KANSAS | MISSOURI

Missouri Cities, PWSDs, and Public Sewer Districts: Rates, Fees, and Charges

An Overview of Legal and Regulatory Guidelines

Introduction

• Purpose of the presentation:
• Review applicable legal guidelines for rates, fees, and charges.
• Discuss best practices for setting equitable, sustainable rates.

Legal Framework in Missouri

Key Statutes:

• Missouri Revised Statutes (RSMo):
• Chapter 67 (Political Subdivisions, Miscellaneous Powers)
• Chapter 71 (Provisions Relative to All Cities and Towns)Also Ch. 77. 78 & 79
• Chapter 91 (Municipally Owned Utilities)
• Chapter 204 (Sewer Districts - .250 Common/.600 Reorganized)
• Chapter 249 (County Sewer District)
• Chapter 250 (Sewerage Systems and Waterworks) (City or Sewer District)
• Chapter 247 (Public Water Supply Districts)

Chapter 67 (Political Subdivisions, Miscellaneous Powers)

Key Statutes:

• several statutes address rates, fees, and deposits:
• 67.042   License or fee adjustment not deemed "increase", as used in Missouri ...
• 67.080   Expenditures prohibited unless authorized under this chapter.
• 67.100   Applicability of law – All political Subdivisions
• 67.319   Water service lines, repair programs, municipalities and certain districts ...

Chapters 71 Provisions Relative to All Cities and Towns & 91 (Municipally Owned Utilities)

Key Statutes:

• Missouri Revised Statutes (RSMo):
• several statutes address rates, fees, and deposits:
• 71.715   Sewerage service charges may be imposed, how collected — use of proceeds.
• 91.010   Cities empowered to erect, maintain gas and power plants — waterworks — ice ...

Chapter 204 (Sewer Districts - .250 Common/.600 Reorganized)

Key Statutes:

• several statutes address rates, fees, and deposits:
• 204.322   Board of trustees, rules and regulations.
• 204.330   Board of trustees, duties — agreements as to manner of discharge — ...Administrative fines
• 204.400   District to charge and collect sufficient revenues.
• 204.440   Charges to be at rate recommended by advisory board, exception.
• 204.455   Delinquent fees or charges by sewer district to bear interest from due date ...

Chapter 204 (Sewer Districts - .250 Common/.600 Reorganized)

Key Statutes (continued):

• several statutes address rates, fees, and deposits:
• 204.616   Powers of the board — industrial user defined. 204.330   Board of trustees, duties — agreements as to manner of discharge — ...Administrative fines
• 204.624   Costs, how met.
• 204.628   Fees or charges levied, when due.
• 204.640   Courts and officers of political subdivisions to cooperate with district.

Chapter 249 Sewer Districts in Certain Counties

Key Statutes:

• Missouri Revised Statutes (RSMo):
• several statutes address rates, fees, and deposits:
• 250.040   Cost of system, how financed by cities.
• 250.050   Cost of system, how financed by sewer district.
• 250.140   Services deemed furnished both to occupant and owner of premises
• 250.150   Revenues to be kept separate — order of payments — records — transfers.

​

Chapter 250 (Sewerage Systems and Waterworks)

Key Statutes:

• Missouri Revised Statutes (RSMo):
• several statutes address rates, fees, and deposits (Continued):
• 250.170   Action by bondholder against city or district for neglect of duty.
• 250.190   Services outside corporate limits — rates.
• 250.233   Charges for sewer services — notice and public hearing required. (8/28/2010).
• 250.234   Delinquent payment for sewer service, interest due, when — lien against ... (8/28/1983)

Chapter 247 (Public Water Supply Districts)

Key Statutes:

• several statutes address rates, fees, and deposits (Continued):
• 247.050   Powers of public water supply districts.
• 247.110   Board to fix rates and charges — delinquencies to create lien, when — procedure.
• 247.228   Public water supply districts and cities owning a waterworks to be notified ...

