Pursuant to Section 644.145, RSMo, when issuing permits under this chapter that incorporate a new requirement for discharges from publicly owned combined or separate sanitary or storm sewer systems or publicly owned treatment works, or when enforcing provisions of this chapter or the Federal Water Pollution Control Act, 33 U.S.C. 1251 et seq., pertaining to any portion of a publicly owned combined or separate sanitary or storm sewer system or [publicly owned] treatment works, the Department of Natural Resources shall make a “finding of affordability” on the costs to be incurred and the impact of any rate changes on ratepayers upon which to base such permits and decisions, to the extent allowable under this chapter and the Federal Water Pollution Control Act.
Tools Used by the Department to Determine Affordability
Cost Analysis for Compliance (CAFCom)
The Cost Analysis for Compliance (CAFCom) was developed by the department to meet the requirements of 644.145 RSMo. The CAFCom estimates the potential cost for publicly-owned treatment works to comply with new requirements in a permit. The results of the CAFCom are used to determine an adequate compliance schedule for the permit that may mitigate the financial burden of new permit requirements. The department must consider eight criteria presented in subsection 644.145 RSMo to evaluate the cost associated with new permit requirements.
The eight criteria are as follows:
(1) A community's financial capability and ability to raise or secure necessary funding;
(2) Affordability of pollution control options for the individuals or households at or below the median household income level of the community;
(3) An evaluation of the overall costs and environmental benefits of the control technologies;
(4) Inclusion of ongoing costs of operating and maintaining the existing wastewater collection and treatment system, including payments on outstanding debts for wastewater collection and treatment systems when calculating projected rates;
(5) An inclusion of ways to reduce economic impacts on distressed populations in the community, including but not limited to low- and fixed-income populations. This requirement includes but is not limited to: (a) Allowing adequate time in implementation schedules to mitigate potential adverse impacts on distressed populations resulting from the costs of the improvements and taking into consideration local community economic considerations; and (b) Allowing for reasonable accommodations for regulated entities when inflexible standards and fines would impose a disproportionate financial hardship in light of the environmental benefits to be gained;
(6) An assessment of other community investments and operating costs relating to environmental improvements and public health protection;
(7) An assessment of factors set forth in the United States Environmental Protection Agency's guidance, including but not limited to the "Combined Sewer Overflow Guidance for Financial Capability Assessment and Schedule Development" that may ease the cost burdens of implementing wet weather control plans, including but not limited to small system considerations, the attainability of water quality standards, and the development of wet weather standards; and
(8) An assessment of any other relevant local community economic condition.
For further information on CAFComs, please contact the Department of Natural Resources, Water Protection Program, Operating Permits Section at 800-361-4827 or 573-751-6825.
The department uses software to estimate the cost for reconstruction of a treatment plant titled CapdetWorks. CapdetWorks is a preliminary design and costing software program from Hydromantis for wastewater treatment plants that uses national indices, such as the Marshall and Swift Index and Engineering News Records Cost Index for pricing in development of capital, operating, maintenance, material, and energy costs for each treatment technology. As the program works from national indices and each community is unique in its budget commitments and treatment design, the estimated costs are expected to be higher than actual costs.
The design parameters for Hydromantis are for larger facilities with flows greater than most Missouri facilities are designed for. CapdetWorks provides a cost estimate based on national averages, not the site-specific conditions of a community. Cost estimates are verified through the tracking of actual costs from submitted facility plans, engineering reports, bid documents, and loan closures. This verification process allows the engineering section to track costs to see if the assumptions from CapdetWorks are appropriate for the State of Missouri. The department uses CapdetWorks to estimate costs of upgrading to meet new permit requirements in CAFComs.For further information on CapdetWorks, please contact the Department of Natural Resources, Water Protection Program, Engineering Section at 573-751-6621.
Affordability Prescreening Tool
The Affordability Prescreening Tool is a socioeconomic database primarily designed to assist department staff in conducting affordability findings. The data are compiled from the United States Census Bureau and United States Bureau of Labor Statistics. The indicators include population, median household income, per capita income, median age, unemployment rate, poverty level, food stamps reception, and consumer price indices. Data are provided for various administrative units including the United States, the State of Missouri, all 114 counties, and all 1,039 communities in Missouri for the years 1990, 2000, 2010, and annually beginning in 2011.
