HomeMy Public PortalAboutFiscal Year 2013 Popular Annual Financial ReportPopular
Annual
Financial
Report
FISCAL YEAR ENDING JUNE 30, 2013
St. Louis, MO
TABLE OF CONTENTS
Letter to Readers ........................................................................1
Our History ..................................................................................2
Organization ...............................................................................3
Our Customers ...........................................................................5
Key Financial Information
Statement of Net Position ....................................................6
What We Owe and What We Own .......................................7
Income Statement ................................................................8
Expenses and Revenues ......................................................9
Cash Flow Statement ..........................................................10
Performance Against Budget .............................................11
Credit Rating ........................................................................11
Performance, Accomplishments, Hurdles & Initiatives ........12
Looking Ahead ..........................................................................15
T h e G o v e r n m e n t F i n a n c i a l O f f i c e r s A s s o c i a t i o n o f t h e U n i t e d S t a t e s a n d C a n a d a ( G F O A ) h a s g i v e n a n
A w a r d f o r O u t s t a n d i n g A c h i e v e m e n t i n P o p u l a r A n n u a l F i n a n c i a l R e p o r t i n g t o t h e M e t r o p o l i t a n S t . L o u i s S e w e r
D i s t r i c t f o r i t s P o p u l a r A n n u a l F i n a n c i a l R e p o r t f o r t h e f i s c a l y e a r t h a t e n d e d J u n e 3 0 , 2 0 1 2 . T h e A w a r d f o r
O u t s t a n d i n g A c h i e v e m e n t i n P o p u l a r A n n u a l F i n a n c i a l R e p o r t i n g i s a p r e s t i g i o u s n a t i o n a l a w a r d r e c o g n i z i n g
c o n f o r m a n c e w i t h t h e h i g h e s t s t a n d a r d s f o r p r e p a r a t i o n o f s t a t e a n d l o c a l g o v e r n m e n t p o p u l a r r e p o r t s .
I n O r d e r t o r e c e i v e a n A w a r d f o r O u t s t a n d i n g A c h i e v e m e n t i n P o p u l a r A n n u a l F i n a n c i a l R e p o r t i n g , a
g o v e r n m e n t u n i t m u s t p u b l i s h a P o p u l a r A n n u a l F i n a n c i a l R e p o r t , w h o s e c o n t e n t s c o n f o r m t o p r o g r a m s t a n d a r d s o f
c r e a t i v i t y , p r e s e n t a t i o n , u n d e r s t a n d a b i l i t y a n d r e a d e r a p p e a l .
W e b e l i e v e o u r c u r r e n t r e p o r t c o n t i n u e s t o c o n f o r m t o t h e P o p u l a r A n n u a l F i n a n c i a l R e p o r t i n g r e q u i r e m e n t s , a n d
w e a r e s u b m i t t i n g i t t o t h e G F O A .
G o v e r n m e n t F i n a n c e O f f i c e r s A s s o c i a t i o n
A w a r d f o r
O u t s t a n d i n g
A c h i e v e m e n t i n
P o p u l a r A n n u a l
F i n a n c i a l R e p o r t i n g
P r e s e n t e d t o
M e t r o p o l i t a n S t . L o u i s
S e w e r D i s t r i c t , M i s s o u r i
F o r i t s A n n u a l
F i n a n c i a l R e p o r t
f o r t h e F i s c a l Y e a r E n d e d
J u n e 3 0 , 2 0 1 2
E x e c u t i v e D i r e c t o r / C E O
1 6
Letter to Readers
The Metropolitan St. Louis Sewer District (MSD) is pleased to share with you the Fiscal
Year 2013 (FY2013) Popular Financial Annual Report.
Much of the work MSD does is performed out of the sight of most members of our community.
This report is designed to give you a glimpse into our world. Using non-technical language, it
provides a snapshot of our activities from our most recent fiscal year, which ran from July 1,
2012 to June 30, 2013. As you read it, you will learn how we are carefully investing the funds we
receive to improve and manage our region’s wastewater and stormwater systems. Our mission
is simple: to protect the public’s health and safety, and safeguard water quality in our region’s
waterways.
This report also contains financial information for this past fiscal year that summarizes the
much more detailed information found in our Comprehensive Annual Financial Report.
