HomeMy Public PortalAboutExhibit RC 70- Rate Commission's Second Discovery Request to MSD 04072023BEFORE THE RATE COMMISSION OF THE
METROPOLITAN ST. LOUIS SEWER DISTRICT
SECOND DISCOVERY REQUEST
ISSUE: 2023 STORMWATER & WASTEWATER RATE
CHANGE PROCEEDING
WITNESS: METROPOLITAN ST. LOUIS SEWER DISTRICT
SPONSORING PARTY: RATE COMMISSION
DATE PREPARED: APRIL 7, 2023
Lashly & Baer, P.C.
714 Locust Street
St. Louis, Missouri 63101
Exhibit RC 70
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BEFORE THE RATE COMMISSION
OF THE METROPOLITAN ST. LOUIS SEWER DISTRICT
For Consideration of a Stormwater & )
Wastewater Rate Change Proposal )
by the Rate Commission of the )
Metropolitan St. Louis Sewer District )
SECOND 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”), Restated Operational Rule § 3(7) and Procedural Schedule §§ 16 and
17 of the Rate Commission of the Metropolitan St. Louis Sewer District (the “Rate Commission”),
the Rate Commission requests additional information and answers from the Metropolitan St. Louis
Sewer District (the “District”) regarding the Rate Change Proposal dated March 24, 2023 (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.
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DISCOVERY REQUEST
1. The Rate Change Proposal states that it is consistent with constitutional, statutory or
common law as amended from time to time. See MSD Ex.1, p. 4-40, 4-41 and 5-7, 5-8. Please
(a) describe the analysis that was performed to reach this conclusion; (b) provide copies of any
memorandum, report, work paper, summary, analysis, or schedule that supports this conclusion;
and (c) describe the rationale for such conclusion.
WASTEWATER RESPONSE:
STORMWATER RESPONSE:
2. The Rate Change Proposal states that it enhances the District’s ability to provide
adequate sewer and drainage systems and facilities or related services. See MSD Ex. 1 p. 4-41, 5-
8. Please (a) describe the analysis that was performed to reach this conclusion; (b) provide copies
of any memorandum, report, work paper, summary, analysis, or schedule that supports this
conclusion; and (c) describe the rationale for such conclusion.
WASTEWATER RESPONSE:
STORMWATER RESPONSE:
3. The Rate Change Proposal states that it is consistent with and not in violation of
any covenant or provision relating to any outstanding bonds or indebtedness of the District. See
MSD Ex. 1, p. 4-41, 5-8. Please (a) describe the analysis that was performed to reach this
conclusion; (b) provide copies of any memorandum, report, work paper, summary, analysis, or
schedule that supports this conclusion; and (c) describe the rationale for such conclusion.
WASTEWATER RESPONSE:
STORMWATER RESPONSE:
4. The Rate Change Proposal states that it will not impair the ability of the District to
comply with applicable federal or state laws or regulations as amended from time to time. See
MSD Ex. 1, p. 4-41, 4-42 and 5-9. Please (a) describe the analysis that was performed to reach this
conclusion; (b) provide copies of any memorandum, report, work paper, summary, analysis, or
schedule that supports this conclusion; and (c) describe the rationale for such conclusion.
WASTEWATER RESPONSE:
STORMWATER RESPONSE:
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5. The Rate Change Proposal states that it considers the financial impact on all classes
of ratepayers in determining a fair and reasonable burden. See MSD Ex. 1, p. 4-42, 5-9 Please (a)
describe the analysis that was performed to reach this conclusion; (b) provide copies of any
memorandum, report, work paper, summary, analysis, or schedule that supports this conclusion;
and (c) describe the rationale for such conclusion.
WASTEWATER RESPONSE:
STORMWATER RESPONSE:
6. Please identify any covenants with which the Rate Change Proposal must comply.
Please describe any loans, grants, or provisions of the Consent Decree which were considered in
formulating the Rate Change Proposal.
RESPONSE:
7. Please describe how the District’s affordability metrics compare to similarly
situated utilities.
RESPONSE:
8. Please describe any facts and circumstances which demonstrate whether the Rate
Change Proposal and all portions thereof is necessary to pay interest and principal falling due on
bonds issued to: (a) finance assets of the District; (b) necessary to enable the District to provide
for the costs of operation and maintenance; and (c) such other amounts as may be required to cover
emergencies and anticipated delinquencies, as required by § 7.040 of the Charter Plan.
WASTEWATER RESPONSE:
STORMWATER RESPONSE:
9. Please describe any other facts and circumstances which demonstrate whether and
to what extent the Rate Change Proposal and all portions thereof is necessary to enable the District
to comply with any covenant or provision relating to outstanding bonds or indebtedness of the
District, together with a specific quantification of the amount of the Proposed Rate Change is
necessary for such purposes, as required by § 4(2)(c) of the Operational Rules.
WASTEWATER RESPONSE:
STORMWATER RESPONSE:
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10. Please describe any facts and circumstances which demonstrate how the Rate
Change Proposal considers the financial impact on all classes of ratepayers in determining a fair
and reasonable burden, including whether and how cost of service considerations, have been
factored into such determination as required by § 4(2)(e) of the Operational Rules.
