Denver St. LLC v. Town of Saugus

Since at least 1986, the town had a deteriorating sewer system. Defects allowed inflow and infiltration (I/I). Wet weather caused overflow, contaminating the ocean, rivers, and wetlands. To avoid overflow into housing, the town installed, without approval, a bypass pump that discharged raw sewage into the Saugus River. In 2005, the town entered into a consent order with the Department of Environmental Protection, acknowledging violations of the Clean Water Act and state law; the town was required to implement plans to eliminate I/I. There was a moratorium on new connections until the problem was addressed. The town embarked on a 10-year, $27 million dollar plan. Ratepayers were to finance the majority of the plan. In the interim, the town required new connections to pay an I/I reduction contribution, calculated by multiplying, by a factor that decreased as repairs were completed, the number of gallons of new flow to be generated. Plaintiff, developers, paid $670,460 to accommodate new flow from the single-family houses and multifamily housing. The trial court concluded that the charge provided no particularized benefit to the developers; that the amount was excessive compared to regulatory costs involved; and that the charge was an impermissible tax. The Massachusetts Supreme Court vacated, finding that the charge is a fee. View "Denver St. LLC v. Town of Saugus" on Justia Law