For the TG16, I put 4 bypass caps on the encoder, and then 2 on the component circuit.
I don't use a 22uF like TheSteve suggested. 1 0.1uF Ceramic and 1 220uF Aluminum can in parallel for each pin.
I tried at first with just 0.1uF bypasses on the circuit and encoder but I still had bars. I noticed on my oscilloscope I was getting some noise on the vcc line so I added the 220uF's in parallel with them, it got rid of them and reduced the noise greatly.
Then just put a 0.1uF and 220uF in parallel between your vcc and GND input on the circuit.
Screenshots using my PEXHDCAP to capture the Component:
It looks amazing on my CRT.
Big thanks to TheSteve for creating this circuit, it's great!