Article Week of March 5th, 2007
There was no shortage of action last week at the Illinois House. Several major issues were addressed. First, the House met Tuesday in a rare Committee of The Whole to investigate the recent huge increases in electric rates which are being experienced by AMEREN customers. The proceedings started at 1:00 PM and did not end until around 2:30 AM. For hours, Representatives questioned individuals from the Commerce Commission, the Attorney General’s Office as well as both AMEREN and COMED. Horrifying stories were told about the real life effects and consequences of these increases. Elderly people are choosing between food, medicine and electric service, businesses are closing because they cannot pay electric bills resulting in job loss as many are seeing increases of two to three hundred percent in their bills.
Of course, if you question the Commerce Commission members, they did nothing wrong, and as inconceivable as it might seem, they actually defended the “reverse auction” process that set these rates. When questioned, President and CEO of AMEREN Illinois Utilities, Scott Cisel, actually attempted to defend these rate increases. Then he presented an “Eight Point Plan” that he says provides as much relief as the multi-billion dollar utility giant can possibly muster.
Here are some of the highlights of that plan:
- Providing a one-time bill credit for large residential users that would pay about $40 on increased bills of around $195 and reduce bills of around $365 by about $170. If you were an extremely heavy electric user (and had been promised discounts for going “all-electric”) you would get around a $300 credit if your bill reached $540.
- For next heating season, AMEREN proposes a 25% reduction for “heavy electric users” (this usually means all-electric).
- They will expand the budget billing program.
- Invest $15 million in residential bill paying assistance programs, promote residential real time pricing, encourage municipal aggregation (help cities to offer real choice to citizens) and promote what they call “real time” pricing.
- Finally, they will eliminate all interest charges on the customer elect plan (this is the plan that allows a three year rate increase phase in), and they will delay disconnecting residential customers for non-pay until April 1st.
While there are some concessions in this plan, there is not nearly enough to satisfy me. First, I really do not know whether or not to believe AMEREN when they claim that this is the “best they can do”. Last fall, when I was attempting to support their position that some type of rate increase was necessary, they stated that they would be forced to file bankruptcy if they could not charge interest for those choosing the three year rate increase phase offered through the Customer Elect plan. Why can they do it now? Plus a one-time bill credit is NOT going to solve the problem when huge increases are experienced in the future.
I think it is great that they are going to give a 25% reduction next heating season for all-electric homes (heavy users). However, when people were talked into all-electric homes, they were provided deep discounts and we must consider if 25% just for the heating season is enough of an offer to this group. At first blush, I don’t think so.
It is nice of AMEREN to hold off disconnecting residential customers for non-pay until April 1st. I cannot imagine that they were going to in the first place after these types of increases. The extra money for certain bill paying assistance plans might be nice too, but why did they wait until now and is this also the best they can do? I and many others at the Statehouse just do not know when to trust them. That is a dangerous position for them in a town like Springfield.
I can promise you that this will continue to be my number one concern in the coming weeks. So far, both Speaker Madigan and Senate President Jones have not agreed on a solution. The Speaker still wants a long term rate freeze for both AMEREN and COMED. Senate President Jones will not hear of a rate freeze for COMED. I have given up on the Governor showing any leadership on this issue. In the coming days, downstate legislators will form a common bond on this issue which will force action. I will be very actively involved in that.
Of course, the electric rate issue is not the only thing that is happening. Last week HB138, the Embryonic Stem Cell Research and Cloning Act passed by a vote of 67-46. I discussed this bill in detail last week. I voted NO on the measure.
Next week, we might vote on a bill (HB317) that would weaken the recent parental notification decision made by the Illinois Supreme Court. The Court upheld a 1995 Illinois law that requires parental notification for a child under 18 to get an abortion. This bill seeks to expand the notification to a group outside the parents and allow for abortions without parental consent in other instances. Check the entire bill out at www.ilga.gov
The electric rate crisis is taking up a lot of time and energy in Springfield. There are other major issues that will soon take center stage. The Governor’s Budget Address is March 7th. He is expected to unveil a plan for covering the 1.4 million Illinois residents that do not have health insurance coverage. The plan would be phased in by 2010 (starting in 2008). The estimated cost is $2 billion when fully implemented. The "Illinois Covered" plan, would allow the 1.4 million uninsured adults in Illinois to enroll in government health services, get help paying for private coverage or buy insurance under a new program the state would require insurers to join. A payroll tax of about 3% would be charged to those employees not offering a health plan to their workers. We need to solve the problem of the uninsured in Illinois and I will be listening carefully to this proposal. It could be a starting point.
The Governor is also expected to pitch a new gross receipts tax in this budget. Business groups and others are lining up to kill that plan. Most believe it will cost Illinois jobs and could bring in as much as $10 billion to “slop the trough” of Illinois spending of taxpayers money. More next week.
Let me know what you think about any of these issues or any issue of importance to you. E-mail me (reddyunit1@aol.com); write to me at Box 125, Hutsonville, IL 62433 or call us at 618-563-4128. You can also keep up with important issues at my web site: www.peopleforeddy.com