HomeMy Public PortalAboutFiscal Year 2021 Popular Annual Financial ReportPOPULAR ANNUAL FINANCIAL REPORT
Fiscal Year Ending June 30, 2021
METROPOLITAN ST. LOUIS SEWER DISTRICT
ST. LOUIS, MISSOURI
MSD PROJECT CLEAR
MSD Project Clear (MSDPC) is two utilities in one—responsible for approximately
9,400 miles of public wastewater and stormwater sewer systems in the St. Louis
region. MSDPC is investing billions of dollars over a generation to improve water
quality and minimize wastewater and stormwater issues by monitoring regulatory
compliance, planning, designing, and building community rainscaping, system
improvements, and performing an ambitious program of maintenance and repair.
MSD MISSION
To protect the public’s health, safety, and water environment by
responsibly providing wastewater and stormwater management.
TABLE OF CONTENTS
Directors’ Letter ....................................................................................................3
Tunnels Improve Efficiency ...........................................................................4
What We Do ...........................................................................................................7
MSD Goes Virtual .................................................................................................8
Year in Review .....................................................................................................10
Looking Ahead .....................................................................................................11
Balance Sheet ......................................................................................................12
MSD Assets and Long-Term Obligations ..............................................13
Income Statement............................................................................................14
Revenues and Expenses .................................................................................15
Cash Flow Statement ......................................................................................16
Cash Flow Activities Comparison .............................................................16
Performance Against Budget and Credit Rating ...........................17
ON THE COVER
MSD used a Tunnel Boring Machine, nicknamed “Mrs. Nancy,” to bore through rock 150 to 250 feet
below ground from Clayton Road to Interstate 44. The Deer Creek Sanitary Tunnel was lined with
a 15-inch thick concrete liner. Once completed in fall 2022, the tunnel will collect and temporarily
store peak wastewater overflows along the Deer Creek sewer system. Read more about MSD’s tunnel
projects on pages 4-6 of this report.
2 | METROPOLITAN ST. LOUIS SEWER DISTRICT POPULAR ANNUAL FINANCIAL REPORT FY2021 | 3
We appreciate your interest in the Metropolitan St. Louis Sewer District (MSD) and are proud to
present our Popular Annual Financial Report for the Fiscal Year 2021, ending June 30, 2021 (FY21).
Throughout the ongoing COVID-19 pandemic, MSD has adjusted its business practices to
protect the health and safety of employees, contractors, and the larger community, while
remaining focused on our mission to protect the public’s health, safety, and water environment
by responsibly providing wastewater and stormwater management.
In all that we do, MSD is committed to improving water quality, serving the daily needs of
residents, and implementing improvements that will alleviate wastewater concerns and
benefit the region for decades to come. In FY21, MSD appropriated funds for 197 new or
continuing wastewater and stormwater design and construction projects.
This annual report provides a non-technical overview of MSD’s work and a snapshot of our most
recent fiscal year—July 1, 2020 to June 30, 2021. Within this report, you will learn how we are
carefully investing the funds we receive to maintain and improve our region’s wastewater and
stormwater systems. In fact, we are proud to share that overall, MSD is financially improving.
In addition, you will find financial information for the past fiscal year that summarizes the
more in-depth financial review provided in our Annual Comprehensive Financial Report.
Please note that while the summary information provided here uses principles and guidelines
consistent with Generally Accepted Accounting Principles (GAAP), it has been simplified
for general audiences, and it is not GAAP-compliant. Both reports are available online at
www.msdprojectclear.org/annualreports. To request a printed copy of this information,
contact MSD at 314-768-6260 or send an email to customersvc@stlmsd.com.
The purpose of this report is to be informative and useful. As always, we welcome any
comments or suggestions on how we might improve future reports to better serve your
interests and needs.
Respectfully submitted,
Brian Hoelscher, P.E. Marion Gee
Executive Director & CEO Director of Finance
Government Finance Officers Association of
the United States and Canada (GFOA) has
given an Award for Outstanding Achievement
in Popular Annual Financial Reporting to the
Metropolitan St. Louis Sewer District for its
Popular Annual Financial Report for the fiscal
year that ended June 30, 2020. The Award for
Outstanding Achievement in Popular Annual
Financial Reporting is a prestigious national
award recognizing conformance with the
highest standards for preparation of state and
local government popular reports.
In order to receive an Award for Outstanding
Achievement in Popular Annual Financial
Reporting, a government unit must publish a
Popular Annual Financial Report, the contents
of which conform to program standards of
creativity, presentation, understandability, and
reader appeal.
An Award for Outstanding Achievement in
Popular Annual Financial Reporting is valid for
a period of one year only. Metropolitan St. Louis
Sewer District has received a Popular Award
for the last nine consecutive years (fiscal years
ended 2012-2020). We believe our current report
continues to conform to the Popular Annual
Financial Reporting requirements, and we are
submitting it to GFOA to determine its eligibility
for another Award.