​

Regulatory oversight Missouri Department of Natural Resources

Key Statutes:

• several statutes address rates, fees, and deposits (Continued):
• Sections 640.100 to 640.140 (State Safe Drinking Water Act) and the federal Safe Drinking Water Act as amended. 640.141 - .150 Water Safety and Security Act.
• 640.100.5. (1) For the purpose of complying with federal requirements for maintaining the primacy of state enforcement of the federal Safe Drinking Water Act, the department is hereby directed to request appropriations from the general revenue fund and all other appropriate sources to fund the activities of the public drinking water program and in addition to the fees authorized pursuant to subsection 3 of this section, an annual fee for each customer service connection with a public water system is hereby authorized to be imposed upon all customers of public water systems in this state. Each customer of a public water system shall pay an annual fee for each customer service connection.
• 10 CSR 60-16.010 Levy and Collection of the Missouri Primacy Fee

Regulatory oversight Missouri Department of Natural Resources

Key Statutes:

• several statutes address rates, fees, and deposits (Continued):
• 640.102   Definitions. 640.100.5.
• (6) "Public water system", a system for the provision to the public of water for human consumption through pipes or other constructed conveyances, if such system has at least fifteen service connections or regularly serves an average of at least twenty-five individuals daily at least sixty days per calendar year. Such system includes any collection, treatment, storage or distribution facilities used in connection with such system.

Types of Rates and Fees Charged

• Water Supply Districts (PWSDs):
• Base Rates: Flat fee for connection to water services.
• Consumption Rates: Charges based on usage (tiered rates).
• Connection Fees: One-time fee for new customers.
• Infrastructure Development Fees: For new developments.
• Public Sewer Districts:
• Base Rates: Monthly service fee for sewer services.
• Volume-Based Rates: Charges based on water usage (linked to water bills).
• Permit/Inspection Fees: For new sewer connections or modifications.

Rate Structures for Cities

• Flat Rate:
• Same charge regardless of usage.
• Simple but can be inequitable for low-consumption users.
• Tiered Rates:
• Increases with higher usage.
• Encourages conservation, more equitable.
• Volumetric Rates:
• Based directly on water/sewer consumption.
• Fairer for different usage levels.

Factors Impacting Rate Setting

• Cost of Service:
• Operating expenses (staff, power, chemicals).
• Maintenance of infrastructure (pipes, treatment plants).
• Capital Improvement Projects (CIP):
• New construction, repairs, and upgrades.
• Debt Service:
• Funding past or future borrowing for improvements.
• Regulatory Compliance:
• Costs of adhering to EPA and DNR regulations.
• Conservation Incentives:
• Encouraging water saving through rate structure.

Best Practices for Setting Rates

• Cost-Based Rates:
• Recover all costs related to water/sewer provision.
• Equitable Rates:
• Fairly distribute the costs among users.
• Financial Stability:
• Ensure rates are sustainable over time.
• Public Participation:
• Engage with the public in setting rates through hearings or surveys.

Fees and Charges Beyond Basic Rates

• Late Fees:
• Penalty for overdue bills.
• Reconnection Fees:
• Charged when reconnecting service after disconnection.
• Administrative Fees:
• For tasks like paperwork or special meter readings.
• Impact Fees:
• Applied to new developments that impact water/sewer infrastructure.

Challenges and Controversies

• Affordability:
• Balancing fair rates with the need for affordable services.
• Aging Infrastructure:
• High cost of maintaining/replacing old systems.
• Environmental Regulations:
• Increasing costs due to compliance with stricter standards.

Conclusion

• Recap:
• Legal foundations in Missouri statutes.
• Variety of rate structures and fees.
• Best practices ensure fairness, sustainability, and compliance.

Doug Silvius: ddsilvius@martinpringle.com

doug@silvius.org

• 816-268-8962 Direct Dial Office
• 816-516-7816 Cell
• Questions?