While the summary information you’ll find here uses principles and guidelines consistent with
Generally Accepted Accounting Principles (known in the accounting world as GAAP), it has been
simplified for general audiences and is not a GAAP-compliant publication.
If you prefer more detailed information, you are invited to review our Comprehensive Annual
Financial Report (CAFR) and audited financial statements, both of which are available online at
http://www.stlmsd.com/aboutmsd/fiscal/annualreport. You may also request a printed copy of
this information by contacting MSD at 314-768-6260.
As you will see as you review the following pages, MSD is working hard to create a 21st
Century stormwater management & wastewater collection and treatment system for our
region. We hope you find this information useful, and welcome your comments and
suggestions on how we might improve future reports to better meet your interests and needs.
Respectfully submitted,
Brian Hoelscher Janice Zimmerman
Executive Director Director of Finance
1
Our History
St. Louis first learned the importance of maintaining a safe water supply more than 100 years before
the Metropolitan St. Louis Sewer District was founded.
Up until 1849, when a major cholera epidemic killed over 4,000 of the city’s residents, St. Louis had
no significant sewer systems; wastewater was diverted into a honeycomb of limestone caves beneath
the city or directed to an area creek or river. Serious efforts to protect public health began thereafter,
when the City of St. Louis and individual municipalities began building their own sewage collection
systems. Following standard practice for the times, these sewers collected and transported sewage and
stormwater away from neighborhoods, through the same sewer pipe, to the Mississippi River or
smaller streams. However, this sewage was not receiving treatment before reaching local waterways.
By the mid-1900’s, our region’s
waterways were becoming
more and more polluted by this
untreated sewage. MSD was
formed in 1954 to address the
serious water quality issues the
region was facing.
Today, MSD is the compilation of
79 individual sewer systems that
formerly served all 62 square
miles of St. Louis City and 462 square miles -- or about 90% -- of St. Louis County.
Today MSD operates and maintains 6,550 miles of sanitary and combined sewers that transport
wastewater to one of seven plants for treatment before returning it to local waterways. Because it is
responsible for protecting our region’s five major watersheds,* MSD is also currently in the process
of addressing hundreds of overflow points where a combination of stormwater and wastewater still
discharge into area rivers and streams during and after medium to heavy rainstorms.
As the St. Louis region’s clean water advocate, MSD has made significant improvements to local
watersheds and water quality in its 59-year history. Significant additional investment in this essential
natural resource is planned for the years ahead.
DID YOU KNOW?
* A watershed is an area of land that eventually drains into a
particular body of water. Watersheds are important because they
supply our drinking water, provide a habitat for fish and wildlife,
and are the source of the water needed for irrigation, industry,
and recreational activities. All of our region’s watersheds drain
eventually into either the Missouri or Mississippi River.
2
WHAT MSD DOES
Created under a provision of the Missouri State Constitution, MSD is actually two separate utilities
– a wastewater utility and a stormwater utility under one organizational umbrella. Each one has
distinct responsibilities and its own source of funding:
WHAT IT INCLUDES
“Used” water disposed
of in sinks, toilets, and
floor drains by house-
holds and businesses
Rainfall and drainage
that is not naturally
absorbed in the soil
Our primary responsibility
To collect this water and
treat it to high standards
before returning it to our
region’s waterways
Manage this water in
accordance with established
funding levels and
appropriate regulations
WASTEWATER
MANAGEMENT
STORMWATER MANAGEMENT
Organization
MSD is governed by a six-person Board of Trustees appointed by the St. Louis City
Mayor and the St. Louis County Executive. Our Executive Director reports to this Board,
which sets policy and adopts our annual budget. MSD’s Rate Commission, which is made
up of representatives from 15 local organizations, makes recommendations to the Board
regarding all proposed wastewater, stormwater, and tax rate and structure changes.
3
MSD BY THE NUMBERS
OUR MISSION: To protect the public’s health, safety, and water environment by
responsibly providing wastewater and stormwater management.
Number of wastewater Seven treatment plants:
Average Daily 356 million gallons Wastewater treated:
Sewers operated 9,578 miles, including 3,028 miles of stormwater sewers, 4,744and maintained: miles of sanitary sewers, and 1,806 miles of combined sewers*.