“
”
DIRECTORS’ LETTER
Government Finance Officers Association
Award for Outstanding Achievement in Popular Annual Financial Reporting
Presented to
Metropolitan St. Louis Sewer District
Missouri
For its Annual Financial Report
for the Fiscal Year Ended
2020
Executive Director/CEO
4 | METROPOLITAN ST. LOUIS SEWER DISTRICT POPULAR ANNUAL FINANCIAL REPORT FY2021 | 5
TUNNELS IMPROVE SEWER SYSTEM EFFICIENCY, REDUCE BACKUPS
TUNNEL TIMELINE OF COMPLETION
MALINE CREEK STORAGE FACILITYFall 2020
JEFFERSON BARRACKS TUNNELFall 2023
DEER CREEK SANITARY TUNNELFall 2022
LOWER MERAMECTUNNELFall 2024
The pandemic has impacted businesses and
activities in many ways, but it has not affected
MSD’s commitment to its efforts to improve
water quality in the St. Louis region—including
building efficient tunnels in the area.
In periods of heavy rain or snow melt, the
District’s sewer system and treatment plants
can see an excess in capacity. To prevent
overflows and improve the overall system,
MSD is building eight above-ground storage
facilities and deep underground tunnels to
temporarily store and transport wastewater
during heavy rain until treatment facilities
can handle the water volume.
Using specialized Tunnel Boring Machines
(TBM), MSD’s construction partners dig tunnels
into the limestone rock layer underlying the
St. Louis area. This is no easy feat as most of
the work happens up to 200+ feet below the
surface. In addition, the TBM bores the tunnel
out of sight and sound of the public.
On smaller projects, contractors use controlled
blasting to excavate the tunnel. The goal is for
local residents and businesses to experience
little, if any, disturbance to their daily routine.
Once excavated, the tunnels are lined with a
sturdy material to keep ground water out
and wastewater in.
Tunnel construction takes several years and
occurs in three phases:
• Phase 1: Preliminary design and
geotechnical investigation of the area to be
excavated.
• Phase 2: Final design, construction bidding
and right-of-way acquisition.
• Phase 3: Construction.
The first tunnel project under the multi-billion
dollar MSD Project Clear initiative, the Lemay
Redundant Force Main, was successfully
completed in 2014. Currently, MSD is working
on the Deer Creek Sanitary Tunnel, the
Jefferson Barracks Tunnel, and the Lower
Meramec Tunnel. The recently completed
Maline Creek Storage Facility went into
service in fall 2020.
Deer Creek Sanitary Tunnel
Extending more than four miles from Clayton
Road to Interstate 44, the Deer Creek Sanitary
Tunnel will collect and temporarily store peak
wastewater overflows along the Deer Creek
sewer system. Once completed in fall 2022,
the $150 million, 22,800 foot long tunnel will
provide relief to several communities including
Clayton, Richmond Heights, Brentwood,
Maplewood, Webster Groves, and Shrewsbury,
where basement backups and sewer
overflows historically occurred when heavy
rains overcharged the existing system.
During the first phase of this project, MSD
considered a variety of construction options,
including pumping excess flow to above-
ground storage tank farms or building a
network of open-cut sanitary sewers. However,
given the heavily developed area and the
major roadways involved, MSD determined
that a deep storage tunnel provided the least
disruptive and most cost-effective solution.
Using an enormous TBM dubbed “Mrs. Nancy,”
contractors bored the tunnel through rock
150 to 250 feet below the ground surface.
The inside of the tunnel will be finished with a
15-inch thick concrete liner, leaving a diameter
of approximately 19 feet. The construction
shaft, which will later serve as part of the
pump station that drains the tunnel, is located
at the downstream end of the tunnel near
I-44 and Shrewsbury Avenue.
In the fall of 2021, the concrete lining of this
tunnel was completed with an antimicrobial
concrete admixture to permanently protect
the tunnel’s concrete lining from corrosion.
This admixture uses an electro-physical
mechanism to destroy the cell walls of
microorganisms on contact and is leach
resistant, providing an enduring solution.
Jefferson Barracks Tunnel
Stretching nearly 3.4 miles parallel to the
Mississippi River, the Jefferson Barracks Tunnel
was designed to address sewer overflows in the
Lemay/South St. Louis County area by adding
more capacity to collect, transport, and store
wastewater. The tunnel will extend from south
of I-255 at Koch Road to the Lemay Wastewater
Treatment Plant at the confluence of the River
Des Peres and the Mississippi River.
The new $152 million tunnel, along with some
additional construction scheduled to be
complete in the fall of 2023, will replace the
old system, which could no longer handle the
demand during moderate to heavy rainfall.
