HomeMy Public PortalAboutExhibit MSD 86- Transcript of Public Hearing- June 22, 2023Page 1
·1· · · · ·IN THE CITY OF BRIDGETON
· · · · · · · ·STATE OF MISSOURI
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· · ·ST. LOUIS METROPOLITAN SEWER DISTRICT
·8 · · ·RATE COMMISSION PUBLIC HEARING
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13· · · · ·TRANSCRIPT OF PROCEEDINGS
· · · · · · ·OF THE PUBLIC HEARING
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· · · · · · ·BRENTWOOD CITY HALL
18· · ·2348 SOUTH BRENTWOOD BOULEVARD
· · · · · ·BRENTWOOD, MISSOURI 63144
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· · · · · · · · ·JUNE 22, 2023
22· · · · · · · · ·6:00 P.M.
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Exhibit MSD 86
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·1· · · · · · · · · · ·A P P E A R A N C E S
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· · · · · · Matt Muren - MSD Rate Commission, Presiding
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·5· · · · · Brian Hoeslcher
· · · · · · Executive Director and CEO
·6· · · · · Office of the Executive Director
· · · · · · Metropolitan St. Louis Sewer District
·7· · · · · 2350 Market Street, St. Louis, MO 63103
· · · · · · 314.768.6260
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22· ·Court Reporter:
23· ·Georgia B. Northway, RPR, CCR
· · ·Missouri CCR #1401
24· ·Lexitas Legal - St. Louis
· · ·711 North Eleventh Street
25· ·St. Louis, Missouri 63101
· · ·(314) 644-2191
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·1· · · · · · · · · · ·*· · *· · *· · *· · *
·2· · · · · (Starting time of the meeting: 6:00 p.m.)
·3· · · · · MR. MUREN:· Good evening.· I'm Matt Muren;
·4· ·Technical Committee Chair of the Metropolitan St. Louis
·5· ·Sewer District Rate Commission.· I will be presiding
·6· ·over the public hearing this evening.
·7· · · · · The charter plan of the District was amended by
·8· ·voters in St. Louis City and St. Louis County at a
·9· ·general election on November 7, 2000, and established
10· ·the Rate Commission.
11· · · · · The purpose of the Rate Commission is to review
12· ·and make recommendations to MSD's Board of Trustees
13· ·regarding changes in wastewater rates, stormwater rates,
14· ·and tax rates proposed by MSD staff.
15· · · · · The Rate Commission seeks to ensure that MSD
16· ·ratepayers and the public in general have a voice in
17· ·MSD's rate setting process.
18· · · · · Through the charter plan, the Rate Commission is
19· ·composed of 15 member organizations, collectively
20· ·representing the broadest possible cross-section of MSD
21· ·customers and the community it serves.
22· · · · · The Rate Commission member organizations are
23· ·selected by MSD Board of Trustees through a public
24· ·self-nomination and selection process, set forth in the
25· ·charter.
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·1· · · · · Each member organization serves a six-year term
·2· ·and appoints an individual to represent the organization
·3· ·on the Rate Commission.
·4· · · · · Further voter-approved changes made to MSD's
·5· ·charter in 2000; the Board of Trustees shall select new
·6· ·organizations so as to ensure a fair representation of
·7· ·all users of the District's services.
·8· · · · · Specifically, Rate Commission organizations shall
·9· ·represent commercial industrial users, residential
10· ·users, and other organizations interested in the
11· ·operation of the District, including by way of example,
12· ·but not by way of limitation; organizations focusing on
13· ·environmental issues, labor issues, socioeconomic
14· ·issues, community neighborhood organizations, and other
15· ·nonprofit organizations.
16· · · · · For a list of individual Rate Commissioners and
17· ·the organizations that they represent, please visit the
18· ·Rate Commission section of MSD's website at
19· ·www.MSDProjectClear.org.
20· · · · · The Rate Commission received a rate change notice
21· ·from MSD staff on March 24, 2023 for wastewater rates
22· ·and stormwater rates and taxes.
23· · · · · Per the charter plan, the Rate Commission must
24· ·issue its report on the proposed rate change notice to
25· ·MSD's Board of Trustees on or before September 5, 2023.
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·1· · · · · The Rate Commission adopted operational rules and
·2· ·a procedural schedule to conduct its proceedings in a
·3· ·timely manner, with procedural fairness to all parties.
·4· · · · · Since the rate change notice was received on
·5· ·March 24, 2023, the Rate Commission has received
·6· ·testimony from MSD staff and rate consultants employed
·7· ·by the Rate Commission to evaluate MSD staff's proposal.
·8· ·The parties have also engaged in discovery requests.
·9· · · · · Documentation of these activities is listed on
10· ·the Rate Commission section of MSD's website at
11· ·www.MSDProjectClear.org.
12· · · · · Tonight's public hearing is one 14 planned
13· ·on-the-record sessions that will be conducted from June
14· ·21, 2023 through August 7, 2023.
15· · · · · Any ratepayer who wishes to be heard on the
16· ·proposed rate change may testify or participate in the
17· ·public hearing sessions.
18· · · · · These public hearings sessions are publicly
19· ·noticed via postings to the Rate Commission section of
20· ·MSD's website at www.MSDProjectClear.org.
21· · · · · These postings contain the time, date, and
22· ·location of each of the public hearings.· As hearings
23· ·are added to the schedule, the same information will be
24· ·posted.
25· · · · · Public hearings are held for the purpose of
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·1· ·permitting MSD staff to present its wastewater and
·2· ·stormwater rate change proposal to the general public
·3· ·and to permit said public the opportunity to ask
·4· ·questions and/or make comments.
·5· · · · · Those unable to or not wishing to provide public
·6· ·comments at a public hearing may provide feedback to the
·7· ·Rate Commission via phone or e-mail.
