Shaarei Tfiloh v. Mayor & Council of Baltimore

Panel: Leahy, Reed, Shaw Geter, JJ. * Leahy, J. ¹⁰⁸ "If the rain spoils our picnic, but saves a farmer's crop, who are we to say it shouldn't rain?" 1 This appeal swells out of the controversial law imposing stormwater remediation fees, commonly referred to as the "Rain Tax." 2 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, 3 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. The 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 ¹⁰⁹ underlying appeal, owned by Appellant ⁸⁴⁹ Shaarei Tfiloh Congregation ("the Congregation"). At the 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 slightly: 4 1.

Did the Board err in holding that the Stormwater Fees imposed under Article 27 of the Baltimore City Code were valid? 2. Did the Board err in holding that Article 27 is not a land use ordinance? 3. Did the Board err by ignoring the broad protections afforded religious institutions under Article 36 of the Maryland Declaration of Rights? ¹¹⁰ 4. Did the Board err in failing to follow its own rules of procedure?

We hold 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 established procedures. BACKGROUND Stormwater 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, https://www.epa.gov/nutrient-policy-data/addressing-nutrient-pollution-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 Court. ⁸⁵⁰ A. Statutory Framework 1. Federal Law Amid 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 ¹¹¹ 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. 5 Id. § 1342(a)(1). The EPA 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. Although 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, 134 A.3d 892 (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 ¹¹² 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. 6 76 Fed. Reg. 549 . 2. Maryland Law The purpose of Maryland's stormwater management subtitle is codified in Envir. § 4-201. That section announces the General Assembly's findings: ⁸⁵¹ 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. On 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. ¹¹³ 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 7 -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. 8 Id. § 4-202.1(c). The legislature specified how to assess a Stormwater Fee: (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. ¹¹⁴ (ii) A county or municipality may set a stormwater remediation fee under this paragraph based on: ⁸⁵² 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 municipality. Envir. § 4-202.1(e)(3). As we 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. 3. The City's Law and Regulations The 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 , https://publicworks.baltimorecity.gov/stormwater (last 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 key. 9 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 (2008). In 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. ¹¹⁵ 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 only: (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 future development; (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; ⁸⁵³ (ii) stream and wetland restoration; and (iii) public education and outreach related to stormwater management or stream and wetland restoration; (7) reasonable costs necessary to administer the Fund; and ¹¹⁶ (8) any other use authorized by [ Envir. § 4-202.1 ]. Id. § 2-3.

As 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. 10 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. 11 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. 12 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. 13 Id. §§ 3-3(b), 3-4(a), (c). ¹¹⁷ 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. 14 Id. § 3-3(e)(3). Therefore, rather than being charged $60 per year per ERU, these ⁸⁵⁴ properties are charged $12 per year per ERU. Article 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). DPW 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' ¹¹⁸ 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). Any 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. § 4-2. B. The Congregation's Administrative Challenges 1. Contest to DPW For the 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.

The 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 ¹¹⁹ 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.), ⁸⁵⁵ 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 applied retroactively.

On May 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 imposition of the Stormwater Fee to a "user fee" like those for water and sewage, DPW concluded that it was not unconstitutional to impose Stormwater Fees on the Congregation.

