Prior to March 2008, MSD funded stormwater services with a combination of a monthly $0.24 charge, a variety of property taxes and a subsidy from wastewater user charges. This method of funding was not only insufficient to meet the stormwater needs of the community, but it also did not treat all MSD customers fairly.
MSD decided to ask the independent Rate Commission to consider a proposal to change the method used for funding stormwater services. This new method would be based upon the amount of impervious area on each individual customer’s property. Impervious area does not absorb rain water and is covered by features such as concrete, blacktop, etc. After a lengthy, public process, the Rate Commission approved this new funding method.
Starting in March 2008, each MSD customer was charged $0.12 for every 100 square feet of impervious area on their property. That charge rose to $0.14 for every 100 square feet of impervious area in January 2009. MSD planned to gradually increase this rate until it reached $0.29 in 2014.
However, in July 2010, a Lincoln County judge ruled against MSD in the case of Zweig, et. Al. vs. MSD. The judgment found that MSD’s impervious stormwater charge was invalid under the Missouri State Constitution. Specifically, the judge ruled that the charge was not in compliance with the Hancock Amendment, which voters approved in 1980.
Because of this ruling, MSD has reverted back to its previous stormwater funding structure. Effective August 1, the impervious stormwater charge is suspended. The system of a monthly $0.24 stormwater charge will again fund stormwater services. For those customers with multi-unit dwellings, the monthly stormwater charge will be $0.18 per unit.
In FY 2011 (July 1, 2010 to June 30, 2011), MSD expected to raise $48.3 million in stormwater funding through the impervious rate. The elimination of this rate means MSD faces an approximate cut of $20 million in stormwater services for FY 2011. In future fiscal years, the shortfall will reach over $50 million.
In light of the court ruling and the change in stormwater funding, the type and scope of stormwater services provided by MSD will change and most likely be reduced. This is currently being evaluated. Whatever the outcome of this evaluation, the construction of new stormwater projects and services will be limited, if not impossible, due to a lack of funding.