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Missouri approves Liberty Utilities' $4.6M rate hike, with US tax cut a factor

Liberty Utilities (Midstates Natural Gas) Corp. will raise rates by $4.6 million annually after a rate decision that incorporated the effects of this year's changes to the federal tax code.

When Liberty Utilities first asked to raise rates in 2017, the company proposed a $7.5 million hike. But since then, the U.S. dropped its corporate tax rate from 35% to 21%, lowering the costs the company has to pass along to customers.

A recently approved stipulation — the product of an agreement reached among Liberty Utilities, the Missouri Public Service Commission staff, the Office of Public Counsel, and the energy division of the Missouri Department of Economic Development — allows Liberty to raise base rate revenues by $4.6 million. About 10% of that increase is related to moving into base rates those charges that had previously been part of the company's infrastructure system replacement surcharge.

The stipulation includes plans for rate restructuring at Liberty utilities. The company plans to consolidate rates for two operating districts — Northeast Missouri and Western Missouri — and Liberty may file a single infrastructure system replacement surcharge for the two districts combined. A third district in Southeast Missouri will not be grouped with the others.

Liberty also will put in place a weather normalization rider to adjust the company's rates for weather-related changes in customer usage.