The need for adequate and steady funding mechanisms in municipalities is the main issue affecting various regions of the United States. Stormwater management utility fees (SWMUFs) is a dependable process of funding for the maintenance of water resources, environmental protection, and flood control. SWMUFs are an estimated fee for all property owners, including homeowners, businesses, governments, and schools. The pros of SWMUFs include the provision of credits to those who incorporate best management practices on their parcel, which reduces stormwater runoff at the source, thereby protecting the waterways. This paper is a literature review paper on the mechanism of SWMUFs, rate structure, and factors to consider in establishing a stormwater utility fee. The findings from this review show that the equivalent residential unit (ERU) is the most prevalent funding method used in several municipalities, which is found on impervious areas, and many jurisdictions need to implement the SWMUFs