DPW noted that this was a final decision appealable to the Board. 2. Appeal to the Board After its largely unsuccessful challenge before DPW, the Congregation appealed to the Board on June 27, 2014. In its appeal to the Board, the Congregation did not contest DPW's assessment of applicable ERUs or the amount of impervious surface on the Properties; nor did it challenge DPW's fee ¹²⁰ reduction amounts under Article 27 § 3-3(e)(3). Instead, quoting Eastern Diversified Properties, Inc. v. Montgomery County , 319 Md. 45 , 55, 570 A.2d 850 (1990), the Congregation contended that the Stormwater Fee is a property tax because it is "exacted solely for revenue purposes, is an involuntary payment of money, and the funds raised by the fee are used to ... benefit the general public." The Congregation contested the DPW Director's characterization of the Stormwater Fee as a user fee, pointing out that "in contrast to water and sewer fees which are directly tied to services directly provided to the synagogue (as measured by how much water it actually uses), the Fund is clearly being used to benefit projects such as the general public's 'stream and wetland restoration projects' and 'public education and outreach,' which have no correlation to the properties owned by [the Congregation]." Moreover, relying on Weaver v. Prince George's County , 281 Md. 349 , 379 A.2d 399 (1977), the Congregation asserted that under Article 27, the failure to pay creates a property lien, which indicates that the Stormwater Fee is a property tax, and the Properties are exempt from property taxes under Tax-Prop. § 7-204.

Lastly, the Congregation contended that the Stormwater Fee posed "an unconstitutional substantial burden upon the free exercise of religion," in violation of RLUIPA, the First Amendment of the United States Constitution, and the Maryland Declaration of Rights. In its response, the City averred that the Stormwater Fee is not a property tax as it is "not based upon value or ownership of the property, but on the amount of impervious surface on the property." The City stated that this "reflect[s] the extent to which [the Congregation] contributes ⁸⁵⁶ runoff to the system." Additionally, the City explained that Envir. § 4-202.1 -the enabling statute-required local governments to impose the Stormwater Fee, which the City did in a manner similar to a user fee though it could have designed the fee as an excise or regulatory tax. The City persisted that RLUIPA was inapplicable because the Stormwater Fee was not a land use regulation within that statute's meaning; and, even if it was, the Stormwater Fee passed the "strict scrutiny" test provided in ¹²¹ RLUIPA. The City maintained that the Stormwater Fee withstood the Congregation's First Amendment challenge because, applying the test the Supreme Court articulated in Employment Division v. Smith , 494 U.S. 872 , 881, 110 S.Ct. 1595 , 108 L.Ed.2d 876 (1990), it is neutral and generally applicable.

Lastly, the City asserted that the Stormwater Fee neither violated the Maryland Constitution nor the Maryland Declaration of Rights, claiming that neither was more protective of religious rights than the First Amendment. In reply, the Congregation repeated its argument that the Stormwater Fee was a property tax. Even if the Board were to find that it was an excise tax, and thus the Congregation would not be exempt under Tax-Prop. § 7-204, the Congregation argued that the City lacked express legislative authority to impose such a tax. The Congregation also asserted that the Stormwater Fee violated RLUIPA because it is a land use law that limits the Congregation's use of its land and is a substantial financial burden on the Congregation's free exercise of religion.

Lastly, the Congregation asserted that Article 36 of the Maryland Declaration of Rights provides more protection to religious entities than the First Amendment and urged the Board to apply a "least-restrictive means" test to the law regardless of whether RLUIPA applies. The Board held a hearing on January 27, 2015. The Congregation and the City each presented one witness. When the Board asked the Congregation about the burden that the Stormwater Fee imposed, the Congregation responded simply that it was "a small synagogue" with "a very modest budget." The Congregation did not present specific documents to support its claim of financial hardship.

Ms. Kim Grove, who had been DPW's Chief of the Surface Water Management Division, testified for the City that "impervious area has been a consistent metric[ ]" and that DPW selected impervious area because it was "simple and objective." The Board issued a written resolution on March 23, 2015, affirming DPW's decision and denying the Congregation's request to void the Stormwater Fees. In regard to the Congregation's ¹²² first contention that the fee was a tax rather than a user fee or regulatory fee, the Board declared that it "finds that the determination requested by Appellant is beyond the authority of the Board, and accordingly the Board will not issue a decision on such determination." The Board explained that, "[s]imply stated the Board reviews and examines the law as written and as [it] appl[ies] to a certain set of facts.... It is not for this Board to find that a fee is a tax or a tax is a fee." Thus, the Board decided it would apply the law as written and treat the Stormwater Fee as a fee rather than a property tax and leave the determination as to whether the fee is more properly categorized as a tax to "the courts of Maryland or the legislature[.]" The Board concluded that RLUIPA was inapplicable because Article 27 is not a land use regulation, observing that "Article 27 is not a landmarking law; it does not impact the development of land and does not limit or restrict the use of land." Regarding the constitutional challenges, the Board determined that Article 27 did ⁸⁵⁷ not violate the Free Exercise Clause of the First Amendment because the law is neutral and generally applicable. "The stormwater remediation fee is based on the amount of impervious surface area a property has regardless of the use of the property.