Adding to the complexity of the project, the
route runs through an area of river bluff karst,
a porous limestone containing numerous
6 | METROPOLITAN ST. LOUIS SEWER DISTRICT POPULAR ANNUAL FINANCIAL REPORT FY2021 | 7
ColdwaterWWTP
Grand GlaizeWWTP
FentonWWTP
MissouriRiverWWTP
LemayWWTP
LowerMeramecWWTP
I-270
I-270
I-270
I-44
I-44
I-64
I-64
I-255
I-55
I-170
I-70
I-70
Bissell PointWWTP
MSD Wastewater Treatment
Plants (WWTP)
Service Area
SOURCES: Northeast Ohio Regional Sewer District, Baltimore City Department of Public
Works, KCWater, City of San Diego, Metro Government of Nashville & Davidson County,
Tennessee, and San Antonio Water System (Rates based on 10 CCF)
Note: In the FY20 Popular Annual Financial Report, the San Diego Residential
Wastewater User Charge incorrectly included two months of base charge.
The correct charge equaled $51.31 instead of $66.64.
The Metropolitan St. Louis Sewer District owns, operates,
and maintains a sewer system which consists of wastewater,
stormwater, and combined collection sewers—carrying both
wastewater and stormwater—pumping stations, and wastewater
treatment facilities that have been incorporated into one entity
over the last 60-plus years.
MSD provides a variety of additional services, including monitoring
of industrial waste, issuance of pretreatment discharge permits,
plan review and approvals, issuance of connection permits, public
education, and customer service. It is one of the largest and most
complex systems in the United States. MSD is two separate utilities
within one organizational structure:
MSD’s Dual Function
Residential Wastewater User Charge
Cleveland
Baltimore
St. Louis
Kansas City
Nashville
San Diego
San Antonio
$116.20
$100.93
St. Louis and Other Municipalities
454 sq. miles of
St. Louis County
(87%)
66 sq. miles of
St. Louis City
(100%)
1.3 MILLION SERVED
520 SQUARE MILE
SERVICE AREA
428,000 accounts
Wastewater — collect “used”
water disposed of in sinks,
toilets, and floor drains by
households and businesses,
and then treat it to regulatory
standards before returning it to
the region’s waterways.
Stormwater — operate and
maintain the public storm
sewer system and help
coordinate regional efforts to
address pollution carried in or
caused by stormwater runoff.
WHAT WE DO
$69.26
$51.31
$49.36
$79.01
$75.10
caves and sinkholes caused by erosion.
Engineers determined the best solution was to
bore below the limestone and karst, tunneling
into rock at 150 to 230 feet below the surface.
Maline Creek Storage Facility
Maline Creek is a small tributary that runs
along the northern edge of the City of St.
Louis and empties into the Mississippi River.
The area is served by aging sewer pipes that
can be overwhelmed with stormwater during
heavy rain, causing combined sewer overflows
than can discharge untreated wastewater into
Maline Creek.
The new $84 million tunnel runs a half mile
from Chain of Rocks Drive to Church Road and
is located 175 feet below ground on Riverview
Drive. The 28-foot diameter of this tunnel will
store excess stormwater and sewage during
extreme weather. When the rain subsides,
a pump station will transfer the stored
wastewater to the Bissell Point Wastewater
Treatment Plant near I-70 and Grand Avenue
for treatment and proper discharge into the
Mississippi River.
This tunnel took eight years to design
and build with primary contractors SAK
Construction and Goodwin Brothers
Construction. The Maline Creek Tunnel went
into service in the fall of 2020 and has already
been utilized several times.
MSD has released a unique 3D, VR-compatible
model of the tunnel that allows anyone with
a phone, computer, tablet, or VR goggles to
explore the tunnel and learn how it was built.
Learn more about MSD’s virtual experiences
on page 9 of this report or visit
www.msdprojectclear.org/virtualtour.
Lower Meramec Tunnel
The Lower Meramec Tunnel, which runs
between Old Towne Fenton and Baumgartner
Road, will carry wastewater currently treated at
the Fenton Wastewater Treatment Plant to the
Lower Meramec Wastewater Treatment Plant.
This tunnel allows MSD to eliminate a flood-
prone facility and improve water quality for
the Meramec River. The 6.8 mile project with
six drop shafts is being completed in phases
with a final estimated completion date in
September 2024.
*The schedule and cost presented is tentative as determined by
current planning efforts. It is subject to program implementation
and final budget approval.
An MSD team member handles the
Tunnel Boring Machine head that
was used to dig into the limestone
and karst rock layers to create the
Jefferson Barracks Tunnel.
