HomeMy Public PortalAboutExhibit MSD 112- Transcript of Public Hearing- July 27, 2023Page 1
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·6· ·Metropolitan Saint Louis Sewer District Public
· · · · · · · · · · · · ·Hearing
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·8· · ·2023 Stormwater and Wastewater Rate Change
·9· · · · · · ·John C Murphy Health Center
· · · · · · · · · 6121 North Hanley Road
10· · · · · · · · · Berkeley, MO 63134
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14· · · · · · · · · · July 27, 2023
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Exhibit MSD 112
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·1· · · · · · · · · · · · · INDEX
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·4· ·Opening· · · · · · · · · · · · · · · · · · · · · · 5
·5· ·Presentation:· · · · · · · · · · · · · · · · · · ·10
· · · ·By Brian Hoelscher
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·7· ·Questions by the Public:· · · · · · · · · · · · · 33
·8· ·Adjournment· · · · · · · · · · · · · · · · · · · ·40
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·1· ·Metropolitan Saint Louis Sewer District Public
·2· · · · · · · · · · · ·Hearing
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11· · · · · ·MSD Public Hearing, produced, sworn and
12· · · examined on July 27, 2023, between the hours of
13· · · 07:00 p.m. and 09:00 at 6121 North Hanley Road,
14· · · in the City of Berkeley, State of Missouri,
15· · · before Colin Wallis, within and for the State
16· · · of Missouri.
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·1· · · · · · · · · A P P E A R A N C E S
·2· ·RATE COMMISSIONERS:
·3· ·Bill Clarke, Secretary
· · ·Ryan Berry
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·5· ·MSD Staff:
·6· ·Brian Hoelscher, MSD CEO
· · ·Lance Lecomb
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·9· ·REPORTED BY:
10· ·Mr. Colin Wallis
· · ·Lexitas Legal
11· ·711 North Eleventh Street
· · ·St. Louis, Missouri, 63101
12· ·(314) 644-2191
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·1· · · · · · · · · *· *· *· * *
·2· · · · ·(Proceedings commenced at 3:00 p.m.)
·3· · · · COMMISSIONER BERRY:· Good afternoon.· I'm
·4· ·Ryan Berry of the Metropolitan St. Louis Sewer
·5· ·District Rate Commission.· I'm joined this
·6· ·afternoon by Commissioner Bill Clark.· I will
·7· ·serve as presiding commissioner for this public
·8· ·hearing.
·9· · · · The Charter Plan of the District was
10· ·amended by voters in St. Louis City and St.
11· ·Louis County at a general election on November
12· ·7th, 2000, and established the Rate Commission.
13· ·The purpose of the Rate Commission is to review
14· ·and make recommendations to MSD's Board of
15· ·Trustees regarding changes in wastewater rates,
16· ·stormwater rates, and tax rates proposed by MSD
17· ·staff.
18· · · · The Rate Commission seeks to ensure MSD
19· ·ratepayers, and the public in general, have a
20· ·voice in MSD's rate-setting process.· Per the
21· ·Charter Plan, the Rate Commission is composed
22· ·of 15 member organizations who collectively
23· ·represent the broadest possible cross-section
24· ·of MSD customers and the community it serves.
25· · · · The Rate Commission member organizations
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·1· ·are selected by MSD's Board of Trustees through
·2· ·a public self-nomination and selection process
·3· ·set forth in the Charter.· Each member
·4· ·organization serves a six-year term and
·5· ·appoints an individual to represent the
·6· ·organization on the Rate Commission.
·7· · · · Per the voter-approved changes made to
·8· ·MSD's charter in 2000, the Board of Trustees
·9· ·shall select member organizations so as to
10· ·ensure a fair representation to all users of
11· ·the District's services.
12· · · · Rate commission member organizations shall
13· ·represent commercial-industrial users,
14· ·residential users, and other organizations
15· ·interested in the operation of the District,
16· ·including by way of example, but not by way of
17· ·limitation, organizations focusing on
18· ·environmental issues, labor issues,
19· ·socioeconomic issues, community neighborhood
20· ·organizations and other nonprofit
21· ·organizations.
22· · · · For a list of individual rate
23· ·commissioners and the organizations they
24· ·represent, please visit the Rate Commission
25· ·section of MSD's website at www.msdproject
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·1· ·clear.org.
·2· · · · The Rate Commission received a rate change
·3· ·notice from MSD staff on March 24th, 2023, for
·4· ·wastewater rates and stormwater rates and
·5· ·taxes.· Per the Charter Plan, the Rate
·6· ·Commission must issue its report on the
·7· ·proposed rate change notice to MSD's Board of
·8· ·Trustees on or before September 5th, 2023.· The
·9· ·Rate Commission adopted operational rules and a
10· ·procedural schedule to conduct its proceedings
11· ·in a timely manner and with procedural fairness
12· ·to all parties.
13· · · · Since the rate change notice was received
14· ·on March 24th, 2023, the Rate Commission has
15· ·received testimony from MSD staff and the rate
16· ·consultants employed by the Rate Commission to
17· ·evaluate the MSD staff's proposal.· The parties
18· ·have also engaged in discovery requests.
19· ·Documentation of these activities is listed on
20· ·the Rate Commission's section of MSD's website
21· ·at www.msdprojectclear.org.