·8· · · · · The phone number is 314-335-2028.· Again, the
·9· ·phone number is 314-335-2028.· The e-mail address is
10· ·RateCommission@AHCConsulting.com.· Again, that e-mail
11· ·address is RateCommission@AHCConsulting.com.
12· · · · · A card with the contact information is available
13· ·at the sign-in area.· Alternatively, staff representing
14· ·the Rate Commission, who I'll ask to identify themselves
15· ·shortly, will also be able to provide that information.
16· · · · · Further information on how to provide feedback
17· ·outside of the public hearings is listed on the Rate
18· ·Commission's section of MSD's website at
19· ·www.MSDProjectClear.org.
20· · · · · Our next step tonight is a presentation by MSD
21· ·staff, followed by a public comment period.
22· · · · · Tonight's presenter is Brian Hoelscher, MSD's CEO
23· ·and executive director.
24· · · · · As presiding commissioner of tonight's meeting, I
25· ·would as that questions be held until the comment period
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·1· ·after the presentation.
·2· · · · · Those wishing to speak should sign in at the
·3· ·sign-in area.· Speakers will be called upon in the order
·4· ·they have signed up.· Each speaker should identify
·5· ·themselves and any organizations they represent.
·6· · · · · Several housekeeping rules are: If you wish to
·7· ·present testimony, or expect you may have
·8· ·questions/comments, please sign in at the door by which
·9· ·you entered the room.
10· · · · · Speakers will be recognized by the order in which
11· ·they sign up.· While not a requirement, we ask those
12· ·that are speaking to state their name and address so we
13· ·may ensure we are associating comments in the record
14· ·with the correct speakers.
15· · · · · If you are representing an organization, please
16· ·provide information about the organization.
17· · · · · If speakers wish to remain anonymous, in whole or
18· ·part, we respect those wishes.
19· · · · · Each speaker may have a minimum -- excuse me, a
20· ·maximum of ten minutes to speak regarding the proposed
21· ·rate change.· As the presiding officer, I can limit or
22· ·expand speaking time as deemed necessary.
23· · · · · If you have not already done so, please silent
24· ·your cell phones.· If you have further questions
25· ·regarding bathrooms or any other logistics, staff
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·1· ·representing the Rate Commission -- staff, please raise
·2· ·your hands -- are available.
·3· · · · · Are there any questions regarding the procedures
·4· ·for this evening?· Is MSD ready to proceed?
·5· · · · · MR. HOELSCHER:· Yes, sir.
·6· · · · · COMMISSIONER:· Mr. Hoelscher, would you please
·7· ·come forward.
·8· · · · · MR. HOELSCHER:· My name is Brian Hoelscher.· I'm
·9· ·the executive director and CEO of the the Metropolitan
10· ·St. Louis Sewer District.
11· · · · · My presentation tonight is going to kind of be in
12· ·three parts.· First of all, I want to talk about MSD in
13· ·general, a little background so everyone knows what MSD
14· ·does, what we -- and what we're responsible for.
15· · · · · Some discussions about the two systems we run;
16· ·the stormwater and the wastewater system, and the work
17· ·that's being done with those.
18· · · · · And then finally, probably most importantly, we
19· ·are going to be asking the voters some questions at the
20· ·August 2024 election -- April 2024 election, I'm going
21· ·to go over those in detail.· They're kind of the meat of
22· ·the presentation, and I'll explain that at the end.
23· · · · · And then there will be room for questions.· As
24· ·I'm going through this, the one thing I want to let you
25· ·know, my internal staff -- raise your hands -- are here.
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·1· · · · · I'm going to go over the rate proposal.· If you
·2· ·have other questions, if you have other questions about
·3· ·MSD specific to your home or some other topic, we will
·4· ·stay as long as it takes.· We have the folks here who
·5· ·can probably answer your question; or if nothing else,
·6· ·be able to get back to you at a later date.
·7· · · · · So again, three parts, something we call A Tale
·8· ·of Two Systems.· There are two different systems that
·9· ·are funded with separate funding sources.· We'll talk
10· ·about those.· Again, talk about the rate proposal and
11· ·the Rate Commission's role, and then go over, very
12· ·specifically, what's in the rate proposal.
13· · · · · So MSD's Project Clear protects the public's
14· ·health and safety and water environment by responsibly
15· ·managing these two separate systems.· The management
16· ·problems, though, change and they are different.
17· · · · · On the wastewater side, there's funding to
18· ·continue the program, the court-mandated program to fix
19· ·the wastewater system.
20· · · · · On the stormwater side, it is a partnership
21· ·between MSD and the public how much funding and what we
22· ·fund for stormwater.
23· · · · · And so you'll see something that will be a little
24· ·bit different when we talk about the programs and talk
25· ·about the funding requirements.
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·1· · · · · On the wastewater side, some of the work;
·2· ·cleaning and repair of the existing wastewater system.
·3· ·The existing wastewater system right now is working
·4· ·better than it ever has before.
·5· · · · · It's clean, and when we have a normal -- what is
·6· ·just a normal rain, normal storm, everything works
·7· ·terrifically, especially compared to where it was, say,
·8· ·25 years ago.
·9· · · · · We're making sure we're in compliance with
10· ·environmental regulations.· That's what's really driving
11· ·this program.
12· · · · · Those regulations and the major improvements
13· ·we're making are based on a consent decree, or an
14· ·agreement with the Department of Justice, the EPA,
15· ·having to do with what work we got to do in order to
16· ·come in compliance with the Clean Water Act.
17· · · · · It's not just the work we have to do, but also
18· ·the time we have to do it in.· So MSD's program is not
19· ·set up with optional items as to what we want to get
20· ·done.· It's actually stuff that's mandated by a federal
21· ·judge.
22· · · · · You'll find that the work that we're going to do
23· ·over the next four years, 98 percent of the expenditures
24· ·are on mandated activities from that consent decree.
