Greitens' first special session to mull Ameren electric rate for proposed steel mill

Supporters say regulation changes will create jobs; critics complain Ameren customers will pay more

The Missouri House Chambers sit empty awaiting lawmakers' return.
The Missouri House Chambers sit empty awaiting lawmakers' return.

Missouri lawmakers return to Jefferson City Monday afternoon, for a special legislative session Gov. Eric Greitens called last week.

"At the end of the 2017 legislative session, some career politicians in the Senate blocked efforts to bring a steel mill and other projects to the state of Missouri," the governor's news release from Thursday explained. "Those projects could create hundreds of jobs in southeast Missouri."

The steel mill is proposed for the former Noranda Aluminum smelting plant near New Madrid, along the Mississippi River in southeast Missouri's Bootheel region. When it closed, around 900 jobs were lost.

In his weekly column, Mike Kehoe, R-Jefferson City and the state Senate's floor leader, said: "My conversations with the governor's office affirm that this is time-sensitive legislation directly impacting whether or not the steel mill locates to Missouri.

"The prospect of five-hundred direct jobs is worth the Legislature's attention.

"Add to this the thousands of indirect jobs associated with the steel mill, and this becomes very worthy of a special session."

State Rep. Jay Barnes, R-Jefferson City, told members of the Cole County Republican Club last week lawmakers didn't have a lot of time to debate it, because the proposal sponsored by Rep. Don Rone, R-Portageville, was added to a bill as an amendment during the General Assembly's last days.

"It got almost unanimous approval in the House," he said, after Rone gave an impassioned speech about why the steel plant is needed and how it would help people find jobs in a high-unemployment region.

"There are some drafting problems in the bill that, I hope, can get fixed," Barnes explained.

The bill has two parts, he added.

One would "incentivize this steel plant to come to Southeast Missouri," with a subsidized rate for electricity that all other Ameren Missouri customers would help pay for.

That has been a big issue in the past, especially when the now-closed Noranda plant had the lowest per-kilowatt rate of electricity of any Ameren customer - but wanted to buy power at an even cheaper rate.

Barnes said it's a fair discussion.

"There's an argument to be made that there are certain industrial-rate users whose usage is so high that, even if they get a below-the-cost-of service rate," he said, "it is beneficial to ratepayers because Ameren has the assurance of knowing that it won't have wasted power.

"There's always going to be a customer available to get its excess energy."

State Sen. Doug Libla, R-Poplar Bluff, also represents the Bootheel area.

He said in a news release after Greitens announced the special session: "I am, and always have been, in favor of a 'special economic development electric rate' for reopening of the smelter and/or a new steel mill in New Madrid."

But, he said, the proposal lawmakers didn't pass in the regular session had some flaws.

"If the Rone amendment," he said, "only had language that actually helped New Madrid, I would have been an enthusiastic supporter."

But he said the proposal also includes language providing "sweeping deterioration of PSC (Public Service Commission) scrutiny."

And that, Barnes told the Cole County GOP meeting last week, is in the second part of the proposal.

"It says that the PSC may utilize rate-adjustment mechanisms not otherwise authorized by statute," he explained, "which means the PSC, as it's drafted right now, can do darn near anything they want, to give Ameren the authority to raise rates."

The Consumers Council of Missouri opposes that idea.

"The main goal appears to be taxing utility ratepayers to subsidize big corporations and increase profits for monopoly utility companies. At OUR expense!" the Council said in a news release.

State Sen. Rob Schaaf, R-St. Joseph, added in a post on his Facebook page: "(The governor) is claiming that this is to bring jobs to Missouri, but this corporate welfare/cronyism has the appearance of impropriety, and there is no way for the people of Missouri to know there is no corruption involved."

Schaaf - as he did several times during the past session, including the Senate's discussion of the steel mill proposal - noted Greitens received $178,000 in campaign contributions from Ameren Missouri, Empire Electric and Kansas City Power and Light (KCP&L).

Libla said, in his news release: "This is my fifth year in the Missouri Senate opposing unfair electric utility legislation that would severely diminish the commission's authority in defending all electric ratepayers. I take seriously my responsibility to the citizens of my district, and everyone across this state, to safeguard them from being overcharged by utility companies."

Rep. Rocky Miller, R-Lake Ozark, told the News Tribune he supports the plan.

"I believe that a vast majority of representatives and senators are for the economic development rates," he said, "and adding flexibility to the PSC ability to provide modern rates that will moderate the increases consumers have been facing the last decade."

Rep. David Wood, R-Versailles, added: "I believe this is necessary to bring the jobs into the Southeast but I am hopeful that we can address the rate concerns so that the legislation can make it through the Senate."

The House estimates the special session will cost between $50,000 and $100,000 a week - depending on how often the full chamber needs to meet for debates and votes.

The Senate estimates its part of the special session will cost taxpayers $28,000 a week.

Wood said: "If the reason for the special session is economic development then the revenues generated will work to offset the expense."