Circuit Court for Baltimore City Case No. 24-C-15-002026
Reed, Shaw Geter, JJ. [*]
the rain spoils our picnic, but saves a farmer's crop,
who are we to say it shouldn't rain?"
appeal swells out of the controversial law imposing
stormwater remediation fees, commonly referred to as the
"Rain Tax." The law passed like a tidal wave through
the General Assembly in 2012 to fulfill requirements imposed
by the United States Environmental Protection Agency
("EPA") in order to reduce pollutants entering the
Chesapeake Bay. Under the new state law, Maryland Code (1982,
2013 Repl. Vol.), Environment Law Article
("Envir."), § 4-202.1,  local
jurisdictions subject to Phase I municipal separate storm
sewer system permits ("MS4") were required to
create watershed protection and restoration programs and
establish stormwater remediation fees by July 1, 2013.
surge hit Baltimore City ("the City") in early
2013, when the City Council passed Ordinance 13-143, enacted
into the Baltimore City Code as Article 27. Pursuant to
Baltimore City Code, Art. 27, §§ 3-1(a) and
3-7(b)(1), the Baltimore City Department of Public Works
("DPW") was authorized to assess and collect a
stormwater remediation fee ("Stormwater Fee") on
all non-exempt properties within the City. For the third and
fourth quarters of 2013, DPW charged $240 total per quarter
for the three properties that are the subject of the
underlying appeal, owned by Appellant Shaarei Tfiloh
Congregation ("the Congregation").
first level of administrative review, DPW denied the
Congregation's demand to void the Stormwater Fee as an
unconstitutional property tax in violation of the
Congregation's rights under state and federal laws
protecting the free exercise of religion. Still, DPW granted
the Congregation a slight reduction in fees to $150 per
quarter. The Congregation appealed DPW's decision to the
Baltimore City Board of Municipal and Zoning Appeals
("the Board"), where the Congregation's
constitutional challenge was also rejected. Thereafter, the
Congregation sought judicial review of the Board's
decision in the Circuit Court for Baltimore City, and the
court affirmed the Board's judgment. Notably, however,
the circuit court ruled that the Stormwater Fee was an excise
tax rather than a fee but concluded that such a tax was
authorized by the State's enabling law. The Congregation
appealed to this Court and presents four questions for our
review, which we have reworded and reordered
1. Did the Board err in holding that the Stormwater Fees
imposed under Article 27 of the Baltimore City Code were
2. Did the Board err in holding that Article 27 is not a land
3. Did the Board err by ignoring the broad protections
afforded religious institutions under Article 36 of the
Maryland Declaration of Rights?
4. Did the Board err in failing to follow its own rules of
that the City acted within its authority under the state
enabling law when it enacted Article 27 of the Baltimore City
Code. We agree with the Congregation that despite its name,
the Stormwater Fee is a tax because its primary purpose is to
raise revenue and because property owners' only
obligation under the statute is to pay the charge. However,
we hold that the Stormwater Fee is an excise tax, rather than
a property tax, because it is based on the particular use of
the property, not the value of the property or property
ownership. We also hold that Article 27 does not violate the
Free Exercise Clause of the Maryland Declaration of Rights
and does not implicate the Religious Land Use and
Institutionalized Persons Act of 2000 ("RLUIPA").
Finally, we discern no failure by the Board to follow its
management undertakes to reduce stormwater runoff's
adverse effects on rivers and streams and to protect the
public's safety. See Envir. § 4-201.
Stormwater runoff continues, however, to be a major source of
the pollution that flows into the Chesapeake Bay-the largest
estuary in the United States. See EPA, Addressing
Nutrient Pollution in the Chesapeake Bay,
(last visited Apr. 14, 2018). The federal mandate to protect
the Chesapeake Bay and the cascading laws enacted by the
State and the City set the course for the case before this
growing concerns of increased water pollution, Congress
passed the Federal Water Pollution Control Act of 1972, known
as the Clean Water Act ("CWA"), which is codified
with amendments at 33 U.S.C. § 1251 et seq.