Miles of sewers that have 834 miles, including 523 miles that are more than 80 yearsreached the end of their old and 311 miles that are more than 120 years old.useful life:
MSD’s wastewater collection system is the fourth largest in the
country -- roughly the same size as the wastewater system
in Los Angeles, which has more than twice the population
to support it.
No. of employees: 931
DID YOU KNOW?
* Combined sewers collect both sanitary sewage and stormwater
runoff in a single pipe. No longer built in new communities,
combined sewers are found in older cities like St. Louis.
Overflows from these sewers during wet weather are a source
of water pollution.
4
Our Customers
Our service area: MSD serves all of St. Louis City and approximately 90 percent of St. Louis County,
including county residents generally east of Highway 109.
No. of customers:
Approximately 1.3 million, representing more than 424,000 accounts. About two-thirds of our
customers are in St. Louis County and one-third from the City of St. Louis.
MSD'S 10
largest
customers
in FY2013:
1. A-B InBev
2. Washington University
3. Mallinckrodt, Inc.
4. City of St. Louis
5. St. Louis University
Hospital
6. Sigma-Aldrich
7. Boeing Co.
8. Sensient Colors Inc.
9. St. Louis Zoo
10. Prairie Farms Dairy
5
KEY FINANCIAL INFORMATION
CONDENSED STATEMENT OF NET POSITION
(in thousands)
FY2013 FY2012
ASSETS:
Current, restricted, and other assets $ 603,104 $ 407,731
Capital assets (net of accumulated depreciation) $2,659,806 $2,548,816
Total Assets $3,262,910 $2,956,547
LIABILITIES:
Current liabilities $89,432 $86,337
Non-current liabilities $924,281 $651,916
Total Liabilities $1,013,713 $738,253
NET POSITION:
Net investment in capital assets $1,886,831 $1,936,590
Restricted $117,365 $106,694
Unrestricted $245,001 $175,010
Total Net Position $2,249,197 $2,218,294
Definitions:Current, restricted and other assets: all assets other than fixed assets, that are owned or due to the District.Capital Assets (net of accumulated depreciation): the total value of all fixed assets, including all sanitary infrastructure,
general plant and equipment, and land.Current liabilities: money owed by the District that is due within 12 months. Non-current liabilities: money owed by the District that is due more than 12 months into the future. Net investment in capital assets: the value or net worth of all fixed assets, after related liabilities are deducted.Restricted: the value or net worth of all assets designated for specific purposes after related liabilities are deducted. Unrestricted: the value or net worth of all remaining assets after remaining liabilities are deducted.
What it tells you
A Statement of Net Position, also known as a balance sheet, is a financial statement that summarizes
what MSD owns and owes at a given point in time. It also shows our net worth at that same point
in time.
OUR FY2013 BALANCE SHEET SHOWS THAT:
• MSD’s assets exceed liabilities by $2.25 billion.
• MSD’s assets are overwhelmingly in the form of capital assets, including treatment plants, collec-
tion systems and equipment that we use to provide wastewater and stormwater management. The
$2.66 billion in net capital assets is split into the five categories shown in the pie chart on page 7.
• Of the $1.01 billion in liabilities, $.92 billion are in the form of bonds and notes payable.
