Stormwater Utilities

The information provided below is an overview of the process for establishing a stormwater utility (also referred to as SWU). This page also includes links to the other guidance webpages on key topics, such as stormwater asset management plans, performing feasibility studies, and various rate structure options for setting fees and credits.

Background & General Information

In March 2019, the Stormwater Utility Law, officially known as the ‘Clean Stormwater and Flood Reduction Act’, was signed into law. This Act authorizes local and county governments and certain utilities the ability to create stormwater utilities. A stormwater utility is currently the only mechanism that would be able to dedicate these funds directly to stormwater management, thus allowing a utility to properly operate, maintain, repair, and improve their storm sewer system as necessary.
A public utility is an organization that maintains the infrastructure for a public service; a stormwater utility is a public utility that assesses fees and uses the revenue from these fees to maintain infrastructure designed to control stormwater flooding and reduce pollutants from entering into waterbodies.

According to the Act, the established utility fees must be based on a “fair and equitable approximation of the proportionate contribution of stormwater runoff from a real property.”

Stormwater Basics

Water from rain and melting snow that flows over lawns, parking lots and streets is known as stormwater runoff. This stormwater runoff may flow through gutters, into catch basins, through storm drain pipes and ditches, or over streets and paved areas. Along the way, the stormwater runoff picks up trash (fast-food wrappers, cigarette butts, Styrofoam cups, etc.) and toxins, bacteria and other pollutants (such as gas, motor oil, antifreeze, fertilizers, pesticides, and pet droppings). This stormwater runoff is usually not treated, and is discharged into local surface waterbodies and groundwater.

This polluted stormwater runoff can contaminate drinking waterbodies, it can force the closing of beaches because of health threats from harmful bacteria to swimmers, including those from Harmful Algal Blooms (HABs), it can kill fish and other wildlife, and it can destroy wildlife habitat.

In most towns, the Department regulates stormwater runoff from municipal separate storm sewer systems (MS4s) owned or operated by towns and other MS4 permittees in the state via the MS4 General Permits. The Department has also issued the Combined Sewer Overflow (CSO) permits to regulate stormwater in 21 towns that have combined stormwater and sanitary sewage systems.

Human activity is the primary cause of stormwater pollution. Everything that we put on the ground or into the storm drain can end up in our water.  Each of us has a responsibility to make sure these contaminants stay out of our water.

Who Can Establish A Stormwater Utility?

The Act specifies that only the following entities can form a Stormwater Utility:

• The governing body of a single municipality
• The governing body of a single county
• Municipal utilities authority
• Utilities authority
• County improvement authority
• Sewerage authority

3. The governing body of any county that has established a county sewerage authority, a county utilities authority, or a county improvement authority.

DEP Responsibilities

As required under the Act, the Department is required to provide guidance on the following stormwater utility topics listed below. This guidance, as well as other general information, is being maintained on these webpages to assist towns, counties and authorities in developing Stormwater Utilities.

1. Technical Assistance for establishing a Stormwater Utility
2. Establishment of fees and credits
3. Development of an asset management program for stormwater management systems
4. Development of guidance for stormwater management related public education & outreach

When a stormwater utility is created in New Jersey, the DEP and the Department of Community Affairs (DCA) will be responsible for receiving submissions by local and county governments that demonstrate the local governments’ compliance with the Act.

DEP is working in collaboration with DCA and the Board of Public Utilities (BPU) as their laws and regulations will likely be affected during the forming of utilities under this Act. The office of Local Government Services, within the DCA, is currently drafting regulations regarding the Stormwater Utility annual report requirements noted in the Act.  You may check their website(s) at NJ Department of Community Affairs for future updates regarding these rule amendments.

Stakeholder Involvement

DEP intends to develop this guidance in a transparent manner, using the expertise of stakeholders to advise and guide DEPs efforts.