1 Public Hearing Fiscal Year 2016 Budget, Taxes, User Charges and Capital Improvement & Replacement Program May 14, 2015

2 The Charter of the Metropolitan St. Louis Sewer District requires the development and maintenance of a continuing five-year Strategic and Operating Plan. SECTION Strategic plan. -- A continuing five-year strategic and operating plan for the District shall be adopted on an annual basis by the Board. The strategic and operating plan shall state the District’s objectives for the succeeding five years and include objective targets by which to measure the District’s performance in meeting these objectives. Strategic Business and Operating Plan 2

3 VISION STATEMENT Quality Service Always Strategic Business and Operating Plan 3

4 MISSION STATEMENT To protect the public’s health, safety, and water environment by responsibly providing wastewater and stormwater management. Strategic Business and Operating Plan 4

5 VALUES Integrity – Acting ethically at all times, treating everyone with honesty, fairness, and respect. Teamwork – Working together to accomplish our mission with open communication, trust, respect, and diversity Innovation – Embracing continuous improvement and new solutions to achieve excellence. Strategic Business and Operating Plan 5

6 VALUES (Continued) Employees – Developing successful, responsible, and safety conscious employees and acknowledging their contributions. Customers – Building strong relationships by keeping our commitments, providing excellent service and being transparent in everything we do. Strategic Business and Operating Plan 6

7 A.Deliver consistent, high quality customer service; B.Comply with all legal and regulatory requirements and schedules; C.Minimize customer rate increases; and D.Be accountable to the St. Louis community. GOALS 7

8 STRATEGIES 1.Educate and partner with stakeholders to build support; 2.Manage the District’s costs and revenues to optimize financial impacts; 3.Integrate and improve the District’s business processes; 8

9 STRATEGIES (Continued) 4.Promote appropriate standards through proactive regulatory and legislative involvement; 5.Address customer and regulatory needs through a comprehensive infrastructure management program; 6.Create a learning and business oriented culture based on competency and accountability. 9

10 FY15 Highlights MSD Celebrated 60-years of Service to the St. Louis Region MSD Received Multiple Awards from NACWA and the GFOA MSD Named 2014 Institution of the Year by the St. Louis Minority Business Council MSD Continued Implementation of Project Clear 10

11 Key Initiatives for FY16 Continue Project Clear Related Activities Complete the Rate Commission process Continued Focus on Diversity Complete Upgrades to the Billing and Permitting Software Systems 11

FY16 District Funded Positions

13 FY16 Proposed Budget Expenses ($s in millions) Total = $582.8

Schedule of Residential User Rates 14

15 Fiscal Year 2016 General Fund Expenditures 15

FY16 General Fund Budget By Department 16

17 FY16 General Fund Operating Budget by Expense Category Personnel Services$103.0 Supplies 17.6 Utilities 17.1 Contractual Services 41.8 Capital Outlay 4.0 TOTAL$ ($s in millions)

18 Comparison: FY16 Budget to 2011 Rate Report 18 O&M Expense

19 Fiscal Year 2016 Debt Service 19

20 FY16 Debt Service ($s in millions) 20

21 Comparison: FY16 Budget to 2011 Rate Report 21 Debt Service

22 Fiscal Year 2016 Capital Improvement & Replacement Program 22

23 23

24 FY 2016 Final CIRP Program Summary24

25 FY 2016 CIRP Final vs. Draft Summary 213 New vs. 217 New in draft $271,705,500 vs. $270,738,000 in draft New Projects Continued Projects 15 Continued vs. 16 Continued in draft $26,338,000 vs. $28,150,000 in draft 25

26 51% 9% FY 2016 CIRP New Wastewater Projects 15% DC-02 & DC-03 Sanitary Relief (Brentwood Blvd to Conway Rd) Phase I. Consultant construction phase services for Phase I of this project, construction of 4,200 feet of sewer. DC-02 & DC-03 Sanitary Relief (Brentwood Blvd to Conway Rd) Phase III. Design services for Phase III of the sanitary relief project, construction of 12,700 feet of sewer. Deer Creek Sanitary Tunnel (Clayton Rd to RDP). Additional design for the Linden sewer connection to the tunnel, including sewer extension, diversion structure, and drop structure. 26

