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Committee passes Noranda bill despite deregulation fears

Sunday, May 4, 2003

JEFFERSON CITY -- Noranda's hopes to find a reasonable price for power after June 2005, which is when the previously attained power for the aluminum smelting plant runs out, were given a boost on Thursday. The house committee on Communications, Energy, and Technology voted Senate Bill 555 (SB 555) 14-6 "do pass" to the floor of the Missouri House were it will be debated in the next few weeks.

The passage of this bill to the floor was not without controversy from many on the committee.

Senator Peter Kinder described SB 555 as an effort to "save 1,100 aluminum workers jobs.", while some on the House committee saw SB 555 as a "slippery slope" into the deregulation of municipal utilities. Many in the House called this bill the "camel's nose in the tent" meaning that once the bill is passed it will be hard to keep other companies from wanting to buy their power on the open market as well to get a better price.

These fears are not only those of legislators, but also those of union organizations. The AFL-CIO and the United Steelworkers of America oppose the bill, the very people whose jobs the bill is trying to save. The unions are afraid of this small scale deregulation as becoming something much larger and similar to the California deregulation crisis. In California, aluminum smelting plants choose instead to make money off of their already bought power instead of keeping the plants open and profiting off of the power crunch seen in recent years in that state.

During an executive committee hearing held on Thursday after the Missouri House session adjourned for the week, members of the committee added an amendment restricting the sell of the power bought by Noranda in hopes to suppress fears of the unions.

The representatives of Noranda attending the hearing did not have time to comment on the remarks made by the representative of the United Steelworkers of America regarding this fear. During the testimony of the representatives of Noranda, which included George Swogger and Steve McPheeters, both of Sikeston, stated that if Noranda is lost, most of the work they do will go across the river to Kentucky. In Kentucky there are two aluminum smelting plants which have fixed rate power through 2010.

They further went on to state that they are truly different and unique to the state of Missouri, as they are running at peak levels of power usage 24 hours a day. To this they added that they were not looking for deregulation of municipal utilities. Which did little to change the opinions of some members of the committee without help from some Bootheel area members of the House of Representatives.

Rep. Lanie Black and Rep. Peter Myers both worked for the passage of this bill in the committee and came to an understanding with most of its members that this was a needed piece of legislation for the economic future of the very poor Bootheel area. Black even missed his Agriculture Committee hearings in order to sit through the two meetings this week regarding this bill.

Opposition could grow as the bill waits for its turn on the House floor among those with fears of municipal utility deregulation. As some in the committee hearing vowed to Black and Myers not to vote against it, but said they would also not vote in favor for it.

The fight for this bill can be summed up by the comments of Rep. Schlottach of Gasconade County regarding SB555 "There is no easy way to get off of this train"; either the Representatives are against the bill and losing 1,100 Bootheel area jobs or voting for it and risking other companies asking for the same treatment.