22· · · · This afternoon's public hearing is one of
23· ·14 on-the-record sessions planned for between
24· ·June 21st, 2023, and August 7, 2023.· Any
25· ·ratepayer who wishes to be heard on the
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·1· ·proposed rate change may testify or participate
·2· ·in these public sessions.· The public hearings
·3· ·are publically noted via postings to the Rate
·4· ·Commission MSD's website at
·5· ·www.msdprojectclear.org.· These postings
·6· ·contain the time, date, and location of each of
·7· ·the public hearings.· As hearings are added to
·8· ·the schedule, the same information will be
·9· ·posted.
10· · · · Public hearings are held for the sole
11· ·purpose of permitting MSD staff to present its
12· ·wastewater and stormwater rate change proposal
13· ·to the general public and to permit said public
14· ·the opportunity to ask questions and/or to make
15· ·comments.
16· · · · Those unable or not wishing to provide
17· ·comments at a public hearing may provide
18· ·feedback to the Rate Commission via phone or
19· ·e-mail.· The phone number is (314)335-2028.
20· ·Again, the phone number is (314)335-2028.· The
21· ·e-mail address is
22· ·ratecommission@ahcconsulting.com.· Again, the
23· ·e-mail address is
24· ·ratecommission@ahcconsulting.com.· A card with
25· ·the contact information is available at the
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·1· ·sign-in area.
·2· · · · Alternately, staff representing the Rate
·3· ·Commission, who I will ask to identify
·4· ·themselves shortly, will also be able to
·5· ·provide that information.· Further information
·6· ·on how to provide feedback outside of the
·7· ·public hearings is listed on the Rate
·8· ·Commission section of MDS's website at
·9· ·www.msdprojectclear.org.
10· · · · Our next step is a presentation by MSD's
11· ·staff followed by a public comment period.
12· ·Tonight's presenter is Brian Hoelscher, MSD's
13· ·CEO and executive director.· Before we begin
14· ·the presentation, I ask that we observe the
15· ·following housekeeping rules.· Please hold all
16· ·questions until the comment period after the
17· ·presentation.
18· · · · If you wish to present testimony or expect
19· ·you may have questions or comments, please sign
20· ·in at the door by which you entered the room.
21· ·Speakers will be called upon in the order they
22· ·have signed up.· Each speaker should identify
23· ·themselves and any organizations they
24· ·represent.
25· · · · While not a requirement, we ask those that
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·1· ·are speaking to state their name and address so
·2· ·that we may ensure we are associating comments
·3· ·in the record with the correct speakers.· If
·4· ·you are representing an organization, please
·5· ·provide information about the organization.· If
·6· ·speakers wish to remain anonymous in whole or
·7· ·part, we respect those wishes.
·8· · · · Each speaker may have a maximum of ten
·9· ·minutes to speak regarding the proposed rate
10· ·change.· As the presiding officer, I can limit
11· ·or expand speaking time as deemed necessary.
12· ·If you have further questions regarding
13· ·bathrooms and/or logistics, staff representing
14· ·the Rate Commission, staff, please raise your
15· ·hands, are available.
16· · · · If you have not already done so, please
17· ·silence your cell phones.· Are there any
18· ·questions regarding the procedures for this
19· ·evening?· Seeing none, Mr. Hoelscher, please
20· ·begin MSD's presentation.
21· · · · MR. BRIAN HOELSCHER:· Thank you,
22· ·Commissioner Berry.· So I'm going speak about
23· ·the rate proposal.· There are other MSD staff
24· ·here, raise your hands.· If you have questions
25· ·about the way the system is working, billing,
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·1· ·something like that specific to your situation,
·2· ·they'll stay here.· We'll be here as long as
·3· ·needed to answer all questions.· If there's any
·4· ·kind of topic that's not covered as part of the
·5· ·rate proposal.
·6· · · · So, the agenda is going to be three
·7· ·things.· First of all, a tale of two systems.
·8· ·I'm going to talk about how about MSD systems
·9· ·are set up and just give you kind of a primer
10· ·on what MSD does and what services it provides.
11· ·I'll talk a little about the Rate Commission.
12· ·I'll kind of tag on to what Commissioner Berry
13· ·said, specifically about what the schedule
14· ·looks like during and beyond the Rate
15· ·Commission process.· And then specifically talk
16· ·about the 2023 proposals, what services would
17· ·be performed and how much it would cost.
18· · · · So Project Clear's job is to protect the
19· ·public's health and safety and water
20· ·environment by responsibly managing programs
21· ·with separate funding sources.· One for
22· ·wastewater, one for stormwater.
23· · · · The wastewater services are paid for
24· ·through the annual -- the monthly bill that you
25· ·get, which is based on water usage.· That's how
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·1· ·we pay for wastewater.· All the stormwater
·2· ·services are paid for on your property tax
·3· ·bill.· So there's two different sources.
·4· ·Because the change in those -- how those
·5· ·services are provided and the particulars of
·6· ·the programs, they both look different.· So
·7· ·while this is one proposal, there's two
·8· ·initiatives that are loaded in this proposal.
·9· ·I'll explain both of those.
10· · · · First of all for wastewater, with the
11· ·current services, we clean and repair the
12· ·existing wastewater system.· That's also a
13· ·federal requirement currently, as well as what
14· ·we do.· Compliance with environmental
15· ·regulations, which is driving most of the work
16· ·that is done.· The biggest one is major new
17· ·improvements.
