HomeMy Public PortalAboutExhibit MSD 21 - 2010 CAFRCOMPREHENSIVE ANNUAL FINANCIAL REPORT
For Fiscal Year Ending June 30, 2010
Metropolitan St. Louis Sewer District
Exhibit MSD 21
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
St. Louis, Missouri
COMPREHENSIVE ANNUAL FINANCIAL REPORT
For The Year Ended June 30, 2010
Report prepared and submitted by the
Department of Finance
Janice M. Zimmerman
Director of Finance
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Table of Contents
Page
Introductory Section:
Letter of Transmittal…………………………………………………………………………………………… 1
Organization Chart……………………………………………………………………………………………..10
Certificate of Achievement for Excellence in Financial Reporting……………………………………………11
Financial Section:
Independent Auditors’ Report…………………………………………………………………………………. 13
Management’s Discussion and Analysis………………………………………………………………………. 15
Basic Financial Statements
Statements of Net Assets…………………………………………………………………………………. 28
Statements of Revenues, Expenses and Changes in Net Assets………………………………………….. 30
Statements of Cash Flows………………………………………………………………………………… 31
Notes to Financial Statements……………………………………………………………………………. 33
Statistical Section:
Statistical Section Overview……..…………………………………………………………………………… 65
Net Assets by Component………………………………………………………………………..……………. 66
Changes in Net Assets……..………………………………………………………………………………….. 67
Operating Revenues by Source………………………………..………………………………………………. 68
Operating Expenses …………………………..……………………………………………………………..... 69
Nonoperating Revenues and Expenses………………………………………………………………………... 70
User Charge Rates…………….……………………………………………………………………………….. 71
Sewer User Charges (Composite--Annual)……………………………………………………………………..72
Number of Customers by Type……………………………..……………………………………………….… 73
Ten Largest Customers……………………………………..…………………………………………………. 74
Ratios of Outstanding Debt by Type…..……………………………………………………………………… 75
Computation of Overlapping Debt…………………………………………………………………………….. 76
Pledged Revenue Coverage……..…………………………………………………………………………….. 77
Demographic and Economic Statistics…..……………………………………………………………………. 78
Principal Employers (St. Louis Metropolitan Area)….……………………………………………………….. 79
Employment Level…………………………………………………………………………………………..… 80
Average Flow ……………..…………………………………………………………………………………... 81
Operating and Capital Indicators……………………………………………………………………………….82
Introductory Section
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Our Vision'14(11111.111
Quality Service Always
Our Mission
To responsibly provide sewer service and
114411111 stormwater management to protect the public's
health and safety
Our Values
Quality
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Customer satisfaction
Trust, respect and integrity
Continuous improvement and innovation
Teamwork
Each Employee
A safe, productive, and rewarding work environment
Diversity
Our water environment
Community partnerships
?4r DiSt
Metropolitan St. Louis Sewer District
2350 Market Street
St. Louis MO 63103-2555
(314) 768-6200
November 9, 2010
The Board of Trustees
The Metropolitan St. Louis Sewer District
The Comprehensive Annual Financial Report (CAFR) of The Metropolitan St. Louis Sewer District (MSD or
the District) for the fiscal year ended June 30, 2010, is submitted herewith. The District’s Finance
Department prepared this report. The District is responsible for the accuracy of the data and the
completeness and fairness of the presentation of the financial statements and other information presented
herein. We believe the presentation is accurate in all material respects and includes all disclosures necessary
to enable the reader to gain a reasonable understanding of the District's financial activities. In the CAFR, the
District's financial activities are measured on a single enterprise fund basis where all funds of the District and
its subdistricts are consolidated.
The District's CAFR includes an Introductory Section, a Financial Section, and a Statistical Section. The
Introductory Section includes this transmittal letter, lists of the District's Board of Trustees, members of the
Civil Service Commission, management staff, and an organization chart as of June 30, 2010. The Financial
Section includes the independent auditors' report, management’s discussion and analysis, and the District's
basic financial statements. The Statistical Section includes financial, economic, and demographic
information, generally presented on a multi-year basis.
The CAFR includes all funds of the District. The operations of these funds, as reflected in the financial
statements, are under the control of the District's governing body. The District has determined there were no
other agencies or entities that met the established criteria for inclusion in the reporting entity.
ORGANIZATION
MSD was created in 1954 to provide a metropolitan-wide sewer system to serve the City of St. Louis and
most of the more heavily populated areas of St. Louis County. Before MSD's creation, the City of St. Louis,
various municipalities, and private sewer companies provided sewer service that primarily included only
collecting and transporting sewage from small geographic areas to nearby rivers and streams with little or no
treatment. Most of the municipalities or private sewer companies serving the area did not have the
jurisdictional authority or financial resources needed to eliminate health hazards from untreated sewage.
When the District began operations, it took over the publicly owned wastewater and stormwater drainage
facilities within its jurisdiction and began the construction of an extensive system of collector and interceptor
sewers and treatment facilities. In 1977, voters approved the District's annexation of a 270 square mile area
of the lower Missouri River and lower Meramec River watersheds. The District purchased the Fee Fee
Trunk Sewer Company and the Missouri Bottoms Sewer Company in 1978. MSD has since acquired other
investor-owned or municipally operated systems.
The District's service area now encompasses 525 square miles including all 62 square miles of the City of St.
Louis and 462 square miles of St. Louis County. The current population served by the District is
approximately 1.3 million.
MSD is organized pursuant to Article VI, Section 30 of the Missouri State Constitution that empowers the
people of St. Louis County and the City of St. Louis "to establish a metropolitan district for functional
administration of services common to the area". MSD is the only district established pursuant to that section
of the Missouri State Constitution.
The Proposed Plan of MSD (the Plan), approved by voters in 1954 and amended in 2000, established the
District. The Plan describes the District as "a body corporate, a municipal corporation, and a political
subdivision of the state." As a political subdivision of the state, MSD is comparable to a county or city, such
as St. Louis County or the City of St. Louis.
The Plan established the governing body of the District as a six-member Board of Trustees (the Board) with
three members appointed by the Mayor of St. Louis and three members appointed by the St. Louis County
Executive. No more than two trustees from each area can be of the same political affiliation.
Unlike a corporation's board of directors that is responsible solely to the stockholders who choose to invest in
the corporation, MSD's Board members are trustees of public property and public funds. They are
responsible to all citizens within the District.
According to the Plan, the Board enacts District ordinances, determines policies, and appoints the Executive
Director, the Secretary-Treasurer, and the Internal Auditor. The Executive Director appoints all other
District officials. Among its duties, the Board makes all appropriations, approves contracts for
improvements, and engages an accounting firm to perform the annual independent audit of the District.
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The Plan prescribes other duties of the Board and grants numerous broad powers, subject to federal and state
laws, to the District and the Board of Trustees. Among other things, the Plan outlines the following
requirements or provisions:
• Requires that MSD operate with a balanced budget;
• Details how MSD can tax property and requires an annual public hearing on all taxes levied
by the District;
• Details how MSD can establish user charges;
• Requires MSD to establish civil service rules and regulations governed by a Civil Service
Commission;
• Provides how the original boundaries of the District may be extended to include any area in
St. Louis County; and
• Requires MSD to approve all plans and designs for proposed construction, alteration, or
reconstruction of sewer or drainage facilities within the District's boundaries.
The District is also governed by the Missouri State Constitution and various federal and state laws that
among other requirements mandate the following:
• MSD must hold permits for all sanitary discharges. These permits require a minimum of
secondary treatment.
• MSD must provide wastewater treatment in an area-wide manner to qualify for federal and
state grants.
• MSD must operate, maintain, and replace facilities to provide proper wastewater treatment
or be subject to penalties and fines.
• MSD must set user charge rates in compliance with the Federal Clean Water Act. These
rates must be approved by the Missouri Department of Natural Resources to receive future
construction grants and to avoid the possibility of refunding past grants.
During fiscal 2010, the primary source of funding for the operation and maintenance of MSD's sewerage
system was a user charge that is typically $354.72 per year or $29.56 per month for a single-family
residence. The District's charges for residential wastewater service are tied to the amount of measured water
usage during a winter quarter. For residential properties without water meters, the charges are based on
housing attributes (such as the number of rooms, baths, and toilets) that correlate to water usage. That
methodology is the same billing methodology used by the City of St. Louis Water Division for their non-
metered properties. Multi-family residential and nonresidential rates are proportionate to the single-family
charge and are based on water consumption and the strength of the discharge.
Beginning in March 2008, the District implemented a new stormwater user charge of 12¢ per 100 square feet
of impervious area. A second increase was implemented effective January 1, 2009. This increase resulted in
a user charge of 14¢ per 100 square feet resulting in an average residential stormwater bill of $3.50 per
month or $42 per year. The impervious area based stormwater service charge replaces the 24¢ flat fee and
property tax assessment previously charged for stormwater services. In July 2010 a judge ruled impervious
based stormwater billing unconstitutional. With that the District plans to suspend that method of billing and
re-implement the assessment of property taxes in fiscal year 2011, along with flat fee billing of 24¢ for
residential and commercial properties and 18¢ cents per unit for multi-unit properties.
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These revenues will fund subdistrict debt, construction and a portion of the District’s stormwater operating
expenses. MSD also receives some federal, state, and local grants to help defray the cost of constructing
sewage treatment and drainage facilities and improvements. The District also charges fees for plan review,
permits, construction inspection of new system development, and special discharges. The District charges a
uniform connection fee in all service areas.
The District, itself, may issue general obligation bonds and revenue bonds to finance the cost of
improvements and extensions to the sewer system. The District also may issue, on behalf of each of its
subdistricts, general obligation bonds, revenue bonds, or special assessment bonds. The outstanding bond
indebtedness of the District cannot exceed five percent of the assessed valuation of the area benefited.
OPERATIONS
The Executive Director and his staff administer the operation and maintenance of the District's collection and
treatment systems. The District's sanitary, stormwater, and combined sewer collection system includes more
than 9,900 miles of pipe and channel and grows larger every year due to new development. The District's
responsibilities for stormwater drainage range from cleaning and maintaining street inlets to operating and
maintaining the floodwall pump stations along the Mississippi River.
MSD currently operates 7 wastewater treatment facilities. These facilities treated an average flow of 395.5
million gallons per day (MGD) in fiscal 2010 compared to 394.7 MGD in fiscal 2009. The design capacity
and average flow, by watershed, in MGD was as follows in fiscal 2010:
MAJOR
WATERSHED
LEVEL OF
TREATMENT
NUMBER OF
FACILITIES
DESIGN
CAPACITY
AVERAGE FLOW
FISCAL 2010
Mississippi River Secondary Two 317 298.5
Missouri River Secondary Two 68 61.7
Meramec River Secondary Three 42.75 35.3
Total Seven 427.75 395.5
In addition to construction initiated by the District to protect the public's health and property from raw
sewage and flooding, the District also provides various engineering-related design review and inspection
services for the construction of sanitary and stormwater sewers by individuals, businesses, and municipalities
in the community.
ECONOMIC CONDITIONS IN THE ST. LOUIS METROPOLITAN AREA
As a rule, the District's major revenue sources do not fluctuate with the local and national economy as much
as local governments that depend on sales or income taxes for their major sources of revenue. The
employment level in the City of St. Louis and St. Louis County was 613,266 in June 2010. The combined
unemployment rate for the City of St. Louis and St. Louis County was 10.1 percent in June 2010 and that is
higher than the national unemployment rate of 9.6 percent for the same time period.
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MSD has its own internal barometers for measuring economic development within the District. These are
listed below for fiscal 2010 and 2009:
2010 2009
Sewer Plan Reviews:
Number of Plans Approved 458 565
Number of Miles of Sewers 22 28
Sewer Construction Permits:
Number of Permits Issued 2,406 2,434
Number of Miles of Sewers 28 31
Customer Connections:
Number of Connection Permits Issued 763 848
Connection Fee Revenue (in millions) $1.2 $1.7
Value of Sewers Dedicated to
MSD by Developers (in millions) $18.5 $26.3
Over the years, the St. Louis economy has undergone a transformation from reliance on traditional
manufacturing industries to those industries based on advanced technology and services. The St. Louis area
is a center for health care, biotechnology, banking, finance, transportation, tourism, and education and has a
strong and diverse manufacturing economy. The area has an abundance of energy, water, and sewerage
facilities and can sustain future economic growth.
FINANCIAL INFORMATION
Proprietary Operations. The current financial condition of MSD remains stable. The District achieved net
income from operations of $17.8 million compared to a net operating income of $37.5 million the prior year.
The decrease is explained by a boost in operational spending as well as an increase in outstanding sewer
service receivables. The management discussion and analysis section that appears later in this report
provides a more in depth analysis of the District’s financial position and the magnitude of the capital
improvement and replacement program (CIRP).
Budgetary Controls. The District's Plan requires MSD to maintain budgetary controls and to adopt a
balanced budget. The objective of these budgetary controls is to ensure compliance with legal provisions
embodied in the appropriation process approved by the Board. The annual appropriated budget includes
activities of the District's operating and Debt Service Funds. The Board adopts ordinances to appropriate
funds for capital improvement expenditures at the time of the contract award and acceptance of any grant
offers.
Budgetary control is by division and major expenditure category within the General Fund, each Debt Service
Fund, and each capital improvement contract. The District maintains an encumbrance accounting system as
one technique of accomplishing budgetary control. Certain encumbrances carry over from one year to the
next.
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Interim and year-end financial reports are prepared in accordance with U.S. generally accepted accounting
principles for Enterprise Funds. Adjustments are made to the accounting records, where necessary, to reflect
the full accrual method of accounting. Under the full accrual method of accounting, revenues are recognized
when earned and expenses are recorded as liabilities when incurred. Encumbrances and unearned capital and
operating grants are eliminated under the full accrual method of accounting. These amounts are disclosed as
commitments in the footnotes to the financial statements.
Cash Management. In compliance with its Plan, the District invests temporarily idle funds in cash
equivalents and investments such as collateralized certificates of deposit, collateralized repurchase
agreements, and United States Treasury bills and notes. The District utilizes competitive bidding for
investment purchases and monitors market conditions daily. MSD receives interest on certificates of deposit
monthly and reinvests it to improve yields.
Risk Management. In-house staff and consultants jointly conduct risk management activities. MSD has a
risk management program and retains certain risks related to officers’ and directors’ liability. The District
maintains replacement cost property and casualty insurance on certain facilities and equipment that have an
estimated replacement cost of $1.25 billion. The District assumes the risk of loss (including payment of
water backup claims to its customers) on the majority of its underground pumping facilities and collection
system. MSD is one of two sewer districts in the country known to provide water backup claim coverage to
its customers. The underground pumping facility and collection system assets have an estimated replacement
cost of $9.9 billion. To minimize exposure to loss, the District inspects its facilities regularly, performs
preventative maintenance, and maintains excess liability coverage for sewage backup damage to property.
MSD maintains automobile and general liability insurance on specific facilities. The District is self-insured
for workers' compensation and funds those costs through annual appropriations from the District's general
fund. The District maintains reinsurance for workers' compensation liabilities in excess of specified limits up
to the statutory limit. Risk control activities include using a third-party claims administrator, maintaining a
computerized claim tracking system, and reevaluating medical care provided to injured employees. The
District also has programs to promote safety in the workplace.
The District provides group medical coverage for its employees and offers dependent medical coverage on a
contributory basis through a self-insured plan. At January 31, 2010, the District maintained stop loss
coverage for specific claims exceeding $125,000 per year and for total annual claims greater than 125
percent of the annual claims estimate. As of February 1, 2010, the District increased this limit to $150,000.
The District provides its employees with contributory group dental insurance coverage and non-contributory
life insurance and contributory optional life insurance coverage. The District also contributes $100 annually
to a vision care program for employees. The District reevaluates insurance coverage and providers annually.
For most construction projects, insurance is obtained by the individual contractor and included in the contract
price.
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Internal Controls. District management is responsible for designing, establishing, and maintaining an
internal control system that protects District assets from loss, theft, or misuse and ensures that adequate
accounting data is compiled to prepare financial statements in conformity with U.S. generally accepted
accounting principles. Internal control systems are designed to provide reasonable, but not absolute,
assurance that these objectives are met. The concept of reasonable assurance recognizes that the cost of a
control should not exceed the benefits likely to be derived and that the evaluation of costs and benefits
requires estimates and judgments by management. The District's internal control system is subject to
periodic evaluation by management, the internal audit department, and the District's independent
accountants. For additional information regarding the districts financials, please refer to the Management’s
Discussion and Analysis section.
MAJOR INITIATIVES AFFECTING THE FINANCIAL RESOURCES OF THE DISTRICT
The District’s Board of Trustees implemented an impervious based stormwater rate on March 1, 2008
replacing its prior funding mechanism of property taxes and user fees. The impervious based stormwater rate
was again increased on January 1, 2009. On July 9, 2010, a circuit court of St. Louis County found this
impervious rate to be unconstitutional under Missouri law. In response to this ruling, the Board suspended
the impervious based stormwater rate and reinstituted the District’s stormwater property taxes and user fees
previously rolled back on a voluntary basis as part of the stormwater rate plan. The court decision resulted in
the loss of $45 million in stormwater revenue expected in fiscal year 2011 to support stormwater services and
improvements to related infrastructure. As of the date of this audit, there was the potential the District would
be required to refund all stormwater revenue collected and spent since the inception of the impervious based
rate. Since then, a court decision regarding a potential refund was received and indicated the District will not
have to refund any monies collected under the impervious based rate. The court decision to stop the
impervious based stormwater funding negates the culmination of a 20-year effort to adequately fund much
needed stormwater services for District ratepayers. The impact of this court decision will result in a dramatic
reduction in stormwater services across the District with many customers receiving little or no stormwater
services until an alternative funding source is identified.
The District continues its use of debt to fund its multi-billion dollar, multi-decade wastewater capital
improvement program. In February 2004, St. Louis voters approved a $500 million authorization allowing
the District to issue wastewater revenue bonds. Beginning in fiscal year 2004, the District issued $336
million in bonds. An additional $124 million was issued during fiscal year 2005 through 2007 with the
remaining $40 million issued in fiscal year 2009. On August 5, 2008, St. Louis voters authorized, by a
margin of 3 to 1, the issuance of an additional $275 million in wastewater revenue bonds. $30 million of
these bonds were issued in fiscal year 2009 and $116 million in 2010. Issuance of the remaining $129
million bond authorization is planned through fiscal year 2012. Funding of the long term wastewater capital
improvement program continues to be expected through a combination of additional bonds and wastewater
rate increases.
