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HomeMy Public PortalAboutExhibit MSD 3F - Direct Testimony, Henrietta Locklear, RFCMSD Exhibit No. MSD 3F 2018 Stormwater Rate Proceeding HENRIETTA LOCKLEAR Direct Testimony Metropolitan St. Louis Sewer District February 26, 2018 Table of Contents Page Witness Background and Experience ........................................................................................... 1 Stormwater Rate Proposal............................................................................................................. 2 Direct Testimony of Henrietta Locklear, Raftelis February 26, 2018 2018 Stormwater Rate Proceeding 1 MSD Exhibit No. MSD 3F Witness Background and Experience 1 Q1 Please state your name and business address. 2 A. My name is Henrietta Locklear and my business address is 1331 Union Ave Suite 1150, 3 Memphis, TN, 38104, hlocklear@raftelis.com. 4 Q2. Please describe your educational background and work experience. 5 A. I am a graduate of the University of North Carolina at Chapel Hill with a Bachelor of 6 Arts in Political Science and a Masters of Public Administration. 7 In 2004, I joined amec (now the Woods group), in its Nashville, TN office and in 2006 8 transferred to its Raleigh, NC office. While at amec, I served in positions of increasing 9 responsibility from public relations coordinator up to project manager. I was involved in 10 a wide variety of water resources projects including water quality permit compliance, 11 regulations development, floodplain mapping and stormwater finance. As a project 12 manager and supervisor I managed multi-million dollar projects and a team of stormwater 13 finance and Geographic Information System (GIS) specialists. 14 In 2011, I joined Raftelis Financial Consultants, Inc. (RFC). At RFC, I have been 15 involved in many financial and management consulting engagements for water, sewer, 16 and stormwater utilities. I have served in increasing levels of responsibility within the 17 firm moving from senior consultant to senior manager. 18 Q3. Do you belong to any professional organizations or committees? 19 A. Yes, I am a member of the Water Environment Federation. 20 Q4. Please describe your experience in stormwater management. 21 A. I have 13 years of experience in local government finance and stormwater management. I 22 began my career assisting agencies with stormwater regulatory compliance, from 23 developing regulations for post-construction runoff to developing outreach programs and 24 Direct Testimony of Henrietta Locklear, Raftelis February 26, 2018 2018 Stormwater Rate Proceeding 2 MSD Exhibit No. MSD 3F completing annual reporting. I am experienced in governmental financial analysis and 1 planning, particularly in stormwater utility implementation and rate studies. I am also 2 experienced in all aspects of stormwater funding implementation, with particular focus on 3 policy analysis and development, and data and billing system implementation. I have 4 studied rate credit programs and served as project lead on credit program development 5 for several large stormwater utilities. I have worked with more than 50 local governments 6 on stormwater funding analyses, rate feasibility, or implementation projects and have 7 served as project manager for more than 15 stormwater user rate implementation projects. 8 I was a member of the working group that developed the certification test for APWA’s 9 Stormwater Manager Certification. I was also a reviewer for the Water Environment 10 Federation’s Special Publication titled User-Fee-Funded Stormwater Programs, 2nd 11 Edition.  In addition, I co-authored two chapters in the industry guidebook Water and 12 Wastewater Finance and Pricing: The Changing Landscape, which are entitled, "Public 13 Outreach and Gaining Stakeholder Commitment," and “Expanding Financing and Pricing 14 Concepts into Stormwater.”  15 Q5. Have you previously testified before the Rate Commission of the St. Louis 16 Metropolitan Sewer District? 17 A. No, I have not. 18 19 Stormwater Rate Proposal 20 Q6. What is the basis of the stormwater rate contained in the Rate Proposal? 21 A. The Rate Proposal proposes a Stormwater Capital Rate that will be charged based on the 22 amount of each customer’s impervious area. Impervious area is generally accepted to be 23 a fair and reasonable approach to recovering stormwater related costs because impervious 24 Direct Testimony of Henrietta Locklear, Raftelis February 26, 2018 2018 Stormwater Rate Proceeding 3 MSD Exhibit No. MSD 3F area directly impacts the volume and rate of stormwater runoff a customer will generate. 1 Q7. Is impervious area commonly used to determine stormwater ratess? 2 A. Yes. Over the past 30 years, funding for stormwater services and programs has shifted 3 from tax levy-based or consumption-based funding to impervious area-based ratess. 4 In our experience, impervious area is a common basis of stormwater rates. Surveys of 5 stormwater agencies demonstrate that this is the case. For example, a 2016 survey of 6 stormwater utilities indicates that the vast majority of stormwater utilities employ a rate 7 based upon impervious area (77%). Impervious area may be measured from aerial or 8 satellite imagery or it may be estimated or assumed using gross parcel area with a factor 9 based on land use or water premise type. 10 Q8. How does the District’s stormwater impervious rate credit/incentive program 11 compare to other utilities? 12 A. Most utilities offer credits as a part of a rate system. These are ongoing reductions to 13 customers’ rates that recognize their reduced demand for stormwater service. A number 14 of utilities provide incentives of various kinds. MSD’s proposed credit and incentive 15 program is within industry norms for such programs with respect to its major features. 16 Q9. How does the District’s billing methodology compare to other utilities that charge 17 an impervious area-based stormwater rate? 18 A. The District’s methodology compares favorably with other utilities. Apart from its 19 impervious area basis, which has been discussed, the use of single family residential tiers, 20 a unit of charge based on a typical residential impervious area and basis for charging all 21 non-single family residential properties based on units of impervious area are all well-22 established features of agencies’ stormwater rate methodologies in our experience. 23 Single Family Residential (SFR) tiers - Most agencies employ a simplified rate structure 24 Direct Testimony of Henrietta Locklear, Raftelis February 26, 2018 2018 Stormwater Rate Proceeding 4 MSD Exhibit No. MSD 3F for single family residential (SFR) properties. Typically, SFR customers share similar 1 characteristics and make up a majority of customers in a service area, so a simplified rate 2 structure can be both equitable and make the rate easy to administer. A 2016 national 3 survey found that 58% of participating utilities charged SFR properties a single flat rate 4 and another 19% charged tiered rates, while only 27% charged individually calculated 5 rates. 6 Unit of impervious area - employing an Equivalent Residential Unit (ERU) based on 7 typical residential impervious area is ubiquitous; provides balance between 8 understandability to the customer and ease of administration. 9 Non-SFR rate structure – charging non-SFRs in units of impervious area or ERUs is a 10 common industry practice; properties with more impervious area pay proportionally more 11 than single family residential. 12 Q10. Does this conclude your direct testimony in this matter? 13 A. Yes 14 15