ST. LOUIS 鈥 Next April, area residents will vote to determine whether their sewer bills increase by about 32% by 2028 鈥 or run far higher. The board of the Metropolitan 狐狸视频 Sewer District paved the way for the vote by sending a controversial rate hike proposal to the ballot at its Thursday meeting.
The move comes amid growing debate about the looming rate increase, as MSD and voters try to figure out how to finance $750 million in needed upgrades.
Concerned residents, advocates and area lawmakers have sought to reduce how much bills stand to climb for typical customers 鈥 pushing to create a scenario with 24% rate increases phased in from 2025 to 2028, instead of the alternative 32% jump included in a recommendation from the utility鈥檚 independent rate commission.
That wish from opponents was rejected by Thursday鈥檚 5-to-1 decision from MSD鈥檚 board to uphold the recommended rate proposal.
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Some local residents said the rate increases will confront them 鈥 plus neighbors and relatives 鈥 with an affordability crisis.
鈥淚t would hurt,鈥 said Sheila Davis, who lives in 狐狸视频鈥 Fountain Park neighborhood. 鈥淓verything 鈥 I mean everything 鈥 is going up. ... We cannot ignore the financial issues affecting us.鈥
Revenue from the rate increases will fund four years of improvements that MSD is required to make, based on a 2012 legal agreement that seeks to reduce sewage overflows and discharges into local waterways during storms. The utility will ultimately devote $7.2 billion to the cause, spread over multiple decades.
Voters will have two options to cover this round of funding, similar to the choice people face about taking out a loan for a major purchase, like a house. On one hand, if they approve bond financing, MSD customers will make smaller payments over time that also include interest 鈥 pushing bills from a monthly average of about $61 to $75 over the four-year span. Or, if bond financing is rejected, upfront costs of MSD鈥檚 spending will be far steeper 鈥 with typical monthly bills skyrocketing as high as $104 in 2026, before settling around $85 per month.
Some critics said the options do not give enough concessions to customers.
鈥淭here will be no wins in the consumer column,鈥 said John Coffman, a lawyer focused on utility issues for the Consumers Council of Missouri. 鈥淯sually there is some middle ground that is found.鈥
New rates will not go into effect until 2025.
Throughout recent weeks the recommended rate proposal faced vocal opposition. Some critics said a smaller rate hike option of about 24% would only trim the amount of cash kept on hand by MSD, and would not disrupt any necessary sewer upgrades that are planned.
That push has been bolstered by newly introduced legislation in both 狐狸视频 and 狐狸视频 County that also aims to dial back the size of impending rate increases.
The upcoming funding cycle is shaping up to be far more expensive than originally anticipated a few years ago, said Brian Hoelscher, MSD鈥檚 executive director and CEO.
鈥淚nflation really zapped us in the last few years,鈥 he said, after Thursday鈥檚 meeting. 鈥淭here鈥檚 this readjustment.鈥
Looking forward, Hoelscher said he expects it to be a 鈥渙ne-time adjustment鈥 and that customers can be presented with more palatable options for rate hikes in the future. And he was hopeful that the Environmental Protection Agency could grant an extension for MSD鈥檚 window of upgrades, to improve affordability.
Hoelscher added that MSD has a goal to expand customer assistance by the time new rates take effect, as its rate commission recommended.
Thursday鈥檚 MSD meeting also helped next spring鈥檚 ballot take shape in other ways. For instance, voters will also decide on the proposed introduction of new charges that would help address local flooding problems, through 鈥渟tormwater solutions鈥 that exist outside the utility鈥檚 current scope of authority and funding.
That proposal would charge an extra $2 a month to residential customers, and bill commercial customers $1.05 for every 1,000 square feet of impervious surfaces, such as parking lots, that fuel runoff.