18· · · · So in 2011, MSD signed a consent decree
19· ·after a lawsuit by the Department of Justice,
20· ·the EPA, and the Coalition for the Environment
21· ·wanting MSD to meet all of its Clean Water Act
22· ·requirements by a certain date.· MSD is not the
23· ·only one.· There are over 200 other
24· ·municipalities that were also sued.· The idea
25· ·being while that we're working to meet the
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·1· ·Clean Water Act, the Federal Government wanted
·2· ·to have a court-enforcible document that said
·3· ·you had to be done by a certain date.· That's
·4· ·what came out of that.
·5· · · · So as you see the wastewater program, to
·6· ·give you an example of how much those items
·7· ·drive it, 98 percent of the capital work that's
·8· ·scheduled to be scheduled over the next four
·9· ·years is either to be compliance schedules from
10· ·the consent decree or compliance schedules from
11· ·other regulatory requirements such as water or
12· ·the Clean Water Act.
13· · · · On stormwater, it's a little bit
14· ·different.· Remember, stormwater is paid
15· ·through property taxes.· Right now, we clean
16· ·and repair the existing storm sewers, these are
17· ·inlets, manholes, and storm sewers.· MSD did
18· ·not have the ability to do that district-wide
19· ·until 2016, when the public voted in a rate
20· ·that now allows us to maintain them throughout
21· ·the entire public.· Prior to that, inside 270,
22· ·we had some funding to maintain the storm sewer
23· ·system and everything outside or west, north,
24· ·and south of 270, we owned the facilities but
25· ·had absolutely no funding to provide any kind
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·1· ·of operation and maintenance.· That has been
·2· ·taken care of.
·3· · · · Compliance with environmental regulations,
·4· ·that's paid for on your property tax.· MSD has
·5· ·funding for that since it was created in 1954.
·6· ·The final item, the final service can be
·7· ·provided, and it's the issue or the focus of
·8· ·the rate proposal, is to provide funding for
·9· ·new improvements to address flooding and creek
10· ·erosion.· MSD does not have a district-wide
11· ·source for that.
12· · · · While MSD does not own the creeks and
13· ·streams, we don't manage the floodplains, those
14· ·are owned or managed by individual
15· ·municipalities.· We do have the ability to
16· ·raise funds, region-wide, and then take those
17· ·in a prioritized basis and solve the most
18· ·problems first, in cooperation and teaming with
19· ·our municipal partners.· That's what this
20· ·proposal is looking to do for stormwater.
21· · · · Really quick, some background on the
22· ·wastewater system improvements.· Right now,
23· ·Project Clear, we are in the midst, right now
24· ·in 2023 dollars, $7.2 billion program to meet
25· ·the requirements of the consent decree in the
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·1· ·lawsuit.· We -- you may have heard different
·2· ·numbers on the consent decree.· When we signed
·3· ·it in 2011, the value was $4.7 billion in 2010
·4· ·dollars.· What we do is we constantly bring it
·5· ·up based on inflation into current dollars.
·6· ·2021, we valued it at 6.1 billion.· With the
·7· ·inflation you've seen and the economic
·8· ·situation over the last two years, that's how
·9· ·we got to 7.2 billion.· But the program is on
10· ·budget and ahead of schedule from the original
11· ·plan.
12· · · · Again, couple things we're doing is keep
13· ·wastewater backups from going into homes, as
14· ·well as taking care of overflows.· Prior to MSD
15· ·and a little bit after it was formed, in order
16· ·to resolve basement backups, the idea was to
17· ·punch a hole in the side of a manhole that's
18· ·next to a creek and a stream, let the
19· ·wastewater and whatever stormwater get in, go
20· ·into the creek and stream instead of basements.
21· ·Those are illegal, and we're in the process of
22· ·removing all those.· That will help improve
23· ·water quality.
24· · · · How do we do this?· There is a couple of
25· ·things.· First of all, we're removing water
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·1· ·that shouldn't be in the wastewater system.
·2· ·That's what's causing primarily most of the
·3· ·backups.· Increase the wastewater capacity
·4· ·where needed, especially with the current
·5· ·climate change.· MSD has really recognized
·6· ·climate change impacts for about 15-plus years
·7· ·in our area, and then, again, eliminate the
·8· ·points where the untreated wastewater spills
·9· ·into the creeks and streams.· That's the
10· ·primarily focus.
11· · · · The wastewater system progress, what we've
12· ·accomplished.· We've eliminated 84 percent of
13· ·those overflows that goes into the creeks and
14· ·streams.· Building backups are down 25 percent.
15· ·We were hoping for a bigger number.
16· ·Unfortunately, the impacts of climate change
17· ·and overland flooding make that number -- keeps
18· ·us from getting that number down further.· If
19· ·you think about it, when there's a flood,
20· ·overland floods floods streets, yards, homes.
21· ·It also floods the sewer system.· And when it
22· ·does that, it fills the sewer system up, and
23· ·even if somebody is not experiencing overland
24· ·flooding, it fills the sewer system up and can
25· ·be reflected in somebody's basement who is
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·1· ·quite a ways away from the overland flooding.
·2· ·But we are still down 25 percent.
·3· · · · And on the wastewater system, we've
·4· ·completed, or are in the process of completing,
·5· ·650 projects since 2011.· Stormwater is a
·6· ·little different.· Never having had a
·7· ·district-wide fund, we collect the problems and
·8· ·keep planning for a point -- is there going to
·9· ·be a point where we'll have funding for this.
10· ·This is -- what you see here are the number of
11· ·issues that have been reported to us.· In 2011
12· ·to '14, we are about 1,100 on a record.· That
13· ·went up in 2015-'18 to 2,400, and, now, it's up
14· ·to 3,700.· It seems to be tracking climate
15· ·change and the larger storms we've had.
