HF 4151

as introduced - 84th Legislature (2005 - 2006) Posted on 12/15/2009 12:00am

A bill for an act
relating to utilities; regulating rate recovery for income taxes; amending
Minnesota Statutes 2004, section 216B.16, by adding a subdivision.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2004, section 216B.16, is amended by adding a
subdivision to read:

new text begin Subd. 6e. new text end

new text begin Income taxes. new text end

new text begin (a) For purposes of setting an allowance in rates for
income or corporate franchise taxes, the commission may base the allowance on an
estimate of what the public utility will pay as a stand-alone taxpaying entity or an estimate
of the tax liability of the public utility if it files tax returns on a consolidated basis with
other related business entities. The commission shall utilize the estimate that it determines
will provide the most accurate estimate of future tax liability.
new text end

new text begin (b) A public utility shall annually file with the commission a statement showing:
new text end

new text begin (1) the amount of income and corporate franchise taxes collected by the utility in
rates in the immediately preceding year; and
new text end

new text begin (2) the amount of income and corporate franchise taxes it paid in the immediate
preceding year, minus any refunds received.
new text end

new text begin If the commission determines that the amount allowed by the commission for
income and corporate franchise taxes in the public utility's rates for a calendar year
exceeded the amount actually paid for that year, the commission shall order the utility to
refund the excess to ratepayers by credit posted as a separate item on customer bills in
the billing cycle next following the commission's order.
new text end

new text begin (c) A public utility may not receive rate recovery for the cost of payments required
by this section.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin Paragraph (a) is effective the day following final enactment
and applies to rate hearings pending or commenced on and after that date. Paragraph (b) is
effective the day following final enactment and applies to taxes paid in 2005 and thereafter.
new text end

Sec. 2. new text begin RETROACTIVE APPLICATION.
new text end

new text begin The Public Utilities Commission, by July 1, 2006, shall request from each public
utility for which the commission set customer rates a report containing the information
described in section 1, paragraph (b), for calendar years 2002, 2003, and 2004. The public
utility shall provide each requested report by September 30, 2006.
new text end

new text begin If the commission determines that the amount allowed by the commission for
income and corporate franchise taxes in the public utility's rates for a calendar year
exceeded the amount actually paid for that year, the commission shall order the utility to
refund the excess to ratepayers by a credit posted as a separate item on customer bills in
the billing cycle next following the commission's order. A public utility may not recover
in its rates for the cost of payments required by this section.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective retroactively from January 1, 2002.
new text end