Loading...
HomeMy Public PortalAboutExhibit MSD 50A - MSD's Response to Fourth Discovery Request of the Rate CommissionExhibit MSD 50A BEFORE THE RATE COMMISSION OF THE METROPOLITAN ST. LOUIS SEWER DISTRICT MSD'S RESPONSE TO FOURTH DISCOVERY REQUEST OF THE RATE COMMISSION The Metropolitan St. Louis Sewer District Response ISSUE: STORMWATER RATE CHANGE PROCEEDING WITNESS: THE METROPOLITAN ST. LOUIS SEWER DISTRICT SPONSORING PARTY: RATE COMMISSION DATE PREPARED: MAY 31, 2018 Lashly & Baer, P.C. 714 Locust Street St. Louis, Missouri 63101 Exhibit MSD 50A BEFORE THE RATE COMMISSION OF THE METROPOLITAN ST. LOUIS SEWER DISTRICT For Consideration of a ) Stormwater Rate Change Proposal by ) The Rate Commission of The Metropolitan ) St. Louis Sewer District ) MAY 31, 2018 FOURTH DISCOVERY REQUEST OF THE RATE COMMISSION The Metropolitan St. Louis Sewer District Pursuant to § 7.280 and § 7.290 of the Charter Plan of The Metropolitan St. Louis Sewer District (the "Charter Plan"), Operational Rule 3(5) and Procedural Schedule § 17 and § 18 of the Rate Commission of The Metropolitan St. Louis Sewer District ("Rate Commission"), The Metropolitan St. Louis Sewer District ("District") hereby responds to the May 21, 2018 Fourth Discovery Request of The Rate Commission for additional information and answers regarding the Rate Change Notice dated February 26, 2018 (the "Rate Change Notice"). Exhibit MSD 50A BEFORE THE RATE COMMISSION OF THE METROPOLITAN ST. LOUIS SEWER DISTRICT For Consideration of a ) Stormwater Rate Change Proposal by ) The Rate Commission of The Metropolitan ) St. Louis Sewer District ) FOURTH DISCOVERY REQUEST OF THE RATE COMMISSION Pursuant to §§ 7.280 and 7.290 of the Charter Plan of the Metropolitan St. Louis Sewer District (the "Charter Plan"), Operational Rule 3(5) and Procedural Schedule §§ 1, 17 and 18 of the Rate Commission of the Metropolitan St. Louis Sewer District ("Rate Commission"), the Rate Commission requests additional information and answers from the Metropolitan St. Louis Sewer District ("District") regarding the Rate Change Proposal dated February 26, 2018 (the "Rate Change Proposal"). The District is requested to amend or supplement the responses to this Discovery Request, if the District obtains information upon the basis of which (a) the District knows that a response was incorrect when made, or (b) the District knows that the response, though correct when made, is no longer correct. The following Discovery Requests are deemed continuing so as to require the District to serve timely supplemental answers if the District obtains further information pertinent thereto between the time the answers are served and the time of the Prehearing Conference. 3 Exhibit MSD 50A FOURTH DISCOVERY REOUEST 1. Of the projects listed in the stormwater CIRP (Exhibit MSD 41F), how may projects (and what percentage of the total number of projects) would be located entirely on private property? RESPONSE: According to MSD GIS data analysis of the project conceptual alignments, 145 projects (30%) would be located entirely on private parcels. Only 11 projects (2%) do not touch private parcels at all. 2. Does the District's Stormwater Policy (Exhibit MSD 23) or any other policy prohibit/limit the District's authority to construct improvements or repairs entirely on private property? If the District is authorized to construct improvements or repairs entirely on private property, does the District have a mechanism or procedure to determine whether such improvements/repairs would provide a benefit to the public? RESPONSE: MSD is not prohibited by any policy from constructing improvements or repairs on private property provided easement or property rights exist. The District believes as stated in previous discovery response, see Exhibit MSD 41A, that construction improvements and repairs to address stormwater flooding and erosion provide added value to the community overall. The District prioritization system and prioritization worksheet, see Exhibit MSD 301( is the mechanism used to consider benefits to the public. It offers benefit points for the proposed solution as well as benefit points for regional and environmental benefits to the public we serve. 3. Would the District undertake a stormwater project on private property if the District would not be able to obtain an easement to maintain or improve the project? Please explain why or why not. RESPONSE: No, the District requires the appropriate property rights to perform stormwater work on private properties. If the fi trict would be unable to obtain those rights the District would not undertake the project. 