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HomeMy Public PortalAboutExhibit MSD 3D - Direct Testimony, Jonathon Sprague, MSDMSD Exhibit No. MSD 3D 2015 Rate Change Proceeding JONATHON C. SPRAGUE Direct Testimony Metropolitan St. Louis Sewer District February 26, 2015 Table of Contents Page Witness Background and Experience ........................................................................................... 1 Wastewater Operations Services ................................................................................................... 2 Stormwater Operations Services ................................................................................................... 5 Direct Testimony of Jonathon C. Sprague, MSD February 26, 2015 Witness Background and Experience 1 Q1. Please state your name, business address, and telephone number. 2 A. Jonathon Sprague, 2350 Market Street, St. Louis, Missouri 63103-2555, (314) 768-6261, 3 jsprague@stlmsd.com 4 Q2. What is your occupation? 5 A. I am the Director of Operations for the Metropolitan St. Louis Sewer District (District). 6 Q3. How long have you been associated with the District? 7 A. I have been with the District continuously since May of 2005 8 Q4. What is your professional experience? 9 A. I have spent the last 19 years working in the water/wastewater industry. I came to the 10 District in 2005 as Assistant Director of Operations, and became Director of Operations 11 in 2007. Prior to working for the District, I held a number of progressively responsible 12 utility positions in the Virginia area. I started as a Project Engineer for the City of 13 Richmond and my last position before coming to MSD was Assistant Chief of Operations 14 for Henrico County, Virginia. Before this I was a senior engineer involved with the 15 controls of Nuclear Aircraft Carriers. 16 Q5. What is your educational background? 17 A. I have an undergraduate degree in electrical engineering from the University of Akron. I 18 also have a Master's in Business Administration from the College of William and Mary in 19 Virginia. 20 Q6. Are you registered as a Professional Engineer? 21 A. Yes, I am a registered Professional Engineer in the state of Missouri. 22 23 2015 Rate Change Proceeding 1 MSD Exhibit No. MSD 3D Direct Testimony of Jonathon C. Sprague, MSD February 26, 2015 Wastewater Operations Services 1 Q7. What makes up the wastewater services within the District? 2 A. Wastewater services are comprised of the effective collection, transport and treatment of 3 wastewater within the District. This requires the operations and maintenance of over 4 6,300 miles of sanitary and combined sewers, over 270 pump stations and 7 wastewater 5 treatment plants. 6 Q8. What is the purpose of the District’s wastewater operations and maintenance 7 program? 8 A. To maintain the wastewater system in a proactive and efficient manner that meets all 9 State and Federal regulatory requirements and minimizes disruptions to customers 10 Q9. What approach does the District take for its O&M program? 11 A. The District’s O&M program takes an Asset Management approach. Utilities throughout 12 the world are faced with the challenge of how best to manage their existing asset stock to 13 provide satisfactory customer service with limited funds. Asset Management is a 14 maintenance management process that guides the acquisition, use and disposal of 15 infrastructure assets to optimize service delivery and minimize costs over the asset’s 16 entire life. What that means is with limited funds you focus your efforts on meeting 17 wastewater service level goals such as regulatory requirements and customer service 18 goals. To do this the District has to understand the condition of its infrastructure, and 19 prioritize maintenance efforts on those assets that pose the greatest risk to District goals. 20 If goals are being met, the District then engages the public to determine the balance 21 between expectations of wastewater service levels of and minimizing maintenance costs. 22 23 2015 Rate Change Proceeding 2 MSD Exhibit No. MSD 3D Direct Testimony of Jonathon C. Sprague, MSD February 26, 2015 Q10. What are the key components of the WW O&M Program? 1 A. Within the collection system and pump stations groups, the O&M program is focused 2 around the requirements of the Capacity Management Operations and Maintenance 3 (CMOM) program within the CD. Within the collection system this requires proactive 4 cleaning, inspecting and rehabbing of pipe to assure adequate capacity. Pump stations 5 and force mains are regularly inspected and maintained with the inspection frequency 6 being based on the criticality of the asset. In the treatment plants, asset management 7 consists of performing equipment maintenance and repairs based on criticality, to assure 8 permit and regulatory issues are met. 9 Q11. Is the District’s O&M programs impacted by State and Federal requirements? 