Editor’s note: This story originally appeared in the July 31 issue of the West Chester Roundup Newsletter. If you are interested in receiving our weekly newsletter, you can subscribe here.

On April 30, the Pennsylvania Supreme Court ruled, 4 to 3, that West Chester’s Stream Protection Fee was not a fee after all. Rather, it was a tax, and as such, tax-exempt institutions like West Chester University did not have to pay it. Beyond that, we knew little about what would come next.

Well, it seems the implications of that 31-page decision run deeper than we first thought.

Earlier this week, we stumbled onto some hints of just how big the impact would be to the Borough. On page 57 of the Borough’s latest financial audit, in the section reviewing the Stormwater Fund, there is a header “Subsequent Events.” Here, auditors have listed financial changes that will impact the future revenue stream. It reads as follows:

“The Borough is collaborating with its legal team to determine next steps and intends to fully comply with the PA Supreme Court’s decision. Among these steps include no longer accepting payments for stream protection fees from any payor.”

I reached out to Borough Manager Sean Metrick for confirmation that the text is saying what I think it’s saying: there will be no Stream Protection Fee for anyone going forward.

“You are correct. The Borough is no longer accepting payment for stream fees, regardless of the payor’s taxable status,” he wrote. “Going forward, [Borough] Council will have some tough choices.”

I’ll say.

Between 2017 and 2026, the Stream Protection Fund received approximately $12.6 million in contributions. About $11.1 million came from the Stream Protection Fee itself. The Borough generated the rest through grants and interest earnings. However, while the Supreme Court’s decision has voided the bulk of that revenue stream, it did not voided the Borough’s responsibility to provide clean water.

“Stormwater system improvements for towns like West Chester are mandated by the state and enforced through the Department of Environmental Protection. We’ve been investing on average about $700,000+ per year in capital projects and another $50,000–$250,000 per year in maintenance,” Sean shared.

The Borough’s Buffer

As of April 30, the date of the ruling, West Chester had collected nearly 90 percent of the year’s fees. There was also roughly $400,000 from grants and other revenue sources, and a bit of a carryover from previous years. At the end of May (when the audit was completed), the Stream Protection Fund had a $2.3 million balance. This is not an indefinite solution, but it does seem to give Borough Council a bit of a buffer.

The auditors, however, would like to see action sooner rather than later, writing in their events statement:

“Borough Council will need to create a new income stream in 2027 during the budget process in 2026 so that the Borough can continue to fund debt payments, maintenance and new projects to be compliant with PADEP Municipal Separate Storm Sewer System (MS4) permit requirements,” the statement continues.

Borough Council will discuss what that income stream will look like starting next month. If you have thoughts on these developments, and I am guessing you may, I want to pass along Sean’s advice:

“I encourage you to tune in to work sessions in August, September, and October,” he said.

Borough Council August Worksession will be Aug. 18 at 6:30 p.m.

Pennsylvania HB 1308

West Chester isn’t the only place in the state whose stormwater budget was upended by the Supreme Court decision. At least 70 other Pennsylvania municipalities charge a similar fee for stormwater services. PA House Bill 1308 seeks to end this unfunded mandate by clearly giving the municipalities doing the work the ability to charge for their services. Under the revised wording, municipalities can levy charges on anyone who benefits from the services, regardless of tax status.

Of course, this means a fee, not a tax.

With reporting and photos by Margie Swart.