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Home My Public Portal AboutExhibit MSD 105 - First Discovery Request of MSD to Intervener MIEC 5-18-15Exhibit MSD 105 BEFORE THE RATE COMMISSION OF THE METROPOLITAN ST. LOUIS SEWER DISTRICT FIRST DISCOVERY REQUEST ISSUE: WASTEWATER AND STORMWATER RATE CHANGE PROCEEDING WITNESS: INTERVENOR MISSOURI INDUSTRIAL ENERGY CONSUMERS SPONSORING PARTY: METROPOLITAN ST. LOUIS SEWER DISTRICT DATE PREPARED: MAY 18, 2015 Metropolitan St. Louis Sewer District 2350 Market Street St. Louis, Missouri 63103 BEFORE THE RATE COMMISSION OF THE METROPOLITAN ST. LOUIS SEWER DISTRICT For Consideration of a Wastewater and Stormwater Rate Change Proposal by the Rate Commission of the Metropolitan St. Louis Sewer District FIRST DISCOVERY REQUEST OF 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(2) and Procedural Schedule §§ 1, 17 and 18 of the Rate Commission of the Metropolitan St. Louis Sewer District ("Rate Commission"), the Metropolitan St. Louis Sewer District ("District") requests additional information and answers from the Missouri Industrial Energy Consumers ("MIEC") regarding the Rebuttal Testimony and Schedules of Michael P. Gorman on behalf of MIEC dated May 11, 2015. MIEC is requested to amend or supplement the responses to this Discovery Request, if the MIEC obtains information upon the basis of which (a) the MIEC knows that a response was incorrect when made, or (b) the MIEC knows that the response, though correct when made, is no longer correct. The following Discovery Requests are deemed continuing so as to require the MIEC to serve timely supplemental answers if the MIEC obtains further information pertinent thereto between the time the answers are served and the time of the Prehearing Conference. DISCOVERY REQUEST 1. Michael P. Gorman states in Rebuttal Testimony that he is recommending maintaining the bad debt provision equal to 1.0% of wastewater bills. See MIEC Ex. 102, p. 6, 11. 10-11. Please (a) describe the analysis that was performed to reach this conclusion; (b) provide copies of any memorandum, report, work paper, summary, analysis, or schedule that supports this conclusion; and (c) describe the rationale for such conclusion. RESPONSE: 2. Michael P. Gorman states in Rebuttal Testimony that According to a February 2015 Moody's Analytics report for the St. Louis area, the number of new single-family housing permits is expected to more than double..... See MIEC Ex. 102, p. 11, 11. 14- 20. Please provide copies of the February 2015 Moody's Analytics report for the St. Louis area. RESPONSE: 3. Given that Michael P. Gorman provided similar testimony regarding economic conditions and the effect of those conditions on the Districts sales (Exhibit-MIEC-29, 2011 Rate Case, beginning on line 16 of page 9) in the District's 2011 Rate Case, please provide a detailed variance analysis of your recommendations to the District's actual experience as shown in Tables 4-2 and 4-3 of the Rate Change Proposal, Exhibit MSD1. RESPONSE: 4. Michael P. Gorman states in Rebuttal Testimony that he believes that MSD has overstated the annual decline in both the number of customers, and contributed wastewater volumes, and its projections should be revised. See MIEC Ex. 102, p. 12, 11. 2-3. Please (a) describe the analysis that was performed to reach this conclusion; (b) provide copies of any memorandum, report, work paper, summary, analysis, or schedule that supports this conclusion; and (c) describe the rationale for such conclusion. RESPONSE: 2 5. Michael P. Gorman states in his rebuttal testimony that MSD's adjustment to the usage per unit values for unmetered properties are unjustified and should remain at the current usage levels. Please a) describe the analysis that was performed to reach this conclusion, b) provide copies of any memorandum, report, workpapers, summary analysis or schedules that supports this conclusion, and c) describe rationale for such conclusion. RESPONSE: 6. Michael P. Gorman states in Rebuttal Testimony that by decreasing both the number of billable units and the fixture usage per unit values shown in Table 5, MSD could be significantly overstating the decline in unmetered wastewater volumes. See MIEC Ex. 102, p. 16, 11. 1-3. Please (a) describe the analysis that was performed to reach this conclusion; (b) provide copies of any memorandum, report, work paper, summary, analysis, or schedule that supports this conclusion; and (c) describe the rationale for such conclusion. RESPONSE: 7. Michael P. Gorman states in Rebuttal Testimony that he believes a reasonable and conservative projection for escalation in utility expenses is 3.0% every other year. See MIEC Ex. 102, p. 20, 11. 11-12. Please (a) describe the analysis that was performed to reach this conclusion; (b) provide copies of any memorandum, report, work paper, summary, analysis, or schedule that supports this conclusion (including but not limited to a copy of the Ameren Investor Presentation: "Powering Growth" MUFG Spring Utility Day, April 1, 2015 as referred to on p. 19, 11. 19 of said testimony); and (c) describe the rationale for such conclusion. RESPONSE: 8. Michael P. Gorman states in Rebuttal Testimony that he proposes to change the escalator for Late Charge Revenue from 1.0% used by MSD up to the percent increase in bills proposed in this rate filing. See MIEC Ex. 102, p. 22,11.4-5. Please (a) describe the analysis that was performed to reach this conclusion; (b) provide copies of any memorandum, report, work paper, summary, analysis, or schedule that supports this conclusion; and (c) describe the rationale for such conclusion. RESPONSE: 3 9. Michael P. Gorman states in Rebuttal Testimony that MSD has failed to provide any justification for assessing stormwater charges based on uniform assessed property value tax across its service territory. See MIEC Ex. 102, p. 23,11. 14-15. Please (a) describe the analysis that was performed to reach this conclusion; (b) provide copies of any memorandum, report, work paper, summary, analysis, or schedule that supports this conclusion; and (c) describe the rationale for such conclusion. RESPONSE: 10. Michael P. Gorman states in Rebuttal Testimony that stormwater capital should not be uniform across all of MSD's service territory. See MIEC Ex. 102, p. 24, 11. 8-9. Please (a) describe the analysis that was performed to reach this conclusion; (b) provide copies of any memorandum, report, work paper, summary, analysis, or schedule that supports this conclusion; and (c) describe the rationale for such conclusion. RESPONSE: Respectfully submitted, Susan M. Myers METROPOLITAN ST. LOUIS SEWER DISTRICT 2350 Market Street St. Louis, Missouri 63103 Tel: (314) 768-6366 Fax: (314) 768-6279 4 CERTIFICATE OF SERVICE The undersigned certifies that a copy of the foregoing was sent by electronic transmission to Janice Fenton, Office Associate Senior, Metropolitan St. Louis Sewer District; Lisa Stump, Counsel for the Rate Commission; and Brad Goss, Counsel for Intervener Home Builders Association of St. Louis & Eastern Missouri, on this 18th day of May, 2015. Lisa O. Stump, Esq. Lashly & Baer, P.C. 714 Locust Street St. Louis, MO 63101 lostump@lashlybaer.com Mr. Brad Goss Smith Amundsen, LLC 120 South Central Avenue, Suite 700 St. Louis, MO 63105-1794 bgoss@salawus.com Brandon W. Neuschafer Bryan Cave, LLP 211 N. Broadway, Suite 3600 St. Louis, MO 63102 John.kindschuh@bryancave.com -e/r usan M. Myers General Counsel 5