TRANSMITTAL LETTER FOR BOARD MEETING OF June 19, 2008
COMMITTEE ON STORMWATER MANAGEMENT
Mr. Richard Lanyon, General Superintendent
Title
Request for General Policy Direction Regarding Authority to Dissolve Drainage Districts Pursuant to the Cook County Stormwater Management Act and for Specific Direction Regarding Dissolution of Calumet Union Drainage District No. 1
Body
Dear Sir:
In November 2004, the Metropolitan Water Reclamation District (“MWRD”) obtained responsibility for stormwater management in Cook County pursuant to Public Act 093-1049 (“Act”). Under the Act, the MWRD now has discretionary statutory authority to petition the Circuit Court of Cook County (“Court”) to dissolve those drainage districts that are located entirely within the MWRD geographical area, and to petition the Court to disconnect from an existing drainage district, those portions of the drainage district that may be located within MWRD limits. (70 ILCS 2605/7h(h)).
Residents of the City of Markham located in the Calumet Union Drainage District No. 1 (“CUDD”) have submitted a “Petition for Action” (“Petition”), containing approximately 120 residents’ signatures, to show support for the MWRD assuming maintenance and responsibility of CUDD and for MWRD to pursue legal action to dissolve the drainage district. The Petition cites the failure of CUDD Commissioners to respond to complaints to maintain and repair the Cal-Union Drainage Ditch, resulting in erosion and concerns regarding flow capacity, as the reasons behind the request to the MWRD. As more fully set forth below, it is requested that the General Superintendent seek MWRD Board of Commissioners (“Board”) approval on a policy direction going forward regarding dissolution of drainage districts, as well as direction on the specific question of whether to investigate the possibility of dissolving CUDD.
There are some key provisions of the MWRD’s statutory authority to consider in developing a drainage district dissolution policy. The Act requires that should the MWRD be successful in dissolving a drainage district, the MWRD then assumes all assets (including property/land), liabilities, and obligations of the former drainage district, including all debts, which must be discharged as soon as practicable. Furthermore, active drainage districts that have stormwater programs consistent with or at least as stringent as the MWRD’s can petition the MWRD and subsequently the Court, as necessary, for an exception from dissolution. The Act requires drainage districts that continue to exist within Cook County to conform their operations to the countywide stormwater management plan. (See 70 ILCS 2605/7h(h)).
There are several issues to consider in adopting a formal policy regarding the dissolution of drainage districts, not the least of which is Section (h)’s mandatory requirement that if the MWRD dissolves a drainage district, it shall assume all property and obligations of the former drainage district, as well as its debts, and further that the MWRD shall discharge these debts as soon as practicable. Due to the lack of records and information available for most of the approximately 40 drainage districts that are located in whole or in part in Cook County, the MWRD does not have a detailed, accurate assessment of the activities, geographical boundaries, officers, assets, and liabilities of these districts, including any pending lawsuits and potential bond indebtedness, all of which the MWRD would become responsible for with each drainage district it was successful in dissolving.
Another serious concern in the development of a drainage district dissolution policy is the assumption by the MWRD of drainage districts’ capital improvement obligations. Currently, while drainage districts are responsible for work that the MWRD defines as stream maintenance, they may also be responsible for work the MWRD considers capital improvements, such as stream bank stabilization. Under the Plan regional capital improvement projects will be prioritized for funding on a countywide basis by the Board. However, local stormwater management capital improvements that are not considered regional will not be addressed by the MWRD. Upon dissolution of a drainage district and assumption of the drainage district’s obligations, the MWRD would assume responsibility for local capital improvements that would previously have been the responsibility of the drainage district.
The Board should also be aware there are processes in place, other than the MWRD Act, by which drainage districts can be dissolved. The Illinois Drainage Code provides a statutory method by which residents can petition for dissolution by filing a petition signed by not less than two-thirds of the adult landowners who own not less than two-thirds of the lands in the drainage district, which will prove difficult in an urban environment. Additionally, residents may pursue dissolution by seeking legal relief in court through an action known as mandamus or quo warranto.
As the foregoing discussion illustrates, the decision to dissolve a particular drainage district depends upon numerous factors. It is, therefore, recommended that the Board adopt a case-by-case policy on the dissolution of drainage districts. The case-by-case approach would allow the MWRD to adopt conditions under which it would decide whether or not to pursue dissolution. Such conditions could include, but not necessarily be limited to, debts exceeding a certain maximum dollar value, pending liabilities associated with lawsuits, how well the drainage district is functioning on its own, and any rehabilitation and repair issues. This approach would allow the MWRD to adjust its policy to address unexpected situations as they occur. Overall, this case-by-case approach would provide the MWRD the most flexibility in implementing a drainage district dissolution policy. Should the MWRD decide to pursue dissolution of a drainage district, it is critical that the MWRD conduct extensive investigation and due diligence into the respective drainage district in order to determine the assets and liabilities of the drainage district, and all other known consequences of the MWRD undertaking dissolution. Moreover, it is important to recognize that even the most extensive due diligence will not uncover inchoate, unfiled claims, or lawsuits.
Should the Board decide to adopt this policy, the immediate question raised by the Petition of Markham residents located within the CUDD must also be addressed. The MWRD could begin an investigation into CUDD, and if deemed beneficial to the residents and in the best interest of the MWRD, pursue dissolution of the drainage district. This approach would allow the MWRD to use the dissolution of CUDD as its test case in formulating its comprehensive case-by-case dissolution policy.
It is, therefore, requested that the General Superintendent seek Board approval for a policy decision regarding dissolution of drainage districts pursuant to the Cook County Stormwater Management Act wherein the MWRD will evaluate the merits of dissolving drainage districts on a case-by-case basis as more fully set forth above. It is further requested that the General Superintendent seek Board approval for the MWRD to begin an investigation as to whether or not dissolution of CUDD is deemed appropriate, and report back to the Board with staff’s findings.
Requested, Frederick M. Feldman, Attorney, FMF:RMH:LLD:BOC:jvs
Respectfully Submitted, Patricia Young, Chairman Committee on Stormwater Management
ORDERED passed by affirmative roll call vote of a majority of the Commissioners present this June 19, 2008. Approved, President Terrence J. O’Brien