16· · · · If you notice, as some people pointed out,
17· ·we seem to be getting the same amount of rain
18· ·per year, that's true.· However, we're getting
19· ·it in a much shorter period at a much higher
20· ·intensity.· That's what's causing a lot of the
21· ·flooding problems.
22· · · · There is an example of stormwater
23· ·problems.· There's flooding.· So this is any
24· ·place where water, stormwater, lands on a
25· ·property, doesn't go away for whatever reason,
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·1· ·whether it's because of overland flooding,
·2· ·creek flood, anything like that, looking to
·3· ·avoid those issues.· Also, on stormwater,
·4· ·there's two pieces.· There's flooding and
·5· ·there's creek erosion.· The things that are
·6· ·going on with the environment also result in
·7· ·more storms, heavier stream flows, faster
·8· ·stream flows.· It causes erosion.· That can
·9· ·also threaten people's property and their homes
10· ·just as much as overland flooding.· Those are
11· ·the two major problems we want to address.
12· · · · Right now as -- well, I'll hit that later.
13· ·Improvements identified by watershed, this is
14· ·where we've gotten the complaints from.· The
15· ·only thing I point out here is on the purple
16· ·area, if you take a look, it's -- the right
17· ·side is the Mississippi River, up at the top is
18· ·the Missouri River and you can see the
19· ·interstate system.· The purple area has some
20· ·legacy small taxing districts, where we do
21· ·small stormwater projects.· Those people pay a
22· ·tax that's existed for quite a while.
23· · · · What we found is if people complain and
24· ·they find on occasion that we can do some work,
25· ·we give more information.· It's worth
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·1· ·reporting.· The rest of the areas, whether it's
·2· ·up in North County, West County, down south
·3· ·around the Meramac River, when we get
·4· ·complaints, we say thank you, we'll log them,
·5· ·we'll let you know when we get a funding
·6· ·source.· You can imagine that doesn't drive
·7· ·people to keep reporting to us because nothing
·8· ·gets done.· So we suspect there's a lot more
·9· ·problems out there than what we've identified
10· ·so far, what's been reported to us.
11· · · · Really quick on the Rate Commission, I'm
12· ·not going to go over some of the stuff that
13· ·Commissioner Berry did, but what I am going to
14· ·do is go over the timeline.· Thank you.· So in
15· ·2022, MSD staff that summer, actually we
16· ·started at the beginning of 2022, started to
17· ·put a rate proposal together for this Rate
18· ·Commission.· We completed that proposal.· We
19· ·gave it to the Rate Commission in March of
20· ·2023.· They're scheduled to be completed by
21· ·September 2023.· They have to be done by 165
22· ·calendar days.
23· · · · Once they're done, they will turn that
24· ·over to our Board of Trustees.· They will
25· ·evaluate MSD's proposal.· They will evaluate
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·1· ·any suggestions made by the Rate Commission,
·2· ·and they'll decide how to move forward, and
·3· ·they'll use the last part of 2023 doing that.
·4· · · · Once they have the results, we will end
·5· ·up -- right now, we are going to use the
·6· ·April 2nd, 2024 election for at least one, if
·7· ·not both of these initiatives.· There will be
·8· ·two things on the ballet.· One will be
·9· ·wastewater.· If you've seen this before, this
10· ·is what we do every four years.· We come to the
11· ·Rate Commission, kind of true up the wastewater
12· ·program, and poll the public on how would you
13· ·like us to fund this?
14· · · · So in 2024, April 2024, on the wastewater
15· ·side, the public will be asked do you want to
16· ·implement the rate proposal that assumes you
17· ·allow us to borrow additional monies, and I'll
18· ·go over those details later, or do you want to
19· ·not provide additional bonding and just pay
20· ·cash.· Those have consequences I'll go over in
21· ·detail later.
22· · · · The other one is the stormwater one.· It's
23· ·a little bit different.· The wastewater one has
24· ·to be done because a federal judge and
25· ·environmental regulations say we simply have to
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·1· ·do the work.· Just a question of how we fund
·2· ·it.
·3· · · · Stormwater is up to the public.· We will
·4· ·provide a provision, here's the services that
·5· ·are proposed, here's what it costs, the public
·6· ·gets to decide if that's a good idea, I will
·7· ·vote yes, or it's not a good idea, I will vote
·8· ·no.· That will be up to the public.
·9· · · · So the details of the rate proposal, and
10· ·here's where all of the -- I'll have some good
11· ·discussions here about what's really going on.
12· ·In the stormwater rate proposal, the first
13· ·thing we wanted to do was to make sure
14· ·different sections of the community paid their
15· ·fair share.· So what we did is, we went through
16· ·and we said -- we used impervious area.
17· ·Impervious area is rooftops, driveways,
18· ·sidewalks, places where when rain hits, it
19· ·doesn't soak into the ground, it runs off.· So
20· ·we wanted to determine how much of impervious
21· ·area is on our residential customers.· It was
22· ·57 percent.
23· · · · Therefore, we set the rate assuming the
24· ·residential customers would provide 57 percent
25· ·of the funding.· The other 43 percent is for
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·1· ·not non-residential customers.· Those
·2· ·non-residential customers also include
·3· ·not-for-profit non-residential customers.· They
·4· ·will provide 43 percent of the overall amount
·5· ·of funding that we're looking to get.
·6· · · · How is that going to be divided up and how
·7· ·was it calculated?· So we were driven by the
·8· ·residential customers.· We do a lot of polling.