4. Has the District considered seeking authority to partially bond -finance projects in the stormwater CIRP (Exhibit MSD 41F), that would result in an asset which would be owned by the District? Why or why not? RESPONSE: No. Please see the response to question 1 of the surrebuttal testimony (Exhibit MSD 55) of Marion Gee which provides the District's rationale for not issuing bonds to finance the projects. 4 Exhibit MSD 5OA 5. Please explain in detail the process for which projects were included and prioritized within the stormwater CIRP (Exhibit MSD 41F). RESPONSE: The process for prioritization was provided in MSD's Response to First Discovery Request of the Rate Commission, Exhibit MSD 30B - See Questions #2, #12, and #13. The process for scheduling or programming within the annual CIRP is an iterative process impacted by a number of factors. Projects are generally placed in the annual CIRP according to the benefit cost ratio, scheduling higher priority projects sooner in the program. The annual CIRP typically includes a five year rolling block of projects. The factors that can impact the exact timing of the design and construction are: funding availability, project phasing (needing to perform a downstream project prior to an upstream to avoid causing additional problems), project design requirements, grouping of project types, internal staffing capacity, coordination with other entities, coordination with Wastewater CIRP, regionalization of projects, and additional project analysis or validation. These factors and this programming process can require the movement of projects both higher in priority to be delayed or projects of lesser priority to be expedited in the program, but as stated earlier it is always the intent to address the highest priority issues. 6. Has the District's prioritization system (Exhibit MSD 30J and MSD 30K) been peer -reviewed or reviewed by any experts? If the answer is yes, please identify the persons/entities which have reviewed the prioritization system and produce any reports or analysis by such persons/entities. RESPONSE: Yes. The District's prioritization system has been written and reviewed by experts. The Stormwater System Master Improvement Plan (SSMIP) was written by national and local experts at Camp Dresser & McKee (CDM), Homer and Shin, CH2M-Hill and Montgomery Watson. This team won out over five other consultant teams due to their experience in stormwater planning. Leading experts involved in the process include: CDM's Jim Hagerty and Dan Lau, Shifrin's Gene Rovak and Bill Clarke, CH2MHill's Carey Brand and Montgomery Watson's Ed Tharp and Ron Krusie. This entire process involved oversight by a Public Advisory Committee with fourteen members, and a Technical Advisory Committee with nine members. The Technical Advisory Committee was selected due to their stormwater management expertise and included: a Professor of Hydraulics, the Chief of Hydrologic Engineering for the US Army Corps of Engineers, four local government representatives including two Public Works Directors, a Vice President of an engineering consulting firm, and Associated General Contractor representation. 5 Exhibit MSD 50A The prioritization system was upgraded by MSD and Parsons in 2006 to better reflect the various problem categories with severity refinements plus points were added to encourage regional and environmentally beneficial solutions. Parsons won the contract over other consultants due to their approach, experience and expertise. Parsons ' project manager was Ed Sweet, and the team contained numerous national and local experts (see Exhibit MSD 50B Project Proposal). The internal MSD project manager was Gary Moore, who is also an expert in the water environment field (see Exhibit MSD 50C Moore Resume). 7. Did the District consult or review any scientific or professional journals in crafting its prioritization and scoring systems? If the answer is yes, please identify the materials the District consulted or reviewed. RESPONSE: The District relied upon the experience and expertise of staff and its consultants, who were all involved in water industry trend setting activities, and active in professional organizations. Per the SSMIP Policy Report Section 2.5.1, "Various methods of prioritization from other urban areas were reviewed and applicable points for the SSMIP prioritization program are presented in the following sections. Many approaches have been utilized to rank stormwater related projects that together comprise a continuum of complexity and detail. " The approach taken by federal agencies, for example, was evaluated and rejected as an overly complex and time-consuming approach. The majority of city and county -wide stormwater prioritization procedures fell into a weighted benefit point system with cost comparison approach, which was selected as the most appropriate method. The benefit to cost ratio was modeled after the approach in Virginia Beach, Virginia. The Parsons team further contributed to the effort with leading experts all having personal experience and were selected due to their expertise. The team led the District in developing a prioritization system most appropriate for the District's needs. See Exhibits under response to Q6. 