An historic look at MSD’s debt level is illustrated in the following table:
HistoricDebt Level
6
FISCAL YEAR AMOUNT
2004 $ 336,753,275
2005 342,723,599
2006 379,940,538
2007 445,985,230
2008 437,276,799
FISCAL YEAR AMOUNT
2009 $499,243,290
2010 605,156,058
2011 584,600,880
2012 658,396,362
2013 877,066,658
7
What we own: MSD Assets
Condensed Statement of Capital Assets-Net of Depreciation
(in millions)
What we owe: MSD Long-term Obligations
$50
$361
$599
$1,614
$36
$86
Land
Construction in progress
Treatment and disposal plant
and equipment
Collection and pumping plant
General plant and equipment
$-
$100
$200
$300
$400
$500
$600
$700
$800
$900
$1,000
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013Millions Bonds and Notes Payable
INCOME STATEMENT Statement of Revenues, Expenses and Changes in Net Position (in thousands)
FY2013 FY2012 FY2011 FY2010 FY2009
OPERATING REVENUES: Sewer Service Charges $238,635 $227,677 $223,276 $251,683 $254,378Provision for doubtful sewer service charge accounts (2,655) (6,911) (6,249) (10,188) (9,678)Provision for uncollected stormwater charge accounts 0 0 (2,374) 0 0Licenses, permits and other fees 2,731 2,684 2,976 3,085 3,475Other Operating Revenue 3,235 2,550 1,815 2,007 1,550
TOTAL OPERATING REVENUE 241,946 226,000 219,444 246,587 249,725
NON-OPERATING REVENUES: Property taxes levied by the district 26,017 24,604 27,126 1,401 2,129Investment income 1,057 2,407 3,847 6,554 13,116Rent and other income 293 295 443 265 215
TOTAL NON-OPERATING REVENUES 27,367 27,306 31,416 8,220 15,460
TOTAL REVENUES 269,313 253,306 250,860 254,807 265,185
OPERATING EXPENSES: Pumping and treatment 54,526 49,005 50,532 47,266 44,746Collection system maintenance 37,877 36,695 33,152 36,082 32,917Engineering 12,020 8,544 12,486 15,773 13,736General and administrative 41,485 33,180 36,078 39,237 37,922Water backup claims 3,503 2,050 8,912 3,951 6,817Depreciation 70,030 66,742 66,854 54,012 47,370Asset management 10,717 20,092 36,492 32,458 28,669
TOTAL OPERATING EXPENSES 230,158 216,308 244,503 228,780 212,178
NON-OPERATING EXPENSES: Net (gain) loss on disposal and sale of capital assets 796 3,163 3,486 2,719 2,162Non-recurring projects and studies 4,676 6,403 10,801 9,872 7,104Legal claims 0 5 4,829 0 0Interest expense 20,315 15,811 7,971 13,189 9,079
TOTAL NON-OPERATING EXPENSES 25,787 25,382 27,087 25,780 18,345
TOTAL EXPENSES 255,945 241,690 271,590 254,560 230,523
INCOME BEFORE CAPITAL Grants and contributions 13,368 11,616 (20,730) 247 34,662Capital grants and contributions 17,535 9,659 10,099 19,786 26,993
CHANGE IN NET POSITION 30,903 21,275 (10,631) 20,033 61,655
Net Position – Beginning of Year 2,218,294 2,197,019 2,207,650 2,187,617 2,125,962
NET POSITION – END OF YEAR $2,249,197 2,218,294 2,197,019 2,207,650 2,187,617
Definitions:Operating Revenues: all income received from the District’s daily normal business. Operating Expenses: all expenses
related to the District’s daily normal business. Non-operating Revenues: all income not related to the District’s daily normal
business. Non-operating Expenses: all expenses not related to the District’s normal business activities.
What it tells youAn income statement tells you where MSD gets its funds and how they are spent. It also shows how much money MSD made or lost over a specific period of time.
OUR FY2013 INCOME STATEMENT SHOWS THAT:• MSD’s sewer service charges increased as a result of the scheduled rate increase that occurred in FY2013.• Operating expenses increased due to increased personnel costs, costs related to heavy spring rains, and increased claims associated with those rains.8
REVENUES
$26,017
$235,980
$7,316
Property taxes levied by
the District
Sewer Service Charges,
Net
Other
Where the Money Comes From
(in thousands)
EXPENSES
$91,939
$14,534 $31,134
$70,030
$20,315
$27,994 Employment Costs
Utilities
Contracted Services
Depreciation
Interest Expense
Other
Where the Money Goes
(in thousands)
9
CASH FLOW STATEMENT Condensed Statement of Cash Flows (in thousands)
FY2013 FY2012
Cash flows from operating activities $ 84,882 $ 67,839
Cash flows from non-capital financing activities 23,014 24,604
Cash flows from capital activities 83,449 (91,085)
Cash flows from investing activities (168,410) 60,540
Net increase (decrease) in cash and cash equivalents 22,935 61,898
Cash and cash equivalents at beginning of year 158,820 96,922
Cash and Cash Equivalents at End of Year $181,755 $158,820
Definitions:Cash flows from operating activities: all cash received or spent related to MSD’s daily normal business activities.Cash flows from non-capital financing activities: all cash received related to taxes.Cash flows from capital and related financing activities: cash received or spent related to construction of
MSD’s infrastructure.Cash flows from investing activities: cash received or spent related to investing MSD’s cash reserves.
