HomeMy Public PortalAboutExhibit MSD 83A- MSD's Response to Rate Commission's Sixth Discovery RequestExhibit MSD 83A
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22BEFORE THE RATE COMMISSION OF THE
METROPOLITAN ST. LOUIS SEWER DISTRICT
MSD’S RESPONSE TO THE SIXTH DISCOVERY REQUEST OF
THE RATE COMMISSION
ISSUE: 2023 STORMWATER & WASTEWATER RATE
CHANGE PROCEEDING
WITNESS: METROPOLITAN ST. LOUIS SEWER DISTRICT
SPONSORING PARTY: RATE COMMISSION
DATE PREPARED: JUNE 26, 2023
Exhibit MSD 83A
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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 )
SIXTH 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 Metropolitan St. Louis Sewer District (the “District”) hereby responds to the
June 15, 2023 Sixth Discovery Request of the Rate Commission for additional information and
answers regarding the Rate Change Proposal dated March 24, 2023 (the “Rate Change
Proposal”).
Exhibit MSD 83A
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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 )
SIXTH 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.
Exhibit MSD 83A
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DISCOVERY REQUEST
1. Please explain the District’s methodology for identifying stormwater customers as
residential or non-residential.
RESPONSE: The District utilized the classifications provided by the City and County Assessor’s
Offices. See the District’s response to the Rate Commission’s First Discovery Request (Exhibit
MSD 68A, question 14).
2. Appendix 8.9 of Ex. MSD 1 (Rate Change Proposal) categorizes impervious
surface features as Building Main Structure Footprints, Paved Roads, Driveways, Sidewalks, and
others. Please provide examples of “other” impervious surface features.
RESPONSE: “Other” impervious surface features considered billable include fields named:
Buildings-out-buildings, Parking-Paved, Patio-Concrete-Slabs, Recreation-Areas (tennis or
basketball courts), and Sheds.
3. Please state whether the proposed non-residential impervious area rate is based on
the 2020 or 2022 aerial photography.
RESPONSE: Rate proposal is based on 2020 aerial photography; however, before billing
customers this will be updated with 2022 aerial photography and then updated every 2 years
thereafter.
4. Please state whether tax-exempt residential properties will be assessed the proposed
stormwater capital tax.
RESPONSE: Properties classified by the City and County Assessors as “Residential” and tax
exempt will not be assessed the proposed stormwater capital ad valorem tax. There’s a total of
approximately 25,400 properties designated as residential tax-exempt by the City of St. Louis
(11,700 properties) and St. Louis County (13,700 properties) Assessor’s Offices. Of the 11,700
properties classified as residential tax exempt by the City of St. Louis, approximately 8,600 or 74%
are owned by the Land Reutilization Authority (LRA) and approximately 1,050 or 9% are owned
by other City agencies (i.e., St. Louis Housing Authority). Approximately 11,500 or 84% of the
residential exempt properties within St. Louis County are listed as vacant.
5. Please state whether tax-exempt non-residential properties be assessed the
proposed stormwater capital charge.
RESPONSE: Yes, tax-exempt non-residential properties will be assessed the proposed
stormwater capital charge (see Exhibit MSD 3B - Direct Testimony of Susan Myers, question 8).
6. Please provide the total gross area at the parcel level for all non-residential parcels
currently designated as “vacant”.
Exhibit MSD 83A
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RESPONSE: The total gross area for non-residential parcels designated as “vacant” is 17.3
square miles from 4,425 parcels.
7. Appendix 8.15 of Ex. MSD 1 indicates that the proposed stormwater capital tax
($0.0745 cent) would apply to residential personal property. Does the District currently bill the
Regulatory ($0.02 cent) tax and O&M ($0.1000 cent) tax to personal property as well?
RESPONSE: Yes, the District currently bills the Regulatory ($0.02 cent) tax and O&M ($0.1000
cent) tax to personal property.
8. In Ex. MSD 73I, the cost of the Fluidized Bed Incinerator (“FBI”) project was
estimated to be $477,300,000 in 2018. In Ex. MSD 73K, the estimated cost is listed as
$951,200,000. Please explain the factors contributing to the increase in total project cost. How
certain is the District that the current cost estimate will not increase further?