7
As part of this funding effort, the District submitted a proposal to its Rate Commission on March 1, 2007.
The Rate Commission delivered its final Recommendation Report to the Board on April 1, 2008 in
accordance with Charter. Based on the Rate Commission recommendation, the Board approved a 5-year
wastewater rate plan and a 7-year impervious based stormwater rate plan. The initial wastewater rate
increase took effect January 1, 2008. Since that time subsequent wastewater rate increases have been
implemented each July 1st for 2009 and 2010. Per the Board’s approved plan, the last wastewater increase is
scheduled to take effect July 1, 2011. The District expects to submit a wastewater rate increase proposal to
the Rate Commission in February 2011. This proposal is designed to provide funding to continue the
District’s comprehensive wastewater capital improvement program. The Board also implemented a 7-year
stormwater rate plan with increases effective March 1, 2008 and January 1, 2009. The stormwater rate
increase originally scheduled for January 1, 2010 was deferred due to adequate funding to the support the
District’s fiscal year 2010 stormwater program. The remaining 4 years of anticipated increases have been
suspended due to the court decision previously discussed.
In addition to these major funding initiatives, the District is in the process of implementing a comprehensive
plan to increase the collection of outstanding sewer charge delinquencies. The implementation of this plan is
expected to be completed by April 2011. The District continues its comprehensive sewer cleaning program
initiated in June 2008. This initial effort addressed 17 million feet of sewer pipe and inspection of 80,000
manholes. The sewer cleaning program is on target to clean 5 million feet of pipe and inspect 15,000
manholes each year. This effort continues to reduce basement backups and overland funding throughout the
St. Louis metropolitan region. During 2010, the District continued in litigation with the U.S. Environmental
Protection Agency and the State of Missouri concerning alleged Clean Water Act violations. The District is
in the final phase of the implementation of a comprehensive multi-year, multi-million dollar strategic
technology plan. This plan is designed to dramatically improve connectivity and interaction between District
Departments, increase overall District efficiency and enhance customer service for all District ratepayers. To
date, this implementation is under budget with scheduled completion expected by the summer of 2012.
8
OTHER INFORMATION
Audit Requirements. The District's Plan requires an annual audit by independent certified public
accountants. The District's CAFR includes a report on the District's financial statements by the accounting
firm of Schmersahl Treloar & Co.
Besides meeting the requirements set forth in the Plan, the annual audit is also designed to meet the
requirements of the 1996 amendments to the Federal Single Audit Act and the U.S. Office of Management
and Budget (OMB) Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations. A
Single Audit Report was issued as of June 30, 2010.
The financial statements of the Metropolitan St. Louis Sewer District's Employees' Pension Plan and the
District’s Deferred Compensation Plan are also audited annually. Those audited financial statements are also
available to interested parties upon request.
Awards. The Government Finance Officers Association of the United States and Canada (GFOA) awarded a
Certificate of Achievement for Excellence in Financial Reporting to MSD for its CAFR for the fiscal year
ended June 30, 2009. The Certificate of Achievement is a prestigious national award that recognizes
conformance with the highest standards for preparation of state and local government financial reports.
To be awarded the Certificate of Achievement, a government unit must publish an easily readable and
efficiently organized CAFR, the contents of which conform to program standards. The CAFR must satisfy
both U.S generally accepted accounting principles and applicable legal requirements. A Certificate of
Achievement is valid for one year only. The District has received a Certificate of Achievement for the last
twenty-two consecutive years. We believe our current CAFR continues to conform to the Certificate of
Achievement program requirements, and we are submitting it to the GFOA again this year.
The District also received the GFOA's Distinguished Budget Presentation award for its fiscal 2009 annual
budget. The District has received this award for twenty-three consecutive years. The District's fiscal budget
document for 2009 was judged proficient in several categories including policy documentation, financial
planning, and organization.
Acknowledgments. I wish to express my tha nks and appreciation to the members of the Finance Department
who diligently and faithfully contributed to the preparation of this report.
Janice M. Zimmerman
Director of Finance
9
ORGANIZATION
(As of June 30, 2010)
BOARD OF TRUSTEES
John H. Goffstein, Chair; Bob Berry, Vice Chair; James H. Buford; David
Visintainer; Gerald Feldhaus; Eddie Ross, Jr.
OFFICE OF INTERNAL AUDITOR
Gene F. Rhodes
Audit Administrator
RATE COMMISSION
Leonard P. Toenjes, Chair
OFFICE OF SECRETARY TREASURER
Karl J. Tyminski
Secretary/Treasurer
CIVIL SERVICE COMMISSION
Joseph F. Krispin, Chair;
Valerie F. Patton, Vice-Chair;
William C. Duffe
EXECUTIVE DIRECTOR
Jeffrey L. Theerman
FINANCE
Janice M. Zimmerman
Director
OFFICE OF GENERAL COUNSEL
Randy E. Hayman
General Counsel
OPERATIONS
Jonathon C. Sprague
Director
ENGINEERING
Brian L. Hoelscher
Director
OFFICE OF HUMAN RESOURCES
Vicki L. Taylor Edwards
Director
INFORMATION SYSTEMS
Barbara E. Mohn
Director
10
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12
Financial Section
METROPOLITAN ST. LOUIS SEWER ❑ISTRICT
SERVICE AREAS
�r.
COLAkNATER
GREET(
Independent Auditors’ Report
To the Board of Trustees of the
Metropolitan St. Louis Sewer District
We have audited the accompanying financial statements of the Metropolitan St. Louis Sewer District
(the “District”) as of and for the year ended June 30, 2010, as listed in the table of contents. These
financial statements are the responsibility of the District’s management. Our responsibility is to express
an opinion on these financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in the United States of
America and the standards applicable to financial audits contained in Government Auditing Standards,
issued by the Comptroller General of the United States. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes assessing the accounting principles
used and the significant estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the
financial position of the District as of June 30, 2010, and the respective changes in financial position and
cash flows for the year then ended in conformity with accounting principles generally accepted in the
United States of America.
In accordance with Government Auditing Standards, we have also issued our report dated November 9,
2010, on our consideration of the District’s internal control over financial reporting and on our tests of
its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other
matters. The purpose of that report is to describe the scope of our testing of internal control over
financial reporting and compliance and the results of that testing, and not to provide an opinion on the
internal control over financial reporting or on compliance. That report is an integral part of an audit
performed in accordance with Government Auditing Standards and should be considered in assessing
the results of our audit.
13
(314) 966-2727 · fax (314) 966-6464 · 10805 Sunset Office Dr., Suite 400 · St. Louis, MO 63127 · e-mail: stcpa@stcpa.com
The management’s discussion and analysis on pages 3 through 12 is not a required part of
the basic financial statements but is supplementary information required by accounting
principles generally accepted in the United States of America. We have applied certain
limited procedures, which consisted principally of inquiries of management regarding the
methods of measurement and presentation of the required supplementary information.
However, we did not audit the information and express no opinion on it.
November 9, 2010
St. Louis, Missouri
14
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Management’s Discussion and Analysis
for the years ended June 30, 2010 and 2009
15
The annual report of The Metropolitan St. Louis Sewer District (the “District”) includes the independent
auditors’ report, management’s discussion and analysis (“MD&A”), and the financial statements accompanied
by notes essential to the user’s understanding of the financial statements.
Management of the District has provided this MD&A to be used in combination with the District’s financial
statements. This narrative is intended to provide the reader with more insight into management’s knowledge
of the transactions, events, and conditions reflected in the accompanying financial statements and the fiscal
policies that govern the District’s operations.
2010 Financial Highlights
¾ The District placed $56.4 million of capital assets into service during fiscal year 2010. This
continued high level of expansion and updating of the District’s plant and system is related to the
Capital Improvement and Replacement Program (CIRP) required by regulations.
o Collection and pumping plant $ 43.7 million
o General plant and equipment $ 7.1 million
o Treatment and disposal plant and equipment $ 4.4 million
o Land $ 1.1 million
¾ Interest expense increased $4.1 million compared to the prior year. This can be attributed to
additional bond issues in fiscal years 2009 and 2010.
¾ Investment income decreased $6.6 million as a result of a reduction in short term interest rates as
well as a decrease in investment balances.
¾ The continued high level of expansion and updating of the District’s plant and system is the reason
for a $6.6 million increase in depreciation expense.
¾ The District has determined that a material restatement of $25.7 million is required for prior year
financials due to management decisions regarding a number of construction in progress projects.
Since prior to 2004 and through 2009, $25.7 million in expenses related to a number of construction
in progress projects were capitalized. In 2010, management determined that the scope of these
projects was planning in nature and they were noncapital in nature. All expenses prior to 2010 would
be recognized in the years they were incurred. This results in a restatement of the financials for the
following years with the following amounts:
2009 $ 7.2 million
2008 $ 7.7 million
2007 $ 1.2 million
2006 $ 2.2 million
2005 $ 4.5 million
2004 and prior $ 2.9 million
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Management’s Discussion and Analysis
for the years ended June 30, 2010 and 2009
16
2009 Financial Highlights (As Restated)
¾ The District placed $98.4 million of capital assets into service during fiscal year 2009. This
continued high level of expansion and updating of the District’s plant and system is related to the
Capital improvement and Replacement Program (CIRP) required by regulations.
o Collection and pumping plant $54.4 million
o Treatment and disposal plant and equipment $35.2 million
o General plant and equipment $ 8.8 million
¾ In addition to these capital asset additions, the District has also shown an increase of $136.0 million
in construction in progress due to the large capital improvement and replacement program currently
underway.
¾ Cash and cash equivalents decreased by $36.9 million. This can be partially attributed to the
significant capital expenditures reflected by the increase in net capital assets. Investments also
increased by $20.4 million displaying a shift of assets from cash and cash equivalents to
investments.
¾ Both total revenue and expense remained in line with prior year amounts causing similar results of
$34.7 million in 2009 compared to $34.0 million in 2008 for income before capital contributions.
¾ The District had a stormwater rate increase in January 2009 from 12¢ to 14¢ per hundred square feet
of impervious area. This is expected to generate a total of $36.8 million to date for funding of
stormwater projects.
Required Financial Statements
The financial statements presented by the management of the District include the Statements of Net Assets;
Statements of Revenues, Expenses, and Changes in Net Assets; and Statements of Cash Flows. These
statements are prepared using the accrual basis of accounting. This method of accounting recognizes revenue
at the time it is earned and expense when the related liability occurs. As a result of using this method of
accounting, the District’s performance over the time period being reported is more easily determinable.
The Statements of Net Assets provide a report of the District’s current, restricted, and other noncurrent assets
such as cash, investments, receivables, and property. Also, the Statements of Net Assets provide a summary
of the District’s current, restricted, and noncurrent liabilities, including contracts and accounts payable,
deposits and accrued expenses, and bond and notes payable. The final section of the Statements of Net
Assets, the net assets section, contains earnings retained for use by the District. Increases or decreases in the
net assets section may be indicative of an improving or declining financial position. This statement provides
the basis for computing rate of return, evaluating the capital structure of the District, and assessing the
liquidity and financial flexibility of the District.
The Statements of Revenues, Expenses, and Changes in Net Assets summarize all of the years’ revenue and
expense. This statement indicates how successful the District was at maintaining expense below the level of
revenue earned.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Management’s Discussion and Analysis
for the years ended June 30, 2010 and 2009
17
The Statements of Cash Flows account for the net change in cash and cash equivalents by summarizing cash
receipts and cash disbursements resulting from operating activities, noncapital financing activities, capital and
related financing activities, and investing activities. This statement assists the user in determining the sources
of cash coming into the District, the items for which cash was expended, and the beginning and ending cash
balance.
Financial Analysis
The District’s financial position improved in the current year, as evidenced by the increase in net assets of
$20.0 million. The District continues capacity expansion and updating of the District’s plant and system.
Plans for maintaining the District’s ability to meet future spending needs are discussed in greater detail in the
section of the MD&A entitled “Decisions Impacting the Future.”
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Management’s Discussion and Analysis
for the years ended June 30, 2010 and 2009
18
Condensed Financial Statements and Analysis
The Metropolitan St. Louis Sewer District
Condensed Statements of Net Assets
(000s)
Increase Increase
2009 (Decrease) 2008 (Decrease)
2010 As Restated 2010-2009 As Restated 2009-2008
Assets:
Current, restricted, and other assets $ 469,003 $ 469,124 $ (121) $ 531,030 $ (61,906)
Capital assets (net of accumulated
depreciation) 2,411,877 2,292,596 119,281 2,107,907 184,689
Total Assets 2,880,880 2,761,720 119,160 2,638,937 122,783
Liabilities:
Current liabilities 75,512 82,961 (7,449) 77,031 5,930
Noncurrent liabilities 597,718 491,142 106,576 435,944 55,198
Total Liabilities 673,230 574,103 99,127 512,975 61,128
Net Assets:
Invested in capital assets, net of
related debt 1,868,974 1,798,914 70,060 1,704,322 94,592
Restricted 80,782 94,769 (13,987) 97,422 (2,653)
Unrestricted 257,894 293,934 (36,040) 324,218 (30,284)
Total Net Assets $2,207,650 $2,187,617 $ 20,033 $2,125,962 $ 61,655
2010 Analysis
Total net assets increased $20.0 million, or 0.9%, above prior year. This change is principally the result of
utility plant contributions of $18.5 million, and results in an increase in total assets of $119.2 million
countered by an increase in liabilities of $99.1 million.
Current, restricted, and other assets decreased by $0.1 million, while capital assets, net of accumulated
depreciation, increased by $119.3 million. The increase in capital assets can be attributed to an increase in
construction in progress of $120.1 million, collection and pumping plant of $22.4 million, general plant and
equipment of $3.4 million, and land of $1.1 million. This was offset by a decrease in treatment and disposal
plant and equipment of $27.6 million. The slight decrease in current, restricted, and other assets is
attributable to the offsetting increase in current assets and the decrease in restricted assets.
The change in total liabilities breaks down to a decrease in current liabilities of $7.4 million and an increase in
noncurrent liabilities of $106.6 million. The increase in noncurrent liabilities is due to a substantial increase
in bonds and notes payable. The District issued new long-term debt in the amount of $122.1 million during
the 2010 fiscal year. Current liabilities are down due in part to a decrease in contracts and accounts payable
of $10.4 million. These were partially offset by an increase in the balance of deposits and accrued expenses
and the current portion of bonds and notes payable of $4.6 million and $0.8 million, respectively.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Management’s Discussion and Analysis
for the years ended June 30, 2010 and 2009
19
2009 Analysis
Total net assets increased $61.7 million, or 2.9%, over prior year. This change is due to an increase in total
assets of $122.8 million countered by an increase in liabilities of $61.1 million.
Current, restricted, and other assets decreased by $61.9 million, while capital assets increased by $184.7
million. The increase in capital assets can be attributed to an increase in construction in progress of $136.0
million, collection and pumping plant of $22.9 million, treatment and disposal plant and equipment of $20.3
million, and general plant and equipment of $5.5 million. The decrease in current, restricted, and other assets
is mostly attributable to the net decrease in cash equivalents of $36.9 million as a result of increased spending
in the capital improvement and replacement program.
The change in total liabilities breaks down to an increase in current liabilities of $5.9 million and an increase
in noncurrent liabilities of $55.2 million. The increase in noncurrent liabilities is due to a substantial increase
in bonds and notes payable. The District issued new long-term debt in the amount of $74.1 million during the
2009 fiscal year. Current liabilities are up due to increases in contracts and accounts payable and current
portion of bonds and notes payable of $2.7 million and $4.9 million, respectively. These were partially offset
by a decrease in the balance of deposits and accrued expenses and retainage payable of $1.4 million and $0.3
million, respectively.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Management’s Discussion and Analysis
for the years ended June 30, 2010 and 2009
20
The Metropolitan St. Louis Sewer District
Statements of Revenues, Expenses, and Changes in Net Assets
(000s)
Increase Increase
2009 (Decrease)2008 (Decrease)
2010 As Restated 2010-2009 As Restated 2009-2008
Operating Revenues:
Sewer service charges $ 251,683 $ 254,378 $ (2,695) $ 221,780 $ 32,598
Provision for doubtful
sewer service charge accounts (10,188) (9,678) (510) (5,162) (4,516)
Licenses, permits, and other fees 3,085 3,475 (390) 4,346 (871)
Other 2,007 1,550 457 961 589
Total operating revenues 246,587 249,725 (3,138) 221,925 27,800
Nonoperating Revenues:
Property taxes levied by the District 1,401 2,129 (728) 27,512 (25,383)
Investment income 6,554 13,116 (6,562) 17,477 (4,361)
Rent and other income 265 215 50 529 (314)
Total nonoperating revenues 8,220 15,460 (7,240) 45,518 (30,058)
Total revenues 254,807 265,185 (10,378) 267,443 (2,258)
Operating Expenses:
Pumping and treatment 47,266 44,746 2,520 44,531 215
Collection system maintenance 36,082 32,918 3,164 30,807 2,111
Engineering 15,773 13,736 2,037 9,973 3,763
General and administrative 39,237 37,922 1,315 39,827 (1,905)
Water backup claims 3,951 6,817 (2,866) 7,439 (622)
Depreciation 54,012 47,370 6,642 54,934 (7.564)
Other 32,458 28,669 3,789 37,634 (8,965)
Total operating expenses 228,779 212,178 16,601 225,145 (12,967)
Nonoperating Expenses:
Net loss on disposal and sale of
capital assets 2,719 2,162 557 686 1,476
Nonrecurring projects and studies 9,872 7,104 2,768 3,259 3,845
Interest expense 13,189 9,079 4,110 4,314 4,765
Total nonoperating expenses 25,780 18,345 7,435 8,259 10,086
Total expenses 254,559 230,523 24,036 233,404 (2,881)
Income Before Capital Contributions 248 34,662 (34,414) 34,039 623
Capital Contributions 19,785 26,993 (7,208) 45,610 (18,617)
Change in Net Assets 20,033 61,655 (41,622) 79,649 (17,994)
Net Assets-Beginning of Year 2,187,617 2,125,962 61,655 2,064,313 79,649
Net Assets-End of Year $ 2,207,650 $ 2,187,617 $ 20,033 $ 2,125,962 $ 61,655
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Management’s Discussion and Analysis
for the years ended June 30, 2010 and 2009
21
2010 Analysis
Net assets increased $20.0 million or $41.6 million less than in the prior year. While revenue saw a
significant decrease, expense grew at a faster pace.