27 51% 9% FY 2016 CIRP New Wastewater Projects (cont.) 15% Missouri River WWTF Secondary Treatment Expansion (Mitigation Credit). Mitigation required by Maryland Heights to compensate for plant expansion into floodplain, to be accomplished via cooperative agreement with the Howard Bend Levee District Missouri River WWTF Secondary Treatment Electrical / Mechanical Modifications. Construction of various electrical and mechanical modifications for code compliance, safety, and operational efficiency. 27

28 FY 2016 CIRP Continued Projects Wastewater Coordination With Others5 Easement Acquisition/ Condemnation3 Scope Change 2 Stormwater Easement Acquisition/ Condemnation 5 Total 15 28

29 Type of Project Number Budget Wastewater 25 $111,145,000 Stormwater 17 2,816,000 Total: 42 $113,961,000 FY 2016 CIRP Contingency Projects29

30 51% 9% FY 2016 CIRP New Wastewater Contingency Projects 15% Bridgevale I/I Reduction (Bridgevale Ave and Lakeview Ave). Removal of private I/I sources from the sanitary sewer. Chapel Hill I/I Reduction (Mattis Rd and Venarde Dr). Removal of private I/I sources from the sanitary sewer. FF-16 Schuetz – Meadowside to Page Sanitary Relief. Construct 9,900 feet of 27-inch to 36-inch sanitary relief sewers. Private Inflow and Infiltration Reduction Program. Continue program to remove private I/I sources from the sanitary sewer. This is a supplemental appropriation. 30

31 51% 9% FY 2016 CIRP New Wastewater Contingency Projects (continued) 15% Sappington Creek I/I Reduction (Gravois Rd and Sappington Rd). Removal of private I/I sources from the sanitary sewer. Sterling Place Separate Sewer I/I Removal. Removal of private I/I sources from the sanitary sewer. Trampe (Partial) I/I Reduction (Castilon Ave and Trampe Ave). Removal of private I/I sources from the sanitary sewer. 31

32 32

33 STORM MAP Continue Consent Decree compliance efforts Remove 11 sanitary sewer overflow structures Begin construction of the Maline CSO Storage Facility Address building backups and system surcharging Rehabilitate existing infrastructure Continue CSO Volume Reduction Green Infrastructure Program Characterization and assessment of 140 miles of sewers and related structures Address stormwater issues at 88 locations Capital Program Results for FY

34 Wastewater Program Appropriation Projections over current Rate Period – FY 2013 to 2016 (Sanitary Replacement and General Funds) Program savings through scope optimization, design efficiencies, and favorable bid results have enabled the program to absorb changes without negatively impacting rate payers. The 4 year program is expected to remain within and under budget. MSD anticipates meeting all Consent Decree and wastewater regulatory requirements expected through FY

35 Fiscal Year 2016 Sources and Uses of Funding 35

36 FY16 Sources and Uses of Funding ($s in millions) Sources of FundingUses of Funding OPERDEBTCIRPTOTAL Wastewater User Charges$216.4$73.5$21.3$

37 FY16 Wastewater User Charges Type of Charge Wastewater User Charge Base Charge $/mo.$

38 FY16 Wastewater User Charges Type of Charge Wastewater User Charge Base Charge $/mo.$18.25 Unmetered (volume) Per Room $/mo Per Water Closet $/mo Per Bath/Shower $/mo

39 FY16 Wastewater User Charges Type of Charge Wastewater User Charge Base Charge $/mo.$18.25 Unmetered (volume) Per Room $/mo Per Water Closet $/mo Per Bath/Shower $/mo Metered Volume $/ccf

40 FY16 Wastewater User Charges Commercial/Industrial Customers Only. Tier based on number of sampling & test points.40 Compliance ChargeWastewater User Charge Tier 1$ 2.15 Tier Tier Tier Tier