RESPONSE: The two main factors that affected the increase in total project cost are (1) scope
modifications to address production capacity and operational needs, and (2) inflationary impacts.
MSD staff is in the process of developing a comprehensive packet of information that will be
provided in the future as a supplement to this answer.
MSD does not anticipate further cost increases in the project, barring unforeseen conditions or
changes that are out of the control of MSD.
9. Please state the amount that the District has spent to date on the FBI project?
RESPONSE: To date a total of $16,230,000 has been appropriated. $12,731,000 has been
appropriated for Owner’s Representative Black and Veatch for pre-design and design services,
$2,000,000 for Design-Build stipends for losing proposers, $1,500,000 for the original 2011 Solids
Handling Study.
10. Please provide a layman’s summary of all sludge management options evaluated in
Ex. MSD 73G (Tech Memo 3), along with a summary of why each solution was or was not
selected.
RESPONSE: Exhibit MSD 73G is a 530-page document with several technical memorandums
addressing several areas. At a high level, there are essentially three (3) approaches to treatment
and disposal of biosolids: Anerobic digestion (to make fertilizer) with subsequent land application
or landfilling, landfilling of raw solids, and incineration. MSD looked at various options for all of
these and evaluated them across a triple bottom line matrix based on social, environmental, and
economic factors.
MSD considered several versions of anaerobic digestion technologies to treat biosolids. Anaerobic
digestion is a biological process that works best with consistent feeds rates and fuel content. For
all of these, the variability in biosolids quantity and chemical makeup of the biosolids currently
produced at the Bissell and Lemay plants would make treatment operations with digesters difficult.
The chemical makeup of the biosolids that MSD must process at these two plants is significantly
Exhibit MSD 83A
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affected by the flow of the Mississippi River and grit and soil received in the combined sewer
system. When the river is high, inflow from the river comes to the wastewater treatment plants
impacting the variability in the biosolids. This variability causes biosolids quantities to go up,
and the amount of organic material (or fuel content) in the biosolids to go down. This impacts the
key biological components of the digestion process. This was a major factor, among others, in
MSD’s decision not to pursue this option.
Additionally, a more significant consideration, one that is not considered in Exhibit MSD 73G, is
future regulation on disposal of biosolids containing Per- and Polyfluoroalkyl Substances (PFAS).
The anaerobic digestion technology will not remove PFAS from biosolids, adding uncertainty to
future disposal options. For example, regulatory requirements for using biosolids as a fertilizer
and land application will soon be much more stringent due to changes that EPA is making to
address PFAS.
MSD staff also considered biosolids landfilling but concluded that was not a good alternative.
MSD doesn’t own the land where an appropriately sized landfill could be located. Assuming the
land could be acquired, MSD would need to haul 40-60 trucks per day of raw solids. MSD would
be storing undigested and odorous solids for extended periods at the Bissell Point and Lemay
plants. Trucking raw solids also represents an odor and nuisance hazard. Also, there is significant
concerns about the long-term viability of landfilling raw solids due to future PFAS regulation.
The solution that the team selected was replacing the existing biosolids incineration equipment at
Bissell Point and Lemay with fluidized bed incineration (FBI) facilities. These new facilities are
designed to handle the variability in biosolids quantity and chemical makeup, without other facility
changes. Fluidized bed incineration is also a promising PFAS destruction technology.
Additionally, included emission control processes, like granular activated carbon, should remove
PFAS from the exhaust. Finally, MSD will be able to continue to dispose of ash in its existing
landfill. The FBI approach also scored highest in the TBL assessment.
MSD staff is in the process of developing a comprehensive packet of information that will be
provided in the future as a supplement to this answer.
11. Kansas City’s sludge management solution is Thermal Hydrolysis. Did the District
consider this technology? If so, what factors led the District to not select it? If not, why did the
District not consider it?
RESPONSE: Yes, the District considered the Thermal Hydrolysis Process, or THP. THP is not
a standalone treatment process, but rather a component of an anerobic digestion process. Several
factors led MSD to not select anaerobic digestion, see 10 above.
Additionally, THP relies on high pressure steam reactors to help the anaerobic digestion process.
