Friday, February 28, 2014

Utility Rate Hike To Bankroll Clean Air Clears Committee

Posted By on February 28, 2014, 5:10 PM

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A bill that would raise gas and utility bills by a dollar and push the money into an interlocal agency stacked with representatives from utility companies and the oil and gas industry cleared its first hurdle in the legislature Friday.---

The bill could potentially yield tens of millions of dollars per year, the majority of which would flow to this interlocal agency that would disperse it to clean air projects, though it's unclear how stringent any spending guidelines would be.

Although many members of the public and legislators took a favorable position on the bill, known as House Bill 243, some expressed concern about the lack of a clean-air advocacy group on the interlocal board, while others said the utility fee hike amounts to nothing more than a new tax.

“What you're really doing is setting up a huge bureaucracy. … A regulatory nightmare” said Claire Geddes, an ardent opponent of the Utah Transit Authority, who said she fears the money will become that agency's “slush fund.” “I have a great concern about [giving] $20 million of our utility money over to an entity where I don't know how it's going to go,” she said.

The majority of the funding, 70 percent, would be disbursed by the interlocal agency. Twenty percent would go to the state's Air Quality Board, while 10 percent would go to public/private partnerships aimed at cleaning the air.

Sen. Stuart Adams, R-Layton, the bill's sponsor, noted that the utility increase allows rate payers to opt out, making it more of a “donation” to clean air programs than a tax.

But critics assailed Adams for levying a tax. If it were truly a donation, opponents said utility payers could instead opt in to the program.

“You're going to scoop in hundreds of thousands of people just because they don't pay close enough attention to their bills,” warned Michele Beck, director of the state's Office of Consumer Services.

Beck also had words of caution for the Senate Natural Resources, Agriculture and Environment Committee, saying the bill provides very little guidance for what it must be used for.

“That makes this kind of funding very different from the kinds of money normally collected in utility rates, which is heavily regulated and dealt with a great deal of oversight,” she said.

The bill was supported by utilities like Questar Gas and Rocky Mountain Power, in addition to energy companies.

An example of what the funding could be used for, Adams said, is converting diesel burning school buses to natural gas. It could also be used to erect natural gas filling stations around the state.

The makeup of the board includes a member from the senate and house, a person from the Utah Association of Counties, a person from the Utah League of Cities and Towns, an employee of a school district, a person from public transit, and the following people appointed by the governor: an employee of a gas corporation; a person from a municipal electric company and a representative from the Utah Petroleum Marketers and Retailers Association.

Time will tell what a board weighted so heavy with industry will do to address air quality concerns along the Wasatch Front.

What won't happen, Adams said, is for a person from an air-quality group to make it onto the board. Before voting on the bill, Sen. Jim Dabakis, D-Salt Lake City, asked Adams if he'd pledge to work with him to make such an appointment that happen. But Adams said the board was already getting big with the addition of a representative from an electric utility, and he would not.

One thing is certain. If the bill does pass, a bunch of money, a sum Adams estimated would range between $1 million and $18 million annually, will be held by this interlocal agency. And for some air quality advocates, that's a good thing.

Rep. Patrice Arent, D-Salt Lake City, who sat in on the hearing because an air-quality bill of her own went before the senate committee, said after the meeting that she supports Adams' bill. “I think his intentions are good,” Arent said.

To read SB 243, click here. To contact Sen. Adams, click here. To find your representative using your address, click here. For more legislative coverage visit CityWeekly.net and follow @ColbyFrazierLP and @EricSPeterson on Twitter.

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