Poll: Oppose or Support Proposed Electric Utility Infrastructure Surcharge?

Most likely you’ve seen recent TV commercials talking about utility surcharges and regulations. These are sponsored by groups on opposite sides of Missouri Senate Bill 207 (link):

SCS/SB 207 – Currently, gas corporations may file a petition with the Public Service Commission for rate adjustments to recover costs incurred for infrastructure replacement projects. This act allows electrical corporations to follow a similar process to recover costs for infrastructure replacement projects. The types of costs that can be recovered include certain work on electric plants, certain capital projects undertaken to comply with environmental or safety regulations, and costs of facilities relocation due to public works projects.

This act details the process that an electric corporation and the Public Service Commission must follow in reviewing applications for infrastructure system replacement surcharges. If surcharges are approved by the Public Service Commission, this act requires electric corporations to submit to the Commission a reconciliation noting the differences between infrastructure system replacement revenues and appropriate pretax revenues. Additionally, this act modifies the amount of revenues that may be produced from an infrastructure system replacement from no less than one million dollars or half of 1% of the corporation’s base revenue and no more than 10% of the corporation’s base revenue. While the electric corporation is collecting an infrastructure system replacement surcharge, they may only adjust the rate two times every twelve months. If an electric corporation files a petition or change to an infrastructure system replacement surcharge, it shall not be considered an increase in the electric corporation’s base rate.

In other words:

The measure would let Missouri’s three investor-owned electric companies — Ameren Missouri, KCP&L and Empire District Electric — put the cost of replacing infrastructure on customer’s bills without first needing to get approval from the Public Service Commission. (St. Louis Business Journal)

Supportive viewpoint:

Under current law utility companies have to go through the Public Service Commission to increase rates to pay for infrastructure and other additional expenses. This process can take months. They said this bill fixes that regulatory lag and allows utility companies to invest faster while interest rates are low. Supporters said this will give the companies better credit ratings, which could make utilities cheaper in the long run and make infrastructure projects more attractive to investors. (KMOX)

Opposition viewpoint:

The Fair Energy Rate Action Fund, an opponent of the legislation, said the changes are not near enough to protect consumers. Executive Director Chris Roepe said the proposed expiration date is lengthy, the cap still would allow for significant costs and proving a case to get the refund would be difficult.

 “It’s still a really terrible bill for Missouri businesses and families,” Roepe said. (Southeast Missourian)

Who is the Fair Energy Rate Action Fund?

FERAF is a diverse coalition comprised by consumer protection groups. Members of FERAF include:

• AARP
• Missouri Association for Social Welfare
• Consumers Council of Missouri
• Missouri Association of Retailers
• Ford Motor Company
• Noranda Aluminum

The utilities have Missourians for a Balanced Energy Future with 19 co-chairs!

The poll this week seeks to find out how readers feel about this issue. The poll is on the right sidebar, mobile users need to switch to the desktop layout to vote in the poll.

— Steve Patterson

Thank You Stray Rescue

Stray Rescue Welcomed Animals From St. Louis’ Shelter on July 19, 2010. At the time the front of the new facility was unfinished raw space.

Since that first day when the dogs were transferred to the kennels in the new facility the front has been completed.

Thank you to Randy Grim, the staff, and volunteers behind Stray Rescue for the last 15 years!

— Steve Patterson

Clothing Retailer Uniqlo Coming To St. Louis? When, Not If

Japanese clothing retailer Uniqlo (pronounced YOU-nee-klo) has only six US stores right now but they plan to have 200 by 2020. Never heard of Uniqlo? I hadn’t either until Sunday when I saw a segment on CBS Sunday Morning’s report The ambitious clothing company Uniqlo aims high (video).

Uniqlo has 1,200 stores worldwide and is the 4th largest clothing retailer in the world. They want to be #1 by 2020, so that means a big push in the US.

Uniqlo, the Japanese basics brand, is starting aggressive growth plans at shopping malls that are expected to include 20 to 30 new stores a year over the next eight years.

[snip]

To hit the company’s stated target of $10 billion in sales in the United States by 2020, “we need to go where the customer is, and in the United States, malls are the premier location where Americans shop,” Mr. Kyogoku said. The Uniqlo executives declined to discuss specifics about the expansion plans, beyond saying they also included stores in other big American cities. The company is also working on an e-commerce site in the United States, the executives said. (NY Times As U.S. Retailers Retreat, a Japanese Chain Sees an Opening)

So this means we’ll likely get a store in The Galleria and/or West County Mall rather than a pedestrian-friendly area like The Loop or downtown. Remember when people hoped for Urban Outfitters and H&M to locate somewhere other than The Galleria?