8 | METROPOLITAN ST. LOUIS SEWER DISTRICT POPULAR ANNUAL FINANCIAL REPORT FY2021 | 9
MSD GOES VIRTUAL: REIMAGINING PUBLIC ENGAGEMENT
While the Metropolitan St. Louis Sewer
District, like most businesses around the
world, has had to continually alter its practices
throughout the COVID-19 pandemic, its
commitment to providing a vital public
health service has remained.
As MSD continues its work day in and day out
to keep the region’s waterways clean and safe,
the District has reaffirmed its commitment
to informing, educating, and partnering with
stakeholders on these efforts. When public
health restrictions required MSD to suspend
traditional in-person public engagement
efforts, the District quickly, thoughtfully, and
carefully shifted to a virtual format, using the
interruption to reassess why the District holds
public meetings and how it can use digital
tools to improve them.
At any given time, MSD has about 100 projects
in active construction that can affect the
public, including improvement, emergency
repair, and maintenance projects. The District
has a responsibility to inform key stakeholders
about these projects, introduce customers to
project teams, demonstrate their expertise,
and provide opportunities for stakeholders to
ask questions of MSD staff. To do so, MSD took
a twofold approach: introduce virtual public
meetings (VPMs) and focus on providing
thorough, up-to-date information
on msdprojectclear.org.
MSD evaluated the needs and goals of its
stakeholders (internal and external) and
created a way to meet those needs and goals
in a virtual environment. MSD now hosts
these meetings via Zoom and has found that
because stakeholders can join virtual meetings
from anywhere, these meetings have attracted
much broader and more diverse participation
than some traditional neighborhood meetings.
Beyond virtual public meetings, MSD
has created dedicated webpages for its
construction projects on msdprojectclear.org.
These webpages, which are accessible 24/7,
ensure customers can learn about projects
when it is convenient for them—whether or
not they attended the VPM—and provide an
opportunity to contact the project manager
with any questions or concerns. The webpages
also house recordings of previous VPMs, further
increasing accessibility and transparency.
In addition to webpages for customers to
learn about ongoing and upcoming projects,
MSD also created a dedicated webpage
(msdprojectclear.org/smu) for contractors
to find the most up-to-date information on
an upcoming major project, key dates and
deadlines, requests for qualifications, and more.
Overall, the new approach to public
engagement, while necessitated by the
pandemic, has empowered MSD to reach
more stakeholders, expand its outreach efforts
beyond public meetings, streamline data
collection and reporting, and improve the
stakeholder experience by making meetings
and project information more easily accessible.
Moving forward, the District will continue to
expand these outreach initiatives, and virtual
components will remain an essential part of
MSD’s public and stakeholder engagement
even after in-person engagement returns.
As part of MSD’s continuing
effort to educate its customers
about the essential services
it provides, the district has
created virtual experiences of
the lower meramec treatment
plant and the maline creek
storage tunnel.
Sitting on 200 acres of land in
South St. Louis County where
the Meramec and Mississippi
rivers meet, the Lower Meramec
Wastewater Treatment Plant
treats an average of 15 million
gallons of wastewater per day,
which travels to the plant from
homes and businesses through
tunnels and pipes hundreds of
feet below ground. Now, virtual
technology provides a close up,
360-degree look in and around
the plant from the comfort
of your computer, helping
customers understand the
District’s wastewater collection
and treatment efforts, which
keep waste out of the region’s
waterways and provide critical
wastewater management for
MSD’s customers.
The Maline Creek Storage
Tunnel in North St. Louis was
the first tunnel of its kind built
under MSD Project Clear and
is part of an intricate network
of pipes, weirs, shafts, and
pump stations that are helping
eliminate basement backups,
reduce wastewater overflows,
and protect natural waterways
from pollutants. Sitting 200 feet
underground with no source of
light or fresh air, many people
drive over Riverview Boulevard
(from Church Street to Chain of
Rocks) every day without even
knowing the tunnel exists, and
only a select few have had the
chance to see it for themselves—
until recently.
A first-of-its-kind 3D VR-
compatible explorable model,
MSD Project Clear introduced
the Maline Creek Tunnel Virtual
Experience in FY21, giving
anyone with a smartphone,
tablet, computer, or VR goggles
the opportunity to explore the
0.75-mile tunnel end to end
and to learn about how it was
built and how it works. The
tunnel took eight years to build,
costing about $84 million, and
went into service in the fall of
2020. During rain events, when
the regions combined sewer
system exceeds capacity, excess
water is diverted into the tunnel
and held until the rain stops,
at which point the water is
pumped back into the system
to be treated at the Bissell Point
Wastewater Treatment Plant.
Explore the Lower Meramec
Treatment Plant and
Maline Creek Tunnel at
msdprojectclear.org/virtualtour.
In the future, MSD plans
to create additional virtual
experiences of the Deer Creek
Tunnel and the Missouri River
Wastewater Treatment Plant.
