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Bad Debt Surcharge creates opposition to gas ISRS


JEFFERSON, Mo. – As the vote on Gas ISRS nears in the House, opposition appears to be growing because of the Bad Debt Surcharge.

“This bill may be forced through the House, but honestly I cannot support the bill as long as Bad Debt Surcharge is in it,” Rep. Jeff Grisamore, R-Lee’s Summit, said.

Supporters of the bill stress the fact that Missouri has a gas ISRS policy and this would be increasing the amount of ISRS financing that can be immediately passed to consumers through this bill.

However, the Bad Debt Surcharge would be a new concept in the gas industry.

“I am philosophically against ISRS funding models,” Assistant Majority Floor Leader Mike Cierpiot, R-Blue Springs, said. “If the PSC process is broken then lets fix it and not to the end run carve outs.”

Others in the caucus seem to be willing to follow leadership, but as more discussion is had about the Bad Debt Surchrage, the more opposition in the majority caucus grows.

“I just cannot support the Bad Debt Surchage,” Rep. Craig Redmon, R-Canton. “Collections are a part of every companies cost of doing business.”

The issue seems to be dividing the minority caucus, too.

While there are rumors that possibly a majority of the minority caucus will oppose the issue Minority Leader Jacob Hummel, D-St. Louis City, said he intends to support it.

“Clearly this is designed to improve our infrastructure and will be a job creator,” he said, adding that several other minority members will likely vote against the bill.

The Bad Debt Surcharge allows gas corporations to recover, from customers, 90 percent of the increase in net write-offs. For decreases in net write-offs, the gas corporations must return 90 percent of the decrease. Those recoveries or returns shall occur over a period that doesn’t exceed five years.

The measure seems to have ample support to pass without the Bad Debt surcharge. However, as Sen. Brad Lager, R-Savannah, told The Missouri Times earlier this week: if amended, the bill faces an uncertain future in the Senate.

“Gas ISRS passed out of the Senate before opponents of electric ISRS decided they were going to kill everything,” Lager said. “It was literally a function of timing.”

To contact Scott Faughn, email, or via Twitter at @scottfaughn.