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HomeMy Public PortalAboutExhibit RC 73- Rate Commission's Fourth Discovery Request to MSD 05022023BEFORE THE RATE COMMISSION OF THE METROPOLITAN ST. LOUIS SEWER DISTRICT FOURTH DISCOVERY REQUEST ISSUE: 2023 STORMWATER & WASTEWATER RATE CHANGE PROCEEDING WITNESS: METROPOLITAN ST. LOUIS SEWER DISTRICT SPONSORING PARTY: RATE COMMISSION DATE PREPARED: MAY 1, 2023 Lashly & Baer, P.C. 714 Locust Street St. Louis, Missouri 63101 Exhibit RC 73 2 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 ) FOURTH 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. 3 DISCOVERY REQUEST 1. Please provide all citations to cases referenced in any legal opinion received by the District that was relied upon in crafting the stormwater and wastewater Rate Change Proposals under consideration by the Rate Commission. RESPONSE: 2. Please identify the five Keller factors utilized by Missouri courts to consider whether a payment is considered a tax or a user fee under the Hancock Amendment to the Missouri Constitution. See Keller v. Marion County Ambulance District, 820 S.W.2d 301 (Mo. banc 1991). RESPONSE: 3. Please provide a citation to (and/or a copy of) any opinion of which the District is aware, issued by a Missouri court or tribunal (or a court/tribunal from another state), that has authorized a stormwater rate charge for residential ratepayers based on an ad valorem property tax, and a rate/charge based on impervious area for non-residential ratepayers. RESPONSE: 4. Please provide all legal citations contained in any memorandum or opinion relied upon by the District to support the Rate Change Proposal, including the rationale set forth in Ex. MSD 3B1 and Ex. MSD 3B2. RESPONSE: 5. Please state the name of any consultant who performed or assisted the District in performing the Stormwater Public Survey, and provide the dates any such surveys were performed. RESPONSE: 6. Please provide a list of all projects planned or presently being funded by the $0.02 ad valorem tax levied by the District for regulatory purposes. RESPONSE: 7. Please provide a copy of any publication or guidance issued to municipalities in the District’s service area regarding grants available within the OMCI subdistricts. RESPONSE: 4 8. For each OMCI subdistrict, please provide, in Microsoft Excel format, a summary of historical revenue provided to each municipality over the past 10 years, along with projected allocation of grant money from the 30% allocation of the proposed stormwater capital charge. RESPONSE: 9. Please provide any available summaries of demographic data for the communities within each OMCI subdistrict. RESPONSE: 10. Please provide a summary of residential versus non-residential number of parcels and impervious area for each community within each OMCI subdistrict. RESPONSE: 11. In Ex. MSD 3C, Direct Testimony of Mr. Unverferth, Question 10, beginning on line 14, Mr. Unverferth indicates that the stormwater CIRP includes “$5.5 million in funding to provide stormwater grants to third parties to promote flooding and erosion control, and green infrastructure, funded via OMCI taxing districts and the District’s stormwater regulatory fund.” Please provide a breakdown of the funding from each OMCI subdistrict and the regulatory fund. RESPONSE: 12. Please provide a copy of the Stormwater CIRP, in Microsoft Excel format, including project priority numbers for the 4-year capital program to be funded by the Rate Change Proposal. See Ex. MSD 1; p. 8-64 – 8-76. RESPONSE: 13. Mr. Unverferth stated in his testimony during the technical conference on April 26, 2023 that the grant program funded from the 30% allocation of the stormwater capital charge would be allocated to communities as reimbursement for projects completed, versus up-front funding. Please state whether, when communities apply for funding, do they do so prior to initiating a project, or does the District require a project to be complete before approving the project? Please state whether the District anticipates some communities to not participate in the program due to lack of funding to fund the project initially? Pleas state whether the District has discussed any options that would allow communities to move forward with erosion and/or flood control projects if they do not have the financial capability to fund the project up front? RESPONSE: 14. Please state the number of properties which would be subject to the exemption from stormwater taxes, fees, or charges by virtue of § 204.700, RSMo. RESPONSE: 5 15. Please the estimate number of non-residential properties which do not receive wastewater service from the District, but would, under the Rate Change