KS Gov. Kelly asks AG to launch price gouging investigation on huge natural gas bills
The natural gas bill for a greenhouse and flower shop in northern Kansas usually runs between $2,000 and $3,000 dollars each month.
But after 10 days of bitterly cold temperatures this February and warnings of energy shortages, the owner of Riverside Market and Flowers in Grand Rapids received a bill more than 30 times the normal size.
Jan Bergkamp was left in “disbelief” by a $92,000 gas bill this month.
The disbelief was shortly followed by the sinking feeling that a century-old business may fail because of a utility bill.
“I said we’ll just have to declare bankruptcy,” Bergkamp, 67, said.
Bankruptcy would mean closing the business, and laying off employees Bergkamp said she’s worked hard to keep on through the pandemic.
She filed a price gouging complaint with the Kansas Attorney General and reached out to her state lawmakers and the governor’s office.
“Coming out of COVID where businesses have been struggling … it’s like a death knell for many,” Bergkamp said. “What more can happen?”
Bergkamp is one of several business owners surprised this month by exorbitant bills.
The Shawnee Mission School District reported they’d received a $1.6 million bill last week. And lawmakers acted swiftly in early March to create a loan program for Kansas towns in danger of bankruptcy because of bills.
In response, Governor Laura Kelly sent a letter Tuesday to Attorney General Derek Schmidt requesting an investigation and a public information campaign about natural gas price gouging. Schmidt, however, said that the investigation has already started.
With the legislative session quickly approaching an end, the Kansas Chamber of Commerce said it is working with lawmakers to find a fast solution.
When asked early this month whether she believed price gouging had occurred with natural gas, Kansas Gov. Laura Kelly said investigations needed to occur. In her letter she took a stronger stance.
“I am concerned that instead of merely responding to reasonable changes in the market for natural gas, some providers may have taken the extreme and dangerous weather as an opportunity to charge unconscionably high prices,” Kelly said.
Kelly said her office had been working with stakeholders to find solutions for the bills but called on Schmidt, a candidate to run against her for governor in 2022, to play the role assigned to him as attorney general and investigate gas companies.
While the Kansas Corporation Commission is investigating some providers, Kelly wrote, not all Kansas providers are under its jurisdiction.
“These entities are, however, subject to the Kansas Consumer Protection Act and your office’s statutory mandate to investigate and prosecute potential violations,” Kelly wrote.
In a response letter, however, the Schmidt said his office opened an investigation into the matter on Feb. 18. It is working to determine whether a crime was committed and whether the Kansas Consumer Protection Act allows him to act, he said.
“Because of the complexity of the investigation, which deals with numerous entities involved in the production, transportation and distribution of natural gas, and the time that all the entities require to respond to inquiries, this investigation is likely to be time intensive,” Schmidt wrote.
Last year, Schmidt launched a public information campaign informing Kansans of their consumer rights and urging them to file complaints when encountering price gouging on personal protective equipment and other COVID-19 related needs.
A similar measure is not needed for natural gas bills because the situation is “materially different,” said Schmidt’s spokesman John Milburn.
“During COVID, there was a need to alert Kansans to potential scams so they could identify and avoid them and to hear from Kansans what types of scams were circulating so we could investigate them,” Milburn said in an email. “But there is no need to alert Kansans to the natural gas price spike - they are well aware, as are we.”
According to Kansas statute, Schmidt can launch an inquiry into price gouging if prices rise at least 25% above their normal level.
Such inquiries can provide relief to Kansans like Bergkamp by recovering damages, and obtaining restraining orders stopping the alleged price gouging.
In addition to her complaint to the AG’s office, Bergkamp said she hoped the legislature could help her.
Eric Stafford, a lobbyist for The Kansas Chamber of Commerce, said he was working with lawmakers to draft a solution for business owners similar to the loans provided to localities.
“Ideally it would be resolved before (the Legislature adjourns next week) because bills are hitting companies now. Waiting a month likely won’t help anyone,” Stafford said in an email.
This story was originally published March 31, 2021 at 3:26 PM.