VIRTUAL TOURS PROVIDE INSIDE LOOK AT TREATMENT PLANT, TUNNEL
10 | METROPOLITAN ST. LOUIS SEWER DISTRICT POPULAR ANNUAL FINANCIAL REPORT FY2021 | 11
YEAR IN REVIEW
Capital Improvement
MSD made 197 appropriations for new or
ongoing wastewater and stormwater design
and construction projects in FY21, totaling
$365.3 million.
Diversity
MSD remains committed to cultivating a
diverse workforce and developing programs
to assist under-utilized minority and women-
owned firms. MSD continues to implement
programs and create capacity-building
opportunities to help fulfill this commitment.
In FY21, minority-owned firms performed
$38,682,764 on capital construction projects,
representing 16.79% of the District’s capital
program spending for the fiscal year. Women-
owned firms performed $22,170,623 in
capital construction work, representing
9.63% of the District’s capital construction
program spending. Minority-owned design
firms (professional services) accounted for
$13,302,476, or 34.75%, of payments made
to design firms, and women-owned design
firms were paid $3,451,308 or 9.02%, of
payments made to design firms in FY21.*
During that same time frame, minority
workforce participation on capital construction
projects was 196,699 hours, or 27.28%, and
women participation was 53,339 hours,
or 7.40%, of total hours worked on capital
construction projects by contractors.
Minorities and women comprised 16.35% and
36.61%, respectively, of the staff of design firms
with workplace participation goals.*
The FY21 Diversity Report will be found at
www.msdprojectclear.org/about/diversity/
annual-report/ when it is available in early 2022.
*Numbers are as of August 2021. Please note, as project
documentation is finalized, precise numbers may fluctuate.
Peak Performance Awards
MSD was awarded top environmental honors
from the National Association of Clean
Water Agencies (NACWA), which recognized
all seven of MSD’s treatment plants with
Peak Performance Awards for excellence in
compliance with National Pollutant Discharge
Elimination System (NPDES) permit limits in
the 2020 calendar year.
PLATINUM PEAK PERFORMANCE AWARD
Plants that have completed at least five consecutive years
of 100% NPDES permit compliance.
• Fenton
• Grand Glaize
• Lower Meramec
• Missouri River
GOLD PEAK PERFORMANCE AWARD Plants that have achieved 100% NPDES permit compliance in the previous calendar year.
• Coldwater Creek
• Lemay
SILVER PEAK PERFORMANCE AWARD Plants that have no more than five NPDES permit violations in the previous calendar year.
• Bissell Point
LOOKING AHEAD
MSD Project Clear
In FY22, MSD has plans for 122 new,
ongoing, or continued wastewater project
appropriations totaling $336.5 million. These
projects are funded primarily from the
Sanitary Replacement fund and represent
$7.3 million in continued projects from the
previous fiscal year, and $329.2 million in new
and ongoing projects.
In addition to operating the existing
stormwater system, MSD Project Clear plans 20
stormwater design and construction projects
totaling $16.0 million in FY22. Continued
projects from FY21 total $0.4 million.
Disparity Study
In 2019, MSD commissioned the next analysis
of its prime and subcontractor performance
by conducting an update to the 2012 Disparity
Study for the next five-year period (2013-2017)
by Mason Tillman and Associates. The initial
study completed in 2012 became the catalyst
for the expansive offering of initiatives now
in place, including more inclusive contractor
goals, worksite inspectors, on-the-job training,
internships, community partnerships, and
other programs.
The update will analyze MSD’s current diversity
programs, practices, and results; measure
inclusion and availability; and determine
what advancements MSD has accomplished
on projects in terms of workforce. After
being delayed due to the pandemic, MSD
anticipates releasing the results of the study
by Q1 2022 and beginning implementation
plans for program changes thereafter.
Voters Approve Proposition Y and
Five MSD Charter Amendments
On April 6, voters in St. Louis City and St.
Louis County approved all six ballot measures
presented by MSD. Proposition Y will allow
MSD to borrow $500 million in bonds to fund
approximately $1.58 billion in wastewater
system improvements through June 2024—
work that is essential to improving water
quality in the region and is a required
component of MSD’s agreement with the U.S.
Environmental Protection Agency and the
Missouri Coalition for the Environment. Per
Proposition Y, wastewater rates will go up 3.4%
in 2022, 3.5% in 2023, and 3.7% in 2024.
In addition to voting in favor of Proposition Y,
voters approved five amendments to MSD’s
Charter to remove obsolete provisions and
modernize certain provisions, references,
and language; allow MSD’s Board of Trustees
to vote on legislation as long as at least five
members are present; clarify Rate Commission
voting delegates; change compensation for
Trustees and members of the Civil Service
Commission to $25 for all public meetings; and
permit MSD to engage the same independent
auditing firm in excess of five consecutive years
as long as the District holds a competitive
bid for auditing services and the lead audit
partner/concurring partner is changed.