Total revenue decreased by $10.4 million largely due in part to a reduction in investment income and sewer
service charges of $6.6 million and $2.7 million, respectively. Property tax revenue continued to decrease by
$0.7 million as a result of reduction of the tax rate to 0.0% in 2007. The provision for doubtful sewer service
charge accounts increased $0.5 million while licenses, permits, and other fees were decreased by $0.4 million.
Other operating revenues amounted to a $0.5 million increase when compared to prior year.
Total expense ended the year up $24.0 million compared to 2009 due to increases in both operating and
nonoperating expense. Total operating expense for 2010 increased $16.6 million. Increases in pumping and
treatment, collection system maintenance, engineering, and general and administrative expenses totaled $9.0
million. Depreciation expense increased by $6.6 million, mostly due to additional assets that were placed in
service. Other operating expense increased by $3.8 million. This was offset by water backup claims
decreasing by $2.9 million. Nonoperating expenses experienced increases in the costs of net loss on disposal
and sale of capital assets, nonrecurring projects as well as interest expense totaling $7.4 million.
2009 Analysis
Net assets increased $61.7 million or $18.0 million less than in the prior year. While total revenues were
slightly lower compared prior year, this was offset by the reduction of net expenses.
Total revenue decreased by $2.3 million due to offsetting changes in operating and nonoperating revenue.
There was an increase in sewer service charges of $32.6 million following a sanitary rate increase and a
stormwater rate change in 2008. Other revenues contributed an additional $0.6 million. All of this was largely
offset by the final property tax being levied by the District in December 2007. This loss in revenue has been
partially offset by a newly implemented stormwater rate charge. As a result, property tax revenue decreased
by $25.4 million. The provision for doubtful sewer service charge accounts increased $4.5 million while
investment income decreased by $4.4 million. Rounding out the offset were decreases in licenses, permits,
and other fees as well as rent and other income of $0.9 million and $0.3 million, respectively.
Total expense ended the year down $2.9 million compared to 2008 due to offsetting balances in operating and
nonoperating expense. Total operating expense for 2009 was reduced $13.0 million due overwhelmingly to a
decrease in other operating expense. Other operating expense decreased by $9.0 million, mostly due to
extensive watershed facility planning that took place in 2008 and was not continued in 2009. Depreciation
expense decreased by $7.5 million, general and administrative cost was reduced by $1.9 million, and water
backup claims decreased by $0.6 million. These were offset by a combined increase of $6.1 million for
pumping and treatment, collection system maintenance, and engineering. Nonoperating expense experienced
increases in the costs of net loss on sale of utility plant, nonrecurring projects as well as interest expense
totaling $10.1 million. There were also increases in engineering costs and collection system maintenance
expenses of $3.8 million and $2.1 million, respectively.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Management’s Discussion and Analysis
for the years ended June 30, 2010 and 2009
22
The Metropolitan St. Louis Sewer District
Condensed Statements of Cash Flows
(000s)
Increase Increase
2009 (Decrease) 2008 (Decrease)
2010 As Restated 2010-2009 As Restated 2009-2008
Cash flows from operating
activities $ 67,916 $ 84,222
$ (16,306) $ 44,857
$ 39,365
Cash flows from noncapital
financing activities 1,401 2,129
(728) 27,512
(25,383)
Cash flows from capital
and related financing
activities (81,406) (163,367)
81,961 (164,494)
1,127
Cash flows from investing
activities 17,399 40,070
(22,671) 120,352
(80,282)
Net increase (decrease) in
cash and cash equivalents 5,310 (36,946)
42,256 28,227
(65,173)
Cash and cash equivalents
at beginning of year 6,457 43,403
(36,946) 15,176
28,227
Cash and Cash Equivalents
at End of Year $ 11,767 $ 6,457
$5,310 $ 43,403
$(36,946)
2010 Analysis
The District ended the year with $11.8 million in cash and cash equivalents or $5.3 million higher than the
prior year. This was due primarily to cash flow from operating activities contributing a positive $67.9
million, which is a $16.3 million decrease from 2009. Cash flow from investing activities contributed a
positive $17.4 million or a $22.7 million decrease from the previous year. This change is due in part to the
District purchasing $287.4 million in investments compared to $297.6 million in proceeds from sale and
maturity of investments. Cash flow from noncapital financing activities contributed $1.4 million or a
decrease from the prior year due to the District suspending the collection of property taxes in 2007. All of this
was offset by cash outflow from capital and related financing activities of $81.4 million or $82.0 million less
than fiscal year 2009.
2009 Analysis
The District ended the year with $6.5 million in cash and cash equivalents or $36.9 million lower than the
prior year. Cash outflow from capital and related financing activities was $163.4 million or $1.1 million less
than in the previous year. Cash flow from operating activities contributed $84.2 million, which is a $39.4
million increase from 2008. Cash flow from investing activities contributed $40.1 million or an $80.3 million
decrease from the previous year. This change is due in part to the District purchasing $329.4 million in
investments compared to $359.1 million in proceeds from sale and maturity of investments. Cash flow from
noncapital financing activities contributed $2.1 million which was $25.4 million less in 2009 than 2008 due to
the District suspending the collection of various taxes.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Management’s Discussion and Analysis
for the years ended June 30, 2010 and 2009
23
Capital Assets
The Metropolitan St. Louis Sewer District
Capital Assets
Net of Depreciation (000s)
Increase Increase
2009 (Decrease) 2008 (Decrease)
2010 As Restated 2010-2009 As Restated 2009-2008
Land $ 28,129 $ 27,070 $ 1,059 $ 27,070 $ --
Construction in progress 570,602 450,540 120,062 314,605 135,935
Treatment and disposal plant and equipment 394,826 422,413 (27,587) 402,088 20,325
Collection and pumping plant 1,393,152 1,370,782 22,370 1,347,861 22,921
General plant and equipment 25,168 21,790 3,377 16,318 5,472
Total $ 2,411,877 $ 2,292,595 $ 119,281 $ 2,107,942 $ 184,653
2010 Analysis
Total capital assets, net of depreciation, increased $119.3 million over prior year. Construction in progress
increased $120.1 million due primarily to the large capital improvement and replacement program currently
underway. Increases in collection and pumping of $22.4 million and general plant and equipment of $3.4
million are consistent with the increases seen in 2009. Land also contributed an additional $1.1 million to the
increase. All of this was offset by treatment and disposal decreasing $27.6 million. This is primarily due to
$16.3 million in deletions and reclassifications, only partially offset by additions of $4.4 million. 2010 also
recorded a net increase in accumulated depreciation of $15.6 million as 2010 realized a full year of
depreciation on $35.3 million in additions placed into service in 2009.
2009 Analysis
Total capital assets, net of depreciation, increased $184.7 million over prior year. Construction in progress
increased $135.9 million due to the large capital improvement and replacement program currently underway.
Collection and pumping along with treatment and disposal increased $22.9 million and $20.3 million,
respectively. These increases can also be attributed to the high level of expansion and updating of the
District’s plant and system. General plant and equipment saw $5.5 million in net additions while land
remained unchanged in 2009.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Management’s Discussion and Analysis
for the years ended June 30, 2010 and 2009
24
Long-Term Debt
The Metropolitan St. Louis Sewer District
Long-Term Debt
(000s)
Increase Increase
(Decrease) (Decrease)
2010 2009 2010-2009 2008 2009-2008
Revenue Bonds:
Series 2004A $ 167,370 $ 168,965 $ (1,595) $ 170,485 $ (1,520)
Series 2004B 130,110 136,795 (6,685) 143,563 (6,768)
Series 2005A 5,665 5,955 (290) 6,240 (285)
Series 2006A 38,420 40,480 (2,060) 42,515 (2,035)
Series 2006B 12,935 13,575 (640) 14,205 (630)
Series 2006C 60,000 60,000 -- 60,000 --
Series 2008A 30,000 30,000 -- -- 30,000
SRF 2008AB 37,375 39,128 (1,753) -- 39,128
SRF 2009A 23,000 -- 23,000 -- --
SRF 2010A 7,981 -- 7,981 -- --
Series 2010B 85,000 -- 85,000 -- --
West Watson and Nanell -- 100 (100) 130 (30)
Ozark and Tablerock -- 68 (68) 81 (13)
Energy Loan Program 37 48 (11) 58 (10)
Oracle/Blue Heron 7,264 4,130 3,134 -- 4,130
$ 605,157 $ 499,244 $ 105,913 $ 437,277 $ 61,967
2010 Analysis
The District ended fiscal year 2010 with $605.2 million in long-term debt outstanding, consisting mainly of
revenue bonds. The District had three bond additions this year (SRF 2009A, SRF 2010A, and Series 2010B)
resulting in the substantial increase in long-term debt.
2009 Analysis
The District ended fiscal year 2009 with $499.2 million in long-term debt outstanding, consisting mainly of
revenue bonds. The District had two bond additions and a capital lease this year (Series 2008A, SRF
2008AB, and Oracle/Blue Heron) resulting in the substantial increase in long-term debt.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Management’s Discussion and Analysis
for the years ended June 30, 2010 and 2009
25
Decisions Impacting the Future
The District continues to implement the second phase of its multi decade wastewater capital improvement
program utilizing the proceeds a $275.0 million bond authorization granted by St. Louis voters in August
2008. This phase of the program includes the design and construction of $662.0 million of capital
improvements through 2012. To date, $415.0 million of this capital program phase has been completed or
underway. These regulatory required projects include completion of the Lemay Treatment Plant expansion,
pump station improvements, and sewage collection system replacement and rehabilitation.
The District implemented an impervious area based stormwater rate in March 2008. In conjunction, the
District elected to discontinue the assessment of approximately $24.4 million per year in property taxes and
flat fees previously used for stormwater funding. This stormwater rate structure was in place throughout the
2010 fiscal year generating $90.9 million for stormwater projects across the St. Louis region. On July 9, 2010,
the Circuit Court of St. Louis, Missouri ruled the impervious rate unconstitutional. As a result, the District’s
Board of Trustees rescinded the impervious based rate effective August 1, 2010. The elimination of this rate
will result in an estimated $48.3 million loss in revenue anticipated to address stormwater issues throughout
the St. Louis region. The District reinstated the property taxes and flat fees previously discontinued in order to
provide a base level of stormwater services as required by the District’s Charter. These services will be
drastically reduced in Fiscal Year 2011 and subsequent future years due to the loss the impervious rate
revenue. The stormwater impervious based rate remains in litigation pending the District’s Board of Trustees
decision on pursuing an appeal of the July 9, 2010 court decision.
The District intends to submit a rate change proposal to the District’s Rate Commission in February 2012.
This Rate Commission is defined and authorized in the District’s Charter and is required to review all
proposed rate changes prior to the adoption by the District’s Board of Trustees. The Rate Commission is
comprised of 15 members representing various commercial and residential customers. Members in the past
have also represented local environmental interests.
The District is also engaged in litigation with the U.S. Environmental Protection Agency and the Missouri
Department of Natural Resources to address issues related to the Clean Water Act of 1972. See note 13 for
additional information regarding this litigation.
The District’s implementation of a new enterprise-wide technology system continued throughout Fiscal Year
2010 and is anticipated to be completed in the next fiscal year. This new technology impacts all aspects of
District operations and replaces antiquated and inefficiency systems used for the past several decades.
Streamlined processes and increased efficiencies are expected as a result of this implementation, saving
ratepayers money and improving response time to customer issues.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Management’s Discussion and Analysis
for the years ended June 30, 2010 and 2009
26
Requests for Information
This financial report is designed to provide a general overview of the District’s finances for all those with an
interest in the District’s finances. Questions concerning any of the information provided in this report or
requests for additional financial information should be addressed or e-mailed to:
Janice M. Zimmerman, Director of Finance
The Metropolitan St. Louis Sewer District
2350 Market Street
St. Louis, MO 63103-2555
or
jzimmer@stlmsd.com
27
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
28 See the accompanying notes to the financial statements.
Statements of Net Assets
June 30, 2010 and 2009
ASSETS
June 30,
2010 2009
(As Restated)
Current Assets:
Cash $ 11,438,945 $ 5,913,696
Pooled cash and investments 228,974,712 274,316,863
Investments 58,240,728 9,661,493
Sewer service charges receivable, less allowance of
$4,055,258 in 2010 and $4,166,398 in 2009 35,333,663 36,963,828
Unbilled sewer service charges receivable, less allowance of
$421,210 in 2010 and $423,000 in 2009
20,379,759
20,146,052
Accrued income on investments 1,206,821 1,437,214
Other receivables, less allowance of
$851 in 2010 and $20,908 in 2009 8,818,269 1,235,357
Supplies inventory 6,832,502 7,155,997
Total current assets 371,225,399 356,830,500
Noncurrent Assets:
Restricted Assets:
Cash 327,864 544,430
Pooled cash and investments 51,363,267 67,890,803
Investments 30,363,923 27,208,257
Accrued income on investments 403,372 618,013
82,458,426 96,261,503
Other Assets:
Note receivable 15,319,087 16,032,069
Capital Assets:
Depreciable:
Treatment and disposal plant and equipment 750,240,748 762,219,595
Collection and pumping plant 1,914,386,404 1,861,695,362
General plant and equipment 64,195,139 60,326,121
2,728,822,291 2,684,241,078
Less: Accumulated depreciation 915,676,211 869,255,067
1,813,146,080 1,814,986,011
Nondepreciable:
Land 28,128,701 27,070,041
Construction in progress 570,602,108 450,539,975
Net capital assets 2,411,876,889 2,292,596,027
Total noncurrent assets 2,509,654,402 2,404,889,599
Total Assets 2,880,879,801 2,761,720,099
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
See the accompanying notes to the financial statements. 29
Statements of Net Assets
June 30, 2010 and 2009 (Continued)
LIABILITIES
June 30,
2010 2009
(As Restated)
Current Liabilities:
Contracts and accounts payable 25,962,579 36,351,578
Deposits and accrued expenses 23,418,377 21,436,863
Retainage payable 8,263,134 8,278,238
Current portion of bonds and notes payable 16,192,133 15,402,057
73,836,223 81,468,736
Current Liabilities--Payable From Restricted Assets:
Contracts and accounts payable 1,341,043 1,266,826
Retainage payable 334,577 226,107
1,675,620 1,492,933
Total current liabilities 75,511,843 82,961,669
Noncurrent Liabilities:
Deposits and accrued expenses 7,295,729 4,659,607
Bonds and notes payable 590,421,835 486,482,071
597,717,564 491,141,678
Total Liabilities 673,229,407 574,103,347
NET ASSETS
Net Assets:
Invested in capital assets, net of related debt 1,868,973,772 1,798,913,796
Restricted for:
Debt service 29,946,469 33,971,107
Subdistrict construction and improvement 50,836,337 60,797,463
Unrestricted 257,893,816 293,934,386
Total Net Assets $2,207,650,394 $2,187,616,752
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
30 See the accompanying notes to the financial statements.
Statements of Revenues, Expenses, and Changes in Net Assets
for the years ended June 30, 2010 and 2009
Years Ended June 30,
2010 2009
(As Restated)
Operating Revenues:
Sewer service charges $ 251,682,865 $ 254,378,459
Provision for doubtful
sewer service charge accounts (10,187,508) (9,678,495)
Licenses, permits, and other fees 3,084,552 3,475,283
Other 2,007,265 1,550,111
Total operating revenues 246,587,174 249,725,358
Operating Expenses:
Pumping and treatment 47,266,420 44,746,325
Collection system maintenance 36,081,992 32,917,464
Engineering 15,772,981 13,735,952
General and administrative 39,237,319 37,921,976
Water backup claims 3,950,797 6,816,722
Depreciation 54,011,776 47,370,379
Other 32,457,589 28,668,961
Total operating expenses 228,778,874 212,177,779
Operating Income 17,808,300 37,547,579
Nonoperating Revenues:
Property taxes levied by the District 1,401,100 2,129,475
Investment income 6,553,760 13,115,519
Rent and other income 265,004 214,674
Total nonoperating revenues 8,219,864 15,459,668
Nonoperating Expenses:
Net loss on disposal and sale of capital assets 2,719,163 2,162,189
Nonrecurring projects and studies 9,872,088 7,104,169
Interest expense 13,189,283 9,079,269
Total nonoperating expenses 25,780,534 18,345,627
Income Before Capital Contributions 247,630 34,661,620
Capital Contributions:
Utility plant contributed 18,544,232 26,302,897
Grant revenue 1,241,780 690,488
Total capital contributions 19,786,012 26,993,385
Change in Net Assets 20,033,642 61,655,005
Net Assets-Beginning of Year (Note 16) 2,187,616,752 2,125,961,747
Net Assets-End of Year $2,207,650,394 $2,187,616,752
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
See the accompanying notes to the financial statements.