(2012). The CWA's purpose "is to restore and
maintain the chemical, physical, and biological integrity of
the Nation's waters." Id. § 1251(a).
Administered by the EPA, the CWA, among other things,
prohibits the discharge of pollutants without a permit into
the navigable waters of the United States.Id.
issues permits for such discharges via its National Pollutant
Discharge Elimination System ("NPDES").
Id. § 1342(a). Pursuant to statute, the EPA
may, however, delegate its permit-issuing authority to a
state government if the EPA accepts that state's proposed
permit program. Id. § 1342(b). The EPA
Administrator approved Maryland's NPDES permit program on
September 5, 1974. See 57 Fed. Reg. 43, 734.
Consistent with this grant of authority, the Maryland
Department of Environment ("MDE") may issue the
various NPDES permits in Maryland. Code of Maryland
Regulations ("COMAR") 26.08.04.07.
the CWA focused initially on water pollution from industrial
sources, Congress amended it in 1987, requiring the
regulation of MS4 (municipal separate storm sewer system)
stormwater discharge. See Pub. L. No. 100-4, 101
Stat. 7 (1987); see also Md. Dep't of Env't v.
Anacostia Riverkeeper, 447 Md. 88, 96-97 n.3 (2016). The
EPA issued its NPDES MS4 stormwater regulations for
"Phase I" jurisdictions in 1990 and for "Phase
II" jurisdictions in 1999. 55 Fed. Reg. 47, 990; 64 Fed.
Reg. 68, 722. As delineated by the EPA, Phase I regulations
apply to "large" jurisdictions, classified as those
with populations over 250, 000 people, and "medium"
jurisdictions, those having between 100, 000 and 250, 000
inhabitants. 55 Fed. Reg. 47, 990. Phase II regulations apply
to those jurisdictions with populations up to 100, 000
residents. 64 Fed. Reg. 68, 722. In December 2010, the EPA
issued the Chesapeake Bay Total Maximum Daily Load
("TMDL"), a cap on the amount of pollutants related
to nutrients-like nitrogen and phosphorus-and sediment that
can be discharged into the Chesapeake Bay and its
tributaries. 76 Fed. Reg. 549.
purpose of Maryland's stormwater management subtitle is
codified in Envir. § 4-201. That section announces the
General Assembly's findings:
The General Assembly finds that the management of stormwater
runoff is necessary to reduce stream channel erosion,
pollution, siltation, and sedimentation, and local flooding,
all of which have adverse impacts on the water and land
resources of Maryland. The General Assembly intends, by
enactment of this subtitle, to reduce as nearly as possible
the adverse effects of stormwater runoff and to safeguard
life, limb, property, and public welfare.
Envir. § 4-201.
March 30, 2012, Maryland submitted its Phase I Watershed
Implementation Plan ("WIP") to the EPA, which
provided details on how it would reduce nitrogen and
phosphorus from all major sources, including stormwater
runoff. Dep't of Legislative Servs., Fiscal Note, H.B.
987, at 5 (2012). The development of a system of charges by
local governments was necessary to fund the estimated cost of
implementing the stormwater management controls needed to
achieve the TMDL. Id. at 7-8. Accordingly, the
General Assembly passed H.B. 987, amending Envir. §
4-201.1 and adding Envir. § 4-202.1, and the Governor
signed the legislation into law in 2012. 2012 Md. Laws,
ch.151 (H.B. 987). The new law required those jurisdictions
subject to an NPDES MS4 Phase I permit-the ten largest
jurisdictions in Maryland, including the City-to pass
legislation establishing a watershed protection and
restoration program by July 1, 2013. Id. §
4-202.1(a)(1), (b). The 2012 law also required these
jurisdictions to impose a Stormwater Fee and create a local
watershed protection and restoration fund. Id.
§ 4-202.1(c). The legislature specified how to assess a
(3)(i) A county or municipality shall set a stormwater
remediation fee for property in an amount that is based on
the share of stormwater management services related to the
property and provided by the county or municipality.
