Bill Summary
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S.F. No. 3528 - Public Utility Income Tax Rate Recovery (first engrossment)
Author: Senator Steve Kelley
Prepared by: Matthew S. Grosser, Senate Research (651/296-1890)
Date: April 7, 2006

 The bill permits the PUC to base the allowance in rates for income or corporate franchise taxes for a public utility on an estimate of what the utility will pay as a stand-alone taxpaying entity or an estimate of the tax liability of the utility if it files returns on a consolidated basis with other related business entities. This section also requires public utilities to file a statement annually with the PUC showing the amount of income and corporate franchise taxes collected by the utility in rates in the preceding year and the amount of income and franchise taxes paid during that year. If the PUC finds that the amount allowed in rates exceeds the amount paid, the PUC shall order the utility to refund the excess to ratepayers. This section prohibits rate recovery of the costs of such a refund.

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