By the time you receive this newsletter the Kansas legislature will have been in session almost two weeks. This is an election year for all members of the House of Representatives and all statewide office holders, including the Governor. The treasury is flush with tax revenues and other unexpected sources of income, the unemployment rate is low and the big game among the Governor, both wings of the Republican Party and the Democratic Party is how big a tax break and what kind to give to voters – then they can go home and run for re-election. The legislature and the Governor want to avoid controversial issues like abortion, guns, and school vouchers. In fact the most controversial item the legislature will deal with turns out to be environmental – namely what to do about hog factories and the fact that people are voting against them in county wide referenda by overwhelming numbers. The debate by the legislature and the status of various pieces of legislation designed to deal with large swine production facilities will be the subject of many of my future newsletters this session of the legislature. The focus of this newsletter is on three major public policy documents released this month.

Surface Water Quality Commission

As you all know, H.B. 2368, passed by the legislature in 1997 and signed by the Governor suspended the implementation of 1994 standards for ammonia (a by-product of urine toxic to aquatic life) and chlorides (toxic to aquatic life) and set a statewide drinking standard for atrazine (a Class C human carcinogen toxic to aquatic life) of 3 parts per billion (degrading the standard for “chronic aquatic life” streams from 1 ppb). A small group of cities with aging wastewater treatment and sewage systems (notably Johnson County, Topeka and Ft. Scott) did not want to meet the 1994 ammonia standard, salt producers (in the Reno County area) did not want to meet 1994 chloride standards, and agribusiness claimed a 1 ppb standard for atrazine would eliminate its use in Kansas causing a loss of crop production and income. A surface water quality commission, with appointees named by the Governor, was also set up in the legislation to examine various aspects of surface water quality standards and issue a preliminary report to the legislature in January 1998, a final report in June 1998 with KDHE to hold public hearings in the summer and fall of 1998 and with the legislature to approve any changes in 1999. All of this, in my opinion, was a blatant attempt to lower surface water quality standards. The preliminary report only confirms that view. Since this is such an important issue to all Kansans, I will print a point-by-point critique of the Commissions preliminary recommendations in my next newsletter. In the meantime you can obtain a copy of the Preliminary Recommendations of the Surface Water Quality Commission from the Office of the Governor, State Capitol, Topeka, KS 66612-1590.

Kansas River Recreation Study

The 1996 Kansas legislature, in Senate Bill 757, directed that the Kansas Department of Commerce & Housing, in conjunction with the Kansas Water Office, Kansas Geological Survey, Kansas Biological Survey and the Kansas Department of Wildlife and Parks conduct a study of the development of recreation opportunities within the Kansas River. There were three major components of the study: 1) Assessment of the direct economic impact of commercial use of resources associated with the Kansas River that impact recreational usage or which recreational usage would impact; 2) Assessment of potential recreational uses of the river; 3) Identification of constituencies that may work in a cooperative manner with public and private entities to develop a framework for determining appropriate development and use of the resources associated with the river.

The recommendations of the study team are: 1) Recreational use of the Kansas River not be limited to specific sections or reaches of the river. The entire Kansas River shall be open of recreational usage; 2) The Kansas River Access Plan developed by the Kansas Department of Wildlife and Parks (KDWP) should be implemented by the state; 3) As part of an application for any future permits for structures in the Kansas River, or for commercial use of state resources associated with the Kansas River, a “Recreation Compatibility Plan” must be submitted to the Chief Engineer, Kansas Division of Water Resources, and approved by KDWP; 4) The management and development of recreational use of the Kansas River be provided by the KDWP; 5) KDWP should investigate the availability of public and private property owners who would volunteer to participate in a “Fishing Access” program to provide access to the Kansas River; 6) the Kansas River should be multi-use including both recreational and commercial usage. The legislature should set aside a portion or portions of the Kansas River for exclusive recreational use and exclude commercial use of the river, specifically in-river sand and gravel dredging operations, in segments established as recreational areas.

I will be working closely with Senator Sandy Praeger (R) of Lawrence, officials at KDWP and the Friends of the Kaw to develop legislative proposals to make these recommendations become reality. If you would like to obtain a complete copy or an executive summary of the Kansas River Recreation Study contact the office of James T. Janousek, Kansas Department of Commerce & Housing, 700 S.W. Harrison Street, Suite 1423, Topeka, KS 66603.

Retail Wheeling

This is the name sometimes given to the development of competition in the electric retail market. As of December 1997 nine states had enacted legislation authorizing retail competition. The Kansas Retail Wheeling Task Force was established through enactment of 1996 H.B. 2600. The legislation directed the 23 member Task Force to study what was to become 21 issues related to retail competition. Most Task Force members shared the opinion that retail competition was inevitable due to a combination of: 1) pressures exerted by multiple constituency groups (particularly large energy consumers); 2) the restructuring activities of other states (most with high-cost electric power); Congressional bill introductions; and recent orders by the Federal Energy Regulatory Commission that ensured open access for wholesale competition. However, Task Force members had different, and often conflicting, ideas about the best means to transition to a competitive environment.

Two major “retail wheeling” issues of concern to environmentalists in Kansas and elsewhere are: 1) stranded costs, and 2) incentives for renewable energy. Stranded costs is the name given for investments made under a past regulatory climate that would not be recoverable by investors in a future regulatory environment. Here in Kansas (and in other states with nuclear powered generation) this boils down to the issue of the cost competitiveness of nuclear power plants such as Wolf Creek in Burlington, Kansas. Who will bear the burden if the Wolf Creek plant proves not to be economically viable in a re-regulated environment, the investors or rate payers? Incentives for renewable energy generation, such as net metering, would allow producers of surplus renewable energy to receive a greater return on the sale of that surplus energy to larger energy producers or retailers.

Because the retail wheeling issue is so complex and the outcomes unknown, most observers of this issue expect only two things to happen legislatively in 1998: 1) “unbundling” or the disaggregation of utility rates for billing purposes (currently, most rates are combined on bills of vertically-integrated electric utilities); and 2) a study of the property tax implications for municipalities of retail wheeling. I am researching proposals from other states that encourage the use of renewable energy and will be working with legislators of both parties to use whatever legislative opportunities present themselves to encourage renewable energy generation in Kansas.

The Final Report of the Task Force on Retail Wheeling can be obtained from the Kansas Legislative Research Department, State Capitol, Room 545-N, Topeka, KS 66612-1504. You can also obtain the report on-line at <http://www.kumc.edu/kansas/ksleg/KLRD/retailwh.html>.

Kansas Chapter of Sierra Club

935 S. Kansas Ave., Suite 200

Topeka, KS 66612