This story has been updated from an earlier version published.
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The “rain tax” is coming later than originally planned.
And before the fees start, the city is rolling out a credit program that might ease the pain on resident’s wallets.
On Wednesday council passed the stormwater management incentive program, also known as the rain tax, with a 10-5 vote.
The program will charge businesses and residences with non-absorbent surfaces, like pavement and buildings, for the upkeep of stormwater collection systems, like sewers, ditches and culverts.
The number residents and business owners will see on their bills is determined by billing units, which are equivalent to the impervious surface area of one residential home.
The new payment system was initially slated to start in September 2025, but a report by consulting firm AECOM discussed at the GIC committee moved the date to April 1, 2026.
Hamilton’s stormwater system is valued at $3.1 billion and funding to keep it maintained currently comes from residential water bills.
The system includes 3,500 culverts the city says are in largely rural areas, like Flamborough, which need to be maintained and cleared.
The fees have been hotly debated by residents across the city, but rural Hamiltonians and farmers with large properties faced almost absurdly high estimates when the program was initially announced.
How council voted
YES - Mayor Andrea Horwath, Ward 1 Coun. Maureen Wilson, Ward 2 Coun. Cameron Kroetsch, Ward 3 Coun. Nrinder Nann, Ward 4. Coun. Tammy Hwang, Ward 7 Coun. Esther Pauls, Ward 8 Coun. John-Paul Danko, Ward 12 Coun. Craig Cassar, Ward 13 Coun. Alex Wilson and Ward 14 Coun. Mike Spadafora.
NO - Ward 5 Coun. Matt Francis, Ward 6 Coun. Tom Jackson, Ward 9 Coun. Brad Clark, Ward 11 Coun. Mark Tadeson and Ward 15 Coun. Ted McMeekin.
ABSTAINED - Ward 10 Coun. Jeff Beattie, who is a farm owner.
Farmer says he could be 'pushed out of the city'
Flamborough farmer Daniel Vanderhout said his family’s business, Beverly Greenhouses, were initially given an estimate of $86,972 per year if the program goes forward.
At the June 5 GIC meeting, he called on council to consider an exemption for farmers.
“The current program unduly burdens agricultural properties and fails to satisfy the guiding principles laid out by council,” Vanderhout said, adding that the proposed credit system is not enough.
Ward 15 Councillor Ted McMeekin asked Vanderhout if adding fees on agricultural land will end up finding its way into grocery prices, which Vanderhout said is a possibility.
“There are added costs to continuing the growth of our operations in Hamilton, if the fees were to go forward, and that could have unintended consequences of pushing farmers out of the city,” Vanderhout said.
At a town hall hosted by MPP Donna Skelly in February, Flamborough farmers were outraged at being charged for managing stormwater when they often have their own drainage ponds, bioswales and rain barrels.
AECOM project manager Nancy Hill, who presented the results of a community survey on the fees, said sometimes mitigation practices on farms aren’t enough.
“I know that rural owners and agricultural property owners do a lot of work managing stormwater on site, and a lot of them reuse their stormwater,” Hill said in her presentation, but added with outbuildings, paved driveways and parking lots, some farms will have stormwater runoff.
Credits and subsidies
The report released on June 5 now includes three different credit systems to ease those costs: the Green Space credit, the Hamilton Harbour credit and the Stormwater Management credit.
The credits can’t be stacked.
The Green Space credit is meant for farms, parks, golf courses and cemeteries without a direct connection with the stormwater system. This credit will be automatically applied and will be based on the percentage of property that is green space.
For example, a 158-acre property with a 21 per cent impervious surface area (buildings, asphalt, etc.) would be billed for 455.3 billing units, which would lead to a $77,402 total bill.
AECOM calculates that the credit percentage for this hypothetical property would be 94 per cent and the landowner would end up paying $4,455 once the credit is factored in.
The Hamilton Harbour credit will apply to residences, commercial buildings and lands that drain directly into Hamilton Harbour. Residents who can prove they have direct flow into Hamilton Harbour can receive up to 90 per cent of their fees back in credit.
The final credit, the Stormwater Management Credit, will depend on a property’s mitigating systems for runoff, like rain barrels, catchment ponds, permeable pavement, bioswales, etc. This credit can cover up to 50 per cent of fees if residents can reduce the quantity of water or improve the stormwater’s quality before it enters the system.