·9· ·Residential customers have indicated to us that
10· ·over half of them are willing to fund a
11· ·stormwater program as long it's not more than
12· ·two dollars per month for cost.· So we used
13· ·that as a starting point.· We're going to use
14· ·property tax for the residential customers, so
15· ·we found out what the median value --
16· ·median-assessed value of a home was in our
17· ·service area, and it's $176,600.
18· · · · So to get about to two dollars per month,
19· ·that results in a property tax proposal of
20· ·$7.45 per $100 evaluation or about $25 per
21· ·year.· We use that number, it's somewhat
22· ·convenient for folks, easy ones, to double
23· ·twice the assessed value is $350,000.· So if
24· ·you have a $350,000 assessed home, if this
25· ·proposal moves forward, it would cost you $50
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·1· ·per year on your property tax bill.
·2· · · · So doing that, setting at that amount,
·3· ·that generates a certain amount of volume, and
·4· ·providing 57 percent of the funding.· The other
·5· ·43 percent comes from the non-residential
·6· ·customers.· Again, I said we're going to use
·7· ·impervious area.· What we're going to do is
·8· ·we're going to measure the impervious area of
·9· ·all the non-residential customers, we do this
10· ·with aerial photography, and we were going to
11· ·bill them $1.05 per thousand square feet of
12· ·impervious area per month.· If we do that for
13· ·the customer base we have, that allows them to
14· ·provide 43 percent of the total funding.· By
15· ·the time you add this all up, the total
16· ·proposal is for $35 million that will be
17· ·generated annually.
18· · · · Now, where we do we spend the money?
19· ·Right now, I showed you a list of the problems
20· ·we had, those issues.· Right now, just kind of
21· ·an estimate, those problems we have identified
22· ·will cost about $700 million to fix in total.
23· ·That does not include problems that came up
24· ·from the flooding in 2022.· That would be
25· ·additional.· But how we're going to spend it,
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·1· ·and this was something we really went back to
·2· ·the public, we tried this kind of proposal in
·3· ·2019, the public voted it down 53/47.· We went
·4· ·back out, said, hey, what are things we can do
·5· ·to enhance this, to make this more attractive
·6· ·that folks might want to reconsider.· One of
·7· ·them was how we spend the money.
·8· · · · So 50 percent of the revenues, MSD is
·9· ·going to use on projects with the highest
10· ·benefit cost value throughout the entire
11· ·district for stormwater.· We have a formula
12· ·that was reviewed and approved by a public
13· ·group.
14· · · · · · · · ·(Phone rings)
15· · · · MR. BRIAN HOELSCHER:· Is that --
16· · · · MR. LANCE LECOMB:· The video camera.
17· · · · MR. BRIAN HOELSCHER:· That's the video
18· ·camera? The video camera forgot to silence
19· ·itself.
20· · · · MR. LANCE LECOMB:· I could answer it.
21· · · · MR. BRIAN HOELSCHER:· No, that's okay.
22· ·Where I was, 50 percent is by a benefit-cost
23· ·analysis.· We take the benefit, which is a
24· ·point value for the types of things we're
25· ·protecting.· So for flooding and erosion,
Page 25
·1· ·they're kind of the same things.· A yard,
·2· ·garage, is erosion going to cause your house to
·3· ·fall into the channel, all of those things.· We
·4· ·total up the points of what the project will,
·5· ·say, what they'll protect, divide by the cost,
·6· ·and you'll end up with the benefit-cost ratio.
·7· · · · 50 percent of the dollars we simply start
·8· ·from the top of the list, the highest scoring
·9· ·projects and work our way down.· 30 percent of
10· ·the revenues will go to individual
11· ·municipalities in the form of 100 percent
12· ·grants.· We kind of started this in some of
13· ·those small-taxing districts in the individual
14· ·municipalities where we thought it was a good
15· ·idea.
16· · · · So the way this works is, the
17· ·municipalities can determine their own priority
18· ·as long as it is a stormwater need.· They'll
19· ·submit to us what that need is, the money will
20· ·be distributed by population, the higher
21· ·population municipalities will get more, the
22· ·lesser will get a smaller value.· It can
23· ·accumulate from year to year.· If you want to
24· ·save up four years worth to do a project, you
25· ·can do that.· But it will go to the -- it will
Page 26
·1· ·go to those communities.· All they have to do
·2· ·is submit, tell us what project they're going
·3· ·to spend it on, and, again, it's a hundred
·4· ·percent grants.· There's no local requirements.
·5· · · · This allows us to take care of more
·6· ·regional type stuff, as well as going to
·7· ·municipalities and provide them funding to be
·8· ·able to address issues they may think are more
·9· ·important on a stormwater side.
10· · · · Next, 10 percent of the funding will go to
11· ·adjust to environmental justice areas.· So
12· ·working through the Federal Government, the
13· ·Federal Government as well as the State of
14· ·Missouri, they call them different things.· The
15· ·Federal Government's environmental justice
16· ·areas.· The State of Missouri is low income, I
17· ·think, or some terminology.· But however they
18· ·do it, they give us the tools that they
19· ·determined map these and find out what part of
20· ·your area is environmental justice.
21· · · · So we've mapped those.· We did those
22· ·recently, what was given to us from the State
23· ·in order to apply for some grant monies and,
24· ·just in general, those areas are the north part
25· ·of the City of St. Louis, North County, North
Page 27
·1· ·County heading out to the west, and then
·2· ·there's an environmental justice area just on
·3· ·South City bleeding into South County.
