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Home My Public Portal AboutExhibit RC 86 - Rate Commission Third Discovery Request to MSD April 3, 2015Exhibit RC 86 BEFORE THE RATE COMMISSION OF THE METROPOLITAN ST. LOUIS SEWER DISTRICT For Consideration of a Wastewater and Stormwater Rate Change Proposal by the Rate Commission of the Metropolitan St. Louis Sewer District THIRD DISCOVERY REQUEST OF THE RATE COMMISSION Pursuant to §§ 7.280 and 7.290 of the Charter Plan of the Metropolitan St. Louis Sewer District (the "Charter Plan"), Operational Rule 3(2) and Procedural Schedule §§ 1, 17 and 18 of the Rate Commission of the Metropolitan St. Louis Sewer District ("Rate Commission"), the Rate Commission requests additional information and answers from the Metropolitan St. Louis Sewer District ("District") regarding the Rate Change Proposal dated February 26, 2015 (the "Rate Change Proposal"). The District is requested to amend or supplement the responses to this Discovery Request, if the District obtains information upon the basis of which (a) the District knows that a response was incorrect when made, or (b) the District knows that the response, though correct when made, is no longer correct. The following Discovery Requests are deemed continuing so as to require the District to serve timely supplemental answers if the District obtains further information pertinent thereto between the time the answers are served and the time of the Prehearing Conference. THIRD DISCOVERY REQUEST 1. The Rate Model describes a growth rate for low income customers of 19% a year for the period FY2015 FY2020 and 0% thereafter. See District Rate Model, tab "Inputs" Excel lines 339-340. Please (a) describe the analysis that was performed to reach this conclusion; (b) provide copies of any memorandum, report, work paper, summary, analysis, or schedule that supports this conclusion; (c) describe the rationale for such conclusion. RESPONSE: 2. The Rate Model lists factors utilized in allocating Operation & Maintenance expenses. See District Rate Model, input values in tabs "OM-Funct" and "OM-Alloc". Please (a) describe the analysis that was performed to determine this allocation; (b) provide copies of any memorandum, report, work paper, summary, analysis, or schedule that supports this conclusion; (c) describe the rationale for such conclusion. RESPONSE: 3. The Rate Model lists factors utilized in allocating Plant Inventory. See District Rate Model, input values in tabs "Plant-Funct", and "Plant-Alloc". Please (a) describe the analysis that was performed to determine this allocation; (b) provide copies of any memorandum, report, work paper, summary, analysis, or schedule that supports this conclusion; (c) describe the rationale for such conclusion. RESPONSE: 2 4. The Rate Model allocates Operations -Collection systems between wastewater - collection, wastewater -conveyance, and stormwater. See District Rate Model, tab "OM-Funct". Please (a) describe the analysis that was performed to determine this allocation; (b) provide copies of any memorandum, report, work paper, summary, analysis, or schedule that supports this conclusion; (c) describe the rationale for such conclusion. RESPONSE: 5. The Rate Model allocates Collection Operation & Maintenance costs as (a) 10% volume, 80% capacity, and 10% customer for collection, and (b) 20% volume and 80% capacity for conveyance. See District Rate Model, tab "OM-Alloc" lines 8-9. Please (a) describe the analysis that was performed to determine this allocation; (b) provide copies of any memorandum, report, work paper, summary, analysis, or schedule that supports this conclusion; (c) describe the rationale for such conclusion. RESPONSE: 6. The Rate Model allocates the treatment portion of pumping operation & maintenance costs to all treatment plant components (e.g. sludge, primary treatment, secondary treatment and pumping, etc.) rather than directly to treatment pumping. See District Rate Model tab "OM-Alloc". Please (a) describe the analysis that was performed to determine this allocation; (b) provide copies of any memorandum, report, work paper, summary, analysis, or schedule that supports this conclusion; (c) describe the rationale for such conclusion. RESPONSE: 3 7. The Rate Model allocates plant inveslrnent for sanitary sewers as 