25· · · · · Stormwater is a different story.· There's not
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·1· ·some separate regulatory issue here.· It's very
·2· ·customer-service driven.
·3· · · · · Right, now we're able to take care of regulatory
·4· ·issues with stormwater.· That has to do with treating
·5· ·pollutants that are in stormwater runoff, taking care of
·6· ·those.
·7· · · · · Making sure the existing sewer system, the inlets
·8· ·and the sewers throughout the area, make sure they work,
·9· ·make sure they're in good shape, operate and maintain
10· ·those.
11· · · · · Until 2016, MSD was not able to do that with all
12· ·the storm sewers in the area.· The area outside of 270
13· ·was given to MSD to maintain in 1989 with no revenues.
14· ·So we couldn't maintain the inlets or the storm sewers,
15· ·and we had very few revenues inside 270.
16· · · · · 2016, that got resolved by a vote of the public.
17· ·We put a property tax in place, and right now, we're
18· ·making sure those systems stay clean, regular inspection
19· ·of inlets, and repairing those part of storm sewers that
20· ·caused problems in the past.
21· · · · · There is a third service that we can provide, and
22· ·that has to do with flooding and creek erosion.· MSD
23· ·doesn't have those in its responsibility.· There's not
24· ·ownership of those problems.
25· · · · · But we do have the ability to raise money, to
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·1· ·work with the community, and resolve those problems, if
·2· ·the public agrees to provide funding.
·3· · · · · Last time we attempted to do that in 2019, the
·4· ·public voted no; that they did not want us to
·5· ·participate in that program.
·6· · · · · We've revised the program a little bit, based on
·7· ·some input we've had from the public, and we're
·8· ·presenting something again in 2024 for consideration by
·9· ·the public.
10· · · · · Let's talk about the wastewater system.· The goal
11· ·is to reduce backup in homes and also overflows --
12· ·wastewater system is where I want to be.· One more.
13· ·There we go.· Okay.
14· · · · · So first one is wastewater systems.· There's a
15· ·couple things; the backups that are into homes, making
16· ·sure we try and -- we reduce those, and also overflows
17· ·into the environment.
18· · · · · A common practice in the past was -- especially
19· ·some of the systems we inherited -- was when stormwater
20· ·got into the sewer systems, instead of letting it back
21· ·up to homes, pipes or little holes were put in manholes
22· ·next to creeks.
23· · · · · And so instead of the water, when it filled up
24· ·inside the sanitary sewer with stormwater, instead of
25· ·going to basements, it discharged directly to creeks and
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·1· ·streams.
·2· · · · · That's illegal.· We had to get rid of that.
·3· ·That's been a big part of or program.
·4· · · · · That also improves water quality, which is the
·5· ·ultimate goal of everything we're trying to do.· And
·6· ·ultimately, keep us in compliance -- or reach compliance
·7· ·with the Clean Water Act by 2039 as we get through
·8· ·there.
·9· · · · · The methods we use it; we do increase the
10· ·capacity of the system where necessary.· That's a little
11· ·more challenging, especially with some of the changes in
12· ·stormwater patterns, which can flood areas and cause
13· ·problems in the sanitary sewer system caused by some
14· ·climate change.
15· · · · · But what we have done is remove water from the
16· ·wastewater system.· There's stormwater that was getting
17· ·in, not supposed to be there, that was causing the
18· ·backups.
19· · · · · The St. Louis's biggest issue was that some homes
20· ·were built, the roof downspouts were connected to the
21· ·sanitary lateral that goes out from underneath your
22· ·home.
23· · · · · That obviously was pumping stormwater into the
24· ·system, some people actually flooding themselves every
25· ·time it rained, coming through the wastewater system.
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·1· · · · · We've gone through the area, and every place that
·2· ·that was causing a problem, we have paid to have those
·3· ·fixed.
·4· · · · · Also, eliminate points where untreated water
·5· ·spills into the streams.· That's what I was talking
·6· ·about, those points that were intentionally put in place
·7· ·a while back, in order to make sure basements don't back
·8· ·up.
·9· · · · · So we got to take the stormwater out to do two
10· ·things; one, make sure we don't back up the basements,
11· ·start reducing those, but also make sure we have enough
12· ·capacity that once we take out those overflows, make
13· ·sure we're able to handle what's in the system.· Go
14· ·ahead.
15· · · · · What progress we made; the number of those
16· ·overflows that go out to creeks and streams, we've
17· ·reduced those by 84 percent.
18· · · · · That was the biggest -- that was the biggest
19· ·focus of the schedule that was put in place by the
20· ·federal government when we were sued to move forward.
21· · · · · Building backups are down 25 percent.· Again, on
22· ·the more normal storms, we don't even see problems at
23· ·all.
24· · · · · One of the things we're seeing, we would like
25· ·that 25 percent down to be a much larger number.
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·1· ·Unfortunately, climate change is starting to put us a
·2· ·little bit behind the curve.
·3· · · · · The types of storms were getting; we're getting
·4· ·the same amount of rain, it's just coming in a much
·5· ·shorter period, and it's coming much harder.
·6· · · · · And then to accomplish that, we have at least --
·7· ·more than 650 projects that have been completed or
·8· ·started in order to fix that system so we have
·9· ·sufficient capacity.
10· · · · · Stormwater is a little bit different.· Again,
11· ·with lack of funding, the number of complaints we have
12· ·or problems that we know of have been rising.
13· · · · · We collect all these, we're also a stormwater
14· ·regulator.· So every time there's a stormwater problem,
15· ·we log it; even if we don't have funds or the ability to
16· ·do something, we know where the problems are.
17· · · · · Again, there's been a sharp increase -- I'll talk
18· ·about a little bit later about what those issues are and
19· ·what folks would like funded and what problems they
20· ·would like resolved.