31
Statements of Cash Flows
for the years ended June 30, 2010 and 2009
Years Ended June 30,
2010 2009
(As Restated)
Cash flows from operating activities:
Received from customers $248,973,260 $246,543,742
Paid to employees for services (80,987,401) (70,669,904)
Paid to suppliers for goods and services (100,069,468) (91,651,592)
Net cash provided by operating activities 67,916,392 84,222,246
Cash flows provided from noncapital financing activities:
Taxes levied 1,401,100 2,129,476
Cash flows from capital and related financing activities:
Proceeds from capital grants 1,228,764 842,734
Proceeds from issuance of debt 112,193,376 77,982,515
Interest received on bond proceeds to be used for capital improvements 1,569,661 1,673,210
Principal paid on debt (16,178,124) (17,163,509)
Interest and fees paid on debt (21,986,608) (17,542,583)
Payments for capital assets (158,560,144) (209,315,523)
Proceeds from sale of capital assets 325,682 156,023
Net cash used in capital and related financing activities (81,407,393) (163,367,133)
Cash flows from investing activities:
Purchase of investments (287,432,264) (329,356,041)
Proceeds from sale and maturity of investments 297,567,050 359,071,774
Investment income 6,998,794 10,139,852
Proceeds from rents 265,004 214,674
Net cash provided by investing activities 17,398,584 40,070,259
Net Increase (Decrease) in Cash and Cash Equivalents 5,308,683 (36,945,152)
Cash at Beginning of Year 6,458,126 43,403,278
Cash at End of Year $ 11,766,809 $ 6,458,126
Noncash capital and investing activities:
Portion of utility plant contributed represented by:
Utility plant contributed by other governments and developers $ 18,544,232 $ 26,302,897
Fair value investment adjustment gain (loss) $ 109,316 $ (89,291)
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
32 See the accompanying notes to the financial statements.
Statements of Cash Flows
for the years ended June 30, 2010 and 2009 (Continued)
Years Ended June 30,
2010 2009
(As Restated)
Reconciliation of operating income to net cash flows provided by
operating activities:
Operating income $ 17,808,300 $ 37,547,579
Adjustments to reconcile operating income to net cash
provided by operating activities:
Depreciation 54,011,776 47,370,379
Change in operating assets and liabilities:
Decrease (increase) in billed and unbilled sewer service
charges receivable 1,396,458 (2,935,372)
Decrease in other receivables 410,805 173,792
Decrease in supplies inventory 323,495 327,869
(Decrease) increase in contracts and accounts payable (10,388,998) 2,748,721
Increase (decrease) in deposits and accrued expenses 4,354,556 (1,010,722)
Net Cash Provided by Operating Activities $ 67,916,392 $ 84,222,246
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
33
1. Organization and Summary of Significant Accounting Policies
Organization
The Metropolitan St. Louis Sewer District (the District) was authorized by the voters, established and
chartered under the provisions of the Constitution of Missouri, as a municipal corporation and a political
subdivision of the State of Missouri. Upon creation in 1954, the District assumed responsibilities to
provide for the construction, operation, and maintenance of the sewer facilities within its defined
boundaries. The District's service area now comprises all of the City of St. Louis and most of St. Louis
County. Subdistricts within the District’s total service area represent separate geographic areas within
which specific taxes are levied for the retirement of indebtedness issued to finance construction of
sanitary or stormwater facilities within the area or to operate, maintain, or construct improvements
within the subdistrict. The District also maintains all of the publicly owned stormwater sewers within its
original boundaries and is continuing to accept maintenance of the stormwater sewers in the remainder of
its service area.
Pursuant to provisions of its charter and subject to limitations imposed by the Constitution of Missouri,
all powers of the District are vested in a six-member Board of Trustees (the Board), three of whom are
appointed by the Mayor of the City of St. Louis and three of whom are appointed by the County
Executive of St. Louis County.
Reporting Entity
The District defines its financial reporting entity to include all component units for which the District’s
governing body is financially accountable. To be considered financially accountable, the component
unit must be fiscally dependent on the District and the District must either 1) be able to impose its will
on the component unit or 2) the relationship must have the potential for creating a financial benefit or
imposing a financial burden on the District.
Based on the foregoing, the District’s financial statements include all funds that are established under the
authority of the District’s charter. There are no agencies, boards, commissions, or authorities that are
controlled by or dependent on the District.
Measurement Focus, Basis of Accounting, and Financial Statement Presentation
Throughout the year, the District maintains its detailed accounting records on the modified accrual basis
of accounting. In order to account for the transactions related to certain subdistricts and restricted
resources, separate fund accounting records are maintained. For financial reporting purposes, the
District reports its operations as a single enterprise fund. Accordingly, the accounting records are
converted to the accrual basis of accounting and all interfund transactions are eliminated. Under the
accrual basis of accounting, revenues are recognized when earned and expenses are recognized when the
related liability is incurred. The District’s measurement focus is on the flow of economic resources.
Unbilled sewer service charge revenues are accrued by the District based on estimated billings for
services provided through the end of the current fiscal year.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
34
1. Organization and Summary of Significant Accounting Policies (Continued)
Measurement Focus, Basis of Accounting, and Financial Statement Presentation (Continued)
Revenues and expenses are divided into operating and nonoperating items. Operating revenues
generally result from providing services in connection with the District’s principal ongoing operations.
The principal operating revenues of the District are user fees, licenses, and permits for wastewater
treatment services. Operating expenses include the costs associated with the conveyance and treatment
of wastewater, stormwater, administrative expenses, and depreciation on capital assets. All revenues and
expenses not meeting these definitions are reported as nonoperating revenues and expenses.
The District follows GASB Statement No. 33, Accounting and Financial Reporting for Non-Exchange
Transactions (GASB 33), which establishes accounting and financial reporting standards for non-
exchange transactions involving financial or capital resources.
GASB 33 groups non-exchange transactions into the following four classes, based upon their principal
characteristics: derived tax revenues, imposed non-exchange revenues, government mandated non-
exchange transactions, and voluntary non-exchange transactions.
The District recognizes assets from imposed non-exchange revenue transactions in the period when an
enforceable legal claim to the assets arises or when the resources are received, whichever occurs first.
Revenues are recognized in the period when the resources are required to be used or the first period that
use is permitted. The District recognizes revenues from property taxes, net of estimated refunds and
estimated uncollectible amounts, in the period for which the taxes are levied. Imposed non-exchange
revenues also include licenses, permits, and other fees.
Intergovernmental revenues, representing grants and assistance received from other governmental units,
are generally recognized as revenues in the period when all eligibility requirements, as defined by GASB
33, have been met. Any resources received before eligibility requirements are met are reported as
deferred revenues.
When both restricted and unrestricted resources are available for use, it is the District’s policy to use
restricted resources first, and then unrestricted resources as they are needed.
The District follows all Governmental Accounting Standards Board (GASB) pronouncements as well as
all Financial Accounting Standards Board (FASB) Statements and Interpretations, Accounting Principle
Board Opinions, and Accounting Research Bulletins issued on or before November 30, 1989, unless
those pronouncements conflict with or contradict GASB pronouncements. In addition, the District also
applies all FASB Statements and Interpretations issued after November 30, 1989, except for those that
conflict with or contradict GASB pronouncements.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
35
1. Organization and Summary of Significant Accounting Policies (Continued)
Cash and Cash Equivalents and Investments
The District's "cash and cash equivalents" consist of all highly liquid investments (including restricted
assets) with maturity dates of 89 days or less from the date acquired by the District. "Investments"
consist of those investments with maturity dates 90 days or greater at the time of purchase by the
District. Investments are stated at fair value based upon quoted market prices.
The District’s investment disclosures follow GASB Statement No. 40, Deposit and Investment Risk
Disclosures, an Amendment of GASB Statement No. 3 (GASB 40). This standard’s disclosure
requirements address custodial credit risk, concentrations of credit risk, interest rate risk, and foreign
currency risk.
Capital Assets
Capital assets are valued at historical cost or estimated historical cost based in part upon a study
performed in 1981. Interest cost is capitalized as part of the historical cost of acquiring certain assets
when the effect of such capitalization is material to the financial statements. Interest is not capitalized on
assets constructed with contributions from other governmental sources. Depreciation is calculated on a
straight-line basis over the following estimated useful lives:
Treatment and disposal plant and equipment 10 to 50 years
Collection and pumping plant 10 to 100 years
General plant and equipment 3 to 50 years
When designing user charge rates, the District includes funding for replacement cost of assets, which
may differ from depreciation expense recorded for financial reporting purposes.
Normal maintenance and repairs that do not add to the value of the asset or materially extend asset lives
are not capitalized. Betterments are capitalized and depreciated over the remaining useful lives of the
related assets, as applicable. Previously, the District defined capital assets as assets with an initial,
individual cost of more than $1,000 and an estimated useful life in excess of three years. In April of
2010 the District updated this policy and as a result, an asset must now have an individual cost of more
than $5,000 to be considered a capital asset. It is important to note that this change in policy does not
have a retroactive effect on capital assets put in place before April 2010.
Capitalization of Interest
Interest costs are capitalized as part of the costs of capital assets during the period of construction based
on the related weighted average net borrowing costs incurred. Interest earned on temporary investments
acquired with the proceeds of such borrowed funds from the date of the borrowing until the assets are
ready for their intended use is used to reduce the interest costs capitalized on the constructed assets.
Interest is not capitalized for outlays financed by capital grants (or other outside parties) externally
restricted for the acquisition of specified assets. In 2010 and 2009, the District capitalized $8,203,731
and $6,776,034 of net interest expense, respectively.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
36
1. Organization and Summary of Significant Accounting Policies (Continued)
Supplies Inventory
Supplies inventory consists of parts and supplies to be used to operate and maintain treatment facilities and
various treatment-related equipment at the District. This inventory is stated at the lower of cost or market,
determined on the average cost method. Expenses are recognized when the inventory is consumed.
Net Assets
Invested in capital assets, net of related debt: This component of net assets consists of capital assets,
including restricted capital assets, net of accumulated depreciation and reduced by the outstanding debt
that is attributable to the acquisition, construction, or improvement of those assets.
Restricted: This component of net assets consists of constraints placed on net asset use through external
constraints imposed by creditors, grantors, contributors, laws, or regulations of other governments or
constraints imposed by law through constitutional provisions or enabling legislation. Property taxes
levied by the various subdistricts and other revenues received for construction in those subdistricts have
also been restricted for that use. Clean water capital improvement surcharges, sewer extension and
connection fees, grants, and other revenues received for construction within certain subdistricts have
been restricted for that use. In addition, a portion of sanitary sewer charges have been restricted for the
payment of principal and interest on certain debt of the District.
Unrestricted net assets: This component of net assets consists of net assets that do not meet the
definition of restricted or invested in capital assets, net of related debt.
Capital Contributions
Capital contributions to the District represent government grants and other aid used to fund capital
projects. In accordance with GASB 33, capital contributions are recognized as revenue when the
expenditure is made and the amount becomes subject to claim for reimbursement.
Bond Issuance Costs/Bond Premiums and Discounts
Bond issuance costs incurred, as well as bond premiums and discounts, and paid from the proceeds of
revenue bond issues are deferred and amortized using the straight-line method over the term of the bonds.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
37
1. Organization and Summary of Significant Accounting Policies (Continued)
Compensated Absences
Vacation
Under the terms of the District's personnel policies, employees are allowed to carry a maximum of 30
to 45 days of vacation (depending on length of service) from one calendar year to the next. Since
vacation accrued at year-end is expected to be used by the employee during the following fiscal year,
the accrual is reported as a component of current deposits and accrued expenses payable.
Sick Leave
Employees earn sick pay benefits at accrual rates ranging from 10 days per year to 12 days per year
(depending on length of service). Unused sick leave can be carried over at year-end without
limitation. An employee retiring from the District with five or more years of service, who has unused
accrued sick leave remaining, will be compensated for that portion of unused accrued sick leave at
the rate of 1-1/4% for each year of District service. The District has recorded a liability, which has
been actuarially determined to be equal to the accumulated expense charge that will amortize the
employees' benefits over their period of District service. The liability, included in current deposits
and accrued expenses payable, includes vested accumulated rights to receive sick leave benefits
estimated to be paid within one year. The portion of sick leave expected to be paid after one year is
recorded as a component of noncurrent deposits and accrued expenses payable.
Use of Estimates
The preparation of financial statements in conformity with U.S. generally accepted accounting principles
requires management to make estimates and assumptions that affect the reported amounts in the financial
statements. Actual results could differ from those estimates.
Board Designated Funds
The Board has designated certain amounts for construction and improvement of the sewerage and
drainage collection systems and treatment facilities, and for real property improvement and alterations.
These amounts are included with unrestricted cash and investments. At June 30, 2010 and 2009,
designated funds were $277,997,841 and $266,680,363 respectively.
Subsequent Events
In preparing these financial statements, the District has evaluated events and transactions for potential
recognition or disclosure through November 9, 2010, the date the financial statements were available to
be issued.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
38
2. Deposits and Investments
With the approval of the District's Board of Trustees, the Secretary-Treasurer is authorized to invest
excess cash in any investment authorized by the District's charter. The District’s investment policy
conforms to the investment policy guidelines for the State of Missouri. The District’s investment policy
authorizes the District to invest in the following instruments: U.S. Treasury obligations, certificates of
deposit, obligations of any agency or instrumentality of the U.S., repurchase agreements, bankers’
acceptances, and commercial paper rated in the three highest classifications, for terms specified in the
policy. At June 30, 2010 and 2009, all of the District’s investments were in compliance with the
District’s investment policy and charter.
In accordance with the District’s investment policy, the District also invests in mortgage-backed
securities such as collateralized mortgage obligations. These securities are reported at fair value and are
based on the cash flow from interest payments by the underlying mortgages. As a result, they are
sensitive to prepayments by mortgagees, which may result from a decline in interest rates. For example,
if interest rates decline and homeowners refinance mortgages, thereby prepaying the mortgages
underlying these securities, the cash flow from interest payments is reduced and the value of these
securities declines. Likewise, if homeowners pay on mortgages longer than anticipated, the cash flow is
greater and the return on the initial investment would be higher than anticipated.
A summary of deposits and investments as of June 30, 2010 and 2009, is as follows:
2010 2009
Cost Fair Value Cost Fair Value
Deposits $ 38,622,130 $ 38,622,130 $ 55,884,662 $ 55,884,662
Repurchase agreements (collateralized) -- -- 1,662,000 1,662,000
U.S. Treasury and agency obligations 246,273,740 248,904,033 271,258,321 273,727,585
Commercial paper 73,440,879 73,463,049 54,226,147 54,261,295
Bankers’ acceptance notes 19,712,541 19,720,227 -- --
$378,049,290 $380,709,439 $383,031,130 $385,535,542
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
39
2. Deposits and Investments (Continued)
Interest Rate Risk
As of June 30, 2010 and 2009, the District had the following investments and maturities:
2010 2009
Weighted Weighted
Average Average
Maturity Maturity
Investment Type Fair Value (Years) Fair Value (Years)
Repurchase agreements (collateralized) $ -- 0.00 $ 1,662,000 0.00
Certificates of deposit 2,100,000 0.58 12,200,000 0.75
U.S. Treasury obligations 55,119,909 1.24 46,874,765 1.13
U.S. agency obligations 193,784,124 1.56 226,852,820 2.10
Commercial paper 73,463,049 0.12 54,261,295 0.14
Bankers’ acceptance notes 19,720,227 0.11 -- --
Total $344,187,309 1.11 $341,850,880 1.60
In accordance with the District’s investment policy, the District will minimize the risk that the fair value
of debt securities in the portfolio will fall due to increases in general interest rates by:
1. Structuring the investment portfolio so that securities mature to meet cash requirements for ongoing
operations, thereby avoiding the need to sell securities on the open market prior to maturity.
2. Investing operating funds primarily in short-term securities.
3. State law limits the maximum stated maturities to five years on any investment from the date of
purchase.
Custodial/Credit Risk
The District will minimize credit risk, the risk of loss due to failure of the security issuer or backer, by:
1. Prequalifying the financial institutions, broker/dealers, intermediaries, and advisors with which
the District will do business.
2. Diversifying the portfolio so that potential losses on individual securities will be minimized.
In accordance with its investment policy, the District limits its investments in these investment types to
the top rating issued by NRSROs. As of June 30, 2010 and 2009, the District’s investments in
commercial paper were rated A1 by Standard & Poor’s and P-1 by Moody’s Investors Service. The
District’s investments in repurchase agreements carry the explicit guarantee of the U.S. Government.
The District’s investments in U.S. agency obligations that do not carry the explicit guarantee of the U.S.
Government all carry a rating assigned by Standard & Poor’s of “AAA”. All cash deposits of the
District were fully collateralized with securities held by a third party financial institution in the District’s
name.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
40
2. Deposits and Investments (Continued)
Concentration of Credit Risk
The District places no limit on the amount the District may invest in any one issuer with respect to U.S.
Treasury obligations and collateralized time and demand deposits. U.S. agency obligations and
government-sponsored enterprises are limited to 60% of the portfolio; and collateralized repurchase
agreements are limited to 50% of the portfolio. U.S. agency obligations, commercial paper, and bankers’
acceptances are limited to 30% of the portfolio, each. The following table lists investments in issuers that
represent 5% or more of total investments at June 30, 2010 and 2009:
Percent of Total Investments
Issuer 2009 2009
Federal Home Loan Bank 20.1% 15.7%
Federal National Mortgage Association 15.5 21.5
Federal Home Loan Mortgage Corporation 8.5 18.5
3. Note Receivable
The District has a note receivable with the City of Arnold, Missouri (the “City”) for its portion of the
capital costs related to the Lower Meramec wastewater treatment plant. The City also pays reasonable
fees for operation and maintenance costs. The note receivable will be paid over 30 years. At June 30,
2010, future payments are as follows:
For the Years
Ending June 30
2011 $ 1,100,500
2012 1,100,500
2013 1,100,500
2014 1,100,500
2015 1,100,500
2016 – 2020 5,502,500
2021 – 2025 5,502,500
2026 – 2030 5,502,500
2031 – 2032 2,751,225
24,761,225
Less: Amount representing interest 9,030,225
$15,731,000
Classification in Statement of Net Assets:
Current $ 411,913
Noncurrent 15,319,087
$15,731,000
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
41
4. Change in Capital Assets
The following is a summary of capital assets changes for the fiscal years ended June 30, 2010 and 2009:
For the Year Ended June 30, 2010
Balance
June 30, 2009
(As Restated) Additions Reclass Deletions
Balance
June 30, 2010
Capital assets not being depreciated:
Land $ 27,070,041 $ 1,058,660 $ -- $ -- $ 28,128,701
Construction in progress 450,539,975 153,818,974 -- 33,756,841 570,602,108
Total capital assets not being depreciated 477,610,016 154,877,634 -- 33,756,841 598,730,809
Capital assets being depreciated:
Treatment and disposal plant
and equipment 762,219,595 4,360,055 (9,625,867) 6,713,035 750,240,748
Collection and pumping plant 1,861,695,362 43,669,661 9,625,867 604,486 1,914,386,404
General plant and equipment 60,326,121 7,186,774 -- 3,317,756 64,195,139
Total capital assets being depreciated 2,684,241,078 55,216,490 -- 10,635,277 2,728,822,291
Less: Accumulated depreciation:
Treatment and disposal plant
and equipment (339,806,176) (27,019,845) 7,315,692 (4,095,514) (355,414,815)
Collection and pumping plant (490,913,350) (23,256,637) (7,315,692) (251,707) (521,233,972)
General plant and equipment (38,535,541) (3,735,294) -- (3,243,411) (39,027,424)
Total accumulated depreciation (869,255,067) (54,011,776) -- (7,590,632) (915,676,211)
Total capital assets being depreciated, net 1,814,986,011 1,204,714 -- 3,044,645 1,813,146,080
Total Capital Assets $2,292,596,027 $156,082,348 $ -- $ 36,801,486 $2,411,876,889
For the Year Ended June 30, 2009 (As Restated)
Balance Balance
June 30, 2008 Additions Deletions June 30, 2009
Capital assets not being depreciated:
Land $ 27,070,041 $ --$ -- $ 27,070,041
Construction in progress 314,569,981 199,075,923 63,105,929 450,539,975
Total capital assets not being depreciated 341,640,022 199,075,923 63,105,929 477,610,016
Capital assets being depreciated:
Treatment and disposal plant
and equipment 728,496,863 35,254,503 1,531,771 762,219,595
Collection and pumping plant 1,810,225,223 54,361,302 2,891,163 1,861,695,362
General plant and equipment 53,759,969 8,791,873 2,225,721 60,326,121
Total capital assets being depreciated 2,592,482,055 98,407,678 6,648,655 2,684,241,078
Less: Accumulated depreciation:
Treatment and disposal plant
and equipment (326,409,264)(14,274,098)(877,186) (339,806,176)
Collection and pumping plant (462,363,787)(29,794,996)(1,245,433) (490,913,350)
General plant and equipment (37,442,080)(3,301,285)(2,207,824) (38,535,541)
Total accumulated depreciation (826,215,131)(47,370,379)(4,330,443) (869,255,067)
Total capital assets being depreciated, net 1,766,266,924 51,037,299 2,318,212 1,814,986,011
Total Capital Assets $2,107,906,946 $250,113,222 $65,424,141 $2,292,596,027
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
42
4. Change in Capital Assets (Continued)
In fiscal year 2007, the District created a treatment and disposal plant asset in order to represent a
portion of the Lower Meramec wastewater treatment plant. This was created in order to begin recording
depreciation expense for the assets that had been put into service. In fiscal year 2010, a portion of these
assets totaling $9,625,867 was reclassified from treatment and disposal to collection and pumping as a
result of more detailed information becoming available. This also resulted in a $7,315,692
reclassification of accumulated depreciation.