What it tells you
A cash flow statement summarizes both the cash and the net cash coming in and going out of MSD during a given
period.
OUR FY2013 CASH FLOW STATEMENT SHOWS THAT:
• Cash flows from operating activities increased due to more payments received from customers. This was a result
of MSD’s FY2013 rate increase.
• Cash flows from capital and related financing activities increased due to bond proceeds received
during FY2013.
• Cash flows from investing activities decreased as unspent bond proceeds were invested until the cash is needed
to pay expenses.
Operating
activities
Non-capital
financing
activities
Capital
activities
Investing
activities
FY2013 $84,882 $23,014 $83,449 ($168,410)
FY2012 $67,839 $24,604 ($91,085)$60,540
($200,000)
($150,000)
($100,000)
($50,000)
$0
$50,000
$100,000
Operating Activities Comparison
10
$0 $100 $200 $300 $400 $500
Budget
Actual
Millions
FY2013 Actual Spending Vs. Budget
PERFORMANCE AGAINST BUDGET
What it tells you
A performance against budget statement shows the link between the funds used to serve the public and the
outcomes of those services. In our case, it shows that MSD has been good stewards of the funds allocated to
us:
• We minimized increases to our operating budget and are controlling our pension expenses by moving new
employees to a defined contribution, rather than a defined benefit, pension plan.
• Our debt service and capital requirements, however, are rising as we accelerate the pace of our capital
improvement program. Our $933 million in outstanding debt will increase as we take on an additional $720
million in debt over the next 4 years.
WE SPENT LESS MONEY THAN BUDGETED, WITH SAVINGS COMING FROM THREE MAJOR AREAS:
• We spent $58 million less on capital projects than budgeted, due mostly to decisions to delay some project
starts while awaiting completion of the District’s
Diversity Study.
• Operating expenses for day-to-day items such as
payroll, supplies, utilities, and contract services
were under budget by almost $6.8 million, due
mostly to savings in contract services.
• The principal and interest we paid on our debt
were also below budget by almost $4.5 million.
We achieved this savings by issuing less new debt
than expected and by refinancing some existing
debt with a lower interest rate.
CREDIT RATING
What it tells you
A credit rating provides an assessment of an organization’s credit worthiness, based on its
history of borrowing and repayment of funds, as well as its assets and liabilities. A poor credit rating makes it
more difficult to find financing and often results in higher interest rates.
As the chart below illustrates, MSD has premium credit. We have demonstrated to creditors and credit rating
agencies our ability to manage large annual capital plans. Our solid financial management, including close
monitoring of our financial performance, strong debt coverage, and liquidity also contribute to these ratings,
which have remained constant the past two years.
Credit Rating Agency FY2012 FY2013
Moody’s Aa1 Aa1
Standard & Poors (S&P) AAA AAA
Fitch AA+ AA+
11
FY2013 Performance Accomplishments,Hurdles & Initiatives
MSD completes first year of Project Clear on schedule, under budget
Project Clear, MSD’s 23-year $4.7 billion initiative to improve our region’s water quality, got off to a strong start
in FY2013, meeting -- and in some cases, exceeding -- all its first-year goals and objectives.
This initiative, a product of MSD’s Consent Decree with the U.S. Environmental Protection Agency, is designed
to eliminate the 350-plus points where a combination of stormwater and wastewater currently discharge into
local waterways from the sanitary sewer system during moderate to heavy rainstorms. Between FY2013 and
FY2016, we are scheduled to invest over $900 million in improvements that will remove rain from local sanitary
sewers, with the goal of reducing basement backups and sewer overflows, and improving water quality for the
whole region.
