HB 1610 -- UTILITIES

SPONSOR:  Schoeller

COMMITTEE ACTION:  Voted "do pass" by the Committee on Utilities
by a vote of 11 to 1.

Currently, rate adjustments in the purchase price of natural gas
that are approved by the Missouri Public Service Commission are
exempt from certain provisions relating to business license
taxation.  This bill adds a qualifying provision that any
purchased gas adjustment rate must include the gas cost portion
of net write-offs incurred by the gas company in providing
service to customers.  Any net write-offs may only be recovered
once through purchased gas adjustment rates, and an annual
true-up of the net write-offs is required.  The commission must
annually review gas companies' debt collection efforts to ensure
that they are prudently pursuing collection of the amounts owed
by customers.

The bill also specifies that any attempt to pay, or an actual
payment of, a utility bill will not adversely affect the
assistance that an otherwise eligible household would receive
through the Utilicare Program and removes the requirement that a
household must have its service disconnected for failure to pay
its bill before being eligible for assistance.

Electric or gas companies must allow customers who incur an
arrearage during the cold weather rule period to retain service
by paying one-third of the arrearage, plus the current bill, in
each of the three months following the cold weather rule period.

FISCAL NOTE:  Estimated Cost on General Revenue Fund of Up to
$11,880,667 in FY 2011, Up to $14,256,800 in FY 2012, and Up to
$14,256,800 in FY 2013.  No impact on Other State Funds in FY
2011, FY 2012, and FY 2013.

PROPONENTS:  Supporters say that the bill provides a fair method
for recovering bad debt costs incurred by gas companies.  It is
difficult to estimate bad debt losses and then adjust rates in
rate cases to allow recovery.  The bill will allow gas companies
to structure repayment plans more efficiently.

Testifying for the bill were Representative Schoeller; Missouri
Energy Development Association; Laclede Gas Company; Ameren UE;
Empire District Electric Company; and Missouri Gas Energy.

OPPONENTS:  Those who oppose the bill say that uncollectable
debts are not a "gas cost" for the purposes of the law or for
accounting purposes.  The bill will allow overrecovery of bad
debt costs, increase customer costs, and could discourage a gas
company's attempts at debt collection since those costs will be
recovered from consumers.

Testifying against the bill were Missouri Office of Public
Counsel; Missouri Retailers Association; AARP Missouri State
Office; Consumers Council of Missouri; and Missouri Association
for Social Welfare.

Missouri House of Representatives
95th General Assembly, 2nd Regular Session
Last Updated September 14, 2010 at 3:11 pm