12 | METROPOLITAN ST. LOUIS SEWER DISTRICT POPULAR ANNUAL FINANCIAL REPORT FY2021 | 13
FY21 FY20 FY19
ASSETS
Current, non-current, restricted, and other assets $827,663 $787,043 $821,030
Capital assets (net of accumulated depreciation) 4,078,342 3,847,889 3,631,716
Total Assets 4,906,005 4,634,932 4,452,746
DEFERRED OUTFLOWS OF RESOURCES
Bonds and notes payable-Deferred loss on refunding 5,469 5,889 11,343
Pension-related outflows 10,476 15,673 34,238
OPEB-related outflows 3,537 2,843 1,246
Total Deferred Outflows of Resources 19,482 24,405 46,827
LIABILITIES
Current liabilities 165,821 153,611 149,991
Non-current liabilities 1,832,387 1,722,223 1,723,830
Total Liabilities 1,998,208 1,875,834 1,873,821
DEFERRED INFLOWS OF RESOURCES
Bonds and notes payable-Deferred
gain on refunding 2,793 1,393 —
Pension-related inflows 22,671 7,150 4,341
OPEB-related inflows 3,888 4,331 887
Total Deferred Inflows of Resources 29,352 12,874 5,228
NET POSITION
Net investment in capital assets 2,299,308 2,184,736 2,063,519
Restricted 97,920 97,034 127,414
Unrestricted 500,699 488,859 429,591
Total Net Position $2,897,927 $2,770,629 $2,620,524
Definitions:
Current, non-current, restricted, and other assets: all assets other than capital assets that are owned or due to the District.
Capital assets (net of accumulated depreciation): the total value of all capital assets including all sanitary infrastructure,
general plant and equipment, and land.
Deferred outflows of resources: a consumption of net assets that is applicable to a future reporting period.
Current liabilities: money owed by the District and due within 12 months.
Non-current liabilities: money owed by the District that is due more than 12 months in the future.
Deferred inflows of resources: an acquisition of net assets that is applicable to a future reporting period (i.e. advance collections).
Net Position: difference between (a) assets and deferred outflows of resources and (b) liabilities and deferred inflows.
Net investment in capital assets: the value or net worth of all capital assets after related liabilities are deducted.
Restricted: the value or net worth of all assets designated for specific purposes after related liabilities are deducted.
Unrestricted: the value or net worth of all remaining assets after remaining liabilities are deducted.
What it tells you:
A Statement of Net Position, also known as a Balance Sheet, is a financial statement that summarizes what MSD owns
and owes at a given point in time. It also shows our net worth at that specific point in time.
Our FY21 Balance Sheet shows that:
• Overall, the District as a whole is financially improving as evidenced by the increase in the Total Net Position.
• MSD’s assets and deferred outflows exceed liabilities and deferred inflows by $2.9 billion.
• Overwhelmingly, MSD’s assets are in the form of capital assets. The $4.1 billion in net capital assets is split into the
five categories shown on page 13.
• Of the $2.0 billion in liabilities, $1.8 billion are in the form of bonds and notes payable.
BALANCE SHEET
Condensed Statements of Net Position (dollars in thousands)
The financial information included is derived from the Annual Comprehensive Financial Report and presented
in conformity with Generally Accepted Accounting Principles.
Financials Financials
MSD ASSETS
Condensed Statements of Capital Assets Net of Depreciation (dollars in millions)
What We Own
(in millions)
MSD LONG-TERM OBLIGATIONS
Bonds and Notes Payable (Revenue Bonds and Direct Loan Balances Only)
What We Owe
53%
29%
15%Collection and Pumping Plant $2,163
Construction in Progress 1,194
Treatment, Disposal Plant, and Equipment 617
Land 80
General Plant and Equipment 24
TOTAL FY21 ASSETS $4,078
1%
2%
$200
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
$1,800
2020 202120122013201420152016201720182019
$2,000
14 | METROPOLITAN ST. LOUIS SEWER DISTRICT POPULAR ANNUAL FINANCIAL REPORT FY2021 | 15
FY21 FY20 FY19 FY18 FY17OPERATING REVENUES
Sewer service charges $425,248 $430,398 $399,929 $364,165 $330,873
Provision for doubtful sewer service (5,347) (5,612) (4,349) (2,990) (2,513)
charge accounts
Licenses, permits, and other fees 3,754 3,012 3,063 3,777 4,036
Other 3,497 10,193 2,478 3,359 1,095
Total Operating Revenues 427,152 437,991 401,121 368,311 333,491
NON-OPERATING REVENUES
Property taxes levied by the District 43,624 35,439 34,108 33,749 32,458
Investment income 1,392 16,259 16,699 7,406 2,903
Rent and other income 324 302 301 254 106
Total Non-Operating Revenues 45,340 52,000 51,108 41,409 35,467
Total Revenues 472,492 489,991 452,229 409,720 368,958