·4· · · · So what we're going to do with those,
·5· ·similar to the cost-benefit analysis, we're
·6· ·going to consider those projects in those
·7· ·areas.· Then we're going to do a benefit-cost
·8· ·analysis and 10 percent of the funding we'll
·9· ·simply work down the list of only projects in
10· ·the environmental justice areas.
11· · · · And then finally, we put 10 percent aside,
12· ·this quite honestly came out of a discussion we
13· ·kind of had with a lot of the city -- the
14· ·larger city managers.· We're going to put
15· ·10 percent aside for something else.· Is there
16· ·something we're missing.· There's a real
17· ·regional need from a policy perspective that we
18· ·need to address.· The idea is for MSD to really
19· ·get public input on this.· Right now, the
20· ·Municipal League has provisionally volunteered
21· ·to be the representative and have a discussion
22· ·and decide where's a good place to direct these
23· ·dollars.
24· · · · Not that these are where they'll go, but
25· ·an example is, buying homes out of floodplains.
Page 28
·1· ·The area could decide we really need to do
·2· ·that, let's take those monies toward that.
·3· ·They could decide, you know what, the Cities
·4· ·have got some good ideas, let's enhance their
·5· ·grants.· That's another way we could do it.
·6· · · · There's a lot of other options.· MSD
·7· ·doesn't know where it's going to go.· We,
·8· ·obviously, have some ideas to consider, but we
·9· ·really want to get the public's input.· We
10· ·think that's kind of a piece that was really
11· ·missing last time.· To be able to get those
12· ·things that just don't fit in these little
13· ·buckets that we have set up.
14· · · · Next, regarding the wastewater rate
15· ·proposal.· So, as I mentioned, the current
16· ·value of the program is 7.2 billion in 2023
17· ·dollars.· The program started in 2021, our
18· ·consent decree ends in 2039, so we're just
19· ·about halfway through.· Excuse me.
20· · · · So to fund what is now $1 billion of new
21· ·work that we're going start over the next four
22· ·years, the question is, do you want to pay
23· ·cash, or do you want to approve MSD to have an
24· ·additional $750 worth of bonding authority.
25· ·That's the question that will be put in front
Page 29
·1· ·of the voters.· Obviously, just like a car, a
·2· ·house, if you borrow money, you pay less early
·3· ·but you got to pay interest later on.· If you
·4· ·want to pay cash, it costs a lot now, but
·5· ·you'll avoid the interest expense in the
·6· ·future.· Those are the options.
·7· · · · The next page is one, if you guys have
·8· ·been part of this process before, you may
·9· ·recognize.· If you want a real good close up
10· ·view, those of you who have picked up the one
11· ·page flier, it's on that side, too, if you want
12· ·to make some notes or you've seen it.· Sir, do
13· ·you have this document?· Do you have this
14· ·document?
15· · · · MR. CHRISTOPHER WILCOX:· No.
16· · · · MR. BRIAN HOELSCHER:· Do you want one?
17· · · · MR. CHRISTOPHER WILCOX:· Sure.
18· · · · MR. BRIAN HOELSCHER:· That's all right I
19· ·can read off -- I'll get it.· I'll give it to
20· ·him.· I can read off this.· This is usually the
21· ·most popular slide every four years when we do
22· ·this so.· This is on the wastewater side.· On
23· ·the left-hand side, you see a green column.
24· ·That green column assumes the public says yes,
25· ·we will permit you an additional $750 million
Page 30
·1· ·money in bonding authority.
·2· · · · The left-hand side, it says Yearly Change
·3· ·and a percentage number.· So if you take a look
·4· ·at your bill that you will get this August, and
·5· ·you want to see what this proposal will do, you
·6· ·can apply these percentages to your exact bill.
·7· ·So it will go up 7 percent in 2025; 7.6 percent
·8· ·in '26; 7.5 percent in 2027; and 6.6 percent in
·9· ·2028.· That's by percentage.
10· · · · On the right-hand side, we do show the
11· ·average monthly residential bill, very few pay,
12· ·obviously, the average monthly bill.· However,
13· ·it does give the average and helps people get a
14· ·sense of how many dollars we're talking about.
15· ·If you want to calculate exactly yours, you can
16· ·use the column on the left, the percent
17· ·increases based on your billings you'll receive
18· ·in August.
19· · · · The right-hand side is assuming no
20· ·additional bond is authorized, and we'll just
21· ·simply pay cash.· The same way under the yearly
22· ·change, the average monthly bill will go up 35
23· ·percent if there's no additional bonding the
24· ·first year.· 35 percent again the second.· Go
25· ·down 20 percent in the third year, that's
Page 31
·1· ·because of the cash needs of the capital
·2· ·program.· Then go up five percent on the fourth
·3· ·year.· And you can see the average monthly
·4· ·residential bills on the right hand side.
·5· · · · So that's what everybody will be looking
·6· ·at.· There are a couple of things I want to
·7· ·point out.· If these rates, right now, and
·8· ·these changes are based on your portable water
·9· ·usage.· Most residential customers have their
10· ·water metered.· MSD collects the winter meter
11· ·readings, and we use that assuming that's the
12· ·water you use that goes down the drain the
13· ·whole year.· We don't want to catch swimming
14· ·pools, watering the lawn, washing the car, we
15· ·don't want to do any of that.· So we use the
16· ·winter numbers.
