House majority approves Georgia Power rate increase

February 27, 2009

After a long debate, a majority of the House of Representatives voted Thursday to authorize Georgia Power to begin charging its customers higher rates in 2011 for advance financing of the construction of two new nuclear reactors, which will not be in operation at Plant Vogtle before 2017.

I opposed this legislation, SB 31, for several reasons. Utility rate decisions are under the authority of the Georgia Public Service Commission (PSC), not the state legislature. Supporters of the bill were unable to give a clear reason as to why the Senate and House were being asked to act on this prepayment scheme, bypassing the PSC. Also, the measure exempts large companies from the rate hike, leaving residential consumers to shoulder the burden.

The additional charges will provide Georgia Power stockholders an estimated $1 billion advance profit, plus prepayment of about $400 million in federal and state income taxes. Customers will also be charged additional sales tax on the higher rates.

Concerns over how rates would be affected if, for any reason, the nuclear reactors are not built also went unanswered by the bill's supporters. But the measure passed by a vote of 107-66, and it is expected to be signed into law by the governor.

House members also voted Thursday to approve an amended $18.9 billion state budget for the remainder of fiscal year 2009, which ends June 30. The budget had to be trimmed by $2.3 billion because of the shortfall in state tax revenues resulting from the economic recession.

But thanks to an influx of federal funding from the economic recovery plan passed by Congress and signed into law by President Barack Obama, budget writers were able to come up with $428 million to restore the homeowner tax relief grants. These grants, which were marked for elimination in Gov. Perdue's budget proposal, will save the average homeowner $200-$300 this year.

The supplemental budget measure, HB 118, also includes $145 million in federal funds for Georgia's schools and funding for additional Department of Agriculture inspectors in the wake of the recent salmonella contamination at a peanut butter processing plant in Early County. The House version of the plan also accounts for the furloughing of state employees in the Department of Human Resources and Department of Corrections.

The Senate will now consider the supplemental budget while the House continues to work on the annual budget for fiscal year 2010.

Other legislation approved by the House and sent to the Senate this week includes:

HB 100, which would expand a state program implemented last year that provides income tax credits to individuals and corporate entities that donate to organizations set up to provide scholarships for parents to pull their children out of public schools and send them to private schools. I voted against this measure because it is another reduction in state revenue at the expense of our already underfunded public school system.

HB 149, which would allow students in their junior or senior year of public high school to study at a post-secondary college, university or technical college and receive high school credit, which would count toward graduation.

HB 156, which would allow elected magistrate judges who are serving on ordered military duty to remain in office and eligible for re-election during such duty.

HB 229, which would require local school systems to conduct an annual fitness assessment and comply with state physical education instruction requirements. I co-sponsored this legislation.

HB 343, which would establish the position of weight inspector for the Department of Public Safety. The inspectors would enforce weight, registration, size and load regulations for commercial trucks.