MSD Unlikely To Get Requested Rate Increase For 2020

Dec 17, 2019

Metropolitan Sewer District customers will find out Thursday if they'll be paying higher rates next year.  

The Hamilton County Commissioners are likely to keep those rates unchanged even though MSD was seeking a 1% increase.  That increase would cost the average user about $6 extra next year.

"We support the county's stated intent to not raise sewer rates," said Marilyn Wahl, with the local chapter of the Sierra Club. "We would like to see the rate structure made fair and equitable and to see greater efficiency and effectiveness at the MSD."

MSD officials and the county monitoring team for the utility are only about $1 million apart on the agency's operating budget for 2020. MSD is proposing an operations and maintenance budget of $125 million. The county team is at $123.8 million. With debt service included, MSD's total operating budget for 2020 is about $221 million.

But the two sides are about $40 million apart on the agency's capital improvement plan (CIP). MSD is asking for $168 million, and the county team is recommending $129 million.

Cincinnati City Manager Patrick Duhaney sent a letter to county officials Tuesday on that issue. He said the county's recommended changes to the CIP with the city/MSD's recommendations and interfere with the MSD's ability to run the utility.

MSD Director Diana Christy also addressed the issue with the county commission.

"There are recommendations in the county modified CIP that conflict with MSD's recommendations," Christy said. "However, in good faith, we are continuing to cooperate with the county and provide additional information to support its modified budget in an effort to have a budget approved this week."

Many of the capital budget projects involve work to prevent sewers from overflowing into local stream and rivers during heavy rains. A federal court mandated those repairs.

County Commission President Denise Driehaus praised cooperation efforts between MSD officials and members of the county's monitoring team.

"We always are going to get a better product if we have that kind of cooperation as often and as early as possible from either side," Driehaus said.

A 1968 agreement created the Metropolitan Sewer District. It gave Hamilton County the ability to approve the agency's budget and set rates. Cincinnati runs the day-to-day operations of the sewer district.  That relationship has been strained in recent years.

That 50-year agreement expired in 2018, but a federal judge has ruled that it must remain in place until there's a replacement proposal. And thus far such an arrangement has not been identified.