Aside from the few property owners that are exempt from the fee[ ], the stormwater remediation fee applies to all property owners." The Board noted that the Supreme Court established that "a law that is neutral and of general applicability need not be justified by a compelling governmental interest even if the law has the incidental effect of burdening a particular religious practice." Church of the Lukumi Babalu Aye v. City of Hialeah, 508 U.S. 520 , 531, 113 S.Ct. 2217 , 124 L.Ed.2d 472 (1993). The Board also "found that the [Congregation's] claim that the [Stormwater Fee] was a substantial burden was undocumented and unsupported," and concluded that there was no support in case law for the proposition that the Maryland Declaration of Rights offered greater protection than the Free Exercise Clause. ¹²³ C. Judicial Review The Congregation sought judicial review of the Board's resolution in the Circuit Court for Baltimore City. In their memoranda, the parties reiterated the same arguments made before the Board. Additionally, the Congregation argued that the Board's finding that the Congregation did not submit evidence showing that the Stormwater Fee was a substantial burden resulted from the Board's failure to follow its rules of procedure, asserting that either DPW never forwarded the Congregation's water bills or the Board disregarded them.

The City responded that the amount of the Congregation's Stormwater Fee was not at issue; rather, the Board rightly found that the Congregation failed to offer evidence of its own financial status to demonstrate why the amount of that bill-$600 per year-imposed a "substantial burden" on the Congregation. After a hearing on December 15, 2015, the circuit court issued a written memorandum and order on January 6, 2016, largely agreeing with the Board's decision. Per the applicable standard of judicial review, the circuit court reviewed, with a degree of deference, the Board's factual findings for substantial evidence and then reviewed its legal conclusions de novo . Therefore, the circuit court reviewed the Congregation's contention regarding the categorization of the Stormwater Fee de novo , and determined that [l]ike the development impact fee in Eastern Diversified [, 319 Md. 45 , 570 A.2d 850 ], although the Stormwater Remediation Fee is labeled a "fee" in both Section 4-202.1 and Article 27, the charge has all the indicia of a tax.

The stated purpose of the charge is to raise revenue "for the implementation of local stormwater management plans," Md. Code Ann., Envir. [§ 4-202.1(d)(2) ], and in order to comply with Article 27, Baltimore City property owners must not undertake any action, except for paying the fee. Moreover, the fee is mandatory of subject properties, and the funds are used to finance stormwater management plans which benefit the general public. Therefore, given the law as set out in Eastern Diversified , this Court finds that the Stormwater ¹²⁴ Remediation Fee is a tax, and the Board erred in finding that the Stormwater Remediation Fee is a "fee." The circuit court then determined that the Stormwater Fee is a valid tax because the General Assembly granted the City the authority to establish the Fund pursuant to Envir. § 4-202.1 and the language of Article 27 is "firmly grounded" and "expressly tied to the requirements of [Envir.] Section 4-202.1 [.]" To determine whether the tax was a property tax, the court relied ⁸⁵⁸ on the test established by Weaver v. Prince George's County , 281 Md. 349 , 379 A.2d 399 (1977), and set out in Waters Landing Limited Partnership v. Montgomery County , 337 Md. 15 , 25-26, 650 A.2d 712 (1994). Applying the tests established by these cases, the court concluded that the Stormwater Fee was an excise tax, not a property tax, and therefore the Congregation was not exempt under Tax-Prop. § 7-204.