Possibly they might locate in the MX District or Ballpark Village, but my money is on The Galleria. Wherever they open it’ll put pressure on chains like Old Navy, Gap, etc.

— Steve Patterson

Study: Connection Between Transit and Real Estate Value

A study released this month looked at five regions and found a connection between home values and transit:

From the Executive Summary:

Overall there was a substantial decline in average residential sales prices in the study regions between 2006 and 2011. However, in all of the regions, the decline in average residential sales prices within the transit shed was lower than in the region as a whole or the non-transit area. Across the study regions, the transit shed outperformed the region as a whole by 41.6 percent. Figure 1 shows the percent change in average residential sales prices in the transit shed and non- transit area relative to the regional percent change in price.

Within a given region, heavy rail, light rail, and BRT transit sheds held their value best. In addition to having higher frequency service and better transit connectivity, these types of fixed-guideway transit stations also tend to be located in areas that are more walkable, have higher residential density, and better access to jobs. Commuter rail sheds also saw a smaller decline in average residential sales prices than the region as a whole.

From the Conclusion:

Transit type also had an effect on the resilience of property values, which benefited more from transit that was well connected and had a higher frequency of service. Although most commuter rail transit sheds still saw a smaller decline in average residential sales prices than the region as a whole, heavy rail, BRT, and light rail transit sheds outperformed commuter rail transit sheds within and across regions. Heavy rail transit sheds had significantly higher levels of transit access, as measured by the Transit Connectivity Index and the Transit Access Shed, than the commuter rail sheds. Average monthly household transportation costs were also substantially lower in the heavy rail than the commuter rail sheds, indicating that the heavy rail sheds had not only higher levels of transit service, but were more location efficient overall. For most property types, the transit shed outperformed the region; however, unlike with transit type, there were no consistent trends across regions.

In addition to providing consumers and planners with information, the findings support investment in transit and encourage development in location efficient areas. The presence of fixed-guideway transit not only benefits individual property owners, it also supports a more resilient tax base.

I read about the study here. This is no surprise to many of us, but others won’t believe the results. “Everyone aspires to a McMansion in suburbia and driving everywhere” they’ll proclaim.

It’s 2013, not 1963!

– Steve Patterson

Readers Leaning Toward Approval of 3/16th of a Cent Arch/Parks Sales Tax

Next Tuesday voters in St. Louis City and St. Louis County will be asked to approve a 3/16th of a cent sales tax increase that will expire in 20 years. The poll results here are not scientific, only reflecting the views of a small segment of the electorate. Early on the “no” votes outnumbered the “yes” votes 2-1, but slowly throughout the week the yes votes gained momentum but not enough to clear 50%.

Q: Do you support Prop P on the April 2nd ballot? Prop P=3/16th of a cent sales tax for Arch/parks

1. Yes 75 [46.3%]
2. No 59 [36.42%]
3. Undecided 14 [8.64%]
4. Not a voter in STL City/County 6 [3.7%]
5. Unsure/No Opinion 4 [2.47%]
6. Other: 4 [2.47%]

The four (4) other answers were:

1. Probably, but not enthused about itAdd as a poll answer
2. No, would much rather see the 3/16 cent sales tax go to lowering Lambert”s debt
3. It’s strange that St. Louis must put so much money into a park it doesn’t own…
4. Yes, but would greatly prefer revenue to be raised by property taxes .

The Post-Dispatch favors the tax increase:

You add 4.225 percent state tax rate to local rates to get the combined sales tax. The base city sales tax is 4.266 percent, slightly higher in some special taxing areas. The base combined state and local sales in St. Louis city is 8.491 percent, 25th highest among those 107 metro areas. If Prop P passes, the base rate will rise to about 8.51 cents. That’s barely noticeable unless you buy a $20,000 car, when it will cost you another $37.50 in sales taxes. (Editorial: Yes on Prop P. Arch-parks-trails tax fixes old problems, creates new opportunities)

I’m still undecided, but leaning toward “yes.”

– Steve Patterson