8. Please explain in detail how the District's prioritization system (Exhibit MSD 30.1 and MSD 30K) was developed. Please include when it was developed and what revisions have been made since that time. RESPONSE: This information is provided in Section 2.5 of the SSMIP 1995 Policy and Standards Report provided as Exhibits MSD 37F and Section 1.2 of the MSD Stormwater Facility Planning Final Report 2010 provided as Exhibit MSD 37G. The prioritization system provided as Exhibit MSD 30J and MSD 30K was established as part of the 2010 Report and is the system currently in use. 6 Exhibit MSD 50A 9. Please explain how the contribution of private financing would affect a project's score in the District's prioritization system. For example, if a project's score projects a cost to the District of $15 million, and a third party proposed to provide $10 million to reduce the District's cost to $5 million, how would the project's priority be affected? RESPONSE: See Surrebuttal of Brian L. Hoelscher, Exhibit MSD 54 10. Please explain how the District's prioritization system accounts for costs assessed to the District by the Missouri Department of Transportation ("MoDOT"), a public utility, or a municipality. For instance, if MoDOT bills the District for the costs associated with closing a road for the District to complete a project, how would such costs be factored into a project's priority or score? RESPONSE: All known and anticipated costs for design and construction are factored into a project's priority or score, regardless offunding source (MoDOT), and are included in the prioritization calculation. Generally there are a number of project costs, such as coordination costs, utility costs, and/or permitting costs that are unknown during the conceptual or preliminary design of a project. These costs are typically added to the overall project costs as contingency costs based on factors known at that time. This is standard engineering practice in cost estimating. 11. Does the District prioritize or coordinate projects based on their watershed or region? If so, please explain how a project's location in a particular watershed/region would affect its priority. If the District does not prioritize or coordinate projects based on watershed or region, please explain why not. RESPONSE: This information was provided in MSD 's Response to First Discovery Request of the Rate Commission, see Exhibit MSD 30B - Question #2. Additionally, as provided by the prioritization worksheet, see Exhibit MSD 30K, additional benefit points are provided for regional based solutions. 12. Please explain why the District's prioritization system is a fair and equitable method of prioritization. RESPONSE: The District's prioritization is fair and equitable because it is an established, written procedure consistently implemented for all stormwater projects within the District. The prioritization system is intended to provide the greatest benefit for the cost. The prioritization system was developed by qualified experts in the field of stormwater engineering and consistent with industry practice. This is further validated in rebuttal testimony provided by the Rate Commission technical expert Ms. Nicole Young (see Exhibit RC 44 — Question 11). 7 Exhibit MSD 50A 13. Please explain when a point -spread in the list of prioritized projects would become meaningful. RESPONSE: Projects are given a benefit to cost ratio score, and this priority score is stored in the MSD database to the hundredth decimal point. Therefore, a 0.01 difference in benefit to cost ratio will provide a meaningful difference in priority ranking. Respectfully submitted, u an . Myers, General C unsel THE METROPOLITAN ST. LOUIS SEWER DISTRICT 2350 Market Street St. Louis, Missouri 63103 smyers@stlmsd.com Tel: (314) 768-6366 Fax: (314) 768-6279 8 i Exhibit MSD 50A CERTIFICATE OF SERVICE The undersigned certifies that a copy of the foregoing was sent by electronic transmission to Lisa O. Stump, Lashly & Baer, P.C., Brian J. Malone, Lashly & Baer, P.C. and Brandon W. Neuschafer, Brian Cave, LLP, on this 31st day of May, 2018. Lisa O. Stump, Esq. Brian J. Malone, Esq. Lashly & Baer, P.C. 714 Locust Street St. Louis, MO 63101 lostump@lashlybaer.com Brandon W. Neuschafer Bryan Cave, LLP 211 N. Broadway, Suite 3600 St. Louis, MO 63102 bwneuschafer@bc1plaw.com k7i2zk /n /),j/;- san M. Myers, General Counse THE METROPOLITAN ST. LO 2350 Market Street St. Louis, Missouri 63103 smyers@stlmsd.com Tel: (314) 768-6366 Fax: (314) 768-6279 S SEWER DISTRICT 9