During a recent government meeting, significant concerns were raised regarding a proposed rate increase by Kansas Gas Service (KGS). The discussions highlighted widespread dissatisfaction among community members about the company's request to raise its profit margin from 2.66% to 7.88%. Critics described the increase as excessive and driven by corporate greed rather than necessity.
Several speakers, including a representative from AARP and local residents, voiced their opposition to the proposed hike, arguing that KGS has already benefited from substantial rate increases in recent years. One speaker pointed out that KGS had received an $8 million increase in December 2023, in addition to a previously approved $35 million increase, leading to a total profit increase request of $93 million. This would represent a staggering 43.7% increase in profits compared to expected earnings for 2024.
Philip Shirkey, an engineering student, provided a detailed analysis of the financial implications of the proposed rate increase, illustrating how a $100 investment in KGS would yield significantly higher profits for the company under the new rate structure. He urged the commissioners to consider a more modest increase that would adequately cover inflation without disproportionately benefiting the company's owners.
Another resident, Daniel Smalley, echoed these sentiments, questioning the allocation of profits and suggesting that much of the revenue would go towards management bonuses rather than improving services for customers. He also highlighted the ongoing financial burden on consumers from previous rate increases related to the winter storm in 2021.
The meeting underscored a growing frustration among residents regarding utility costs and the perceived lack of accountability from KGS. As the commission deliberates on the proposed rate increase, community members are advocating for a more equitable approach that prioritizes consumer interests over corporate profits.