OPERATING EXPENSES
Pumping and treatment 64,475 62,030 63,197 60,735 60,203
Collection system maintenance 48,113 47,652 45,617 44,786 43,928
Engineering 11,501 11,628 11,447 11,218 11,290
General and administrative 55,011 65,947 67,462 59,012 58,535
Water backup claims 3,985 4,653 5,600 1,557 5,035
Depreciation 91,352 87,633 83,640 81,326 81,194
Asset management 16,024 17,195 13,755 15,131 14,893
Total Operating Expenses 290,461 296,738 290,718 273,765 275,078
NON-OPERATING EXPENSES
Net loss on disposal and
sale of capital assets 990 962 971 1,834 673
Non-recurring projects and studies 11,828 12,458 15,628 9,296 7,459
Interest expense 56,616 36,119 33,082 36,695 31,251
Total Non-Operating Expenses 69,434 49,539 49,681 47,825 39,383
Total Expenses 359,895 346,277 340,399 321,590 314,461
INCOME BEFORE CAPITAL
GRANTS AND CONTRIBUTION 112,597 143,714 111,830 88,130 54,497
Capital grants and contributions 14,701 6,391 17,378 26,077 9,614
CHANGE IN NET POSITION 127,298 150,105 129,208 114,207 64,111
Net position – beginning of year 2,770,629 2,620,524 2,491,316 2,391,168 2,327,057
Effect of adoption of GASB 75 — — — (14,059) —
NET POSITION – END OF YEAR $2,897,927 $2,770,629 $2,620,524 $2,491,316 $2,391,168
INCOME STATEMENT
Condensed Statements of Revenues, Expenses, and Changes in Net Position (dollars in thousands)
Definitions:
Operating revenues and expenses: all income and expenses received from the District’s daily normal business.
Non-operating revenues and expenses: all income and expenses not related to the District’s daily normal business.
Governmental Accounting Standard Board (GASB): establishes accounting and financial reporting standards for U.S. state and local governments
that follow Generally Accepted Accounting Principles.
GASB 75: this statement improved usefulness of information and reporting for other postemployment benefits (OPEB) other than pensions.
What it tells you:
A Statement of Revenues, Expenses, and Changes in Net Position, also known as an Income Statement, tells you where
MSD gets its funds and how they are spent. It also shows how much money MSD made or lost over a specific period of time.
Our FY21 Income Statement shows that:
• The largest impacts to net position were the decrease in investment income and the increase in interest expense.
• Operating expenses decreased primarily due to lower net pension expense resulting from favorable market values
reflected in general and administrative.
FY21 EXPENSES
Year ended June 30, 2021 (dollars in thousands)
Where The Money Goes
FY21 REVENUE
Year ended June 30, 2021 (dollars in thousands)
Where The Money Comes From
Sewer Service Charges, Net $419,901
Other (in Detail)
Property taxes levied by the District (9%) 43,624
Capital grants and contributions (3%) 14,701
Licenses, permits, and other fees (1%) 3,754
Other operating revenues (1%) 3,497
Investment income (0%) 1,392
Rent and other income (0%) 324
TOTAL REVENUE $487,193
Employment Costs $106,791
Depreciation 91,352
Interest Expense 56,616
Contracted Services 51,736
Other (in Detail)
Utilities (4%) 14,948
Materials and supplies (4%) 13,089
Non-recurring projects and studies (3%) 11,828
Other operating expenses (2%) 5,342
Insurance (1%) 4,410
Chemical supplies (1%) 2,793
Net loss on disposal and sale of capital assets (0%) 990
TOTAL EXPENSES $359,895
14%
30%
25%
86%
15%
16%
14%
Financials Financials
16 | METROPOLITAN ST. LOUIS SEWER DISTRICT POPULAR ANNUAL FINANCIAL REPORT FY2021 | 17
Operating Activities Non-Capital Financing Activities Capital Activities Investing Activities-350,000
-300,000
-250,000
-200,000
-150,000
-100,000
-50,000
0
50,000
100,000
150,000
200,000
250,000
FY21 FY20 FY19
$2
1
0
,
6
7
4
$2
1
7
,
8
2
9
$1
8
5
,
2
2
6
$(
1
6
,
5
8
6
)
$9
3
,
7
7
9
$
1
1
3
,
3
3
8
$4
2
,
6
8
9
$3
4
,
9
8
3
$3
3
,
8
5
0
CASH FLOW STATEMENT
Condensed Statements of Cash Flows (dollars in thousands)
CASH FLOW ACTIVITIES COMPARISON
(dollars in thousands)
FY21 FY20 FY19
Cash flows from operating activities $210,674 $216,970 $185,226
Cash flows from non-capital financing activities 42,689 34,983 33,850
Cash flows from capital and related financing activities (211,637) (305,361) (310,046)
Cash flows from investing activities (16,586) 93,779 113,338
Net increase in cash and cash equivalents 25,140 40,371 22,368
Cash and cash equivalents at beginning of year 97,125 56,754 34,386
CASH AND CASH EQUIVALENTS – END OF YEAR $ 122,265 $97,125 $56,754
Definitions:
Cash flows from operating activities: all cash received or spent related to MSD’s daily normal business activities.