Proposal, receive an impervious surface bill from the District. RESPONSE: 16. During Mr. Unverferth’s testimony at the April 27, 2023 technical conference, he referenced a technical memorandum summarizing the District’s evaluation of energy recovery options for the biosolids program. Please state whether this technical memorandum also discuss options beyond the technology chosen? Please provide a copy of the technical memorandum mentioned. If the memorandum does not discuss why fluidized bed technology was chosen, please provide a summary of the reasons the District chose the methodology. RESPONSE: 17. Please provide a summary of any projects proposed in the wastewater CIRP involving the Fluidized Bed Incinerators, and any technical memorandum in the District’s possession regarding such project(s). See Ex. MSD 1; p. 8-17 – 8-41. RESPONSE: 18. In Ms. Pugh’s testimony during the April 27, 2023 technical conference, she discussed liquidity in terms of Days Cash on Hand. What is the current and projected Days Cash on Hand for this Rate Change Proposal? How is the calculation of Days Cash on Hand different than the calculation of the 60-day operating reserve calculation in the rate model and financial plan? RESPONSE: 19. Please state how the District determines which ratepayers/property owners are monitored for industrial waste (as referenced in questioning of Mr. Tom Beckley at the technical conference on April 27, 2023). RESPONSE: 20. Please provide a summary of consent decree spending, including spending to date and projected through completion of the consent decree in 2039. RESPONSE: 21. Please state the estimated impact of inflation to date on the size of the consent decree program? Please provide an analysis of inflationary impact on the remaining costs for FY 2029 – FY 2029. RESPONSE: 6 22. Please provide the report summarizing technical analysis that William Zieburtz referenced in his testimony during the April 27, 2023 technical conference. RESPONSE: 23. In Ex. MSD 66, Stantec’s Infiltration and Inflow Cost Allocation report, for Option 3 in Section 3.2.3, Inch-Feet: Collection System with Minimum 8” Line, please explain why 8” was chosen for the minimum pipe size for the entire system, rather than 8” for the separate system and 12” for the combined system, as discussed in section 8.2.1. If the analysis were updated to reflect the distinction between the two systems, what would the expected directional impact on the allocation of Infiltration and Inflow be? RESPONSE: 24. In Ex. MSD 66, Stantec’s Infiltration and Inflow Cost Allocation report, please explain how the percentage allocations of volume and customer-based allocations were determined to provide a balanced result relative to the target distribution by customer type for the rate code based methodologies presented in sections 3.2.7 (Table 8), 3.2.8 (Table 10), 3.2.9 (Table 12), 3.2.10 (Table 14). Please state whether the “Resulting I/I Allocations” were established to minimize the variance in a specific customer type, or whether they were established to result in a proportionate variance by customer type? RESPONSE: 25. In Ex. MSD 66, on the Rate Code-based options, please state whether the Multi- Family Residential was considered a residential or non-residential customer type? RESPONSE: 26. Please explain the rationale for projecting annual decreases in both TSS and BOD/COD extra-strength loadings starting in FY 2024 at 6.2% and escalating, to decreases of 12.3% by FY 2032, continuing through 2039, when the average FY 2022 – FY 2023 data indicates an increase of 13.54% in TSS and an increase of 3.68% in BOD/COD extra strength loadings. Please also provide any relevant data, analysis and assumptions used in developing the projected surcharge units through 2039. RESPONSE: 27. In. Ex. MSD 68A, in the District’s response to Question 10 (see page 5), the District indicates that volume was projected based on an analysis of the trend in total volume in past years. In the Demand tab of the rate model, please state whether the customer accounts were separately projected at various rates depending on the customer class? Was an analysis of volume per customer for the historical data considered, and if so, does the resulting volume per customer by class in the current rate model reflect the historical volume per customer? If not, what factors were taken into consideration that would explain a different volume/customer? 7 RESPONSE: 28. Please explain how the different compliance tiers are defined and how customers are assigned a compliance tier. RESPONSE: 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 1st day of May, 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