The court reasoned: Looking first at the legislative label that the charge is labeled a fee rather than a tax, is of little use in determining whether it is in fact a property or excise tax. Turning next to the "actual operation and practical effect" of the tax, the Stormwater Remediation Fee is not charged based solely on ownership of the property, but rather, it is imposed only when the owner makes a particular use of the land-namely increases or decreases the amount of impervious surface. Therefore, like the developmental impact tax in Waters Landing , under the second prong of the Weaver test, the Stormwater Remediation Fee is an excise tax. Lastly, like the taxes in Weaver and Water [ s ] Landing , as the method to impose and fix the amount of the tax is not based on the value of the property , but rather the amount of the impervious surface, the Stormwater Remediation Fee is an excise tax under the third prong of the Weaver test.

(Italics in circuit court opinion). The court rejected the Congregation's constitutional challenges, in large part, because Maryland applies the "neutral and generally applicable law" test to Free Exercise Clause challenges, and the Congregation did not challenge the ¹²⁵ Board's finding that Article 27 is a neutral law of general applicability. Disposing of the Congregation's remaining claims, the court found that RLUIPA is inapplicable because Article 27 is not a land use regulation and found no merit to the Congregation's contention that the Board failed to follow its own rules of procedure in determining that the Congregation did not demonstrate a substantial burden. Lastly, the court concluded the Board's decision was supported by substantial evidence.

The Congregation timely noted an appeal on February 3, 2016. Despite prevailing below, the City noted a cross-appeal on February 16, 2016. 15 DISCUSSION I. Administrative Exhaustion and Judicial Review The parties ultimately agree on the scope of our review, albeit they arrive at ⁸⁵⁹ this accord via two very different legal and analytical paths. The primary issue of contention ¹²⁶ centers on the Board's decision to treat the Stormwater Fee as a fee rather than a tax based on the labels employed in Envir. § 4-202.1 and Article 27. The Board opined that it was beyond its "authority to decide that a law as written is not properly categorized[,]" but then on petition for judicial review, the circuit court considered the issue de novo and determined that the Stormwater Fee was, in fact, a tax.

Before this Court the Congregation maintains-as it did before DPW, the Board, and the circuit court-that the City "contravened its authority under [ Envir. §] 4-202.1" in Article 27 because the assessment constituted an invalid tax instead of a statutorily authorized fee. In its response brief to this Court, the City acknowledges, citing O'Donnell v. Bassler , 289 Md. 501 , 509-511, 425 A.2d 1003 (1981), that under the doctrine of administrative exhaustion, "[w]here an administrative agency has not fully performed its function, a reviewing court shall not substitute its judgment for the expertise of the administrative agency.... Instead, a court's proper response is to remand the case back to the Board for further review." The City submits, however, that the circuit court's decision declaring the fee an excise tax in this case was proper under the constitutional exception to exhaustion because the Congregation "attacks the very power of the legislature to enact an ordinance on a particular matter." The City proposes that we should review the circuit court's decision rather than that of the Board on the question of whether the Stormwater Fee exceeds the authority granted to the City under Envir. § 4-202.1. The Congregation, for its part, sees nothing unusual about the procedural posture of this case and contends that the Board did decide the issue by treating the Stormwater Fee as a fee, rather than dismissing that portion of the Congregation's appeal or refusing to move past the issue after opining on the limited scope of its authority.

The Congregation maintains that the Board's decision was final and is properly before this Court because "there is no further administrative function left for the [Board] to perform." In the end, although both parties disagree over whether it is the Board's decision or the ¹²⁷ circuit court's decision that is before us, both agree that we should review the issue de novo . When considering an appeal from judicial review of a final administrative decision, we review the agency's decisions, not that of the circuit court. People's Counsel for Balt. Cty. v. Surina , 400 Md. 662 , 681, 929 A.2d 899 (2007).