5. Property Tax
On or before May 1 of each year, the District levies ad valorem taxes on all taxable tangible property,
real and personal, within its boundaries based on assessed valuations established by the City of St. Louis
and St. Louis County assessors. Tax rates vary by subdistrict and purpose. Taxes levied are used for
operations and stormwater maintenance, debt service, and construction. Taxes are recorded as
nonoperating revenues. Property tax bills are mailed in October. They become delinquent and represent
a lien on the related property if not paid by December 31. All property taxes are billed and collected by
the City of St. Louis and St. Louis County Collectors’ of Revenue and are distributed to the District
monthly. On June 12, 2008, pursuant to Ordinance 12661, the District set the property tax rate at zero
and began charging a stormwater service charge on March 1, 2008 based on the property’s impervious
area. The District has collected $1,401,100 and $2,129,475 in delinquent property taxes in fiscal year
2010 and 2009, respectively.
6. Short-Term Debt
In August 2008, the District issued Tax and Revenue Anticipation Notes, Series 2008A, in the amount of
$5,000,000. This debt was issued for financing of the construction of a storage facility and to undertake
storm water projects within the District. On October 21, 2008, the District repaid the note plus $29,580
of interest at a rate of 2.2%. No additional short-term debt was issued in fiscal year 2010.
The following is a summary of changes in short-term debt for the year ended June 30, 2009:
Balance Balance
June 30, June 30,
2008 Additions Deletions 2009
Tax revenue anticipation note $ -- $ 5,000,000 $ 5,000,000 $ --
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
43
7. Long-Term Liabilities
The following is a summary of changes in the District’s long-term liabilities for the year ended June 30,
2010:
Original Balance Balance
Issuance June 30, June 30,Current
Amounts 2009 Additions Retirements 2010 Portion
Bonds and notes
payable:
Senior revenue bonds:
Series 2004A $175,000,000 $168,965,000 $ --$ 1,595,000 $167,370,000 $ 1,780,000
Series 2006C 60,000,000 60,000,000 ---- 60,000,000 --
Series 2008A 30,000,000 30,000,000 ---- 30,000,000 --
Series 2010B 85,000,000 --85,000,000 -- 85,000,000 --
Subordinate revenue
bonds:
Series 2004B 161,280,000 136,795,000 --6,685,000 130,110,000 6,465,000
Series 2005A 6,800,000 5,955,000 --290,000 5,665,000 270,417
Series 2006A 42,715,000 40,480,000 --2,060,000 38,420,000 1,911,250
Series 2006B 14,205,000 13,575,000 --640,000 12,935,000 595,833
Series 2008A/B 40,000,000 39,127,500 --1,752,500 37,375,000 1,760,000
Missouri Department
of Natural Resources:
West Watson and
Nanell 535,600 99,880 -- 99,880 ----
Ozark and Table Rock 374,680 68,170 -- 68,170 ----
Energy Loan Program 98,595 47,740 -- 11,069 36,671 11,420
Series 2009A 23,000,000 --23,000,000 -- 23,000,000 470,700
Series 2010A 7,980,700 --7,980,700 -- 7,980,700 --
Capital Lease:
Oracle/Blue Heron 12,000,000 4,130,000 6,110,193 2,976,506 7,263,687 2,927,513
$658,989,575 $499,243,290 $122,090,893 $16,178,125 605,156,058 $16,192,133
Add: Unamortized
premium, net 9,199,891
Less: Bond issue
costs, net (7,741,981)
$606,613,968
Deposits and accrued
expenses:
Landfill closure and
postclosure costs $ 622,365 $ 39,651 $ -- $ 662,016 $ --
Compensated
absences 5,824,509 840,300 385,407 6,279,402 1,569,851
Net OPEB obligation 1,014,724 2,115,538 1,206,100 1,924,162 --
$ 7,461,598 $ 2,995,489 $ 1,591,507 $ 8,865,580 $ 1,569,851
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
44
7. Long-Term Liabilities (Continued)
Wastewater System Revenue Bonds Payable
In August 2008, the District received voter authorization for an additional $275,000,000 of revenue
bonds. These funds were sought to enable the District to comply with federal and state clean water
requirements.
In January 2010, the District issued $85,000,000 of Wastewater System Revenue Bonds Series 2010B
(Series 2010B). These bonds were issued pursuant to the August 2008 authorization; in this case for the
purpose of constructing, repairing, replacing, and equipping new and existing District wastewater
facilities. These senior bonds have an interest rate of 5.9% and are payable in semiannual installments at
varying amounts through May 1, 2039. The revenue bonds do not constitute a legal debt or liability for
the District, the State of Missouri, or for any political subdivision thereof and do not constitute
indebtedness within the meaning of any constitutional or statutory debt limitation or restriction.
In November 2008, the District issued $30,000,000 of Wastewater System Revenue Bonds Series 2008A
(Series 2008A) from the authorization for the purpose of providing funds to finance the capital
improvements and replacement program. These senior bonds have interest rates ranging from 5.1% to
5.3% and are payable in semiannual installments at varying amounts through May 1, 2038. The revenue
bonds do not constitute a legal debt or liability for the District, the State of Missouri, or for any political
subdivision thereof and do not constitute indebtedness within the meaning of any constitutional or
statutory debt limitation or restriction.
In November 2006, the District authorized and issued $60,000,000 of Wastewater System Revenue Bonds
Series 2006C (Series 2006C) for the purpose of providing funds to finance the initial phase of its capital
improvements and replacement program, including constructing, repairing, and replacing new wastewater
facilities. These senior bonds have interest rates ranging from 4.1% to 5.0% and are payable in semiannual
installments at varying amounts through May 1, 2036. The revenue bonds do not constitute a legal debt or
liability for the District, the State of Missouri, or for any political subdivision thereof and do not constitute
indebtedness within the meaning of any constitutional or statutory debt limitation or restriction.
In May 2004, the District authorized and issued $175,000,000 of Wastewater System Revenue Bonds
Series 2004A (Series 2004A) for the purpose of providing funds to finance the initial phase of its capital
improvements and replacement program, including constructing, repairing, and replacing new wastewater
facilities. These senior bonds have interest rates ranging from 2.0% to 5.0% and are payable in semiannual
installments at varying amounts through May 1, 2034. The revenue bonds do not constitute a legal debt or
liability for the District, the State of Missouri, or for any political subdivision thereof and do not constitute
indebtedness within the meaning of any constitutional or statutory debt limitation or restriction.
The issuance of the revenue bonds does not obligate the District to levy any form of taxation therefore or to
make any appropriation for their payments in any fiscal year. The principal and interest on the bonds are
expected to be paid from future wastewater revenues. The scheduled payment of the principal of and
interest on the Series 2006C and 2004A Bonds are guaranteed under a financial guaranty insurance policy.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
45
7. Long-Term Liabilities (Continued)
Water Pollution Control and Drinking Water Revenue Bonds Payable
In October 2008, the State Environmental Improvement and Energy Resources Authority (the Authority)
authorized and issued $69,435,000 of Water Pollution Control and Drinking Water Revenue Bonds
(State Revolving Funds Programs) Series 2008A (Series 2008A). The Series 2008A bonds provided
funds to make loans to fourteen Missouri political subdivisions that will be used to finance water
pollution control and drinking water projects. A portion of the proceeds of the Series 2008A/B bonds
issued by the Authority were used to purchase subordinate Participant Revenue Bonds (Participant
Bonds) authorized and issued by the District in the aggregate principal amount of $40,000,000, the
proceeds of which will be used for constructing, repairing, and equipping new and existing wastewater
facilities. The District’s Participant Bonds have interest rates ranging from 4.0% to 5.7% and are
payable in semiannual installments at varying amounts through January 1, 2029.
In November 2006, the Authority authorized and issued $22,105,000 of State Revolving Funds Programs
Series 2006B (Series 2006B). The Series 2006B bonds provided funds to make loans to seven Missouri
political subdivisions that will be used to finance water pollution control and drinking water projects. A
portion of the proceeds of the Series 2006B bonds issued by the Authority were used to purchase
Participant Bonds authorized and issued by the District in the aggregate principal amount of
$14,205,000, the proceeds of which will be used for constructing, repairing, and equipping new and
existing wastewater facilities. The District’s Participant Bonds have interest rates ranging from 4.0% to
5.0% and are payable in semiannual installments at varying amounts through July 1, 2027.
In May 2006, the Authority authorized and issued $87,505,000 of State Revolving Funds Programs
Series 2006A (Series 2006A). The Series 2006A bonds provided funds to make loans to thirteen
Missouri political subdivisions that will be used to finance water pollution control and drinking water
projects. A portion of the proceeds of the Series 2006A bonds issued by the Authority were used to
purchase subordinate Participant Bonds authorized and issued by the District in the aggregate principal
amount of $42,715,000, the proceeds of which will be used for constructing, repairing, and equipping
new and existing wastewater facilities. The District’s Participant Bonds have interest rates ranging from
3.5% to 4.5% and are payable in semiannual installments at varying amounts through July 1, 2026.
In May 2005, the Authority authorized and issued $53,060,000 of State Revolving Funds Programs
Series 2005A (Series 2005A). The Series 2005A bonds provided funds to make loans to ten Missouri
political subdivisions and one Missouri nonprofit corporation that will be used to finance water pollution
control and drinking water projects. A portion of the proceeds of the Series 2005A bonds issued by the
Authority were used to purchase subordinate Participant Bonds authorized and issued by the District in
the aggregate principal amount of $6,800,000, the proceeds of which will be used for constructing,
repairing, and equipping new and existing wastewater facilities. The District’s Participant Bonds have
interest rates ranging from 3.0% to 5.0% and are payable in semiannual installments at varying amounts
through July 1, 2026.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
46
7. Long-Term Liabilities (Continued)
Water Pollution Control and Drinking Water Revenue Bonds Payable (Continued)
In May 2004, the Authority authorized and issued $179,780,000 of State Revolving Funds Programs
Series 2004B (Series 2004B). The Series 2004B bonds provided funds to make loans to seven Missouri
political subdivisions that will be used to finance water pollution control projects. A portion of the
proceeds of the Series 2004B bonds issued by the Authority were used to purchase subordinate
Participant Bonds authorized and issued by the District in the aggregate principal amount of
$161,280,000, the proceeds of which will be used to finance the District’s three water pollution control
construction projects outlined in the agreement. The District’s Participant Bonds have interest rates
ranging from 2.0% to 5.3% and are payable in semiannual installments at varying amounts through
January 1, 2027.
The Series 2004B, 2005A, 2006A, 2006B, and 2008A/B bonds and the Series 2009A and 2010A direct
loans do not constitute a legal debt or liability for the District, the State of Missouri, or for any political
subdivision thereof and do not constitute indebtedness within the meaning of any constitutional or
statutory debt limitation or restriction. The issuance of the Series 2004B, 2005A, 2006A, 2006B bonds
and the Series 2009A and 2010A direct loans do not obligate the District to levy any form of taxation
therefore or to make any appropriation for their payments in any fiscal year. The principal and interest
on the bonds are expected to be paid from future wastewater revenues.
In connection with the District’s issuance of the Participant Bonds, which were purchased with the
proceeds of the Series 2004B, 2005A, 2006A, 2006B, 2008A/B bonds and 2009A and 2010A direct
loans issued by the Authority, the District participates in the State Revolving Loan Program established
by the Missouri Department of Natural Resources (the DNR). Monies from federal capitalization grants
and state matching funds are used to fund a reserve account for each participant.
As the District incurs approved capital expenses, the DNR reimburses the District for the expenses from
the bond proceeds account and deposits in a bond reserve fund in the District’s name an additional 60%
of the expenditure amount for the Series 2004B bonds or 70% for the Series 2005A, 2006A, 2006B
bonds or 100% for the Series 2008A/B bonds. Interest earned from this reserve fund can be used by the
District to fund interest payments on the bonds.
On the date of each payment of the principal amount of the District’s Participant Bonds, the trustee
transfers from this reserve account to the master trustee an amount equal to 60% of the principal payment
for the Series 2004B bonds or 70% for the Series 2005A, 2006A, 2006B bonds or 100% for the series
2008A/B bonds. The costs of operation and maintenance of the wastewater treatment and sewerage
facilities and the debt service is payable from wastewater revenues.
In accordance with the Series 2004A, 2004B, 2005A, 2006A, 2006B, 2008A/B bond and 2009A and
2010A direct loans, the District’s annual net operating revenues from wastewater activities, as defined in
the agreement, coupled with investments earnings must be at least 125% of the current portion of
principal and interest due on all senior bonds and at least 115% of the current portion of principal and
interest due on all bonds. At June 30, 2010 and 2009, the District was in compliance with this covenant.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
47
7. Long-Term Liabilities (Continued)
Principal and Interest Requirements on Revenue Bonds Payable
The annual principal and interest requirements to maturity on revenue bonds payable outstanding as of
June 30, 2010 are as follows:
Wastewater System Revenue Bonds Payable/
Water Pollution Control and Drinking Water
Revenue Bonds Payable
Years ending June 30, Principal Interest Total
2011 $ 12,782,500 $ 25,088,029 $ 37,870,529
2012 13,907,500 28,177,610 42,085,110
2013 14,235,833 27,575,271 41,811,105
2014 14,746,667 26,956,056 41,702,723
2015 15,158,750 26,302,786 41,461,536
2016-2020 86,267,500 119,917,800 206,185,300
2021-2025 103,705,000 96,762,614 200,467,614
2026-2030 95,906,250 70,719,488 166,625,738
2031-2035 115,285,000 45,920,953 161,205,953
2036-2039 94,880,000 13,348,830 108,228,830
Total $566,875,000 $480,769,437 $1,047,644,438
West Watson and Nanell Loan Agreement
During fiscal year 2005, the DNR loaned $535,600 to the District. The West Watson and Nanell Loan
bears interest at a rate of 1.5% and is payable through November 1, 2014. The purpose of this note is to
finance the planning, acquisition, construction, improvement, repair, rehabilitation, and extension of the
sewer system of a certain regional subdistrict. This note is classified as special assessment debt by the
District; therefore, the principal and interest on this note will be repaid from additional tax assessments
on property values within the subdistrict. In April 2010, an additional payment was made to bring the
principal balance to zero.
Ozark and Table Rock Loan Agreement
During fiscal year 2004, the DNR loaned $374,680 to the District. The Ozark and Table Rock Loan
bears interest at a rate of 1.5% and is payable through November 1, 2013. The purpose of this note is to
finance the planning, acquisition, construction, improvement, repair, rehabilitation, and extension of the
sewer system of a certain regional subdistrict. This note is classified as special assessment debt by the
District; therefore, the principal and interest on this note will be repaid from additional tax assessments
on property values within the subdistrict. In April 2010, an additional payment was made to bring the
principal balance to zero.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
48
7. Long-Term Liabilities (Continued)
Energy Efficiency Leveraged Note Payable
In April 2004, the DNR loaned $98,595 to the District. The Energy Efficiency Leveraged Note Payable
bears interest at a rate of 3.2% per annum and is payable through August 1, 2013. The purpose of this
note is to finance the design, acquisition, installation, and implementation of energy conservation
measures. The principal and interest on this note is paid from wastewater revenues.
Principal and Interest Requirements on Energy Efficiency Leveraged Note Payable
The annual principal and interest requirements to maturity on the Energy Efficiency Leveraged Note
Payable outstanding as of June 30, 2010 are as follows:
Energy Efficiency Leveraged Note Payable
Years ending June 30, Principal Interest Total
2011 $ 11,420 $ 1,066 $ 12,486
2012 11,783 703 12,486
2013 12,156 329 12,485
2014 1,312 21 1,333
Total $ 36,671 $ 2,119 $ 38,790
State of Missouri Direct Loan Series 2009A
In October 2009, the DNR loaned $23,000,000 to the District. The State of Missouri Direct Loan
Series 2009A bears interest at a rate of 1.5% per annum and is payable through January 1, 2030.
The purpose of this note is to finance the designing, constructing, improving, renovating, repairing,
replacing and equipping new and existing sewer facilities within the District. The principal and
interest on the bonds are expected to be paid from future wastewater revenues.