(ii) A county or municipality may set a stormwater
remediation fee under this paragraph based on:
1. A flat rate;
2. An amount that is graduated, based on the amount of
impervious surface on each property; or
3. Another method of calculation selected by the county or
Envir. § 4-202.1(e)(3).
explain next, the City adopted a combination of these
statutorily prescribed methods when it assessed Stormwater
Fees on the non-exempt properties within its jurisdiction.
The City's Law and Regulations
City's stormwater management infrastructure was largely
installed before 1950, and with the increased visibility of
environmental concerns, much of the City's focus on
stormwater management has shifted to promoting projects to
enhance water quality. See Balt. City Dep't of
Pub. Works, Stormwater Management,
visited April 14, 2018). Yet five watersheds within City
limits are still considered impaired. Balt. City Dep't of
Pub. Works, Balt. City MS4 Restoration and TMDL WIP v (2015).
Over 45% of the City's surfaces are impervious, meaning
stormwater runoff is voluminous and its management is
Id. The costs of stormwater management services has
increased significantly. See Md. Dep't of
Env't, Report on Stormwater Management Act of 2007 1-2
2013, following the mandate contained in Envir. §
4-202.1, the Baltimore City Council adopted Article 27,
entitled "Stormwater Remediation Fees", which
became effective on July 1, 2013. Baltimore City Code, Art.
27 [hereinafter "Art. 27"]. The purpose of the
City's Watershed Protection and Restoration Fund
("the Fund") was "to finance the costs of
improving the City stormwater management system, including
its watershed protection and restoration program."
Id. § 2-1. The Fund supports the operation of
the City's stormwater management system; its permitted
uses are enumerated as follows:
Money in [the Fund] may be used for the following purposes
(1) capital improvements for stormwater management, including
stream and wetland restoration projects;
(2) operation and maintenance of the City stormwater
management system and facilities;
(3) public education and outreach relating to stormwater
management or stream and wetland restoration;
(4) stormwater management planning, including:
(i) mapping and assessment of impervious surfaces; and
(ii) monitoring, inspection, and enforcement activities to
carry out the purposes of the Fund;
(5) to the extent that fees imposed under the authority of
[Envir. § 4-204] are deposited into the Fund, review of
stormwater management plans and permit applications for
(6) grants to nonprofit organizations for up to 100% of a
project's costs for watershed restoration and
rehabilitation projects relating to:
(i) planning, design, and construction of stormwater
management practices; (ii) stream and wetland restoration;
(iii) public education and outreach related to stormwater
management or stream and wetland restoration;
(7) reasonable costs necessary to administer the Fund; and
(8) any other use authorized by [Envir. § 4-202.1].
Id. § 2-3.
directed under Envir. § 4-202.1(e)(1), the City imposed
a Stormwater Fee on all properties located within its
boundaries, subject to certain exemptions. Id.
§ 3-1(a)-(b). The City divided all non-exempt properties
into two categories-single-family properties and all other
properties-and it calculated fees according to the amount of
impervious surface on a property. Id. §§
3-2, 3-3. For single-family properties, the City created a
tiered system, defining three categories of impervious
surface areas on which it would assess a Stormwater Fee at a
flat rate. Id. § 3-2(b)(1)-(2). For
all other properties, the City assesses $15 per quarter per
Equivalent Residential Unit ("ERU")-with one ERU
equaling 1, 050 square feet of impervious
surface. Id. §§ 3-3(b),
3-4(a), (c). The City also established a minimum fee of one
ERU for these non-residential, non-exempt properties.
Id. § 3-3(d). Qualifying religious
organizations, however, were assessed at $12 per ERU per
annum for structures owned by them so long as the
property was tax-exempt in both Maryland and the City and the
structures on the property were used exclusively for worship
or schooling. Id. § 3-3(e)(3).
Therefore, rather than being charged $60 per year per ERU,
these properties are charged $12 per year per ERU.
27 provides that the assessment of the base fee, based on the
impervious surface area of the property, be measured "at
the sole discretion of the Director of Public Works"
using several methods for measurement, including geographic
information systems analysis of aerial photographs, field
surveys, and as-built engineering drawings. Id.