17· · · · Some residential customers in the City
18· ·don't have meters.· They are billed based on
19· ·attributes.· The same way City Water bills
20· ·them.· We are required by the Missouri Supreme
21· ·Court to use the same billing method that City
22· ·Water uses for non-metered residential
23· ·customers in the City of St. Louis.
24· · · · For those individuals, these percentage
25· ·increases will apply to their current bill in
Page 32
·1· ·August, the only change is, we do an evaluation
·2· ·of the flows we assign to attributes every
·3· ·year.· And we look to see if there should be a
·4· ·change made.
·5· · · · So if you're an unmetered residential
·6· ·customer in the City of St. Louis, in 2025,
·7· ·instead of the 7 percent increase, the first
·8· ·thing you'll see is a 0.8 decrease in your
·9· ·monthly bill.· And that will account for a
10· ·study we did that tries to determine water
11· ·usage based on the parameters given to us by
12· ·City Water.
13· · · · The other part I want to touch on is the
14· ·customer assistance program.· It's a part of
15· ·this whole package that we're offering.· Our
16· ·customer assistance program, what it does, for
17· ·individuals who are making -- households who
18· ·are making less than two times the poverty
19· ·level, if they apply to MSD, their rates --
20· ·their monthly cost will be cut in half.· If you
21· ·are like me, elderly, and over 60 years old,
22· ·and you're two and a half times under -- two
23· ·and a half -- under two and a half times the
24· ·poverty level, you also can apply, and you'll
25· ·get your rates cut in half.· Commissioner
Page 33
·1· ·Berry, that ends my presentation.
·2· · · · COMMISSIONER BERRY:· Thank you,
·3· ·Mr. Hoelscher.· Rate Commission staff, will you
·4· ·please announce those who have requested to
·5· ·speak?
·6· · · · MR. LANCE LECOMB:· Commissioner Berry,
·7· ·given the number of attendees and the size of
·8· ·the room, we believe it would be appropriate to
·9· ·just take questions by raising of their hands
10· ·if you so agree.
11· · · · COMMISSIONER BERRY:· Yes, yes.
12· · · · · · QUESTIONS BY THE PUBLIC:
13· · · · COMMISSIONER BERRY:· Those wishing to
14· ·speak, please remember to state your name and
15· ·address for the record, and if you represent an
16· ·organization.· At this time, does anyone any
17· ·question of comments.· Yes, sir?
18· · · · MR. CHRISTOPHER WILCOX:· I have comments.
19· · · · COMMISSIONER BERRY:· Yes.
20· · · · MR. CHRISTOPHER WILCOX:· Should I stand
21· ·or --
22· · · · COMMISSIONER BERRY:· You can stand.
23· ·Whatever is most comfortable for you.
24· · · · MR. CHRISTOPHER WILCOX:· My name is Chris
25· ·Wilcox.· I am the director of policy advocacy
Page 34
·1· ·for A Red Circle, which is a nonprofit that
·2· ·serves folks in North St. Louis County,
·3· ·particularly those who are disadvantaged and
·4· ·low income.
·5· · · · I can say, you know, over the last year
·6· ·and a half or so, you know, how problems
·7· ·maintaining housing has been the single most
·8· ·consistent need that has been brought to us.
·9· ·And during the period when the State was
10· ·providing funding for rental assistance and
11· ·utilities, we were helping people get that
12· ·because a lot of people were not able to get it
13· ·through the program without additional
14· ·assistance because of the requirements.
15· · · · And consistently, it -- it had a lot of
16· ·uptake because people -- the need is so great
17· ·out there.· And people are as it is, having a
18· ·really difficult time maintaining their basic
19· ·needs, particularly housing.· If you look at
20· ·the calls to 211, for example, around
21· ·80 percent of them are either for
22· ·shelter-rental assistance or utility
23· ·assistance.
24· · · · So consistently, we are in the situation
25· ·where particularly the kinds of low-income
Page 35
·1· ·families that we work with, are having it
·2· ·harder and harder to get their monthly bills
·3· ·paid, which in turn is fueling a possibly
·4· ·unprecedented crisis in terms of people being
·5· ·evicted and failing to pay your utility bill is
·6· ·of the things that can get a family evicted,
·7· ·even if they're able to keep up their rent,
·8· ·which is increasing more difficult, especially
·9· ·with other costs including food going up as
10· ·well.
11· · · · I can understand that there's a lot of
12· ·work that needs to be done from that -- from
13· ·the perspective of MSD, but the Commission has
14· ·granted increases for pretty much every other
15· ·utility that people are paying.· And I've gone
16· ·through a lot of utility bills through the
17· ·course of running those -- those clinics for
18· ·people applying for rental assistance.· MSD
19· ·being one of them.· Even if they don't pay MSD
20· ·directly, they often pay separate utility fees,
21· ·which is another way that landlords are
22· ·increasingly passing the cost and raising the
23· ·rent without saying they're raising the rent.
24· · · · And so what is particularly frustrating
25· ·about this, we understand the climate change
Page 36
·1· ·and how it's contributing to all the flooding.
·2· ·The people we are talking about being asked to
·3· ·pay another 7 percent increase every year for
·4· ·the next few years, they're contributing the
·5· ·least to that problem.· They generally don't
·6· ·live in big houses.· The houses that they do
·7· ·live in tend to be the most energy inefficient,
·8· ·so they're paying more for the same amount of
·9· ·energy usage, and they are -- we know that
10· ·people struggle with transportation in this
11· ·area particularly.· It's often a struggle to
12· ·get to resources that do exist, such as food
13· ·pantries, for instance, because they don't have
14· ·a vehicle.· Because even getting a used car
15· ·over the last few years has been practically
16· ·impossible for someone on a modest income.