10 A. Yes. Federal and State requirements make O&M mandatory. The CMOM program 11 required by the CD requires that minimum maintenance and performance standards be 12 met in the collection system and pump stations or penalties be incurred. Proper O&M 13 within the plants is required to meet the obligations outlined in each wastewater plant 14 permit. 15 Q12. Does the District measure the performance of providing wastewater services? 16 A. Yes it does. The District employs a number of measures and surveys to assure its 17 programs are effective. These measures range from high level goals that are aligned 18 around the District’s strategic plan, down to tactical and crew level goals that assure 19 levels of wastewater service are being met. Examples of high level measures include: 20 percent regulatory compliance; basement backups per thousand homes; percent on-time 21 customer response and overall customer satisfaction. Tactical goals include measures 22 such as miles of pipe cleaned and number of inspections. 23 2015 Rate Change Proceeding 3 MSD Exhibit No. MSD 3D Direct Testimony of Jonathon C. Sprague, MSD February 26, 2015 Q13. Can you provide any supporting documentation that the District’s wastewater 1 services are being operated efficiently and making the best use of ratepayer monies? 2 A. Yes. In recent years the District has made significant strides in improving its measured 3 wastewater services levels, and this has been reflected positively in system performance, 4 customer survey responses, and awards. Some measures worth noting include: Record 5 high levels of customer satisfaction, exceeding 80% overall in 2014 customer surveys. 6 The District has had all seven of its treatment plants regularly receive awards from the 7 National Clean Water Agency (NACWA) for plant permit compliance. CMOM activities 8 have resulted in a downward trend in basement backups, with a record low number of 9 basement backups in 2014. Backups are down 70% from historic levels. Additionally, 10 dry weather overflows are down 50% over historic levels. While these are all strong 11 performance indicators, efficiency is important to the District as well. The District 12 benchmarks its performance and efficiency against other agencies. Included in Exhibit 13 7.2.3 of the Rate Change Proposal are some key performance indicators included in a 14 2013 Water Environment Research Foundation (WERF) wastewater survey. These 15 performance indicators include areas such as employee metrics, regulatory compliance, 16 facility utilization, collection system maintenance, customer calls and safety. Exhibit 17 7.2.3 includes the performance metric and its definition; the industry min, max, medium 18 and average. In the right hand columns is the District's performance along with an 19 explanation of the significance. In general what these metrics show is that the District 20 operates with significantly less employees than is typical, yet maintenance, safety, energy 21 efficiency and facility utilization are measurably better than most utilities. 22 23 2015 Rate Change Proceeding 4 MSD Exhibit No. MSD 3D Direct Testimony of Jonathon C. Sprague, MSD February 26, 2015 Q14. Does the Rate Change Proposal enhance the District’s ability to provide adequate 1 sewer and drainage systems and facilities, or related services? 2 A. Yes. The Rate Change Proposal provides the funds needed to continue adequate O&M in 3 the collection systems, pump stations and wastewater treatment plants. The CMOM 4 program should continue to improve the operations of the collection system and reduce 5 overflows and basement backups. This Rate Change Proposal will also allow for our 6 aging treatment plants to continue to operate efficiently and meet permit requirements. 7 8 Stormwater Operations Services 9 Q15. What makes up the stormwater services within the District? 10 A. The Stormwater system requires the operations and maintenance of over 3,000 miles of 11 storm sewers, 157,000 stormwater inlets, 66 miles of improved channels and monitoring 12 of over 1,380 miles of creeks and streams. 13 Q16. What is the purpose of the District’s stormwater operations and maintenance 14 program? 15 A. Stormwater services are comprised of the effective collection and transport of stormwater 16 within the District in a manner that protects the publics’ health and welfare. 17 Q17. What approach does the District take for its O&M program? 18 A. The District’s existing stormwater O&M program matches O&M service levels to 19 funding levels provided by the various ad valorem property taxes throughout the District. 