MSD $500 million bond issue, Proposition Y, goes to St. Louis County and city voters in April

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The Metropolitan St. Louis Sewer District is asking voters in St. Louis County and the city of St. Louis to make a decision this spring on a $500 million bond issue that will increase wastewater rates to pay for the sewer district’s $1.58 billion consent decree with the federal government.

Proposition Y, on the April 6, 2021 ballot, will determine how MSD’s federal government-mandated water improvement project Project Clear, or MSDPC, funds $1.58 billion worth of required wastewater system improvements over a three-year period from July 2021 to June 2024.

Proposition Y was originally intended to go to voters in April 2020, but the vote was postponed after the onset of COVID-19 restrictions and stay-at-home orders in the weeks leading up to that election, which was ultimately postponed until June.

In addition to Proposition Y, voters will also be presented with several potential changes to MSD Project Clear’s Charter. The work to be funded during this period, which is necessary to improve water quality in the region as part of an agreement between MSD, the U.S. Environmental Protection Agency and the Missouri Coalition for the Environment, includes nearly 300 projects designed to:
• Eliminate wastewater overflows,
• Reduce wastewater building backups,
• Repair and rehabilitate the wastewater sewer system,
• Upgrades at Bissell Point and Lemay Wastewater Treatment Plants, and
• Retire the Fenton Wastewater Treatment Plant.
As in every rate cycle, the rate proposal was reviewed and considered by an independent Rate Commission at several public meetings in 2019.

MSD is two utilities in one, responsible for 7,000-plus miles of public wastewater and stormwater sewer systems in the St. Louis region. Through Project Clear, mandated by a federal consent decree, MSD is investing billions of dollars over a generation to improve water quality and minimize wastewater and stormwater issues by monitoring regulatory compliance, planning, designing, and building community rainscaping, system improvements and an ambitious program of maintenance and repair.

MSDPC staffers say since the ballot issue was delayed in 2020, they prepared an extensive collection of informational material to help voters make an educated decision. That material can be accessed 24/7 online through the Rate Commission and MSD Project Clear.

The language below will appear on the April 6, 2021 ballot in St. Louis County and the city of St. Louis:

PROPOSITION Y

To comply with federal and state clean water requirements, shall The
Metropolitan St. Louis Sewer District (MSD) issue its sewer revenue bonds in the
amount of Five Hundred Million Dollars ($500,000,000) for the purpose of
designing, constructing, improving, renovating, repairing, replacing and
equipping new and existing MSD sewer and drainage facilities and systems,
including sewage treatment and disposal plants, sanitary sewers, and acquisition
of easements and real property related thereto, the cost of operation and
maintenance of said facilities and systems and the principal of and interest on
said revenue bonds to be payable solely from the revenues derived by MSD from
the operation of its wastewater sewer system, including all future extensions
and improvements thereto?
o Yes
o No

A “yes” vote gives MSDPC the ability to issue $500 million in bonds to fund some of the $1.58 billion in required work and repay this debt over a 20- to 30-year period. MSD says that  borrowing this amount through bonds will keep rates lower, although the cost will be greater in the long term since interest will be paid on the amount borrowed.
A “no” vote means MSDPC will pay for the work as it’s done, exclusively through rate increases; this will mean higher rates in the short-term, but lower costs overall since no interest will be paid.
Both options will impact wastewater rates in MSD Project Clear’s service area. Proposition Y’s impact on monthly wastewater rates is for demonstration purposes and is based on typical monthly usage for a single-family residence.

The public is invited to learn more about Proposition Y and ask questions at a series of live virtual public meetings via Zoom and Facebook Live. These virtual town hall meetings will feature a presentation by Executive Director and CEO Brian Hoelscher, who will also take questions from participants.  The full schedule is below and at msdprojectclear.org/townhalls. Click on the date or time you are available to register for one of our virtual town halls, or register on the website:
1. Wednesday, Feb. 10 at 6 p.m.
2. Wednesday, Feb. 17 at 6 p.m.
3. Wednesday, March 24 at 6 p.m.
4. Wednesday, March 31 at 6 p.m.

After registering, you will receive a confirmation email with information on joining the town hall.

For more information on Proposition Y and charter amendments on the April 6, 2021 ballot, click the links below or visit msdprojectclear.org/townhalls.

Proposition Y Fact Sheet
MSD Rate Commission
MSD Plan Amendment Commission