21· · · · · And again what happens is there's extra problems
22· ·now, because we end up with storms on a pretty
23· ·significant basis that outstrip anything that's in the
24· ·built infrastructure the natural systems can handle.
25· · · · · That's what's causing a lot of the local
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·1· ·flooding.· So the problems have just become that much
·2· ·worse in the last -- especially last 10 to 15 years.
·3· · · · · Stormwater problems; what do they look like?
·4· ·This is a pretty minor example.· One of them is
·5· ·flooding.· This is an example of water sitting in a
·6· ·yard, you know, for whatever reason, wasn't picked up,
·7· ·wasn't taken care of when the site was developed.
·8· ·There's been work afterwards.
·9· · · · · Second one is creek erosion.· There are areas
10· ·that don't necessarily have problems with flooding, but
11· ·we end up with storms coming through and water going
12· ·through creeks and streams much faster for much longer
13· ·periods of time.
14· · · · · They start eating away the banks, eating away
15· ·people's yards, and even threatening homes in a lot of
16· ·cases.· And so those are other problems that we would
17· ·like to have a fund to help resolve.
18· · · · · Where are the problems?· These are the four major
19· ·watersheds in the District.· Starting from the top, the
20· ·Missouri watershed, you see we have 97 recorded issues.
21· ·That's in the upper left-hand corner.
22· · · · · The Mississippi River watershed in the upper
23· ·right hand corner, that's next to the Mississippi River,
24· ·is set 61.
25· · · · · The area we have the largest recorded problems
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·1· ·are the River Des Peres watershed.· That's the purple
·2· ·area on the lower right.· And then the Meramec
·3· ·watershed, which is to the south, that has 144.
·4· · · · · Note the number of issues.· Remember that the way
·5· ·we know how many issues are for stormwater is people
·6· ·reporting them.
·7· · · · · You notice that 264 number in the River Des Peres
·8· ·watershed; that happens to have some legacy small taxing
·9· ·districts for stormwater where we are doing -- fixing
10· ·problems.· Brentwood is one of those.
11· · · · · The reason they have -- that we found that they
12· ·have more problems than other places is if we have some
13· ·funds to do something, people are more prone to report
14· ·stormwater problems to us.
15· · · · · Areas where we don't have any funding and can't
16· ·do anything, they get tired of reporting to us and us
17· ·telling them there's nothing we can do about it.
18· · · · · So I suspect once this problem gets going, more
19· ·of those problems and more of those issues will be
20· ·brought to MSD's attention so we can move forward with
21· ·them.
22· · · · · Some information on the Rate Commission; I'm not
23· ·going to repeat this.· But again, they are an
24· ·independent body.
25· · · · · Mr. Muren described this, and again, what's on
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·1· ·here, I think we do have the website here,
·2· ·MSDprojectclear.org/Rate Commission.
·3· · · · · All the documentation for the entire process is
·4· ·on that website.· If you want to follow it, view the
·5· ·testimony, they mentioned discovery requests,
·6· ·cross-examination, exhibits, rate proposal itself are
·7· ·all on that website if you're interested in going there.
·8· · · · · What does the timeline look like throughout?· In
·9· ·2023 -- and I'll actually start with the summer of 2022.
10· · · · · MSD staff starts putting together a rate
11· ·proposal.· That's based on what our regulatory needs
12· ·are, as well as input that we are continuously getting
13· ·from the public as to what they feel is important, what
14· ·they feel is needed.
15· · · · · We give that rate proposal, as described
16· ·previously by Mr. Muren, in March of 2023.· And they
17· ·will take through September, looking at MSD's rate
18· ·proposal, evaluating it, with the plan being in
19· ·September to deliver to MSD's Board of Trustees any
20· ·comments or changes that they would recommend to the
21· ·rate proposal that MSD staff put together.
22· · · · · Then from September to December, MSD's Board of
23· ·Trustees will take a look at those recommendations and
24· ·decide what to do with them and how to move forward.
25· · · · · 2024, we will be doing -- MSD staff, regardless
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·1· ·of what comes out of those -- that board approval
·2· ·process, we'll be doing some education to the voters,
·3· ·letting them know we will have two proposals; one
·4· ·stormwater, one wastewater.· There will be two
·5· ·propositions.
·6· · · · · We'll do a lot of education, saying if you vote
·7· ·no, here's the cons -- here's what happens.· If you vote
·8· ·yes, here's what happens.· We'll do that both for
·9· ·stormwater and wastewater.
10· · · · · You won't find us advocating for either position.
11· ·This is up to the public, both of those, as to which way
12· ·they want to proceed.
13· · · · · After that, depending on the results of the
14· ·election -- and I'll describe later how they're
15· ·different something will happen with the wastewater rate
16· ·as a result of the elections.
17· · · · · Any changes in rates will occur with the bill
18· ·that the public receives in August 2024.· If the
19· ·stormwater rate is approved -- and this is a brand new
20· ·service -- the plan is to start collecting for that in
21· ·calendar year 2025.
22· · · · · There's two different ways that we're collecting
23· ·those rates, but they will all be collected through 2025
24· ·for the first time, and then we'll start delivering
25· ·services.
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·1· · · · · What do the rate proposals looks like?· And this
·2· ·is the part I promised you.· Here's probably what you
·3· ·came to the meeting for.
·4· · · · · So the stormwater rate proposal is designed to
·5· ·provide a funding source to address flooding and erosion
·6· ·problems throughout the entire District.
·7· · · · · We're going to collect amount of moneys from
·8· ·residential and nonresidential customers separately.
·9· · · · · What we've done is we've taken the impervious
10· ·area, that's driveways, rooftops, places where water
11· ·doesn't soak in; it runs off.
12· · · · · We've taken those to determine what should be the
13· ·burden on the residential customers and what should be
14· ·the burden on the nonresidential customers.
