ST. LOUIS — The Missouri Supreme Court handed down an opinion March 15 dismissing an argument from Missouri American Water Co. over an infrastructure fee that the company had been charging St. Louis County residents based on its population.
Now it's up to the Missouri Legislature to decide how similar concerns are handled in the future.
A state statute allows companies to apply an infrastructure surcharge to certain jurisdictions with a population of more than 1 million residents. The Missouri Public Service Commission agreed to allow Missouri American Water to apply a $3 a month rate fee, called an infrastructure system reinvestment surcharge (ISRS), to customers in St. Louis County.
The ISRS fee was appealed in March 2016 by the Office of Public Counsel because the 2010 U.S. census recorded the population of St. Louis County at 998,954 residents. The Missouri Court of Appeals ruled that the fee could not be charged. Missouri American Water had stopped applying the charge in February 2016.
In its opinion, the Supreme Court ruled the argument about the fee was moot because the company is now recouping ISRS-related costs using new rates granted from the Public Service Commission. The court left it to the Legislature to clarify population-based legislation.
“The court ruling didn’t really clarify population-based legislation, other than to say it’s something the state legislature needs to address, and cited many other laws besides our own that are impacted by the uncertainty around such legislation,” Brian Russell, external affairs manager of Missouri American Water, told the St. Louis Record.
Missouri Senate Bill 124 is currently in the Legislature and would provide that a change in population would not remove a city, county or political subdivision from operation of a law. Senate Bill 232, meanwhile, would add a provision relating to population changes in St. Louis County for purposes of water corporations collecting an infrastructure surcharge. This would allow Missouri American Water to apply its surcharge in St Louis County.
“We have bills in the state Legislature that seek to clarify population-based legislation by stating that once such laws go into effect, a body cannot fall out based on population changes, and we will continue to work to get those passed,” Russell said.
The Supreme Court said in its opinion that if the Public Counsel’s position were adopted, it would cause a “tectonic shift” in Missouri law based on statutes linked to population.
“Indeed, for nearly 200 statutes that have a narrow population category with a floor and a ceiling, nullification would be inevitable,” the court ruling said. “If this Court were to adopt the Public Counsel’s position, scores of statutes would be rendered ineffective.”
Attorney Erwin Switzer, representing Missouri American Water, told the St. Louis Record that the company agrees with the Supreme Court’s opinion.
“Should the appellant’s position ever be adopted as law, it would have widespread effects across Missouri," Switzer said.