20% volume, 80% capacity. See District Rate Model tab "Plant-Alloc". Please (a) describe the analysis that was performed to determine this allocation; (b) provide copies of any memorandum, report, work paper, summary, analysis, or schedule that supports this conclusion; (c) describe the rationale for such conclusion. RESPONSE: 8. The Rate Model allocates all sanitary sewer collection system plant, including combined sewer assets, to sanitary sewer (Collection and Conveyance). See District Rate Model tab "Plant-Funct." Please (a) describe the analysis that was performed to determine this allocation; (b) provide copies of any memorandum, report, work paper, summary, analysis, or schedule that supports this conclusion; (c) describe the rationale for such conclusion. RESPONSE: 9. The Rate Model allocates the treatment portion of pumping station plant investment to all treatment plant components rather than treatment pumping only. See District Rate Model tab "Plant-Alloc." Please (a) describe the analysis that was performed to make this determination; (b) provide copies of any memorandum, report, work paper, summary, analysis, or schedule that supports this conclusion; (c) describe the rationale for such conclusion. RESPONSE: 4 10. Please describe how stormwater projects were prioritized in each of the former Red, Green and Yellow zones described in Rate Change Proposal, Section 5 at page 5-4 (a) between each of the areas; (b) within each of the areas. RESPONSE: 11. The Rate Model includes a high level summary of the CIRP only. See District Rate Model "CIRP Input." The Rate Model includes a comment that references the Spreadsheet "CIRP Inflation V2". Please (a) provide the "CIRP Inflation V2" spreadsheet; and (b) explain why there are no design costs before FY17. RESPONSE: 12. Should the Example for Liquidation figure be $7,731,541? See Appendix 7.1.5 of the Rate Proposal Summary Schedule of Adjustments to SW CIRP Project. RESPONSE: 13. The first table of Appendix 7.5.1 summarizes the Regulatory Fund and OMCI Funds. (a) Please explain why OMCI funds are depleted until 2021 when, because of negative capital costs, the fund balances rises again. (b) Please explain the reference to a 5 cent tax and a 1.2 cent tax. The next table shows "proposed" which ties with FY17 in the rate report. Note the Proposed table references an 8.8 cent tax and a 1.2 cent tax. This is also indicated in the Rate Model on the SW dashboard/graphs; however, the input data on the dashboard indicates 1.96 cent and 10 cent taxes. (c) Please provide Appendix 7.5.1 in Excel format. RESPONSE: 5 14. Brian L. Hoelscher states in Direct Testimony that the balance in the current tax funds will be used for improvements to the public stormwater system in the areas where these taxes are collected. See MSD Exhibit 3A, p. 4, 11. 19-20. Please provide (a) copies of the ordinances and ballot language if submitted to the voters which approved the imposition of each of the (i) Regulatory Tax, (ii) the Stormwater O&M Tax, (iii) the OMCI Specific Subdistrict Taxes; and (iv) the; and (b) describe "improvements to the public stormwater system. RESPONSE: Respectfully submitted, Lisa O. Stump LASHLY & BAER, P.C. 714 Locust Street St. Louis, Missouri 63101 Tel: (314) 621-2939 Fax: (314) 621-6844 6 CERTIFICATE OF SERVICE The undersigned certifies that a copy of the foregoing was sent by electronic transmission to Janice Fenton, Office Associate Senior, Metropolitan St. Louis Sewer District; Susan Myers, Counsel for the Metropolitan St. Louis Sewer District; Brad Goss, Counsel for Intervener Home Builders Association of St. Louis & Eastern Missouri; and Brandon Neuschafer and Diana Vuylsteke, Counsel for Intervenor Missouri Industrial Energy Consumers on this 3rd day of April, 2015. Ms. Janice Fenton Office Associate Senior Metropolitan St. Louis Sewer District 2350 Market Street St. Louis, MO 63103 JFENTONi,stlmsd com Ms. Susan Myers General Counsel Metropolitan St. Louis Sewer District 2350 Market Street St. Louis, MO 63103 smyers ,stlmsd.com Mr. Brad Goss Smith Amundsen, LLC 120 South Central Avenue, Suite 700 St. Louis, MO 63105-1794 bgoss@salawus.com Mr. Brandon W. Neuschafer Ms. Diana M. Vuylsteke Bryan Cave LLP 211 N. Broadway, Suite 3600 St. Louis, MO 63102 bwneuschafer@brvancave.com dmvuylsteke(Oryancave.com