15· · · · · The residential customers constitute about 57
16· ·percent of the impervious area, and the nonresidential
17· ·customers, both profit and not-for-profit, they
18· ·represent 43 percent.
19· · · · · So the revenue that's going to be collected is
20· ·going to be divided that way; residential customers will
21· ·provide 57 percent of the revenue, nonresidential
22· ·customers will be providing 43 percent of the revenues.
23· · · · · So for the residential customers, the rate
24· ·proposal is for a property tax that for a median
25· ·household value rate of $176,000, would result in a tax
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·1· ·bill of about $25.00 per year -- property tax bill.
·2· ·That's about two dollars per month.
·3· · · · · Based on surveying, that's the acceptable --
·4· ·that's the amount that would be acceptable to a majority
·5· ·of the voters, based on polling.
·6· · · · · So that's the starting point; is we want to make
·7· ·sure we put something out there that has the potential
·8· ·of being put in place.
·9· · · · · For the nonresidential customers, again, they're
10· ·providing 43 percent of the revenue.· If you back into
11· ·that, they're going to be charged -- let me back up.
12· · · · · The residential customers, that will be on your
13· ·property tax bill.· For the nonresidential customers --
14· ·commercial, industrial, nonresidential, not-for-profits,
15· ·they will be getting a monthly bill.
16· · · · · Their charge will be $1.05 per thousand square
17· ·feet of impervious area per month on their property.
18· ·That will then generate 43 percent of the revenue.
19· · · · · What is the funding?· Right now, just to know the
20· ·size of the problem, we're estimating what we know about
21· ·right now is about $700 million-worth of issues have
22· ·been identified.
23· · · · · This proposal will generate about $34 million a
24· ·year.· It's lets us get started, and especially get
25· ·started on the most critical stormwater issues that we
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·1· ·have.
·2· · · · · We're talking about -- that $700 million number,
·3· ·by the way, does not address any of the problems that
·4· ·became evident during the storms last summer, during
·5· ·500-year storms that put -- basically, St. Louis under a
·6· ·couple feet of water.
·7· · · · · This doesn't address that.· That would be another
·8· ·issue separate from this.· But it does have a mechanism
·9· ·to be addressed here.
10· · · · · So the way we're going to expend those dollars,
11· ·our plan is 50 percent of that 34 million, MSD does a
12· ·benefit-cost ratio, as we do in some of those little
13· ·subdistricts I mentioned earlier.
14· · · · · We take all the benefits of a project, what's
15· ·getting damaged, what's getting -- let's take an erosion
16· ·project; somebody losing a fence, yard, garage, house,
17· ·what are the benefits?
18· · · · · They have points assigned to them; what's the
19· ·total of the benefits, divide it by the cost, so we have
20· ·a benefit-cost analysis.
21· · · · · We simply take the projects at the top of the
22· ·list and we work down that list.· We will do that
23· ·districtwide.· We'll spend 50 percent of the revenues on
24· ·that program.
25· · · · · 30 percent of the revenues are going to be
Page 23
·1· ·available to the individual municipalities in the form
·2· ·of municipal grants, based on population, to do whatever
·3· ·stormwater activity they feel is most critical within
·4· ·their individual municipality.
·5· · · · · It doesn't have to match our need for what we
·6· ·think is a priority.· We want to try and attack this
·7· ·from both the top and bottom.
·8· · · · · So the municipalities will have a chance to ask
·9· ·for those grants.· We will just make sure they're
10· ·addressing stormwater issues.
11· · · · · As long as they're addressing stormwater issues,
12· ·those municipalities will be able to apply for those
13· ·grants and use that grant money to take care of any
14· ·issue.
15· · · · · And again, the amount that gets distributed is
16· ·going to be based on what the population looks like.
17· · · · · 10 percent of the revenues are going to go to --
18· ·and I'm using a federal term here; it's not what's used
19· ·at the state level.· But we participate in both state
20· ·and federal areas.
21· · · · · 10 percent is going to be spent on what's been
22· ·identified as environmental justice areas.· So these are
23· ·areas -- I'm not going to go into the definition of
24· ·environmental justice.
25· · · · · But the state has defined areas low income,
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·1· ·disadvantaged areas where -- underserved areas in the
·2· ·past.
·3· · · · · We're going to take those areas -- in general,
·4· ·those are North City, North County, part of North County
·5· ·going to the west, and there's an area in South City and
·6· ·South County that show up on the map that's been
·7· ·provided by the State of Missouri.
·8· · · · · 10 percent of that's going to go and use that
·9· ·benefit-cost analysis that I previously talked about,
10· ·but the pool of projects will only come from
11· ·environmental justice areas.
12· · · · · So it will allow us to kick-start some areas that
13· ·have been underserved in the past.
14· · · · · And then finally -- and this is something that
15· ·came out, especially with communications with
16· ·municipalities, city managers, and some folks; we're
17· ·going to save 10 percent of those dollars to have a
18· ·discussion with a group that will represent the whole
19· ·area.
20· · · · · Is there something that needs to get done in
21· ·stormwater that doesn't really fit into any of those
22· ·buckets I just identified?· Is there really a policy
23· ·thing we need to go after?
24· · · · · And because it recently happened, I'll just say
25· ·maybe it's decided 10 percent of those revenues ought to
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·1· ·go towards buying people out of floodplains, who got hit
·2· ·real hard last summer.· Maybe that's where those dollars
·3· ·should go to.
·4· · · · · Right now, just to make sure we have a mechanism,
·5· ·we have talked to the Municipal League.· They seem
·6· ·receptive to putting a committee together to represent
·7· ·all the municipalities throughout our service area and
·8· ·help provide guidance to our Board of Trustees about
·9· ·where that other 10 percent could go; stuff that doesn't
10· ·fit into one of those other categories I previously
11· ·described.