Fiscal Year Planned Investments in our Capital
Improvement & Replacement Program
2013 (Actual) $177.6 million
2014 (Forecast) $247.7 million
2015 (Forecast) $285.5 million
2016 (Forecast) $246.8 million
TOTAL FOUR-YEAR PROGRAM $957.6 million
Pace of planning, design, and construction accelerates
The pace of Project Clear planning, design, and construction all picked up speed in FY2013, as MSD
completed projects valued at nearly $200 million, up more than 60% over the prior year. FY2013
accomplishments included:
• Eliminating overflows -- We completed the removal of 50 sanitary sewer overflows that had been designated
as ‘high priority,’ in advance of our Consent Decree deadline of December 31, 2012.
• New construction -- We awarded a total of 46 new construction contracts in FY2013, totaling more than $89
million. That includes a $26.1 million, 10-foot-diameter tunnel that will increase the amount of sewage that can
be transported to the Lemay Wastewater Treatment Plant -- the first major project in Project Clear.
12
Pace of planning, design, and construction accelerates CONTINUED
• Green infrastructure or Rainscaping -- We developed and implemented an “Early Action Green Infrastructure*
Pilot Program” that uses environmentally friendly solutions to manage rainwater where it falls. Such methods
reduce overflows into the Mississippi River and alleviate basement backups. Seven “green” pilot projects were
selected through an application process and submitted for EPA approval. MSD will now track the success of
those projects, using the results to guide the direction of Project Clear’s future rainscaping investments.
• Treatment plant improvements -- Work continued in FY2013 on the Missouri River Treatment Plant, which we
are expanding to allow more flow. Projects that further disinfect the water we discharge from all seven of our
treatment plants also continued. Mandated by government regulations, these improvements are scheduled for
completion prior to the December 31, 2013 regulatory deadline.
• Sewer cleaning and rehabilitation -- We received EPA’s approval for the program we have used the past five
years to prioritize, clean, inspect, and rehabilitate our entire sewer system. Aimed at preventing overflows and
building backups, this program initially involved clearing the roots, grease build-up, and other blockages from our
sewer lines, documenting their condition, and rehabilitating those with cracks, leaks, or other signs of structural
instability. In FY2013, we expanded this program by adding manhole* and force main* inspections. The goal:
to identify problems and prevent failures, focusing first on those most at risk of failure. This program met or
exceeded all of its performance goals in FY2013, resulting in a 46% reduction in maintenance-related base-
ment backups and a 43% reduction in dry weather overflows compared to historical levels.
DID YOU KNOW?
* Rainscaping (aka, Green Infrastructure) is any combination of plantings, water
features, catch basins, permeable pavement, and other activities that manage
stormwater as close as possible to where it falls, rather than moving it someplace else. Below ground level, improved soils store and filter stormwater,
allowing the surrounding area to slowly absorb it over time. Above ground level,
native plants, basins, and water features create public green spaces that also
help store water. Used effectively, rainscaping can reclaim stormwater naturally,
reduce sewer overflows, and minimize basement backups. Through Project
Clear, MSD will be installing more than $100 million in rainscaping throughout
the St. Louis area over the next 23 years.
DID YOU KNOW?
* A manhole you see in the streets is actually the lid for a vertical pipe
that connects the sewer to the surface. Manholes are used to access a
sewer pipe for inspection and maintenance, and as a way to vent sewer
gases. MSD maintains more than 162,000 manholes, inspecting each
one every 10 years.
DID YOU KNOW?
* A force main is a pressurized sewer line that relies on a pump to move
wastewater through it. Most sewer lines use gravity to transport
wastewater. MSD operates approximately 116 miles of force mains
throughout our region.
13
New leadership team in place
MSD experienced some significant shifts in its executive leadership in FY2013. Brian Hoelscher, P.E., was named
Executive Director, replacing Jeff Theerman, who retired in January 2013. Hoelscher formerly served as MSD’s
Director of Engineering, a position now filled by Richard Unverferth, P.E., former Assistant Director of Enginee-
ring. In November 2012, Brenda Schaefer was named MSD’s Secretary-Treasurer, filling the post left vacant by
Karl Tyminski’s retirement. Schaefer served most recently as Corporate Director of Treasury for SSM Healthcare.
Bond sale, refinancing accomplished
In FY2013, MSD completed a $225 million bond sale at advantageous rates to help finance Project Clear for the
next four years. The bonds were part of a $945 million bond issue that 85% of voters approved in June 2012.
We also refinanced approximately $142 million in bonds from 2004, saving MSD approximately $22.5 million in
interest over the bonds’ life.
