MAYOR SCOTT DOUGLASS
sure you have noticed recent increases in your MSD bill. As a matter of
fact, we have received several inquiries from you. As the City does not
regulate or provide any wastewater or stormwater services we are not involved
in billing, collecting or setting of rates. However, I will attempt to
explain these increases for your information. A more comprehensive
explanation can be found at the MSD website, www.stlmsd.com.
how do rate increases come about? In 2000, changes to MSDís Charter
were approved by area voters that required the creation of an independent Rate
Commission. Composed of 15 member organizations representing a broad
cross-section of MSDís customers and the community it serves, the Rate
Commission is designed to provide public input into how rates are set.
The Rate Commission process includes multiple public hearings and can last up
to 165 days. This process begins when a rate proposal is formally
referred to the Rate Commission by MSD staff. The Rate Commission
reviews the proposed rate changes and holds public hearings to obtain customer
input. After these hearings, the Commission again reviews the proposal
and makes a recommendation to the MSD Board of Trustees for final approval.
is the process for all rate changes. In 2007 after this process was
completed, a recommendation for a 15% increase in your wastewater charge to be
effective January 1, 2008 was approved. In addition the 2007 approved
recommendation calls for a series of increases that will raise wastewater
rates 64% from 2007 to 2011. Driven by state and federal environmental
regulations, wastewater rate increases are needed to continue improvements to
a sewer system that ranks as the 4th largest in the United States. An
alternative proposal is being considered-- the sale of bonds to assist in
financing these needs. The sale of bonds to raise $275 million would
hold the series of rate increases to 28% instead of the previously mentioned
64%. This sale of bonds requires voter approval. The Board of
Trustees has not made a decision on when, or if they will ask for voter
approval. See the MSD web site for details.
part of the 2007 recommendation called for a plan to change the
method of charging for stormwater management. Up to March 1st, 2008 it
was funded by a 24 cent per month on each MSD bill and a variety of property
taxes. The funds collected were insufficient to properly handle the
stormwater requirements. Before authorizing any increases in these
changes, the decision was made to find a more accurate method of determining
the customerís stormwater charge. This new charge from the 2007
proposal began March 1st, 2008.
you know about how the increases were approved, how was the new
stormwater charge calculated? This new method is based on the amount of
impervious area on each MSD customerís property. Impervious areas
refer to land that is covered by features such as cement, blacktop, or the
footprint of buildings (rooftops) and cannot absorb rainwater. The
determination of the square footage of impervious area on your property was
done by aerial imagery and it is updated ever two years. The next update
will be January 2009. You are charged .12 for every 100 square feet of
impervious area on your property. It is believed this method reflects
the demand put on area stormwater sewers by individual customers. So,
that other charge that went up on your bill from 24 cents is the stormwater
charge. Now the 2007 proposal included an annual increase in the 12-cent
charge to 29 cents by 2014. Should the bond issue pass there are
indications these increases would be less.
good news in addition to better management of our stormwater, the MSD charge
on your real estate property tax is eliminated. Thatís 0.0187 per
Hundred Dollar assessed valuation, or as shown by the example in the December
2007 edition of the Chronicle: For a $600,000 assessed value home,
MSDís portion was $19.04 a year. This amount is eliminated.