12· · · · · Next, wastewater proposal.· So right now, MSD's
13· ·consent decree -- again, I mentioned we were sued by the
14· ·federal government.· We're one of over 200
15· ·municipalities.
16· · · · · There was a strategy by the federal government,
17· ·we're going to sue every municipality and put a defined
18· ·schedule for them to get in line with the Clean Water
19· ·Act.· St. Louis was one of those.
20· · · · · Right now, the value of that project is 7.2
21· ·billion in 2023 dollars.· We always price our consent
22· ·decree based on current dollars.
23· · · · · So when we signed the consent decree in 2011, in
24· ·2011 dollars, it was 4.7 billion.· In 2021, we repriced
25· ·it, because it had been a while.· It was priced at $6.1
Page 26
·1· ·billion in 2021.
·2· · · · · Knowing that we had a rate proposal coming up and
·3· ·knowing you've all gone through the economic situation
·4· ·we've been through in the last two or three years, prior
·5· ·to submitting the rate proposal, we repriced the program
·6· ·again.
·7· · · · · So right now, it's priced in today's dollars at
·8· ·7.2 billion.· So that doesn't mean an increase in the
·9· ·size or cost of the program.
10· · · · · It's us pricing the program and just bringing it
11· ·up to the current dollars.· We are on budget and we on
12· ·schedule to complete the work that's in the consent
13· ·decree.
14· · · · · So what's going to be asked is how to pay for --
15· ·from 2025 to 2028, how to pay for the wastewater
16· ·improvements that are required to meet the requirements
17· ·of that consent decree and other regulatory
18· ·requirements.
19· · · · · There's $1.7 billion of work that's anticipated
20· ·to be started in those four years; and the proposal
21· ·that's going to be considered by the ratepayers is, do
22· ·we want to pay cash for all the work during that period
23· ·for the 1.7 billion?
24· · · · · Or do we want to bond some of it, or borrow money
25· ·for some of it.· In this case, what's been proposed is
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·1· ·an additional $700 million -- $750 million-worth of
·2· ·bonding.· I'll show you in a minute what the impact of
·3· ·that is.
·4· · · · · This is just like buying a car or buying a house.
·5· ·If you bought a house right now and paid cash, it costs
·6· ·you a lot now, but you don't have any expense for
·7· ·purchasing the house later.
·8· · · · · Or you can borrow money, have it cost you less
·9· ·now, pay over time, and pay something extra because you
10· ·have debt service, or you have interest.
11· · · · · That's the question that will be put in front of
12· ·the voters; which way do you want us to pay for that?
13· · · · · And here's the magical chart that really shows
14· ·that.· So on the left-hand side is assuming that the
15· ·voters will prove additional bonding of $750 million for
16· ·the next four years.
17· · · · · The numbers you see are the average monthly
18· ·residential bill for wastewater service.· This is the
19· ·bill that the residents get on a monthly basis.
20· · · · · Your bill will not be identical to this.· This is
21· ·the average.· The amount that you're charged is based on
22· ·your potable water usage during the winter.· That's how
23· ·we determine how much goes down the drains.· So that's
24· ·what these numbers show.
25· · · · · So right now, the average customer is $57.04.
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·1· ·The first year with bonding, a 7 percent increase to the
·2· ·amount shown.· Then 7.6, 7.5, and then finally 6.6
·3· ·percent, which brings, in 2028, the cost for the average
·4· ·residential customer, a monthly cost of $75.23.
·5· · · · · So before I leave this one, one thing I want to
·6· ·mention.· There is part of the District that does not
·7· ·have water meters.· And this is in the City of St.
·8· ·Louis.
·9· · · · · Most of the residential homes there don't have
10· ·water meters.· They are billed by the water company,
11· ·based on the attributes in the homes; how many water
12· ·closets, how many bedrooms, how many bathrooms, living
13· ·space.· They have a parameter to do that.
14· · · · · Based on a decision by the Missouri Supreme
15· ·Court, those are the parameters we have to use to bill
16· ·them for wastewater service.
17· · · · · What we do is we take those parameters and we
18· ·assign flows to those different types of parameters.
19· ·Every time we do a rate.
20· · · · · Proposal, we take a look to see if there's been a
21· ·significant change in the way water usage is throughout
22· ·the area.
23· · · · · This time, we found some.· And so what's going to
24· ·happen in the city, contrary to what you see on this
25· ·chart, that first year in 2025, if you are a city
Page 29
·1· ·resident with an unbilled water service, you're going to
·2· ·see a .8 percent decrease in your bill in the first
·3· ·year.
·4· · · · · 2026, 2027, and 2028 will go up by the
·5· ·percentages shown; 7.6 percent, 7.5 percent, 6.6
·6· ·percent.· So that is something that's a little bit
·7· ·different here.
·8· · · · · But I wanted to make sure I mentioned that in
·9· ·case there's anybody who happens to be in that situation
10· ·who's listening to the presentation.
11· · · · · Finally, and again, I'm going back to everybody
12· ·now.· If you look on the right-hand side, that is the
13· ·result of voting no for new bonding; decided that for
14· ·the next four years, we're just going to pay cash and
15· ·not have MSD borrow any money to pay for the program.
16· · · · · If you do that, kind of think of the house
17· ·scenario I gave you.· You see the increases -- 35
18· ·percent the first two years, then a 20 percent decrease.
19· ·Obviously, that's how the money is needed as we're going
20· ·the capital program.· And then a 5 percent decrease,
21· ·resulting in a rate for the average residential user for
22· ·wastewater of $87.72 per month in 2028.
23· · · · · Again, this will be a decision of the voters.· We
24· ·don't have a choice whether or not to do the work.· The
25· ·federal judge has already decided that for us.
Page 30
·1· · · · · The question is how do we pay for this, that's
·2· ·what we're coming to the voters to decide; how do we
·3· ·want to move forward paying for this.