§ 3-3(c)(1). DPW is authorized to bill the fees and may
include them on water bills or on a separate bill.
Id. § 3-7(b). The fees, and any applicable
interest and penalties, constitute a personal debt of the
property's owner and creates a lien on the property in
favor of the City. Id. § 3-8(a)-(b).
promulgated regulations in connection with the Stormwater Fee
in September 2013. It clarified that it would use aerial
photographs and Maryland's property tax database to
determine the amount of ERUs on each non-exempt property and
stated that the fee would appear as a line item on the
quarterly water bill. DPW Stormwater Fee Rec. Reg. (II)(c),
(IV)(A)(i) [hereinafter "DPW Reg."]. The regulation
defined "non-single-family property" to include
property owned by religious institutions but set the fee for
these institutions' qualifying properties at the reduced
rate of $12 per ERU, as required by Article 27. DPW Reg.
(I)(i), (III)(b). To receive the reduced fee, the regulation
required a religious organization to "submit an
application provided by [DPW] that identifies the structures
with uses considered eligible for the reduced fee. The
application . . . must be renewed every 3 years." DPW
Reg. (III)(b)(iii). Additionally, DPW created a system for
fee credits but stated that those credits could apply only to
the portions of a religious institution's property that
did not receive a reduced fee. DPW Reg. (III)(b)(ii).
property owner aggrieved by the Stormwater Fee may seek
redress before the Director of DPW within 30 days of the
bill's date so long as the appeal is in writing and
contains all information required by any rules and
regulations adopted under Article 27. Art. 27 § 4-1(a).
If unsatisfied with the result, the property owner may appeal
to the Board within 30 days of DPW's decision.
Id. § 4-1(b). After the conclusion of this
administrative review, a property owner may petition for
review in the circuit court and subsequently this Court, in
accordance with Maryland procedural rules. Id.
The Congregation's Administrative Challenges 1. Contest
third and fourth quarters of 2013, the City issued water
bills to the Congregation for three properties-the main
synagogue at 2001 Liberty Heights Avenue ("the Liberty
Heights Synagogue"), a second synagogue at 3523 Holmes
Avenue ("the Holmes Synagogue"), and a parking lot
at 3515 Woodbrook Avenue ("the Parking Lot")
(collectively, the "Properties"). Each bill
contained a "Maryland Stormwater Fee" line item:
$150.00 for the Liberty Heights Synagogue, $15.00 for the
Holmes Synagogue, and $75.00 for the Parking Lot, totaling
$240 for all three properties per quarter.
Congregation challenged the imposition of the Stormwater Fee
in a letter to the City's Bureau of Water and Wastewater
dated February 27, 2014. Classifying the Stormwater Fee as a
property tax, the Congregation asserted that the Properties
were exempt from the Stormwater Fee because they were used
for public religious worship and exempt from property taxes
under Maryland Code (1985, 2012 Repl. Vol.), Tax-Property
Article ("Tax-Prop."), § 7-204. The
Congregation demanded that DPW void the fees and issue a full
refund, contending that "the assessment is an
unconstitutional burden upon the free exercise of religion 
in violation of the First Amendment of the United States
Constitution and the Maryland Declaration of Rights."
Alternatively, the Congregation sought a fee reduction to be
29, 2014, in a letter signed by the Director, DPW denied the
Congregation's request to void the fees, explaining that
"Baltimore City is one of ten jurisdictions mandated to
implement a stormwater remediation fee by [Envir. §
4-202.1], which does not provide exemptions for tax-exempt
entities." However, pursuant to Article 27 §
3-3(e)(3), the Director granted the reduction for qualifying
religious organizations. He reduced the fee from $150 to $60
per quarter for the Liberty Heights Synagogue, lowering the
Congregation's total quarterly bill from $240 to $150.
Although the Holmes Synagogue qualified as a religious
structure, the Director explained that its "fee has not
been reduced as doing so would lower the fee beyond the
legislated minimum charge of 1 ERU per quarter." The
Director also determined that the Parking Lot did not qualify
for a fee reduction because it did not contain any
structures, including religious structures. Analogizing the