Principal and Interest Requirements on State of Missouri Direct Loan Series 2009A
The annual principal and interest requirements to maturity on the State of Missouri Direct Loan Series
2009A outstanding as of June 30, 2010 are as follows:
State of Missouri Direct Loan Series 2009A
Years ending June 30, Principal Interest Total
2011 $ 470,700 $ 401,094 $ 871,794
2012 957,700 325,452 1,283,152
2013 979,800 311,390 1,291,190
2014 1,002,500 297,002 1,299,502
2015 1,025,700 282,282 1,307,982
2016-2020 5,495,400 1,178,370 6,673,770
2021-2025 6,161,000 755,831 6,916,831
2026-2030 6,907,200 282,079 7,189,279
Total $23,000,000 $3,833,500 $26,833,500
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
49
7. Long-Term Liabilities (Continued)
State of Missouri Direct Loan Series 2010A
In January 2010, the State of Missouri’s Direct Loan Program – ARRA issued to the District an amount
totaling $7,980,700 for the construction, improvement, renovation, repair, replacement and equipping of
its wastewater system, under the authority of and in full compliance with the District’s Charter (Plan).
The District’s interest rate is 1.5% and is payable in semiannual installments at varying amounts through
July 1, 2031.
Principal and Interest Requirements on State of Missouri Direct Loan Series 2010A
The annual principal and interest requirements to maturity on the State of Missouri Direct Loan Series
2010A outstanding as of June 30, 2010 are as follows:
State of Missouri Direct Loan Series 2010A
Years ending June 30, Principal Interest Total
2011 $ -- $ 109,912 $ 109,912
2012 -- 118,114 118,114
2013 337,700 116,871 454,571
2014 344,500 111,848 456,348
2015 351,500 106,724 458,224
2016-2020 1,867,500 453,036 2,320,536
2021-2025 2,065,200 308,380 2,373,580
2026-2030 2,283,300 148,424 2,431,724
2031-2035 731,000 10,856 741,856
Total $7,980,700 $1,484,165 $9,464,865
Master Equipment Lease / Purchase Agreement
In June 2009, the District entered into a lease purchase agreement in which the District will receive
proceeds in the total amount of $12,000,000 in monthly installments over the next nineteen months.
These proceeds will be used to lease technology related to the District’s upgrade to a new enterprise
system. The lease bears interest at a rate of 3.2% and is payable through June 19, 2013 at which time the
District has the option to purchase the leased equipment.
Principal and Interest Requirements on Master Equipment Lease/Purchase Agreement
Master Equipment Lease / Purchase Agreement
Years ending June 30, Principal Interest Total
2011 $2,927,513 $221,942 $3,149,455
2012 2,999,842 149,613 3,149,455
2013 3,096,139 53,316 3,149,455
Total payments remaining 9,023,494 424,871 9,448,365
Remaining available draws 1,759,807 -- 1,759,807
Total $7,263,687 $424,871 $7,688,558
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
50
7. Long-Term Liabilities (Continued)
Restricted Cash and Investments
The following trustee held accounts have been established in accordance with bond ordinances and
financing agreements that require receipts generated from operations be segregated and certain reserve
accounts be established:
Revenue Fund
The Revenue Fund will be used for the purpose of depositing wastewater operating revenues,
providing funds to pay for expenses related to the operation and maintenance of the District, and
fulfilling Sinking Fund requirements in accordance with the bond ordinances.
Sinking Fund
The bond ordinances provide for deposits to and the use of monies in the Sinking Fund to be used for
the sole purpose of principal and interest payments on the bonds. Sufficient monies shall be paid in
periodic installments from the Revenue Fund.
Debt Service Fund
The Debt Service Fund shall be used by the Trustee for the sole purpose of paying the principal and
interest on the bonds, as and when the same become due.
Debt Service Reserve Fund
After initial deposit of the amount required pursuant to the bond ordinances and financing agreements
of the Series 2004A, 2006C, 2008A and 2010B bonds, monies in the Debt Service Reserve Fund
shall be disbursed and expensed by the District solely for the payment of the principal and interest on
the bonds and notes to the extent of any deficiency in the Debt Service Fund for such purpose. The
District may disburse and expend monies from the Debt Service Reserve Fund for such purpose
immediately. As of June 30, 2010 and 2009, cash and investments in the Debt Service Reserve Fund
totaled $30,691,786 and $27,752,687, respectively.
Special Participant Bond Reserve Account
For the Series 2004B, 2005A, 2006A, 2006B, 2008A/B, 2009A and 2010A bonds, the District shall
deposit into the Special Participant Bond Reserve Account amounts in accordance with the bond
ordinance, if any, which shall be disbursed and expensed by the District solely for the payment of the
principal and interest on the Participant Bonds to the extent of any deficiency in the Sinking Fund for
such purpose. At June 30, 2010 and 2009, cash and investments in the Special Participant Bond
Reserve Account held on behalf of the District totaled $153,013,769 and $161,344,007, respectively.
Monies in this account are not considered to be District funds. However, interest earnings on this
account may be used by the District to reduce interest payments on the bonds outstanding.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
51
7. Long-Term Liabilities (Continued)
Restricted Cash and Investments (Continued)
Renewal and Extension Fund
All sums accumulated and retained in the Renewal and Extension Fund shall be first used to prevent
default in the payment of principal and interest on the bonds when due and shall then be applied by
the District for purposes pursuant to the trust indenture. No monies have been deposited into this
account at June 30, 2010 and 2009.
Project Fund
The Project Fund for all bond issuances outstanding will be used for the purpose of providing monies
to pay project costs. The proceeds from the bonds and notes, after a deposit into the Debt Service
Reserve Fund for the amounts required pursuant to the bond ordinances and note agreements of
Series 2004A, 2006C and 2008A bonds, shall be deposited into the Project Fund. At June 30, 2010
and 2009, cash and investments in the Project Fund totaled $63,710,851 and $8,021,897,
respectively.
Rebate Fund
The bond ordinances provide for the creation of a Rebate Fund into which shall be deposited such
amounts as are required to be deposited therein pursuant to the arbitrage instructions regarding the
calculation and payment of rebate amounts due. The District does not have any rights in or claims to
such money; provided, however, any funds remaining in the Rebate Fund after redemption and
payment of all bonds and payment of any rebatable arbitrage amount, or provision having been made
therefore, shall be remitted to the District. At June 30, 2010 and 2009, cash and investments in the
Rebate Fund totaled $237,585 and $571,477, respectively.
Administrative Fee Fund
The Administrative Fee Fund will be used for the payment of the Trustee’s fees and other
administrative fees pursuant to the note agreement. The Trustee shall immediately withdraw the fee
amounts when due. Monies held in this account shall not be invested.
Fair Value of Financial Instruments
The value of the District’s long-term debt is estimated based on the current rates offered to the District
for debt of the same remaining maturities. The carrying amount and estimated fair value of the District’s
long-term debt as of June 30, 2010 was $605,156,058 and $631,821,339, respectively. The carrying
amount and estimated fair value of the District’s long-term debt as of June 30, 2009 was $501,884,128
and $526,658,421, respectively.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
52
8. Defined Benefit Pension Plan
Plan Description
The Metropolitan St. Louis Sewer District Employees’ Pension Plan (the Plan) is a noncontributory
single employer defined benefit plan providing retirement benefits as well as death and disability
benefits to members. As a condition of employment, all full-time employees of the District are covered
by the Plan. The financial statements for the Plan are produced using the accrual basis of accounting.
Under the accrual basis of accounting, revenues are recognized when earned and expenses are
recognized when the related liability is incurred. The Plan issues a publicly available financial report
that includes financial statements and required supplementary information. That report may be obtained
by writing: The Metropolitan St. Louis Sewer District, 2350 Market Street, St. Louis, MO 63103-2555.
The Plan, established on November 1, 1967, is amended from time to time by the District’s Board of
Trustees, primarily to improve benefits to members. A Pension Committee consisting of two members
of the District’s Board of Trustees, two elected employee members, and four members of the District’s
management staff administer the Plan. A committee of the District’s Board of Trustees, with the aid of
an investment advisor, reviews and evaluates the Plan’s investments and the related rates of return on a
periodic basis. The Plan is exempt from the requirements of the Employee Retirement Income Security
Act of 1974 (the “Act”) and, as such, is not subject to the Act’s reporting requirements.
All benefits vest after five years of credited service. Members retiring at or after age 65 with five or more
years credited service are entitled to a pension benefit. The Plan permits early retirement with reduced
benefits beginning at age 55 if the member has completed 60 months of employment. A member whose
combined age and term of service is equal to 75 may retire early with unreduced benefits.
The annual benefit accrued by a member is equal to 1.5% of final average earnings plus 0.4% of final average
earnings that are in excess of covered earnings multiplied by the period of years and months of credited service
not to exceed 35 years. A survivor’s benefit for vested members who have not yet reached their normal
retirement date or earned 75 points is provided for. The survivor’s benefit is equal to the greater of 50.0% of the
member’s monthly-accrued retirement benefit as of the date of death, or 15.0% of the monthly earnings and the
member’s monthly-accrued retirement benefit actuarially reduced under the 100.0% joint and survivor annuity
option. Members are also able to select a Contingent Annuity Pop-Up option. This option allows the member
to elect a survivor annuity for life, with the provision that if the beneficiary should predecease the member, the
benefit shall increase to the amount payable had the survivor option not been selected.
Ordinance Number 10872, effective January 1, 2001, further amended the Plan to extend the cost of
living increases for retirees from a maximum of 30.0% to 45.0% of the original benefit.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
53
8. Defined Benefit Pension Plan (Continued)
Plan Description (Continued)
Effective August 1, 2004, Ordinance No. 11781 amended the Plan to change the benefit formula to 1.7%
of final average earnings plus 0.4% of final average earnings that are in excess of covered earnings
multiplied by the period of years and months of credited service not to exceed 35 years without
including accrued sick leave. Effective July 1, 2007, Ordinance No. 12395 amended the Plan for
members whose annual retirement benefit , as of July 1, 2007, is determined to be higher under the
formula using the definition of “Final Average Earnings” in effect prior to August 1, 2004. Under the
interim rule, if such a member retires on his normal retirement date of or after July 1, 2007 and/or before
June 1, 2009 (the “window period”), he may elect to have his benefit determined using the 1.5%/0.4% of
final average earnings formula including accrued sick leave or the 1.7%/0.4% of final average earnings
formula without using accrued sick leave. The interim rule will not apply if at any time during the
window period a member’s benefit is determined to be higher under the 1.7%/0.4% formula. Sick leave
is paid out at 1.3% per year of service times the amount of leave accrued not to exceed $50,000 unless
the employee accrued an amount greater than $50,000 as of July 1, 2004, and retires or dies while in
active service prior to July 1, 2007. Also, the Plan was amended to provide the retiring member with a
10% partial lump sum payment option. The balance of the distribution will be paid in accordance with
any one of the other payment options available under the Plan.
The retirement benefit payable to a member who retires after his or her normal retirement date is the
greater of a) the benefit that would have been payable on the normal retirement date plus a special
annual retirement benefit provided by the accumulated value, at 4.0% per annum interest, of the monthly
benefit that would have been received prior to the postponed retirement date or b) the benefit determined
as of the postponed retirement date under the normal formula.
Funding Policy
The District’s employees do not contribute to the Plan. Ordinances establishing the Plan provide for
actuarially determined annual contributions, paid solely by the District, that are sufficient to pay benefits
when due. The Entry Age Normal actuarial funding method is used to determine contributions.
Annual Pension Cost
Contributions of $8,859,535 and $7,425,602, excluding certain professional fees paid by the District,
were made to the Plan during the Plan’s calendar years ended December 31, 2009 and 2008,
respectively. These contributions were made in accordance with actuarially determined contribution
requirements based on actuarial valuations performed at January 1, 2009 and 2008, respectively, and for
2010 consisted of a) $5,651,150 normal cost plus b) $2,590,278 amortization of the actuarial accrued
assets in excess of the actuarial accrued liability and prior changes c) multiplied by an interest factor of
1.075.
The District provides certain professional fees, office space, utilities, and other services to the Plan at no
cost. Other costs of administering the Plan are financed from plan net assets.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
54
8. Defined Benefit Pension Plan (Continued)
Annual Pension Cost (Continued)
Significant actuarial assumptions used in the valuations are as follows:
Latest valuation date January 1, 2010
Actuarial cost method Entry Age Normal
Amortization method Level dollar closed
Amortization period 20-year period
Asset valuation method Three-year average of adjusted market values
Post-retirement benefit increases CPI or 3.0% of current benefit, or $50 maximum, if less
Investment rate of return 7.5% per annum (1)
Projected salary increases 4.5% - 10.0% per annum (1)
Social Security wage base 4.0% per annum increase (1)
(1) Includes inflation component of 3.0%
Three-Year Trend Information
Historical trend information about the District’s participation in the Plan is presented below to help
readers assess the Plan’s funding status on a going-concern basis and assess progress being made in
accumulating assets to pay benefits when due.
Annual Percentage
Calendar Pension of APC Net Pension
Year Cost (APC) Contributed Obligation
2009 $ 8,859,535 100.0% --
2008 7,425,602 100.0% --
2007 7,673,240 100.0% --
Required Supplementary Information
Schedule of Funding Progress (dollars in thousands)
Unfunded
Entry Age Actuarial UAAL as a
Actuarial Actuarial Accrued Annual Percentage
Actuarial Value Accrued Liability Funded Covered of Covered
Valuation of Assets Liability (UAAL) Ratio Payroll Payroll
Date (1) (2) (1)-(2) (1)/(2) (3) (1-2)/(3)
01/01/2010 $ 185,753 $ 223,063 $ (37,310) 83.3% $ 52,267 71.4%
01/01/2009 183,679 212,066 (28,387) 86.6 48,077 59.0
01/01/2008 185,356 195,834 (10,478) 94.6 43,640 24.0
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
55
9. Deferred Compensation Plan
The District offers its employees a Deferred Compensation Plan created in accordance with Internal
Revenue Code Section 457. The Deferred Compensation Plan, available to all District employees,
permits them to defer a portion of their salary until future years. The deferred compensation is not
available to employees until termination, retirement, death, disability, or due to financial hardship as
defined by the Deferred Compensation Plan.
The Deferred Compensation Plan was amended and restated to comply with the Economic Growth and
Tax Relief Reconciliation Act of 2001 (the Act). The Act made significant changes to Section 457(b) of
the Internal Revenue Code of 1986, as previously amended. The Deferred Compensation Plan assets are
held in trust for the exclusive benefit of participants and their beneficiaries under Section 1448 of the
Small Business Job Protection Act of 1996. As a result, the assets and liabilities of the Deferred
Compensation Plan are not included in the accompanying financial statements.
The Deferred Compensation Plan issues a publicly available financial report that includes financial
statements and required supplementary information. That report may be obtained by writing: The
Metropolitan St. Louis Sewer District, 2350 Market Street, St. Louis, MO 63103-2555.
10. Post-Employment Benefits Other than Pensions
Plan Description
As part of a total compensation package, the District provides a single-employer defined benefit health
care plan to employees who retire from the District on or after age 62 and five years of service or whose
age plus years of service equal 75 points (“Rule of 75”). The District pays the monthly group health
insurance premium for the individual until the retiree becomes eligible for Medicare at age 65. In
addition, there is a closed group of disabled former employees who receive life insurance coverage from
the District. The District’s annual other post-employment benefit (OPEB) cost (expense) is calculated
based on the annual required contribution (ARC) of the employer, an amount actuarially determined in
accordance with the parameters of GASB 45. The ARC represents a level of funding that, if paid on an
ongoing basis, is projected to cover normal cost each year and to amortize any unfunded actuarial
liabilities. The District’s annual OPEB cost for the current year and the related information are as
follows:
Amortization of past service cost $ 813,700
Normal cost 1,199,400
Interest to end of fiscal year 90,600
ARC 2,103,700
Interest on net OPEB obligation 45,600
Adjustment to annual required contribution (33,800)
Annual OPEB cost 2,115,500
Contributions made (1,206,100)
Increase in net OPEB obligation 909,400
Net OPEB obligation-beginning of year 1,014,700
Net OPEB obligation-end of year $ 1,924,100
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
56
10. Post-Employment Benefits Other than Pensions (Continued)
Plan Description (Continued)
The Plan was established by District Ordinance, which assigned the authority to establish and amend
plan benefit provisions to the District.
The contribution requirements of the District and plan members are established and may be amended by
the District.
Three-Year Trend Information
Annual Percentage
Fiscal Required of ARC Net OPEB
Year Cont. (ARC) Contributed Obligation
2010 $ 2,103,700 57.0% $ 1,924,100
2009 1,744,700 69.0% 1,014,700
2008 1,709,700 73.0% 466,900
Required Supplemental Information
Schedule of Funding Progress (dollars
in thousands)
Unfunded
Actuarial UAAL as a
Actuarial Actuarial Accrued Percentage
Actuarial Value Accrued Liability Funded Covered of Covered
Valuation of Assets Liability (UAAL) Ratio Payroll Payroll
Date (1) (2) (1)-(2) (1)/(2) (3) (1-2)/(3)
07/01/2007 $ -- $ 21,938 $ 21,938 --% $ 43,640 50.3%
07/01/2009 -- 24,412 24,412 -- 50,230 48.6
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
57
10. Post-Employment Benefits Other than Pensions (Continued)
Pan Description (Continued)
Significant actuarial assumptions used in the valuation are as follows:
Latest valuation date January 1, 2010
Discount rate 4.5% per annum
Amortization period 30-year period
Medical trend:
Year
Medical
Year
Medical
2009 8.4% 2035 5.0%
2010 7.5 2040 4.8
2011 6.4 2045 4.7
2012 5.7 2050 4.6
2013 5.7 2055 4.5
2014 5.6 2060 4.5
2015 5.6 2065 4.4
2016 5.6 2070 4.4
2020 5.5 2075 4.4
2025 5.4 2080+ 4.4
2030 5.3
The healthcare trends used in this valuation are based on long term healthcare trends generated by the
Getzen Model. The Getzen Model is the result of research sponsored by the Society of Actuaries and
completed by a committee of economists and actuaries. This model is the current industry standard for
projecting long term medical trends. Inputs to the model are consistent with the assumptions used in
deriving the discount rate used in the valuation.