·4· · · · · And so before I start with questions, we're going
·5· ·to leave this screen up here.· This has got a lot of the
·6· ·contact numbers and stuff for you to contact before
·7· ·questions.· Write it down.
·8· · · · · Again, there's been a lot of other discussions
·9· ·about a lot of other places you can contact people.· We
10· ·want to offer as many things as we can for anybody who
11· ·has questions, comments, or whatever they want to do
12· ·with the process.
13· · · · · So Mr. Muren, that is the end of my presentation.
14· · · · · MR. MUREN:· Thank you, Mr. Hoelscher.· Do you the
15· ·Rate Commissioners have any questions or comments?
16· · · · · If any members of the public that wish to speak
17· ·have not yet signed up, please do so now.
18· · · · · I will ask the Rate Commission staff -- I do have
19· ·here, would you please announce those who have requested
20· ·to speak.· I have one speaker signed up, William Bonner.
21· · · · · Those wishing to speak, please remember to state
22· ·your name and address for the record.· And if you
23· ·represent an organization.· William Bonner.
24· · · · · MR. BONNER:· All right.· I do have have one
25· ·question before I speak on what I was going to speak on.
Page 31
·1· · · · · You say in 2028 that rate will be -- if we vote
·2· ·not to bond it out, we'll be at that 5 percent higher
·3· ·rate or so.
·4· · · · · Will that rate decrease and go back to our normal
·5· ·rate once that four-year period is up?
·6· · · · · MR. MUREN:· Mr. Hoelscher -- would you like him
·7· ·to answer that before you speak?
·8· · · · · MR. BONNER:· Yes, I would.
·9· · · · · MR. MUREN:· Certainly.
10· · · · · MR. HOELSCHER:· Sure.· MSD's programs started --
11· ·well, we started before.· But the consent decree started
12· ·in 2011.· It will end in 2039.
13· · · · · All we're setting up with folks is saying how to
14· ·pay for the next four years.· So when those four years
15· ·of projects are done, there's another four years in 2039
16· ·and 2032.
17· · · · · So there will be need for more funds.· Exactly
18· ·what will happen to the rates afterwards, a lot of it is
19· ·going to depend on what folks vote.
20· · · · · If you vote to bond some of the projects over the
21· ·next four years, then the expense will go out longer.
22· · · · · If we convert -- if the voters decide we want to
23· ·convert to a cash basis and really pay for it in cash,
24· ·it will cost more earlier.
25· · · · · But then as the program starts ending towards
Page 32
·1· ·2039, the rates will either level out or potentially go
·2· ·down.
·3· · · · · But remember, we're talking about the next four
·4· ·year of a 28-year program.· We have a new set of
·5· ·projects that we'll have to build every one of those
·6· ·four years through 2039.
·7· · · · · MR. MUREN:· Thank you.
·8· · · · · MR. BONNER:· Okay.· Now I understand all that.
·9· ·Now I totally disagree with it.· Because I went through
10· ·this since 2000.
11· · · · · I purchased my home back when we were paying
12· ·$12.00 or so every three months.· Okay.· My water bill
13· ·then was 20-something dollars every three months.
14· · · · · Now my water bill is $27.00, and I'm paying
15· ·$51.00 for the sewer.· I'm paying more to get rid of the
16· ·water than I'm paying -- than I'm paying for the water.
17· ·There's a problem with that.
18· · · · · This -- I called down to MSD to have it explained
19· ·to me, and it was told to me that I voted on that. I
20· ·have never voted on an increase that large.
21· · · · · When I purchased my home in 2000, I paid a $3,000
22· ·connection fee.· That was included in the closing costs.
23· · · · · Every year since then, I'm paying on my real
24· ·estate taxes.· I'm paying monthly.
25· · · · · When is enough going to be enough for MSD?· Our
Page 33
·1· ·pockets ain't that deep.· I work every day.
·2· · · · · I don't know what the problem is, whether it's
·3· ·the federal government's fault or whether it's
·4· ·Missouri's fault, or what it is.
·5· · · · · But I have -- my pay has not went up 90 percent
·6· ·like these bills.
·7· · · · · And I appreciate you all letting me speak.
·8· · · · · MR. MUREN:· Thank you.· Mr. Hoelscher, anyone
·9· ·from MSD staff want to add anything to that?
10· · · · · MR. HOELSCHER:· No.· I think we understand the
11· ·comments.
12· · · · · MR. MUREN:· Are there any other attendees?
13· ·Please, if you would please remember to state your name
14· ·and address for the record, and if you represent an
15· ·organization, please.
16· · · · · MS. COLE:· Yes.· I signed up out there.· My name
17· ·is Amber Cole, A-M-B-E-R, C-O-L-E.· I'm in 63107, the
18· ·city.
19· · · · · I'm not in favor for this, mainly because I live
20· ·in a two-family flat that I purchased in 2000, and I'm
21· ·the only one in that house.
22· · · · · I'm paying the same amount of money in that house
23· ·of one person, that the same person that has the
24· ·same-sized house that have 10 or 15 people.· I don't
25· ·understand it.
Page 34
·1· · · · · I'm paying for water closets, rooms, showers, the
·2· ·base costs comes up to $122 a month.· I can't even
·3· ·afford to retire at this rate.
·4· · · · · That's just MSD.· Then I have the water company,
·5· ·and they doing their things with the refuse and the
·6· ·water.· And I paid so much on that, I don't even know --
·7· ·125, living in the city.
·8· · · · · So when you say about -- oh, let me go back.
·9· ·Then you tell me when I call down to the water company
10· ·and the MSD, I said, can I have a meter?· It's going to
11· ·cost you, you got to get a plumber.
