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Government reorganization bill prompts concerns about potential impact to electric, gas rates

iowa capitol building
John Pemble
IPR News
The governor’s bill to reorganize state agencies could impact the rates Iowans pay for electricity and natural gas.

Environmental advocates and groups advocating for older and low-income Iowans have raised concerns about how the governor’s bill to merge and reorganize state agencies could impact the rates Iowans pay for electricity and natural gas.

Iowa’s Office of Consumer Advocate reviews utility rates and policies in the state and can help prevent unfair electric and gas rate hikes by representing consumers before the Iowa Utilities Board.

Gov. Kim Reynolds’ government reorganization bill would remove merit system employment protections for OCA staff. The bill would put the attorney general, rather than the consumer advocate, in charge of hiring OCA staff.

These changes mean the attorney general could fire an OCA worker without just cause.

The bill would also remove the four-year term for the consumer advocate and have them serve at the pleasure of the attorney general, which would allow the attorney general to fire the consumer advocate without cause. It would remove the requirement that the consumer advocate be a “competent attorney.”

Steve Falck with the Environmental Law & Policy Center’s Des Moines office said the changes could allow the state’s powerful utility companies to influence the OCA.

“They’re the watchdog for the public, for ratepayers, to make sure that we’re getting the best rate possible, or the lowest rate, yet have reliable service,” he said. “So it’s very important that this office is independent.”

Falck said the OCA successfully pushed to cut a rate increase proposed by Alliant Energy nearly in half in 2019.

AARP Iowa State Advocacy Manager Paige Yontz said OCA employees need to feel protected so they can give their unfiltered analysis of rates proposed by utility companies.

“I think that this office holds a really important spot in the consumer advocacy space in the state of Iowa,” she said. “It’s something we can’t live without, right? Utilities are a non-negotiable. And so ensuring everybody has access to that fair pricing structure is just incredibly important.”

Reynolds’ office did not respond to IPR’s questions about the rationale for the changes to the OCA as of Tuesday afternoon. According toa fiscal analysisfrom the nonpartisan Legislative Services Agency, this section of the bill is not expected to save the state any money.

During debate on the bill last week, Sen. Jason Schultz, R-Schleswig, said the OCA changes are an “integral part” of the government alignment effort.

“Changing the consumer advocate from a term of years to pleasure of attorney general makes the consumer advocate more accountable to the people of the state of Iowa because we put them in line with an elected official,” he said. “And removing merit coverage from OCA employees is consistent with the vast majority of the personnel at the attorney general’s office for the same reason.”

Schultz said opponents of the bill were “overinflating” the independence of the OCA and said staff who are union members aren’t truly independent.

Sen. Liz Bennett, D-Cedar Rapids, had offered an amendment to remove the OCA changes from the bill, but it was rejected by Republican senators.

“Judas betrayed Jesus with a kiss,” she said. “And that’s what this bill does to Iowa consumers by subjecting the Office of the Consumer Advocate to big dollar donors from electricity and gas companies.”

Bennett said Iowans’ utility bills would be even higher without the independence of the OCA.

Katarina Sostaric is IPR's State Government Reporter