Payroll inflation 4.5% per annum
Mortality 1983 Group Annuity Mortality Table, male rates,
set back 6 years for females
Terminations of
Employment:
Select Rates based on service, Ultimate Rates based on
attained age, Ultimate Rates are from the Sarason T-1
Table:
Employees
Select Rates
(0 to 4 years of service)
Ultimate Rates
(after 4 years of service)
Years of
Service
Rate
Attained
Age
Rate
0 20.0% 20 5.5%
1 12.0 30 3.7
2 7.5 40 1.1
50+ 0.0
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
58
10. Post-Employment Benefits Other than Pensions (Continued)
Pan Description (Continued)
Retirement – Rates vary by age
Age Before 75 Points After 75 Points
55 1.0% 10.0%
56 2.0 10.0
57 2.0 10.0
58 2.0 10.0
59 3.0 10.0
60 4.0 15.0
61 5.0 15.0
62 20.0 35.0
63 10.0 25.0
64 20.0 25.0
65 100.0 100.0
Disability
Percent
Becoming
Age Disabled
20 0.056%
30 0.064
40 0.102
50 0.311
Future Retiree Coverage 90.0% of employees retiring prior to age 65 are
assumed to elect medical coverage
Future Dependent Care 25.0% elect spouse coverage
0.0% dependent children coverage
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
59
11. Self-Insurance Programs
The District is exposed to various risks of loss related to torts; theft of, damage to, and destruction of
assets; errors and omissions; injuries to employees; and natural disasters. The District has established a
risk management program and retains the risk related to its obligation to provide workers' compensation
and medical and hospitalization benefits to its employees; and to pay water backup claims to its
customers. The estimated liabilities for payment of incurred (both reported and unreported) but unpaid
claims relating to these matters are included as a component of current deposits and accrued expenses,
and as such are expected to be paid within one year of the date of the statement of net assets. At June 30,
2010 and 2009, these liabilities amounted to $4,713,013 and $2,246,526, respectively.
The claims liabilities reported are based on the requirements of GASB Statement No. 10, which requires that
a liability for claims be reported if information obtained prior to the issuance of the financial statements
indicates it is probable that a liability has been incurred and the amount of the liability can be reasonably
estimated. Changes in the balance of claims liabilities during fiscal 2010 and 2009 were as follows:
2010 2009
Liability, beginning of year $ 2,246,526 $ 5,056,208
Current year claims and changes in estimates 12,018,566 15,027,843
Claim payments (9,552,079) (17,837,525)
Liability, end of year $ 4,713,013 $ 2,246,526
The District obtains periodic funding valuations from the third-party administrators managing the self-
insurance programs and adjusts the charges as required to maintain the appropriate level of estimated claims
liability. The District also maintains excess liability insurance coverage for workers' compensation and
medical and hospitalization claims; general liability; and water backup damage to customers’ property.
The District purchases commercial insurance for all other risks of loss. Settled claims have not exceeded
this commercial coverage in any of the past three years.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2009 and 2008
60
12. Closure and Postclosure Care Costs
State and federal laws and regulations require the District to place a final cover on its Prospect Hill
Reclamation Project landfill site when it stops accepting waste and to perform certain maintenance and
monitoring functions at the site for 30 years after closure. Although closure and postclosure care costs
will be paid only near or after the date that the landfill stops accepting waste, the District reports a
portion of these closure and postclosure care costs as an operating expense in each period based on
landfill capacity used as of the end of the fiscal year. The $662,018 and $622,365 reported as landfill
closure and postclosure care liabilities at June 30, 2010 and 2009, respectively, represent the cumulative
amounts reported at fiscal year-end based on the use of 89.0% and 80.0% of the estimated capacity of
the landfill for fiscal years ended 2010 and 2009, respectively. The District will recognize the remaining
estimated cost of closure and postclosure care of $79,303 at June 30, 2010 as the remaining estimated
capacity is filled. These amounts are based on what it would cost to perform all closure and postclosure
care in 2010. The District expects to close the landfill in the year 2012. Actual cost may be higher due
to inflation, changes in technology, or changes in regulations.
The District is required to demonstrate that it has the financial capability to close the landfill to the State
of Missouri through the use of a financial test as specified in 10 CSR 80-2.030(4)(D)6 of the Missouri
Solid Waste Management Rules. The District has complied with the State’s requirement. The District
recognizes that estimates of closure costs may change as a result of inflation, deflation, and/or changes in
technology and applicable laws and regulations. If closure cost estimates change, the liability currently
reported on the balance sheet will be adjusted accordingly.
13. Commitments and Contingencies
US and State of Missouri v. Metropolitan St. Louis Sewer District; In the US District Court for the
Eastern District of Missouri; Case No. 07-1120. A lawsuit was filed by the Department of Justice on
behalf of the United States Environmental Protection Agency (“EPA”) for various alleged violations of
the Clean Water Act. The District has been the subject of several investigatory actions by EPA over the
past several years. Negotiations have been ongoing with EPA and the DNR regarding the sewer
collection system, both the combined system and the sanitary system, for several years. The Missouri
Coalition for the Environment (“MCE”) gave Notice of Intent to Sue the District under the citizen suit
provisions of the Clean Water Act. EPA and the DNR then brought the suit in June 2007, and MCE
moved to intervene. Intervention was granted in August 2007. In October 2007, the Court granted the
District’s motion to dismiss all of the plaintiffs’ claims for civil penalties attributable to any and all of
the District’s alleged violations of the Clean Water Act that occurred before June 11, 2002 from this
litigation. The suit is based on violations of the Clean Water Act as a result of overflows in the
combined and sanitary sewer systems causing pollutants to reach waters of the United States. There are
other counts involving violations of permit conditions. Also, the suit alleges that the District does not
have an approved Long-Term Control Program (“LTCP”) for the combined system. The District has
been working on these issues for several decades and has asked voters to approve bonds and rate
increases to rehabilitate and maintain the collection system. As required by its Charter, the District has
increased rates which will continue to fund the improvements sought by EPA and the DNR. In
September 2008, the Judge put in place a Stay while the parties mediate the issues. The parties have
been in mediation over the past two years. A status report on the Stay is due in December 2010.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
61
13. Commitments and Contingencies (Continued)
William Zweig et al. v. Metropolitan Sewer District. This case was filed on July 18, 2008 and, as
amended, contends that Metropolitan Sewer District Ordinances No. 12560 and No. 12789, which
enacted increases in the District’s stormwater user charge based on the amount of impervious area on the
customer’s property, are unconstitutional. The lawsuit claims the ordinances violate the so-called
Hancock Amendment, Mo. Const. art. X, § 22(a), because the stormwater user charge is in reality a tax
that requires voter approval. The District’s Board of Trustees passed the ordinances in December 2007
and December 2008, respectively, without submitting them to the voters. The District contends the
stormwater user charge is not a tax and, thus, not subject to voter approval. The original plaintiff is a
District stormwater customer who seeks to represent a class of all the District stormwater customers. In
July 2009, two more plaintiff class representatives were added to the lawsuit. The lawsuit seeks (1) a
declaration that the stormwater user charge is unconstitutional, (2) a refund of all stormwater user
charges collected, and (3) payment of the plaintiffs’ costs, including attorneys’ fees.
Trial was held April 13, 2010 through April 16, 2010. On July 9, 2010, the court handed down Findings
of Fact, Conclusions of Law, Judgment and Decree in the first phase of the bifurcated trial. The court
declared the Stormwater User Charge is a tax under the Hancock Amendment. The second phase of the
trial was heard on October 6, 2010, to determine the amount, if any, to be refunded. The judge has not
yet issued a ruling on the second phase of the case. The District cannot predict with any certainty at this
time whether, or in what amount, the District may be required to make a refund. The third phase will
determine the amount of plaintiffs’ attorneys’ fees, to be paid by the District out of any refund awarded.
Once the judge rules on phases 2 and 3, the case will be appealable.
The District has collected approximately $90,872,000 since it implemented the impervious charge in
March 2008 until it suspended collection of the impervious charge in August 2010. The District has
resumed the collection of real and personal property taxes for stormwater purposes along with a 24¢ per
month per customer charge that was previously voted on in 1988. This is consistent with how the
District funded stormwater operations prior to implementing the impervious stormwater user charge and
is consistent with the court ruling dated July 7, 2010.
The District is a defendant in various other matters of litigation. Of these matters, management and
District’s legal counsel do no anticipate any material effect on the June 30, 2010 and 2009 financial
statements.
The District has entered into construction and other contracts amounting to approximately $206,441,182
and $226,105,854 at June 30, 2010 and 2009, respectively. Grants to be received from various
governmental agencies and entities to partially offset the cost of the contract commitments amounted to
approximately $2,693,317 and $399,000 at June 30, 2010 and 2009, respectively.
As of June 30, 2010, the District had $245,000,000 in bonds authorized by the voters in August 2008,
but unissued. These bonds will fund the second phase of a multi decade wastewater capital improvement
program.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
62
14. Restricted Net Assets
The government-wide Statements of Net Assets reports $80,782,806 and $94,768,570 of restricted net
assets at June 30, 2010 and 2009, respectively, of which $50,836,337 and $60,797,463 are restricted by
enabling legislation as of June 30, 2010 and 2009, respectively.
15. Segment Information
The District issued wastewater revenue bonds to finance wastewater infrastructure projects. The District
accounts for both wastewater and stormwater activities in a single enterprise fund, but investors in those
bonds rely solely on the revenue generated by the wastewater activities for repayment. Summary
financial information for each business line is presented below.
Wastewater Stormwater
Condensed Statement of Net Assets
Total current assets $ 305,863,378 $ 65,362,021
Total restricted assets 60,261,049 22,197,377
Total other assets 15,319,087 --
Net capital assets 1,881,263,973 530,612,916
Total assets 2,262,707,487 618,172,314
Total current liabilities 66,369,981 10,052,419
Total current restricted liabilities 1,395,959 279,661
Total long-term liabilities 594,345,364 786,023
Total liabilities 662,111,304 11,118,103
Invested in capital assets, net of related debt 1,338,360,856 530,612,916
Restricted net assets 58,865,090 21,917,716
Unrestricted net assets 203,370,237 54,523,579
Total net assets $1,600,596,183 $607,054,211
Condensed Statement of Revenues,
Expenses, and Changes in Net Assets
Operating revenues $ 204,697,930 $ 41,889,244
Depreciation expense (42,129,185) (11,882,591)
Other operating expenses (145,598,505) (29,168,593)
Operating income 16,970,240 838,060
Total nonoperating revenues 5,557,107 2,662,757
Total nonoperating expenses (25,083,597) (696,937)
Nonoperating income (19,256,490) 1,965,820
Capital contributions 10,611,024 9,174,988
Change in net assets 8,054,774 11,978,868
Beginning net assets 1,592,541,409 595,075,343
Ending net assets $1,600,596,183
$607,054,211
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
63
15. Segment Information (Continued)
Condensed Statement of Cash Flows
Operating activities $ 28,953,319 $ 38,963,073
Noncapital financing activities -- 1,401,100
Capital and related financing activities (38,972,995) (42,434,396)
Investing 14,225,082 3,173,502
Increase in cash 4,205,406 1,103,279
Cash beginning 5,415,139 1,042,987
Cash Ending
$ 9,620,545 $ 2,146,266
16. Prior Period Adjustment
An internal review of the District’s CIRP during 2010 in conjunction with the implementation of the
new ERP system, the District discovered that prior year operating and nonoperating expenses totaling
$25,696,026 were incorrectly recorded to CIRP in the enterprise wide financial statements.
Accordingly, the District restated its financial statements for the years ended June 30, 2009 and June 30,
2008. The effect of the restatement was to decrease the change in net assets for fiscal years 2004
through 2009. To correct this error, the beginning prior year net assets of $2,144,497,330, as originally
reported, have been decreased to $2,125,961,747. The ending prior year net assets of $2,213,312,778, as
originally reported, have been decreased to $2,187,616,752. The annual effect for each year is as
follows:
Years Reduction in Increase in Increase in
Ending Construction Other Operating Non Recurring
June 30, in Progress Expense Projects and Studies
2009 $7,160,443 $4,835,151 $2,325,292
2008 7,664,659 5,422,825 2,241,834
2007 1,229,060 1,229,060
2006 2,188,112 2,188,112
2005 4,545,658 4,545,658
2004 and prior 2,908,094 2,908,094
Total $25,696,026 $10,257,976 $15,438,050
17. Subsequent Events
Only July 9, 2010, the court declared that the stormwater user charge is in reality a tax that requires voter
approval under the Hancock Amendment I. The District has since ceased charging customers for stormwater
usage and has reenacted the property tax that was previously charged. It is estimated that the combination of
taxes along with the stormwater charge will generate approximately $27.0 million in revenue annually.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Notes to Financial Statements
June 30, 2010 and 2009
64
18. Future Accounting Pronouncement
GASB Statement No. 54, Fund Balance Reporting and Governmental Fund Type Definitions (GASB
54), establishes fund balance classifications that comprise a hierarchy based primarily on the extent to
which a government is bound to observe constraints imposed upon the use of the resources reported in
government funds. The additional classifications provided are restricted, committed, assigned, and
unassigned based on the relative strength of the constraints that control how specific amounts can be
spent. GASB 54 will be effective for the District for the fiscal year ending June 30, 2011. The District;
however, has not yet completed its assessment of the statement or the potential impact of the statement
on its financial position
Statistical Section
r
ow you -rtvow.,
that there are 9,900 miles of sewers and storm channels under the area
within the boundaries of Metropolitan St. Louis Sewer DiStrict?
That is enough to go across the United States
more than 21' times!
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
65
Statistical Section
This part of the District’s comprehensive annual financial report presents detailed information as a context
for understanding what the information in the financial statements, note disclosures, and required
supplementary information says about the District’s overall financial health.
Contents Page
Financial Trends 66
These schedules contain trend information to help the reader understand how the
District’s financial performance and well-being have changed over time.
Revenue Capacity 68
These schedules contain information to help the reader assess the District’s most
significant local revenue source, the user charge.
Debt Capacity 75
These schedules present information to help the reader assess the affordability
of the District’s current levels of outstanding debt and the District’s ability to
issue additional debt in the future.
Demographic and Economic Information 78
These schedules offer demographic and economic indicators to help the reader
understand the environment within which the District’s financial activities
take place.
Operating Information 81
These schedules contain service and infrastructure data to help the reader
understand how the information in the District’s financial report relates to
the services the District provides and the activities it performs.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
66
2004 2005 2006
2003 As Restated As Restated As Restated
Net Assets
Invested in capital assets,
net of related debt 1,548,524$ 1,586,704$ 1,618,219$ 1,651,792$
Restricted 34,723 44,329 47,584 66,973
Unrestricted 158,573 171,858 190,971 247,958
Total Net Assets 1,741,820$ 1,802,891$ 1,856,774$ 1,966,723$
2007 2008 2009
As Restated As Restated As Restated 2010
Net Assets
Invested in capital assets,
net of related debt 1,682,063$ 1,704,322$ 1,798,914$ 1,868,974$
Restricted 85,447 97,422 94,769 80,782
Unrestricted 278,803 324,218 293,934 257,894
Total Net Assets 2,046,313$ 2,125,962$ 2,187,617$ 2,207,650$
Notes:
GASB Statement 34 was implemented in 2002.
Fiscal Year
Fiscal Year
Net Assets by Component
Last Eight Fiscal Years
(000's)
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
67
Income/(Loss)Change
Fiscal Operating Operating Operating Nonoperating before Capital Capital in Net
Year Revenues Expenses Income/(Loss) Income/(Loss) Contributions Contributions Assets
2003 129,469,562 144,277,411 (14,807,849) 28,392,581 13,584,732 28,410,813 41,995,545
2004 As Restated 157,970,382 150,592,370 7,378,012 18,445,656 25,823,668 35,246,721 61,070,389
2005 As Restated 188,993,673 162,373,895 26,619,778 4,678,347 31,298,125 22,585,702 53,883,827
2006 As Restated 206,803,022 175,889,536 30,913,486 25,966,334 56,879,820 53,069,364 109,949,184
2007 As Restated 202,205,532 183,810,507 18,395,025 36,885,268 55,280,293 24,309,430 79,589,723
2008 As Restated 221,925,048 225,145,882 (3,220,834) 37,259,517 34,038,683 45,609,805 79,648,488
2009 As Restated 249,725,358 212,177,779 37,547,579 (2,885,959) 34,661,620 26,993,385 61,655,005
2010 246,587,174 228,778,874 17,808,300 (17,560,670) 247,630 19,786,012 20,033,642
Notes:
GASB Statement 34 was implemented in 2002.