Cash flows from non-capital financing activities: all cash received or spent related to taxes.
Cash flows from capital and related financing activities: cash received or spent related to construction of MSD’s infrastructure.
Cash flows from investing activities: cash received or spent related to investing MSD’s cash reserves.
What it tells you:
A Cash Flow Statement summarizes both the cash and the net cash coming in and going out of MSD during
a given period.
Our FY21 Cash Flow Statement shows that:
• Cash flows from operating activities decreased due to decreased receipts from customers and increased payments
to employees and suppliers.
• Cash flows from non-capital financing activities increased due to more tax revenue collected.
• Cash flows from capital and related financing activities increased as a result of more bond proceeds and premiums
received during FY21.
• Cash flows from investing activities decreased due to more cash spent on the purchase of investments and less
investments maturing during FY21.
Variance Explanation
CIRP came in under budget for FY21. The largest factor was projects being under budget either from good bids or
reduced scope, contributing to $33.4 million of the variance. Postponements due to easement acquisition delays,
scope revisions, and delays in choosing contractors contributed to $7.7 million of the variance. The remaining $4 million
of savings resulted from cancelled or completed projects coming in under budget.
Debt Service expenses were unfavorable for the District in FY21. The increased expenses of $1.3 million were primarily
related to senior refunding revenue bond placement offset by reduced use of $344 thousand of the Water Infrastructure
Finance and Innovation Act (WIFIA) Series 2018A. The District took advantage of the advance refunding, decreasing total
debt service payments over the next 11 years by $7.4 million and resulting in an economic gain of $2.6 million.
Operating expenses came in under budget for FY21. The largest of the variances was in contractual services of $5 million
due to professional services of $3.4 million, blocked main and OC claims of $1 million, and building repairs and services
of $0.6 thousand. Personnel services were favorable by $3.3 million primarily due to vacancies. Utilities contributed
to the District’s favorable expense variance by finishing under budget by $2.1 million. Supply expenses were also
favorable by $1.1 million primarily due to chemical supplies. Capital outlay offset a portion of these savings, with
expenses exceeding the budget by $0.8 thousand primarily for processing equipment at the treatment plants and
pump stations. It was cost effective for the District to replace older equipment verus spending additional dollars to
maintain existing equipment.
What it tells you:
A credit rating provides an assessment of an organization’s credit worthiness, based on its history of
borrowing and repayment of funds as well as its assets and liabilities. A poor credit rating makes it more
difficult to find financing and often results in higher interest rates. As the chart below illustrates, MSD has
premium credit, with consistent ratings at the top of each credit rating agency’s scale. On a scale of Aaa
to C, MSD earned an Aa1 rating from Moody’s. Similarly, on a scale of AAA to D, MSD earned AAA and
AA+ ratings from Standard & Poor’s and Fitch, respectively. MSD has demonstrated to creditors and credit
rating agencies its ability to manage large annual capital plans. The District’s solid financial management,
including close monitoring of its financial performance, strong debt coverage, and liquidity also contribute
to these ratings, which have remained consistent the past three years.
What it tells you:
In MSD’s case, it shows that MSD has been a good steward of the funds allocated to the District.
FY21 FY20 FY19
Moody’s Aa1 Aa1 Aa1
Standard & Poor’s (S&P) AAA AAA AAA
Fitch AA+ AA+ AA+
Expense
Category
Budget
Expenses
Unspent
(Overspent)
Budget
Capital Improvement
and Replacement
Program (CIRP)
$391.7M
346.6M
45.1M
Debt Service
$123.3M
124.8M
(1.5)M
Operating
$221.0M
210.2M
10.8M
TOTAL
$736.0M
681.6M
54.4M
CREDIT RATING
PERFORMANCE AGAINST BUDGET
$(
2
1
1
,
6
3
7
)
$(
3
0
6
,
2
2
0
)
$
(
3
1
0
,
0
4
6
)
Financials Financials
msdprojectclear.org
MSDProjectClear
@MSDProjectClear
msdprojectclear
msdprojectclear
Metropolitan St. Louis Sewer District
Metropolitan St. Louis Sewer District
Stay up-to-date with
MSD Project Clear online
and on social media.
2350 MARKET STREET, ST. LOUIS, MO 63103