As to factual findings, we are limited to considering "whether the agency decision is supported by substantial evidence in the record." Anderson v. Gen. Cas. Ins. Co. , 402 Md. 236 , 244, 935 A.2d 746 (2007) (citation omitted).

For conclusions of law, we afford deference to an agency's interpretation of the statutes it administers, id. at 244-45 , 935 A.2d 746 , but "we owe no deference to an agency's erroneous conclusions of law." Manekin Constr., Inc. v. Md. Dep't of Gen. Servs. , 233 Md. App. 156 , 172, 163 A.3d 214 (2017). Therefore, we review questions of law de novo . Id.

(citing Assateague Coastkeeper v. Md. Dep't of Env't , 200 Md. App. 665 , 690, 28 A.3d 178 (2011) ). As we stated in Priester v. Baltimore County , [w]hen a legislature provides an administrative remedy as the exclusive or primary means by which an aggrieved party may challenge a government action, the doctrine of administrative exhaustion requires the aggrieved party to exhaust the prescribed process of administrative ⁸⁶⁰ remedies before seeking "any other" remedy or "invok[ing] the ordinary jurisdiction of the courts." 232 Md. App. 178 , 193, 157 A.3d 301 , cert. denied , 454 Md. 670 , 165 A.3d 469 (2017) (emphasis omitted) (quoting Soley v. State Comm'n on Human Relations , 277 Md. 521 , 526, 356 A.2d 254 (1976) (emphasis omitted) ). "The rule of finality overlaps the rule of exhaustion." Id. Before obtaining judicial review, "a party must exhaust the administrative remedy and obtain a final administrative decision[.]" Laurel Racing Ass'n, Inc. v. Video Lottery Facility Location Comm'n , 409 Md. 445 , 460, 975 A.2d 894 (2009).

Exhaustion requires that an individual "invoke and pursue the administrative process until he or she receives a final decision from the agency at the utmost level of the administrative hierarchy." ¹²⁸ Priester , 232 Md. App. at 194 , 157 A.3d 301 . Except in rare circumstances, exhaustion also prevents a court from "pass[ing] upon issues presented to it for the first time on judicial review[.]" Halici v. City of Gaithersburg , 180 Md. App. 238 , 248, 949 A.2d 85 (2008) (emphasis added) (internal quotations omitted). Therefore, a party's failure to raise a contention during the administrative process constitutes a failure to satisfy administrative exhaustion and is "an improper request for 'the courts to resolve matters ab initio that have been committed to the jurisdiction and expertise of the agency.' " Id. at 249 , 949 A.2d 85 (quoting Chesley v. City of Annapolis , 176 Md. App. 413 , 427 n.7, 933 A.2d 475 (2007) ) (additional citation omitted). Finality, on the other hand, occurs in the administrative sense when "the order or decision [disposes] of the case by deciding all question[s] of law and fact and leave[s] nothing further for the administrative body to decide." Willis v. Montgomery Cty. , 415 Md. 523 , 535, 3 A.3d 448 (2010) (citations omitted).

We conclude that the Congregation exhausted its administrative remedies and obtained a final administrative decision on the issue of whether the Stormwater Fee constitutes a tax or fee. The issue is therefore properly before us, and there is no need to consider whether the constitutional exception to the exhaustion requirement applies. Article 27 of the City Code specifically provided the administrative review process: first, the party must seek review before DPW regarding the assessed fees and if unsuccessful, it can then appeal DPW's decision to the Board. Art. 27, § 4-1.

Upon a final decision by the Board, a still-aggrieved party can seek judicial review in the Circuit Court for Baltimore City and may then subsequently obtain review before this Court. Id. § 4-2. Clearly, Article 27 contemplated the Board's determination as the "final decision from the agency at the utmost level of the administrative hierarchy." See Priester , 232 Md. App. at 194 , 157 A.3d 301 . Here, it is undisputed that the Congregation raised the question of the Stormwater Fee's classification from the outset and received a final decision at each step of the administrative ¹²⁹ process.

