Metropolitan St. Louis Sewer District officials are proposing an increase in wastewater rates over the next four years to fund a roughly $1 billion capital construction program and other costs.
Customers owning a single-family home would pay an average of $32.37 per month for wastewater services beginning July 1, 2012, according to the proposal. That rate would increase to $36.71 per month in fiscal 2014, $41.56 per month in fiscal 2015 and $47.05 per month in fiscal 2016.
Commercial customers would be placed on a five-tier compliance charge system based on the number of inspections and compliance samples.
A typical monthly commercial wastewater bill would increase to $292.50 in fiscal 2013, $326.55 in fiscal 2014, $368.05 in fiscal 2015 and $409.80 in fiscal 2016.
MSD already has scheduled a wastewater-rate increase for fiscal 2012.
On July 1, the average single-family’s monthly wastewater bill will increase to $28.73 from $27.56. Commercial customers will pay an average of $254.80 per month in fiscal 2012 — up from $244.25.
Those increases will be the last in a series of rate increases voters approved in April 2008.
Besides the roughly $1 billion wastewater Capital Improvement and Replacement Plan, or CIRP, the newly proposed rate increase would fund $634 million in total operating costs over the next four years and $359 million in total debt service.
MSD hopes to issue $945 million in bonds and use $171 million in cash to finance the CIRP.
Voters would have to approve the bond issue and may consider the measure in the April 2012 election.
Without the bond issue, MSD will be left to fund the entire CIRP with cash, which officials said would cause the average single-family wastewater rate to increase to $73.35 per month in fiscal 2013 — a 255-percent increase over the rate of $28.73 per month that will take effect July 1.
The rate proposal, which would apply solely to the wastewater rate, is driven by a need to bring district infrastructure into compliance with state and federal regulations, an increased use of debt, loss of customer base, declining water usage and unfavorable economic conditions, according to MSD officials.
The district has been negotiating with the Environmental Protection Agency on a settlement to a lawsuit filed in June 2007 regarding raw sewage overflowing into area rivers, creeks and streams.
In addition, MSD projects a 16-percent decrease in billed water usage through fiscal 2016 due to increased water conservation and pre-treatment, as well as the loss of such significant commercial customers as the Chrysler plants in Fenton and Northwest Plaza in St. Ann.
The district also projects a 2-percent decrease in accounts billed by fiscal 2016 from 2006 levels.
District staff presented the proposal May 10 to the MSD Rate Commission, which includes representatives from 15 area organizations, such as the Regional Chamber & Growth Association and the St. Louis County Municipal League.
The commission has up to 165 days to review the proposal and to make a recommendation to the district’s Board of Trustees.
It is expected to conduct public hearings over the next several months to gather public input.