. Dryden did not receive clear, sufficient and timely notice of the deadlines for filing a reimbursement claim in 1995. Therefore, we determine that Mr. Dryden should be awarded his claim of $6,059, based on receipts and documents submitted by Mr. Dryden in 1999. We will process a payment to Mr. Dryden after receiving confirmation from your office of the final disposition of this case.”
 
Date: September 19, 2002