Beginning with its letter to DPW dated February 27, 2014, the Congregation iterated that, as a religious organization, it was exempt from property taxes and that imposition of the Stormwater Fee violated this exemption. DPW refused to void the assessed fees on May 29, 2014, indicating that it was a "final decision ... denying the appeal." The following month, the Congregation appealed to the Board and again detailed its assertion that the Stormwater Fee was an improper property tax-and not an authorized fee. The Board applied a plain reading of the statute and declined to treat the ⁸⁶¹ Stormwater Fee as anything other than a fee, stating that it was without the power to do so. This decision was a final determination because, following its issuance, the Board had "nothing further ... to decide." 16 See Willis , 415 Md. at 535 , 3 A.3d 448 .

Thus, only after presenting the issue throughout the administrative process and exhausting those avenues did the Congregation seek to petition for judicial review. We hold the Congregation properly preserved its categorization contention for judicial review and we discern no "improper request" for the circuit court "to resolve the matter[ ] ab initio [.]" Halici , 180 Md. App. at 249 , 949 A.2d 85 (internal quotations and citation omitted). As the issue posed a question of law, the circuit court correctly reviewed it de novo and we ¹³⁰ now apply that same standard of review to the Board's decision. See Manekin Constr., Inc. , 233 Md. App. at 172 , 163 A.3d 214 .

II

Statutory Construction A. City did not Exceed its Authority by Adopting Article 27 The Congregation contends that Article 27 exceeds the authority granted to the City by Envir. § 4-202.1. Relying on Eastern Diversified , 319 Md. at 49 , 570 A.2d 850 , the Congregation underscores that local governments do not have power to tax on their own authority, but may do so only if and when the State grants them power, adding that courts strictly construe the delegation of such taxing power. 17 To evince the scope of the City's authority, the Congregation contrasts Envir. § 4-202.1's use of the term "fee" with Envir. § 4-204(d)(1), which allows a county or municipality to adopt a "system of charges" to fund the creation of stormwater management programs. The thrust of the Congregation's assertion here is that ⁸⁶² the Stormwater Fee is not based on each property's share of stormwater management services, as required by Envir. § 4-202.1(e)(3)(i), given that (1) the ERU ¹³¹ is inflated because certain properties are exempt; (2) it affords blanket rates for single-family properties; and (3) it is based on a property's impervious surface area and not the "pollutant quality of any runoff[.]" The City responds that Article 27, in line with Envir. § 4-202.1, was enacted to ensure compliance with regulations pursuant to MS4 permits and also provided for raising revenue to ensure such compliance. It notes that although the circuit court found Article 27 was a tax as it "has all the indicia of a tax," Article 27 comports with Envir. § 4-202.1, the purpose of which "is to provide financial assistance" to implement the plans.

Envir. § 4-202.1(d)(2). Thus, the City argues, the contrast between the language in Envir. § 4-204(d) and § 4-202.1 is inapposite because the purpose of Envir. § 4-202.1 allows for a tax or fee. Additionally, the City contends that Article 27 complied with Envir. § 4-202.1(e)(3)(ii), which provides guidance on how a jurisdiction can set a fee, including a flat rate, a graduated amount based on impervious surface, or any other method . The City acknowledges that the Stormwater Fees may be higher to account for exempted properties, however, it maintains that Envir. § 4-202.1 provides for these exemptions.

When deciding a question of statutory construction, "[t]he cardinal rule ... is to ascertain and carry out the intention of the Legislature." Marriott Emps. Fed. Credit Union v. Motor Vehicle Admin. , 346 Md. 437 , 444, 697 A.2d 455 (1997) (citation omitted). The first step is to analyze the words of the statute, affording them their ordinary meaning. Lillian C. Blentlinger, LLC v. Cleanwater Linganore, Inc. , 456 Md. 272 , 294, 173 A.3d 549 (2017).