41 FY16 Wastewater User Charges Extra Strength Surcharge Wastewater User Charge Suspended Solids $/ton$ greater than 300 mg/l Commercial/Industrial Customers Only.41

42 FY16 Wastewater User Charges Extra Strength Surcharge Wastewater User Charge Suspended Solids $/ton$ greater than 300 mg/l BOD’s $/ton$ greater than 300 mg/l Commercial/Industrial Customers Only.42

43 FY16 Wastewater User Charges Extra Strength Surcharge Wastewater User Charge Suspended Solids $/ton$ greater than 300 mg/l BOD’s $/ton$ greater than 300 mg/l COD’s $/ton$ greater than 600 mg/l Commercial/Industrial Customers Only. 43

44 FY16 Sources and Uses of Funding ($s in millions) Sources of FundingUses of Funding OPERDEBTCIRPTOTAL Wastewater User Charges$216.4$73.5$21.3$311.1 Stormwater User Charges

45 FY16 Stormwater User Charges Type of Charge Stormwater User Charge Single Family & Commercial 24 ¢ per account Multi-unit Residential18 ¢ per unit per account 45

46 FY16 Sources and Uses of Funding ($s in millions) Sources of FundingUses of Funding OPERDEBTCIRPTOTAL Wastewater User Charges $216.4$73.5$21.3$311.1 Stormwater User Charges Revenue Bonds

47 FY16 Sources and Uses of Funding Sources of FundingUses of Funding OPERDEBTCIRPTOTAL Wastewater User Charges $216.4$73.5$21.3$311.1 Stormwater User Charges Revenue Bonds Taxes ($s in millions)

48 FY16 Sources and Uses of Funding ($s in millions) Sources of FundingUses of Funding OPERDEBTCIRPTOTAL Wastewater User Charges $216.4$73.5$21.3$311.1 Stormwater User Charges Revenue Bonds Taxes Investment Income & Other * 48 * Includes $17.1 million interfund revenue for Stormwater services.

49 FY16 Sources and Uses of Funding ($s in millions) Sources of FundingUses of Funding OPERDEBTCIRPTOTAL Wastewater User Charges$216.4$73.5$21.3$311.1 Stormwater User Charges Revenue Bonds Taxes Investment Income & Other Fund Balance(25.5)(9.0) * 49 * (Increase) decrease in fund balance

50 FY16 Sources and Uses of Funding ($s in millions) Sources of FundingUses of Funding OPERDEBTCIRPTOTAL Wastewater User Charges $216.4$73.5$21.3$311.1 Stormwater User Charges Revenue Bonds Taxes Investment Income & Other Fund Balance(25.5)(9.0) TOTAL$209.8$73.5$299.5$

51 Fiscal Year 2016 Tax Levies 51

52 District-Wide Tax Levies 2015 TAX RATE ADMINISTRATIVE TAX: City County Total Administrative Tax STORMWATER TAX: City County (Original MSD Boundaries ) Total Stormwater Tax TOTAL DISTRICT-WIDE TAX 6.7¢ per $100 $ 2,813,307 7,666,902 $ 10,480,208 $ 15,633, ¢ per $ TAX LEVY $ 808,615 4,344,583 $ 5,153,198

53 Recommended OMCI Tax Levies SUBDISTRICTS2015 Proposed Tax Levy ResidentialAgriculturalCommercialPersonal Property Tax Rate Per $100 Assessed Value BLACK CREEK $ CLAYTON-CENTRAL $ COLDWATER CREEK $ 1,817, CREVE COEUR $ DEER CREEK $ 3,496, FOUNTAIN CREEK $ GRAVOIS CREEK $ 1,352, LORETTA-JOPLIN $ 21, MALINE CREEK $ 646, MERAMEC RIVER BASIN $ MISSOURI RIVER-BONFILS $ NORTH AFFTON AREA $ 59, SEMINARY BRANCH - RDP $ 223, SHREWSBURY - RDP $ 19, SUGAR CREEK $ 265, UNIV. CITY BRANCH - RDP $ 846, WATKINS CREEK $ 149, WELLSTON $ 31, TOTAL$ 8,929,644

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