20 This means different areas of the District receive very different levels of service based on 21 the amount of taxes they pay. If you refer to the map included in Figure 5.1 of the Rate 22 Change Proposal, you can see the District is divided into three color zones representing 23 2015 Rate Change Proceeding 5 MSD Exhibit No. MSD 3D Direct Testimony of Jonathon C. Sprague, MSD February 26, 2015 the different stormwater taxes paid, and thus different service levels. In the red zone, 1 largely outside of the 270 loop, customers pay an ad valorem tax of only $0.0197 per 2 $100 assessed value. This level of funding is limited, and primarily only covers the 3 District's regulatory requirements in this zone. These regulatory services are described in 4 Rich Unverferth's testimony. Maintenance in this area is restricted to emergency work 5 only, focused on health and safety issues. No, proactive maintenance is funded nor any 6 system improvements. In the yellow zone, primarily the City, customers pay the above 7 mentioned tax as well as an ad valorem tax of $0.0682 per $100 assessed value. These 8 additional funds pay for additional stormwater service. In the City this includes proactive 9 inlet cleaning, maintenance and repair and channel maintenance. In the green stormwater 10 zone, largely outside the City but within the 270 loop, customers pay the same taxes paid 11 in both the red and yellow area and varying additional taxes for O&M and capital work 12 within their sub-districts. These additional funds pay for O&M of channels, full 13 maintenance of existing pipes and improvements to the existing systems. 14 Q18. Does the current stormwater funding provide for efficient service that meets 15 customers’ expectations? 16 A. No. While current funding allows us to meet regulatory requirements, it does not provide 17 funding for consistent proactive maintenance throughout the District. With the red area 18 there is no funding for proactive maintenance to ensure the systems function as designed, 19 nor does the funding allow for system improvements. Customer feedback and 20 satisfaction surveys show dissatisfaction with stormwater services in this area. The 21 service provided in the yellow area is adequate to ensure the systems are maintained and 22 continue to operate properly, however proactive maintenance is limited to cleaning inlets 23 2015 Rate Change Proceeding 6 MSD Exhibit No. MSD 3D Direct Testimony of Jonathon C. Sprague, MSD February 26, 2015 on a two year cycle and channels receive minimal maintenance. Within the green area, 1 proper O&M is provided, and system improvements are funded. Because of these 2 disparate levels of service, efficiency suffers as well. The different levels of funding by 3 area do not allow for specialized District wide stormwater crews to be set up. Instead 4 crews have to adjust the work by area and often delay work to group it for efficiency. 5 This in turn slows down response and limits crew efficiency. 6 Q19. How would the proposed stormwater rate meet the service goals in an efficient 7 manner? 8 A. The proposed stormwater ad valorem taxes will provide a fair and consistent funding 9 level across the entire service area of the District. This will eliminate the need to have 10 different O&M service levels across the District. The proposed rates would allow for 11 improved proactive maintenance, system functionality and improved customer 12 satisfaction. Consistent funding would allow for stormwater specific crews to be set up 13 with specialized functions, which will increase efficiency as well. 14 Q20. What District wide stormwater services would be provided under the proposed 15 funding? 16 A. With the proposed funding levels, stormwater O&M would be set up with an asset 17 management focus much like the wastewater CMOM program. Proactive maintenance 18 crews would provide regular cleaning and inspection of all stormwater inlets, pipes, 19 improved channels across the entire District. Cleaning will assure the maximization of 20 system flow and provide systems to function at designed level of service. Proactive 21 inspection will help identify problems and needed repairs. In turn, problems can be 22 identified, prioritized and fixed before they become emergencies. This will improve 23 2015 Rate Change Proceeding 7 MSD Exhibit No. MSD 3D Direct Testimony of Jonathon C. Sprague, MSD February 26, 2015 customer service and reduce overall costs. The proposed funding will also allow for 1 Operations to investigate and make recommendations for small projects and system 2 improvements to solve localized problem areas and improve customer satisfaction. 3 Q21. Does the Rate Change Proposal enhance the District’s ability to provide adequate 4 sewer and drainage systems and facilities, or related services? 5 A. Yes. The Rate Change Proposal provides the funds needed to enhance the operations and 6 maintenance of the entire Districts stormwater system and provide consistent service to 7 all ratepayers with the District. 8 Q22. Does this conclude your prepared direct testimony in this matter? 9 A. Yes, it does. 10 11 2015 Rate Change Proceeding 8 MSD Exhibit No. MSD 3D