WASTEWATER RESPONSE:
STORMWATER RESPONSE:
11. Please describe any facts and circumstances which demonstrate how the Rate
Change Proposal considers the financial impact on all classes of ratepayers in determining a fair
and reasonable burden, including whether and how cost causation principles, have been factored
into such determination as required by § 4(2)(e) of the Operational Rules.
WASTEWATER RESPONSE:
STORMWATER RESPONSE:
12. Please describe any facts and circumstances which demonstrate how the Rate
Change Proposal considers the financial impact on all classes of ratepayers in determining a fair
and reasonable burden, including whether and how customer impact data has been factored into
such determination as required by § 4(2)(e) of the Operational Rules.
WASTEWATER RESPONSE:
STORMWATER RESPONSE:
13. Please describe any facts and circumstances which demonstrate how the Rate
Change Proposal considers the financial impact on all classes of ratepayers in determining a fair
and reasonable burden, including whether and how economic development considerations have
been factored into such determination as required by § 4(2)(e) of the Operational Rules.
WASTEWATER RESPONSE:
STORMWATER RESPONSE:
14. Please describe any facts and circumstances which demonstrate how the Rate
Change Proposal considers the financial impact on all classes of ratepayers in determining a fair
and reasonable burden, including whether and how environmental effects have been factored into
such determination as required by § 4(2)(e) of the Operational Rules.
WASTEWATER RESPONSE:
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STORMWATER RESPONSE:
15. Please describe any other facts and circumstances which demonstrate how the Rate
Change Proposal considers the financial impact on all classes of ratepayers in determining a fair
and reasonable burden, including whether and how any other factors have been factored into such
determination as required by § 4(2)(e) of the Operational Rules.
WASTEWATER RESPONSE:
STORMWATER RESPONSE:
16. Please (a) describe any other facts and circumstances which demonstrate that the
measures taken by the District to ensure that the cost of constructing and maintaining the District’s
facilities and providing related services are being incurred in a reasonable and efficient manner;
and (b) include copies of all internal or external audit reports that address such matters as required
by § 4(2)(f) of the Operational Rules.
WASTEWATER RESPONSE:
STORMWATER RESPONSE:
17. Please describe any other facts and circumstances which demonstrate how, whether
and to what extent the Rate Change Proposal and all portions thereof, will affect, impact and
comply with the Consent Decree, as required by § 4(2)(g) of the Operational Rules.
WASTEWATER RESPONSE:
STORMWATER RESPONSE:
18. Please provide copies of the CIRP, for both stormwater and wastewater, in
Microsoft Excel format.
RESPONSE:
19. With regard to the Stormwater CIRP, please describe in detail how projects are
prioritized or scored. Has the District performed a District-wide study of stormwater capital
improvement needs and/or priorities? If yes, please provide a copy of the study.
RESPONSE:
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20. With regard to the Stormwater impervious surface charge for non-residential
properties, has the District analyzed the business impact on large properties [such as big-box
stores, strip malls, industrial facilities] with large amounts of impervious surface? If yes, please
provide a copy of such analysis.
RESPONSE:
21. Brian Hoelscher states in his testimony that the District determined that residential
customers “are willing to pay $2/month (or $25/year”) for a stormwater capital improvement
program. See Ex. MSD 3A, p. 3; ll. 19-20. Please explain how the District made this determination.
Provide a copy of the results of any survey or study supporting this conclusion.
RESPONSE:
22. Please explain why the stormwater impervious surface charge does not qualify as a
“tax” under Missouri law. Please provide a copy of any legal analysis relied upon by the District
to make such conclusion.
RESPONSE:
23. Two legal memoranda were provided to the Rate Commission by the District; one
relating to the ad valorem stormwater tax (Ex. MSD 3B1) and another related to applying the
stormwater capital rate to governmental entities and non-profits (Ex. MSD 3B2). Please provide a
copy of any other legal memoranda or analysis relied upon by the District to conclude that the
stormwater impervious surface charge applies to governmental entities and non-profit entities that
are exempt from taxation.
RESPONSE:
24. Would the presence or availability of third-party funding affect a particular
project’s scoring/prioritization under the stormwater CIRP? Please explain why or why not.
RESPONSE:
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Respectfully submitted,
/s/ Brian J. Malone
Lisa O. Stump
Brian J. Malone
LASHLY & BAER, P.C.
714 Locust Street
St. Louis, Missouri 63101
Tel: (314) 621-2939
Fax: (314) 621-6844
lostump@lashlybaer.com
bmalone@lashlybaer.com
CERTIFICATE OF SERVICE
The undersigned certifies that a copy of the foregoing was sent by electronic transmission
to Stephanie DeJarnette, Office Associate Senior, Metropolitan St. Louis Sewer District; Susan
Myers, Counsel for the Metropolitan St. Louis Sewer District, on this 7th day of April, 2023.
Ms. Stephanie DeJarnette
Office Associate Senior
Metropolitan St. Louis Sewer District
2350 Market Street
St. Louis, MO 63103
sdejarnette@stlmsd.com
Ms. Susan Myers
General Counsel
Metropolitan St. Louis Sewer District
2350 Market Street
St. Louis, MO 63103
smyers@stlmsd.com
/s/ Brian J. Malone
Brian J. Malone