Changes in Net Assets
Last Eight Fiscal Years
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
68
Total
Fiscal Sewer Service Licenses, Permits,Operating
Year Charges, Net and Other Fees Other Revenues
2001 123,985,768 6,049,589 1,739,921 131,775,278
2002 120,500,816 5,706,843 2,232,268 128,439,927
2003 120,994,703 5,435,878 3,038,981 129,469,562
2004 150,903,248 6,297,166 769,968 157,970,382
2005 181,966,427 6,549,221 478,025 188,993,673
2006 200,719,348 5,210,321 873,353 206,803,022
2007 194,798,878 6,030,583 1,376,071 202,205,532
2008 216,618,417 4,345,961 960,670 221,925,048
2009 244,699,964 3,475,283 1,550,111 249,725,358
2010 241,495,357 3,084,552 2,007,265 246,587,174
Operating Revenues by Source
Last Ten Fiscal Years
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
69
Fiscal Employment Materials and Contracted Chemical
Year Costs Utilities Supplies Services Supplies
2001 50,191,757 11,242,361 9,679,471 16,986,941 941,970
2002 51,765,551 10,025,931 9,851,643 20,956,310 759,712
2003 52,536,992 10,341,674 9,686,572 20,841,068 919,906
2004 54,259,559 10,321,708 9,453,919 21,148,553 843,259
2005 52,656,509 11,244,255 7,231,297 30,424,935 946,182
2006 56,817,238 11,963,002 11,602,773 38,472,414 1,089,564
2007 58,731,260 11,362,805 12,335,366 40,879,286 1,260,789
2008 As Restated 60,787,548 12,837,998 14,081,785 64,192,143 1,387,122
2009 As Restated 70,475,293 12,587,699 14,855,989 48,783,447 1,589,650
2010 85,030,456 12,355,232 13,297,892 39,561,050 1,478,605
Subtotal,
Expenses Total
Fiscal before Operating
Year Insurance Other Depreciation Depreciation Expenses
2001 1,425,360 4,654,794 95,122,654 41,946,627 137,069,281
2002 1,581,623 5,510,335 100,451,105 41,940,987 142,392,092
2003 2,689,408 5,349,920 102,365,540 41,911,871 144,277,411
2004 2,837,587 9,135,915 108,000,500 42,591,870 150,592,370
2005 2,968,245 12,459,569 117,930,992 44,442,903 162,373,895
2006 2,816,795 9,147,931 131,909,717 43,979,819 175,889,536
2007 2,915,236 10,604,787 138,089,529 45,720,978 183,810,507
2008 As Restated 2,939,390 13,986,037 170,212,023 54,933,859 225,145,882
2009 As Restated 2,746,119 13,769,203 164,807,399 47,370,379 212,177,779
2010 3,062,439 19,981,424 174,767,098 54,011,776 228,778,874
Operating Expenses
Last Ten Fiscal Years
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
70
2004 2005
2001 2002 2003 As Restated As Restated
Nonoperating revenues
Property taxes levied by the District 22,557,934$ 23,451,036$ 21,101,265$ 21,743,767$ 22,015,870$
Investment income 13,867,375 9,622,027 6,790,455 2,060,259 5,501,708
Recovery of doubtful Clean Water
Improvement Surcharge accounts 204,452 233,006 139,675 115,763 -
Rent and other income 3,408,668 3,319,269 1,124,569 1,010,125 1,038,074
Total nonoperating revenues 40,038,429$ 36,625,338$ 29,155,964$ 24,929,914$ 28,555,652$
Nonoperating expenses
Interest expense 331,343$ 213,376 - - -
Clean Water Capital Improvement
refund - - - - 5,667,330
Net (gain) loss on disposal and sale
of capital assets 884,654 299,720 (3,565,868) 548,133 3,138,531
Nonrecurring projects and studies 6,383,723 2,997,263 4,328,951 6,935,332 8,837,532
Other 24,832 42,116 - 183,773 -
Total nonoperating expenses 7,624,552$ 3,552,475$ 763,083$ 7,667,238$ 17,643,393$
Net nonoperating revenue (expense)32,413,877$ 33,072,863$ 28,392,881$ 17,262,676$ 10,912,259$
2006 2007 2008 2009
As Restated As Restated As Restated As Restated 2010
Nonoperating revenues
Property taxes levied by the District 23,210,982$ 24,401,167$ 27,512,070$ 2,129,475 1,401,100
Investment income 7,610,461 16,946,145 17,476,621 13,115,519 6,553,760
Recovery of doubtful Clean Water
Improvement Surcharge accounts - - - - -
Rent and other income 1,026,547 878,319 529,983 214,674 265,004
Total nonoperating revenues 31,847,990$ 42,225,631$ 45,518,674$ 15,459,668 8,219,864
Nonoperating expenses
Interest expense - - 4,313,973 9,079,269 13,189,283
Clean Water Capital Improvement
refund 95,372 15,000 - - -
Net (gain) loss on disposal and sale
of capital assets 95,064 96,630 686,459 2,161,862 2,719,163
Nonrecurring projects and studies 5,563,301 5,228,733 3,258,725 7,104,496 9,872,088
Other - - - - -
Total nonoperating expenses 5,753,737$ 5,340,363$ 8,259,157$ 18,345,627 25,780,534
Net nonoperating revenue (expense)26,094,253$ 36,885,268$ 37,259,517$ (2,885,959) (17,560,670)
Fiscal Year
Fiscal Year
Nonoperating Revenues and Expense s
Last Ten Fiscal Years
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
71
Type of Monthly Charge Unmetered c Residential c Non-Residential
Wastewater User Charge
Base Charge 10.90 10.90 10.90
Compliance Charge a - - 29.65
Volume Charges
per Ccf b - 1.92 1.92
per room 1.25 - -
per water closet 4.69 - -
per bath 3.91 - -
per separate shower 3.91 - -
Extra Strength Surcharges a
SS over 300 ppm per ton - - 218.90
BOD over 300 ppm per ton - - 551.52
COD over 600 ppm per ton - - 275.76
Stormwater Service Charge
per 100 square feet of impervious property 0.14 0.14 0.14
Notes:
a Applicable only to non-residential customers.
b Ccf = Hundred cubic feet.
c User charges for certain low income residential users will be
50 percent of the regular user charge.
Source: Finance Department
Metered
User Charge Rates
As of June 30, 2010
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
72
2001 2002 2003 2004 b 2005 c
Residential:
Single Family/Unit a 170.52$ 170.52$ 170.52$ 205.32$ 249.84$
Multi-Family/Unit a 145.32 145.32 145.32 173.16 210.00
Commercial/Industrial:
Service Charge/Unit 172.44 172.44 172.44 218.28 236.28
Usage Charge/Ccf 1.05 1.05 1.05 1.34 1.66
Storm Sewer Usage Charge/100
sq. feet of impervious area - - - - -
Extra Strength Surcharges:
Suspended Solids over 300
parts per million/ton 87.20 87.20 87.20 162.88 200.15
Biological Oxygen Demand
(BOD's) over 300
parts per million/ton 217.90 217.90 217.90 319.24 412.58
Chemical Oxygen Demand
(COD's) over 600
parts per million/ton 108.95 108.95 108.95 159.62 206.29
2006 d 2007 2008 e 2009 2010 f
Residential:
Single Family/Unit a 271.44$ 271.44$ 344.88$ 344.88$ 351.12$
Multi-Family/Unit a 228.00 228.00 299.76 299.76 305.04
Commercial/Industrial:
Service Charge/Unit 248.28 248.28 457.20 457.20 486.60
Sanitary Sewer Usage Charge/Ccf 1.81 1.81 1.88 1.88 1.92
Storm Sewer Usage Charge/100
sq. feet of impervious area - - 0.12 0.12 0.14
Extra Strength Surcharges:
Suspended Solids over 300
parts per million/ton 218.90 218.90 218.90 218.90 218.90
Biological Oxygen Demand
(BOD's) over 300
parts per million/ton 461.44 461.44 529.90 529.56 551.52
Chemical Oxygen Demand
(COD's) over 600
parts per million/ton 230.72 230.72 264.85 264.78 275.76
Notes:
a The above rates are based on actual rates and budgeted units.
b Ordinance 11553, effective August 1, 2003, changed all rates. It also changed the level of suspended solids and
chemical oxygen demand at which extra strength surcharges are incurred from 350 to 300 and 300 to 600
parts per million/ton, respectively.
c Ordinance 11692, effective July 1, 2004, changed wastewater rates.
d Ordinance 12019, effective July 1, 2005, changed wastewater rates.
e Ordinance 12561, effective January 1, 2008, changed wastewater rates. Ordinance 12560, effective March 1, 2008,
changed stormwater rates.
f Ordinance 12754, effective July 1, 2009, changed wastewater rates.
Source: Finance Department
Fiscal Year
Fiscal Year
Sewer User Charges (Composite--Annual)
Last Ten Fiscal Years
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
73
Single Multi-
Fiscal Family Family Non-Total
Year Residential Residential Residential Accounts
2001 352,656 45,074 25,779 423,509
2002 353,166 44,581 25,664 423,411
2003 353,935 44,632 25,672 424,239
2004 356,069 44,969 25,806 426,844
2005 360,104 44,506 25,758 430,368
2006 362,043 44,700 25,700 432,443
2007 362,569 44,875 25,647 433,091
2008 391,181 54,862 32,336 478,379
2009 388,791 51,441 32,161 472,393
2010 387,670 50,867 31,939 470,476
Source: Finance Department
a Due to the implementation of the impervious area charge in 2008,
approximately 46,000 additional stormwater only accounts are
billed each month. This charge was challenged and a court
decision was entered on 7/9/10. Based on that decision the
46,000 accounts will not be billed an impervious charge in FY '11.
Number of Customers by Type
Last Ten Fiscal Years
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
74
Customer Amount %
Anheuser-Busch 5,518,959$ 2.29%
Washington University 1,309,287 0.54%
City of St. Louis 1,266,572 0.52%
Mallinckrodt Inc 1,250,530 0.52%
Boeing Co 667,443 0.28%
Zoological Gardens 597,152 0.25%
Sigma-Aldrich 512,958 0.21%
BJC Health System 512,642 0.21%
Sensient Colors Inc 462,261 0.19%
Cott Beverages Inc 438,501 0.18%
Subtotal (10 largest)12,536,305$ 5.19%
Balance from other customers 228,959,052$ 94.81%
Grand totals 241,495,357$ 100.00%
Customer Amount %
Anheuser-Busch 5,300,796$ 4.28%
Solutia Inc.1,124,951 0.91%
DaimlerChrysler Group 741,458 0.60%
Boeing Company 589,641 0.48%
Washington University 521,511 0.42%
BJC Health Systems 507,949 0.41%
Coca-Cola Bottling Co.354,226 0.29%
Laporte Pigments 321,067 0.26%
City of St. Louis, Comptroller 286,875 0.23%
Monsanto Company 284,969 0.23%
Subtotal (10 largest)10,033,443$ 8.09%
Balance from other customers 113,952,325$ 91.91%
Grand totals 123,985,768$ 100.00%
Source: Finance Department
Fiscal Year 2000
User Charges
Ten Largest Customers
Current Year and Ten Years Ago
User Charges
Fiscal Year 2010
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
75
General As a Share
Fiscal Obligation Direct of Personal
Year Bonds Senior Subordinate Loans Amount Per Capita Income
2001 2,205,000 - - - 2,205,000 2 -
2002 - - - - - - -
2003 - - - - - - -
2004 - 175,000,000 161,280,000 473,275 336,753,275 248 0.35
2005 - 175,000,000 166,952,500 771,099 342,723,599 253 0.35
2006 - 173,500,000 205,760,000 680,538 379,940,538 282 0.37
2007 - 231,995,000 213,652,500 337,730 445,985,230 330 0.42
2008 - 230,485,000 206,522,500 269,299 437,276,799 324 0.67
2009 - 258,965,000 235,932,500 4,345,790 499,243,290 373 0.81
2010 - 342,370,000 224,505,000 38,281,058 605,156,058 450 0.97
Notes:
Calculation of "Per Capita" for 2010 is based on estimated population levels.
Calculation of "As a Share of Personal Income" for 2010 is based on estimated income levels.
Sources: Regional Economic Information System, Bureau of Economic Analysis, U.S. Department of Commerce,
and the U.S. Census Bureau
Total
Revenue Bonds
Ratios of Outstanding Debt by Type
Last Ten Fiscal Years
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
76
Amount of Debt Percentage of Debt
Governmental Unit Debt Outstanding within District Boundary within District Boundary
City of St. Louis 46,300,000$ 46,300,000$ 100.0%
St. Louis County 37,990,000 37,686,080 99.2
Municipalities 105,954,505 105,864,505 99.9
City of St. Louis School District 238,329,040 238,329,040 100.0
St. Louis County School Districts 1,133,426,820 1,113,302,980 98.2
Fire Districts 86,041,416 82,072,469 95.4
1,648,041,781$ 1,623,555,074$ 98.5%
Sources:
City of St. Louis, Office of Comptroller
St. Louis County, Department of Revenue
Missouri Department of Education, School Finance
Polled Governments
Computation of Overlapping Debt
As of June 30, 2010
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
77
Less:Less:
Operating Non-Operating
Non-Expenses Expenses Net
Fiscal Operating operating Gross (excluding (excluding net Available
Year Revenues Revenues Revenues depreciation) loss disposals) Revenues
2001 130,549,862 12,059,786 142,609,648 95,122,654 6,408,555 41,078,439
2002 127,213,259 7,948,275 135,161,534 100,451,107 3,039,379 31,671,048
2003 128,243,045 5,657,225 133,900,270 102,570,323 4,328,951 27,000,996
2004 As Restated 156,739,527 1,745,978 158,485,505 108,000,500 7,119,105 43,365,900
2005 As Restated 187,759,272 4,356,643 192,115,915 117,930,992 14,504,862 59,680,061
2006 As Restated 205,554,460 6,135,347 211,689,807 131,909,717 5,658,673 74,121,417
2007 As Restated 200,963,085 13,501,751 214,464,836 138,089,529 5,243,733 71,131,574
2008 As Restated 208,981,377 13,281,919 222,263,296 142,725,186 1,016,891 78,521,219
2009 As Restated 209,972,662 10,283,104 220,255,766 138,971,881 6,656,919 74,626,966
2010 204,697,929 5,358,354 210,056,283 145,598,505 9,773,367 54,684,411
Fiscal Coverage
Year Principal Interest Total Ratio
2001 N/A N/A N/A N/A
2002 N/A N/A N/A N/A
2003 N/A N/A N/A N/A
2004 N/A 924,164 924,164 46.9
2005 1,127,500 14,799,402 15,926,902 3.7
2006 5,407,500 13,835,332 19,242,832 3.9
2007 7,817,500 16,512,429 24,329,929 2.9
2008 8,640,000 17,694,791 26,334,791 3.0
2009 12,110,000 17,503,891 29,613,891 2.5
2010 15,999,006 20,810,158 36,809,164 1.5
Debt Service
Pledged Revenue Coverage
Last Ten Fiscal Years
Notes:
This schedule complies with the procedures associated with the continuing disclosure requirements of the 2004 through 2010 revenue bonds
and, therefore, does not include all the revenues and expenses of the District.
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
Per
Personal Capita Total
Fiscal Income Personal Labor Number of
Year Populations (millions) Income City County State Force Households (1)
2001 1,365,241 49,653 36,369 7.0 4.2 4.7 741,504 551,388
2002 1,363,245 51,465 37,752 9.0 5.4 5.8 740,371 551,388
2003 1,359,820 53,070 39,027 10.0 6.0 6.4 732,905 551,388
2004 1,358,428 54,886 40,404 9.6 5.9 6.3 728,014 551,388
2005 1,354,830 55,841 41,216 8.8 5.5 5.7 726,390 551,388
2006 1,347,691 57,660 42,784 7.5 5.1 5.0 723,627 551,388
2007 1,349,778 59,200 43,859 7.5 5.1 5.0 723,627 551,388
2008 1,348,462 62,135 46,079 7.9 5.9 6.0 690,006 551,388
2009 1,339,011 61,947 46,263 11.5 9.7 9.5 681,801 551,388
2010 1,344,146 62,190 46,267 12.3 9.4 9.3 682,165 551,388
Notes:
(1) The number of households was taken from http://quickfacts.census.gov/qfd/states/29000.html. It is based
on the 2000 census. Information for other years is unavailable, and therefore the 2000 census information
is used for every year in this table.
Sources: Regional Economic Information System, Bureau of Economic Analysis, U.S. Department of Commerce,
and Missouri Economic Resource and Information Center (MERIC)
Footnotes--http://www.bea.gov/regional/reis/scb.cfm
http://www.missourieconomy.org/indicators/LAUS/default.aspx
Unemployment Rate
Saint Louis
Demographic and Economic Statistics
Last Ten Fiscal Years
78
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
79
Percentage Percentage
Employer Employees (1)of Total Rank
Employees (1 )of Total Rank
BJC HealthCare 23,592 4% 1 22,694 3% 1
Boeing, Integrated Defense Systems 16,000 3% 2 21,000 3% 2
Washington University in St. Louis 13,167 2% 3 9,667 1% 5
SSM Healthcare 12,367 2% 4
Scott Air Force Base 11,242 2% 5 9,298 1% 7
Wal-Mart Stores Inc.10,800 2% 6 8,600 1% 9
Schnuck Markets, Inc.10,700 2% 7 13,051 2% 4
United States Postal Service 10,249 2% 8
St. John's Mercy Health Care 9,793 2% 9
McDonald's 9,000 1% 10 9,500 1% 6
Unity Health System 14,174 2% 3
City of St. Louis 8,328 1% 10
Trans World Airlines, Inc.8,765 1% 8
126,910 22%125,077 16%
Notes:
(1) Employees are for the St. Louis area which includes several counties not served by the District.
Sources:
St. Louis Business Journal's Book of Lists 2010
St. Louis Business Journal's Book of Lists 2000
Fiscal Year 2000Fiscal Year 2010
Principal Employers (St. Louis Metropolitan Area)
Current Year and Ten Years Ago
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
80
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Administrative 148 140 155 111 122 118 125 131 133 131
Office/Clerical 97 84 108 81 76 88 86 92 94 89
Plant Operation & Laboratory 233 234 221 231 231 233 234 239 237 249
Engineering & Technical 131 110 115 117 114 119 122 133 144 151
Sewer Construction
& Maintenance 257 273 302 259 258 258 271 276 301 315
Total Employees 866 841 901 799 801 816 838 871 909 935
Source: Human Resources Department
Full-time-Equivalent Employees as of June 30,
Employment Level
Last Ten Fiscal Years
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
81
Average Sewage
Fiscal Treatment in Millions
Year of Gallons per Day
2001 304.1
2002 319.8
2003 302.8
2004 342.3
2005 348.7
2006 291.3
2007 313.4
2008 363.7
2009 394.7
2010 395.5
Source: Operations Department
Average Flow
Last Ten Fiscal Years
THE METROPOLITAN ST. LOUIS SEWER DISTRICT
82
2001 2002 2003 2004 2005
Miles of sewers 8,800 8,800 8,959 9,200 9,568
Number of treatment plants 10 9 8 8 8
Treatment capacity (MGD) a 413 413 413 413 413
Annual engineering maximum plant capacity
(millions of gallons)150,745 150,745 150,745 150,745 150,745
Amount treated annually (millions of gallons)110,997 116,727 116,800 124,940 127,276
Unused capacity (millions of gallons)39,748 34,018 33,945 25,805 23,469
Percentage of capacity utilized 74%77%77%83%84%
2006 2007 2008 2009 2010
Miles of sewers 9,630 9,764 9,723 9,812 9,900
Number of treatment plants 8 8 7 7 7
Treatment capacity (MGD) a 413 426 428 423 423
Annual engineering maximum plant capacity
(millions of gallons)150,745 155,490 154,395 154,395 154,395
Amount treated annually (millions of gallons)106,339 114,391 132,751 144,066 144,358
Unused capacity (millions of gallons)44,406 41,099 21,644 10,329 10,037
Percentage of capacity utilized 71%74%86%93%93%
Sources: Operations Department and Engineering Department
Note:
a Million gallons per day.
Fiscal Year
Fiscal Year
Operating and Capital Indicators
Last Ten Fiscal Years
METROPOLITAN ST. LOUIS SEWER DISTRICT2350 Market Street, St. Louis, Missouri 63103-2555