Customer service improves
Our goal is to respond to 90% of emergency calls within four hours. In FY2013, we achieved an on-time
percentage of 88%, up from less than 60% a decade ago. We also set a new record in overall customer
satisfaction. On a scale of 1 to 10 with 10 meaning “completely satisfied,” customers gave MSD an average
performance rating of 8.4 in 2012, surpassing our target of 8.0 and our former record of 8.1.
Disparity Study completed
MSD has had a well-recognized diversity program for many years. It goes without saying that we are proud of our
program and its performance. But change is constant and a key part of the continuous improvement philosophy
we employ at MSD. As we invest billions of dollars in our community over the next 23 years through Project Clear,
everyone must be included. Accordingly, we completed a Disparity Study in FY2013, which is an evaluation of
MSD’s procurement and contracting practices. The study focused on our utilization of African American, Asian
American, Hispanic American, Native American, and women owned firms. Aside from utilization, the study
examined the tools and processes we use to support our inclusion efforts, and takes a holistic approach in
reviewing different facets of the program. Published in February 2013, this review resulted in 56 recommenda-
tions, which have been implemented or are being considered for future implementation. Lastly, the study also
established appropriate workforce goals, to help ensure those working on MSD projects – not just the owners of
the companies we contract with – reflect the ethnic and gender makeup of the community we serve. The Disparity
Study’s findings went into effect August 1, 2013.
A banner year for treatment plant awards
In 2013 the National Association of Clean Water Agencies awarded Peak Performance Awards to all seven
wastewater treatment plants we operate. Four received Gold Awards for 100% compliance with their National
Pollutant Discharge Elimination System (NPDES) permit for the calendar year. The other three received Platinum
Awards, an honor given to plants that have received Gold Awards for five or more consecutive years.
14
Looking Ahead: FY2014 Plans
Our goal: In the coming year, our focus will continue to be on removing stormwater from our sewers.
Excess storm water can overwhelm our treatment plants and is a major source of sewer overflows
into area rivers and streams.
We’ll be accomplishing this several ways:
• Public education focused on “getting the rain out” -- Much of the excess water that contributes to
backups and overflows comes from residential downspouts, sump pumps, and stormwater drains that are
connected directly to the sanitary sewer. Through Project Clear, we are increasing our communications to
homeowners and businesses, educating them on the role they play in minimizing stormwater runoff. That
includes working with them to disconnect downspouts and remove improper connections to the sanitary
sewer at no cost to them. It also involves sharing information on ways to build more “rainscaping” or green
infrastructure on their property so that water can drain into and be absorbed by the ground before it can
enter the sewers.
• Cleaning and lining sewers -- We are in the fifth year of ongoing program to clear roots, grease build-up,
and other blockages from 17 million feet -- or roughly half -- of our region’s sewer pipes. It takes three years
to clean all these lines, after which we start the cycle again. As we clean these sewers, we are also
documenting their condition. Those with cracks, leaks, and show other signs of structural instability will be
lined with a cured-in-place “pipe within a pipe” that can be installed without digging up the street and
restore the sewers to “like new” condition.
• Implementing “rainscaping” projects -- People who live in areas where there are combined sewers, that
is, sewers that are designed to carry both stormwater AND wastewater, will continue to see projects desig-
ned to minimize the amount of stormwater entering the sewer. Many will involve “rainscaping” solutions that
rely on plantings and landscape design to soak up much of this runoff before it can enter the sewers.
• Completing our overflow master plan -- We are now nearing completion of our master plan for
eliminating 85% of the remaining overflows by 2023 and 100% by 2033. This plan -- our Sanitary Sewer
Overflow Master Plan -- is due to the EPA by December 31, 2013.
• Optimizing our systems -- MSD has invested significantly in recent years in information technology,
including asset and maintenance management systems that allow us to track our results and better identify
and plan for future needs. We will be using these systems in FY2014 to optimize our entire system -- from
improving our ability to collect delinquent bills, to better managing our inventory, with the goal of saving
both time and ratepayer dollars.
15
Metropolitan St. Louis
Sewer District
2350 Market Street
St. Louis, MO 63103
Your MSD @Your MSD
www.stlmsd.com