We presume that the legislature "meant what it said and said what it meant[,]" so when statutory language is clear, we need not look past the statute. Id. (quotation marks and citation omitted). If it is ambiguous, we employ additional statutory interpretation tools such as "the meaning of words in light of the statute as a whole and within the context of the objectives and purposes of the enactment." Marriott Emps. , 346 Md. at 445 , 697 A.2d 455 . ¹³² In resolving statutory ambiguity, we do not give effect to constructions that are "illogical, unreasonable, or inconsistent with common sense." Cleanwater Linganore, Inc. , 456 Md. at 295 , 173 A.3d 549 (quotation marks and citation omitted).

We utilize the same principles to interpret local enactments as we do for state statutes. F.D.R. Srour P'ship v. Montgomery Cty. , 179 Md. App. 109 , 122-23, 944 A.2d 1149 (2008) (citations omitted). Further, units of the State can enforce state power only when the State has specifically delegated that authority. E. Diversified , 319 Md. at 49 , 570 A.2d 850 .

Taxing is one of these delegable state powers. Id. Analyzing the plain language of Envir. § 4-202.1, we hold that the City Council did not exceed its authority when it enacted Article 27. Here, Envir. § 4-202.1(c) required the creation of a watershed protection and restoration program, which would include a stormwater remediation fee and a local fund.

Envir. § 4-202.1(d)(2) states the purpose behind the fund is "to provide financial assistance for the implementation of local stormwater management plans[.]" Envir. § 4-202.1(e)(1) requires the establishment and collection of such a fee from all property owners not exempt under subsections (e)(2) or (f). Meanwhile, Envir. § 4-202.1(e)(3) establishes the calculation of the fee: ⁸⁶³ (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 municipality. (Emphasis added). The City then enacted Article 27, which established a system for assessing this charge.

We also conclude Article 27 is in ¹³³ line with the stated purpose of Envir. § 4-202.1, found in subsection (d)(2), which is "to provide financial assistance for the implementation of local stormwater management plans[.]" We note that Envir. § 4-202.1(e)(3)(i) -requiring that the assessed fee be "based on the share of stormwater management services related to the property[ ]"-is not clear because that specific provision does not clarify what "related to the property" means. Fortunately, however, the subsequent provision, Envir. § 4-202.1(e)(3)(ii), provides three options, including one open-ended method for assessing the necessary fee. As explained above, the City delineated a three-category system for single-family properties, each with a specified flat rate. Id. § 3-2(b)(1)-(2).

For all other properties, the City established a rate of $15 per ERU and a mandatory minimum assessment of one ERU per property. Id. §§ 3-3(b), (d), 3-4(c). It also afforded a reduced rate to qualifying religious organizations, assessing $12 per ERU per annum for any structures on property used exclusively for worship or education. Id. § 3-3(e)(3).

Thus, the City opted to apply a flat rate to single-family properties while charging other non-exempt properties based on the property's total impervious surface. Nothing in the statute forbids the local jurisdiction from categorizing different properties and applying different methods for fee assessments based on those categorizations. Additionally, the Congregation's argument that exempt properties inflate the rates of other properties is inapposite to the contention that the City lacked authority to enact Article 27 (although, as we discuss further below, the argument bolsters the view that the fee is not a property tax). Article 27 provides that it "does not apply to any property that is expressly exempted by the Enabling Law." Art. 27, § 3-1(b).

Thus, even if the fees for every non-exempt property-including the Congregation's Properties-may be inflated as a result, the General Assembly specifically authorized those exemptions, and we assume the legislature knew and understood the effect of its decision. Reaching the opposite conclusion would be neither logical nor reasonable. See Marriott Emps. , 346 Md. at 445 , 697 A.2d 455 . ¹³⁴ The General