Not only is this operationally more complex, but inorganic grit and soil, major components of the
low-volatile solids produced at Bissell Point and Lemay, can create hazardous safety issues in the
THP’s high-pressure steam reactors. The same limiting factors regarding PFAS and potential land
application would apply to this process as well.
Different situations and problems require different solutions. We want to point out that other
cities and sewer districts use fluidized bed incineration. For example, the only other
comparatively sized wastewater treatment facility in the Mississippi River basin is in
Minneapolis-St. Paul, MN, and that facility uses fluidized bed incineration. And in the Kansas
Exhibit MSD 83A
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City area, both Little Blue Valley Sewer District and the City of Independence use fluidized bed
incineration.
MSD staff is in the process of developing a comprehensive packet of information that will be
provided in the future as a supplement to this answer.
12. Since the District selected the FBI technology for sludge handling, there have been
developments such as federal incentives for energy recovery, potential regulation of PFAS, etc.,
that would have impacts on a sludge management program. Has the District conducted any recent
review of the selected technology and plan to confirm that the FBI solution remains the best
alternative for the District, given the many technical, financial, and environmental considerations?
RESPONSE: Yes. The District has evaluated these additional developments and confirmed the
FBI solution to be the best solution.
MSD staff is in the process of developing a comprehensive packet of information that will be
provided in the future as a supplement to this answer.
13. What risk would the District take if it were to move away from the FBI project to a
different solution at this time? How much time would be required to undertake the necessary
studies and design to reach the stage the District is currently at with the FBI project? How much
cost would be incurred in conducting the necessary studies and design to reach such stage?
RESPONSE: The existing biosolids equipment at Bissell Point has 3-5 years of working life
remaining. We estimate Lemay has 5-10 years remaining. When the life of the current equipment
is expired, then those facilities wastewater treatment capacities will be reduced (at best) and/or
wastewater clarifiers can no longer be operated (at worst). When these processes fail, then MSD
will not be able to treat wastewater and bypassing of wastewater into area rivers and streams will
occur. Bypassing would also cause MSD to be out of compliance with its NPDES permits and its
Consent Decree, and bypassing is subject to Consent Decree penalties. As such, MSD needs new
facilities to be constructed and operating by 2028.
To move away from FBI technology and then to re-evaluate alternative solutions, plan, design and
be ready for construction of an alternate solution would take at least 5 years, and likely longer
because the District would need to purchase land to build the alternative facility. The cost of design
and land acquisition for the alternative approach, just to get to a point where the project is ready
for awarding a design-build contract, is likely $20-50 million. Executing an aggressive design and
construction schedule, the alternative facilities would not likely begin operation for at least 10
years. MSD’s existing biosolids incineration facilities could not operate that long and comply with
the Clean Air Act. Therefore, interim facilities would need to also be constructed to keep MSD’s
wastewater treatment facilities operating, at additional to-be-determined cost. MSD may also
incur costs for negotiating and executing enforcement orders needed to allow MSD to operate.
This response is based upon staff’s best evaluation of the existing facility conditions, regulations,
and compliance schedules.
Exhibit MSD 83A
Respectfully submitted,
Susan M. Myers /
Brian Stone
THE METROPOLITAN ST. LOUIS
SEWER DISTRICT
2350 Market Street
St. Louis, Missouri 63103
Tel: (314) 768-6366
smyers@stlmsd.com
bstone@stlmsd. com
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Exhibit MSD 83A
CERTIFICATE OF SERVICE
The undersigned certifies that a copy of the foregoing was sent by electronic transmission
to Lisa O. Stump and Brian J. Malone, Lashly & Baer, on this 26th day of June, 2023.
Lisa O. Stump
Lashly & Baer, P.C.
714 Locust Street
St. Louis, Missouri 63101
lostump@lashlybaer.com
Brian J. Malone
Lashly & Baer, P.C.
714 Locust Street
St. Louis, Missouri 63101
bmalone@lashlybaer.com
Susan M. Myers /
Brian Stone
THE METROPOLITAN ST. LOUIS
SEWER DISTRICT
2350 Market Street
St. Louis, Missouri 63103
Tel: (314) 768-6366
smyers@stlmsd.com
bstone@stlmsd.com
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