17· · · · So it's really concerning to me and
18· ·frustrating that as we go along, we see all of
19· ·these continued problems, the poorest people
20· ·are the ones paying the price, and meanwhile,
21· ·they've contributed to the actual problem the
22· ·least, and that's why it's -- it's very
23· ·difficult to keep coming to these and seeing
24· ·how people's -- the poorest people's costs are
25· ·going up and nothing is coming in to help.
Page 37
·1· ·And, so, having seen that, Ameren got an
·2· ·increase.· Spire got an increase.· I believe
·3· ·Missouri America Water might got an increase as
·4· ·well.· So this is just another rate increase in
·5· ·a situation where more and more families who
·6· ·are low income are finding it impossible to
·7· ·keep up with their expenses, and that's why I
·8· ·want to express concerns about the proposed
·9· ·rate increases.
10· · · · COMMISSIONER BERRY:· Thank you for your
11· ·comment.· Would MSD like a chance to --
12· · · · MR. BRIAN HOELSCHER:· Yeah, I think
13· ·just -- since -- we take the opportunity at
14· ·these meetings, sometimes it's difficult for
15· ·us, we try a lot of methods to outreach to
16· ·folks who are looking for assistance. I
17· ·know -- I heard you say you're familiar with
18· ·MSD's program.· The gentleman who runs that
19· ·program right next to you is our director of
20· ·finance, Marion Gee.· If you don't mind talking
21· ·with him afterwards, if there's a way we can
22· ·leverage and get more people involved in the
23· ·program, that would be helpful.· If you don't
24· ·mind talking to him after the -- this is over.
25· · · · MR. CHRISTOPHER WILCOX:· I guess I would
Page 38
·1· ·say one thing about that, if I may.
·2· · · · MR. BRIAN HOELSCHER:· Sure.
·3· · · · MR. CHRISTOPHER WILCOX:· So the problem
·4· ·with these is that, you put these administrator
·5· ·burdens, and they're -- it makes them
·6· ·particularly less accessible to the people that
·7· ·need them the most, right?· So we can raise the
·8· ·rate, and you can say, oh, it's going to impact
·9· ·the poorest people because this program is
10· ·here.· Well, the people that need the program
11· ·the most are going to be least -- access it.
12· ·So it doesn't make a lot of sense to plan from
13· ·that perspective from my point of view.
14· · · · And, you know, the State is sitting on a
15· ·historical budget surplus.· Those are -- that's
16· ·money for public services that isn't currently
17· ·being spent.· I understand there's planning
18· ·that went into putting in a proposal together,
19· ·but we're asking -- you know, we are asking
20· ·people who just don't have the money to
21· ·contribute, and a lot of them are going to
22· ·become unhoused as a result of this because
23· ·already there are people whose rents are going
24· ·up 50 percent.· Possibly even a 100 percent in
25· ·some areas.· And, so, that's part of what I
Page 39
·1· ·want to --
·2· · · · MR. BRIAN HOELSCHER:· Okay.
·3· · · · MR. CHRISTOPHER WILCOX:· -- get that point
·4· ·across.
·5· · · · MR. BRIAN HOELSCHER:· So -- and, sir, I
·6· ·wasn't denying you that.· I think one of things
·7· ·Marion's -- one of his initiatives is, we try
·8· ·everything we can to make it that much easier.
·9· ·And I think your input and ideas, talking with
10· ·him, if you got anything we're missing, we want
11· ·to make it as easy as possible to be part of
12· ·the program, and we'd like to take the
13· ·advantage while you're here to be able to talk
14· ·with Marion and see if there's anything we're
15· ·missing.
16· · · · MR. CHRISTOPHER WILCOX:· Sure.
17· · · · MR. BRIAN HOELSCHER:· That's Marion Gee
18· ·right there.· He's our director of finance,
19· ·sir.
20· · · · COMMISSIONER BERRY:· Thank you.· Any other
21· ·questions from the attendees today or comments?
22· ·Okay, hearing none, I'm gonna announce that the
23· ·next public hearing is scheduled for Saturday,
24· ·July 29th, 2023, at 9:30 a.m.· The hearing will
25· ·be held at O'Fallon Park Recreation Complex,
Page 40
·1· ·YMCA, in the AOA room.· The address for
·2· ·O'Fallon Park Recreation Complex, YMCA, is 4343
·3· ·West Florissant Avenue, St. Louis, Missouri
·4· ·63115.· Thank you for your attendance and
·5· ·feedback.· This public hearing is adjourned.
·6· · (Ending time of the hearing: 03:39 p.m.)
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·1· · · · I, Colin Wallis, in and for the State of
·2· ·Missouri do hereby certify that the witness
·3· ·whose testimony appears in the foregoing
·4· ·Examination Under Oath was duly sworn by me;
·5· ·that the testimony of the said witness was
·6· ·taken by me to the best of my ability and
·7· ·thereafter reduced to typewriting under my
·8· ·direction; that I am neither counsel for,
·9· ·related to, nor employed by any of the parties
10· ·to the action in which this examination was
11· ·taken, and further that I am not relative or
12· ·employee of any attorney or counsel employed by
13· ·the parties thereto, nor financially or
14· ·otherwise interested in the outcome of the
15· ·action.
16· · · · ______________________
17· · · within and for the State of Missouri
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