Rural Missouri Sustainability Assessment Tool (MOSAT)
The State of Missouri contracted with Wichita State University to complete the Rural Missouri Sustainability Assessment Tool (MoSAT), which is an assessment tool that forecasts rural Missouri community populations and future sustainability. The tool uses a statistical modeling analysis of factors associated with each rural Missouri community that predicts future sustainability changes in each community. A stepwise regression model that was applied yielded nineteen individual sustainability factors with statistically significant coefficients. These nineteen sustainability factors are valid predictors of rural population change in Missouri and were incorporated into the assessment tool along with overall population changes from 2000 to 2010.
The sustainability factors are:
1. Change in the population group aged 18 to 29 years from 2000 to 2010.
2. Change in the population group aged 50 and over from 2000 to 2010.
3. Change in the number of persons employed in construction from 2000 to 2010.
4. Change in the number of public assistance income recipients from 2000 to 2010.
5. Change in the number of bachelor’s or higher degree recipients from 2000 to 2010.
6. Change in the number of persons employed in entertainment, recreation and food service from 2000 to 2010.
7. Change in the number of retirement income recipients from 2000 to 2010.
8. Change in the number of Social Security income recipients from 2000 to 2010.
9. Change in the number of persons employed in professional services, scientific and management from 2000 to 2010.
10. Change in the number of high school graduates from 2000 to 2010.
11. Change in the number of persons employed in manufacturing from 2000 to 2010.
12. Change in the number of persons employed in finance, insurance and real estate from 2000 to 2010.
13. Change in the number of persons employed in wholesale trade from 2000 to 2010.
14. Change in the number of persons employed in information technologies from 2000 to 2010.
15. Change in population density (per square mile) from 2000 to 2010.
16. Natural Amenity Scale Rank (1=Low, 7=High).
17. Change in the number of rural immigrants from 2000 to 2010.
18. Change in the number of persons migrating into the town or village from 2006 to 2010.
19. Change in the number of persons employed in retail trade from 2000 to 2010.
The model establishes a hierarchy of the predictive factors which allows it to place a weighted value on each factor. A total of 745 rural towns and villages in Missouri received a weighted value for each of the predicting factors. The weighted values for each rural community within Missouri were then added together to determine an overall decision score. The overall decision scores were then divided into five categories and each town was assigned to a different categorical group based on the overall decision score.
1-2 Likely to see sustainability challenges though time
3 Sustainable over time but a small change in the social or economic conditions could easily decrease or increase sustainability challenges
4-5 Shows progress and growth and is likely sustainable over time
The Financial Questionnaire is a required attachment to the permit renewal application for publicly-owned treatment works. Along with the Community Supplemental Survey, it collects information on the sustainability and financial capability of the community. Examples of information requested are the “current monthly residential sewer rates” and “property tax collection rate in the municipality”.
For assistance in completing the Financial Questionnaire, please contact the Department of Natural Resources, Water Protection Program, Operating Permits Section at 800-361-4827 or 573-751-6825.
Annual Affordability Reports
Annual Reports on Affordability Findings of Compliance to the Missouri Clean Water Law:
Pursuant to Section 644.145.9, RSMo, the department shall file an annual report by the beginning of the fiscal year with the governor, the speaker of the house of representatives, the president pro tempore of the senate, and the chairs of the committees in both houses having primary jurisdiction over natural resource issues showing at least the following information on the findings of affordability completed in the previous calendar year:
- The total number of findings of affordability issued by the department, those categorized as affordable, those categorized as not meeting the definition of affordable, and those implemented as a federal mandate regardless of affordability;
- The average increase in sewer rates both in dollars and percentage for all findings found to be affordable;
- The average increase in sewer rates as a percentage of median house income in the communities for those findings determined to be affordable and a separate calculation of average increases in sewer rates for those found not to meet the definition of affordable;
- A list of all the permit holders receiving findings, and for each permittee the following data taken from the finding of affordability shall be listed:
- Current and projected monthly residential sewer rates in dollars;
- Projected monthly residential sewer rates as a percentage of median household income;
- Percentage of households at or below the state poverty rate.