Pressure is mounting and the rumors are flying about what Mayor Slay and St. Louis County Executive Dooley are going to do about the controversy over the financing plan for the proposed MSD sewer rate increase.
Each day more people become aware that the increase doesn’t need to be 64%, if only MSD would reconsider its decision not to utilize any public debt financing and trust the voters to approve the issuance of bonds.
The St. Louis Post Dispatch ran the following story in its Savvy Consumer column:
Consumers fight 64 percent MSD rate hike
By Michael D. Sorkin
ST. LOUIS POST-DISPATCH
Friday, Nov. 02 2007
Consumer groups are ramping up a last-ditch fight in the Metropolitan St. Louis
Sewer District’s plan to raise residential rates 64 percent.
The groups are AARP, ACORN and the Consumers Council of Missouri.
At week’s end, MSD’s six trustees were scheduled to vote on approving the rate
increase at 5 p.m. Thursday at district headquarters.
Lance LeComb, a sewer district spokesman, said, “It is very difficult to change
course on such short notice and so late in the rate setting process.”
He said, “There has been ample opportunity for the public to participate in the
rate setting process.”
He was referring to ads in 15 area newspapers, and 18 public meetings, between
March and August.
Consumer advocates say hardly anyone knew of the meetings and even fewer
attended.
If the trustees approve, rates will increase over four years, starting in
January.
A typical residential customer now paying $22.38 per month would pay pay $36.79
per month in 2012, according to MSD.
John Coffman, an attorney for AARP and the Consumers Council, called the
increase “totally unnecessary.”
Coffman and others agree that MSD must spend hundreds of millions of dollars on
sewer repairs to comply with federal standards. That isn’t the issue, they say.
What they oppose is the district’s plan to pay for repairs entirely with rate
increases.
If half the improvements were financed with a bond issue instead, the increase
would be cut in half, figures compiled by the consumer groups show.
LeComb says the district wants to keep a bond issue in reserve because
“unknowns” could run costs up billions of dollars.
Says Coffman: “I never heard of any utility of this size going forward without
public debt.”
A bond issue requires voter approval. Consumer advocates say the district has
never lost a bond issue.
Large industrial users agree with the consumer groups. They include the
Missouri Industrial Energy Consumers (Anheuser-Busch, Boeing, Monsanto and
Pfizer among others) and the Missouri Energy Group (including SSM Health Care,
BJC and the Archdiocese of St. Louis.)
Lisa Langeneckert, representing the Missouri Energy Group, said at a public
hearing that even the consultant for MSD’s rate commission agreed that bond
financing is the better option.
Jeff Ordower, of ACORN, said, “Homeowners need relief, not additional costs.”
Coffman urged consumers to contact St. Louis Mayor Francis Slay and St. Louis
County Executive Charles A. Dooley. They appoint MSD’s trustees.
Consumer advocates said Thursday that the mayor and the county executive
appeared to be urging the trustees to work out a compromise with the consumer
groups.
MSD is a public agency serving 1.4 million residents in St. Louis and St. Louis
County.
