RESIDENTS SPEAK AGAINST PROPOSED RATE INCREASES

Speakers before a public hearing on AmerenUE's proposed 22.1 percent increase in residential natural gas rates wondered Thursday night why the company is increasing residential gas rates so dramatically while decreasing rates for some customer classes.

"The raise would seem to be on the back of families, young and old," said Carl Patterson, who identified himself as a Cape Girardeau senior citizen.

About 45 people attended the public hearing at the Osage Community Centre, the second of five the Missouri Public Service Commission will hold across the state on the natural gas rate case.

AmerenUE's proposal would raise the average bill for the company's residential customers by about $10 per month, with the overall result an additional $12 million in income for the company. The Missouri Public Service Commission staff has proposed a substantially lower increase that would bring the company $2.2 to $2.8 million.

AmerenUE says the gas rate increase is needed to offset distribution costs it says have risen by about 20 percent since the company's last rate hike 2 1/2 years ago. Those costs include operating and maintenance expense, depreciation and taxes.

Speakers Thursday night said people with low or fixed incomes would be hurt the most by the proposal.

"If you can't already pay your bill, you don't need a rate increase," said Dorothy Jones, a single parent.

Kevin Sexton, who works for the East Missouri Action Agency, said his organization tries to help people who can't afford the price of necessities, but many are too proud to ask. He worries about the effect the proposal would have on some people with low incomes, some seniors and some disabled people.

"They're already making the decision whether to buy food or pay the utility bill," he said.

Paul Morard, who is disabled, said the hearing was important enough to him to miss a Cardinal game on TV.

"I barely make it through as it is," he said. "This month, I couldn't pay the full amount of my electric bill."

Increasing the commercial rate more than the residential rate would be fairer, he said.

Beverly Breese lives with her disabled 93-year-old mother. They get by on their Social Security checks and her mother's small pension, she said.

"We'll do the best we can. I certainly would appreciate it if you can take into consideration senior citizens on a limited budget."

Two of the six residents who spoke at the public hearing pointed out that AmerenUE made record profits in the second quarter of 2000 and questioned the timing of the increase. Patterson said the company is on track to make a 20-25 percent profit this year.

Gus Javr said AmerenUE's stock has increased by 43 percent since the beginning of March.

Steven Peel suggested the extra $120 per year the rate increase would cost the average family means something more to his own family than it does to the CEO of AmerenUE, whose salary is $832,000 a year, he said.

In July, the PSC approved an unscheduled natural gas rate increase for the company because of higher costs for natural gas. Increases or decreases in the cost of natural gas are automatically passed on to customers. That increase is not related to the case currently before the PSC.

Dianne Drane and Kelvin Simmons, two of the Public Service Commission's five members, were at the Osage Community Centre Thursday night to hear the testimony. Also present were PSC staffers, counsel for the PSC, AmerenUE and the public counsel, who represents the interests of the citizens of Missouri.

The hearing was conducted by Bill Hopkins, a senior law judge for the PSC and former Bollinger County associate circuit judge and prosecuting attorney.

Whatever gas rate increase is approved by the PSC will go into effect in April 2001.

The PSC has warned that natural gas costs could rise significantly this winter because of reduced inventories, high crude oil prices and increased demand for natural gas for generating electricity and use by industry.