12· · · · · Okay, how much?· 2500.· Okay.· So when I get a
13· ·plumber, I got to also pay for a rental meter, $30.00 a
14· ·month, plus the flat fee of $25.00 a month, forgetting
15· ·the meter.· And I still have the water bill.
16· · · · · I'm getting all these bills, but I'm not getting
17· ·no return on my investment.· This is an investment to
18· ·me, you know.
19· · · · · I'm trying to figure out who has -- who's getting
20· ·the bonuses, because I'm not getting them.· I'm not
21· ·getting none of this, and I'm a senior.
22· · · · · I cannot even afford to stop working because of
23· ·this.· I can't get social security, can't get all these
24· ·other benefits.
25· · · · · So I'm trying to understand, you want me to -- do
Page 35
·1· ·you want to pay -- do you want us to pay it all at one
·2· ·time, cash, or do you want me to do a bond?
·3· · · · · Well, use your money for a change and stop using
·4· ·mine's.· I was in for all this, and nothing is getting
·5· ·fixed.· People, things got to change.· Thank you.
·6· · · · · MR. MUREN:· Thank you.
·7· · · · · MR. HOELSCHER:· Mr. Chairman, I think there is
·8· ·something I want to add that she's brought up a point I
·9· ·didn't cover before.
10· · · · · So first of all, you're absolutely correct.· The
11· ·city water -- MSD uses the same billing that the city
12· ·water does, based on attributes.· We're required by the
13· ·Supreme Court of Missouri to do that.
14· · · · · And you're absolutely right; it's the difference
15· ·in billing for you and the other family you mentioned.
16· ·That same difference exists on the water bill side.
17· · · · · There are individuals in the City of St. Louis
18· ·who have a water meter.· And I know -- we understand
19· ·there's expenses.· That's not MSD's choice.· That's the
20· ·city water company.
21· · · · · And there are some that we collect their bills,
22· ·and we'll actually do potable water billing if they get
23· ·the meters.
24· · · · · Since you mentioned elderly, I think one part of
25· ·the program we haven't mentioned, we have a customer
Page 36
·1· ·assistance program.
·2· · · · · MS. COLE:· I'm not looking for nobody to take
·3· ·care of me.
·4· · · · · MR. HOELSCHER:· I know that.· I think it's to
·5· ·address -- it's not to take care of you.· It's to
·6· ·address some of the issues you've mentioned.
·7· · · · · The customer assistance program, if you qualify,
·8· ·there's a level for senior citizens, there's a level for
·9· ·other folks, but it's to address some of these same
10· ·issues.
11· · · · · If you qualify, your bill gets cut in half.· And
12· ·so I would just offer that if you would like to know
13· ·what that program is -- Marion, I think you're the one
14· ·-- the gentleman right over here.
15· · · · · If that would be something that would be possible
16· ·-- it's not something I mentioned in the presentation.
17· · · · · Since you brought it up, I think I at least
18· ·wanted to everything mention it so everybody knew that
19· ·that was out there.
20· · · · · MS. COLE:· Okay.· Is it also true that the St.
21· ·Louis City is also basically billing the county -- the
22· ·county is buying water from St. Louis City because we
23· ·have the reservoir and all that.
24· · · · · MR. HOELSCHER:· I believe they -- are they still
25· ·doing that?
Page 37
·1· · · · · MR. GEE:· I believe it's St. Charles.
·2· · · · · MR. HOELSCHER:· St. Charles is buying water from
·3· ·the City of St. Louis?· Yeah.· We understand -- so and
·4· ·again, we're not part of the city.
·5· · · · · And we are also not the water company.· But I
·6· ·believe the City of St. Louis is selling some water.
·7· · · · · MS. COLE:· Well, is it -- the water company and
·8· ·the sewer company, it's like they're partners.
·9· · · · · MR. HOELSCHER:· We are completely independent.
10· ·The City of St. Louis water is the City of St. Louis.
11· ·We are not part of St. Louis County.
12· · · · · MSD is a separate entity put in place by a vote
13· ·of the people as described previously by Mr. Muren in
14· ·1954 to address just wastewater and just stormwater
15· ·issues.
16· · · · · We have six trustees.· I am one of two employees
17· ·of those trustees.· We have absolutely no connection to
18· ·the city or the county.· We are a political subdivision
19· ·of the state, created by the state constitution.
20· · · · · So there is no connection there.· Obviously, we
21· ·cooperate, and you know, if our utilities are
22· ·interfering with each other, we try and fix those
23· ·problems.· But we're not part of the city or the county.
24· · · · · MS. COLE:· Okay.· Did I just hear you say
25· ·political?
Page 38
·1· · · · · MR. HOELSCHER:· We are a political subdivision of
·2· ·the state.· That is the description of what we are.
·3· · · · · So that is the way the state constitution
·4· ·describes it.
·5· · · · · MR. MUREN:· Thank you.· Is there anyone that
·6· ·wishes to speak that has not already done so?· Okay.
·7· · · · · The next public hearing is scheduled for Monday,
·8· ·June 26, 2023 at 7:00 p.m.· The hearing will be held in
·9· ·the City of Bridgeton's Council Chambers at Bridgeton
10· ·City Hall.
11· · · · · Bridgeton City hall is located at 12355 Natural
12· ·Bridge Road, Bridgeton, Missouri 63044.· This public
13· ·hearing is adjourned.
14· · · · · (WHEREIN, the hearing concluded at 6:46 p.m.)
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·1· · · · · · · · · · CERTIFICATE OF REPORTER
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· · ·STATE OF MISSOURI· · )
·3· · · · · · · · · · · · ) ss.
· · ·CITY OF BRENTWOOD· · )
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·6· ·I, Georgia B. Northway, Registered Professional
·7· ·Reporter, a Certified Court Reporter (MO), do hereby
·8· ·certify that the meeting aforementioned was held on the
·9· ·time and in the place previously described.
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