OREGON SENATE VOTES 26-4 FOR BILL TO END UTILITY TAX SCAM IN OREGON

Good news that the Oregon Senate understands that if we the people are charged for taxes that we expect that the money collected will go to the governmental units for which it was raised. However, it appears that this will have tuff going in the House. Time to make some contact with your Representatives.
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June 8, 2005

OREGON SENATE VOTES 26-4 FOR BILL TO END UTILITY TAX SCAM IN OREGON

SB 408 WOULD END PRACTICE OF CHARGING RATEPAYERS FOR "INCOME TAXES"

THAT THE UTILITIES ACTUALLY DO NOT PAY

Today, the Oregon State Senate voted 26-4 for SB 408, the bill to end the enormous utility tax scam in Oregon.

Senator Vicki Walker (D Eugene), the carrier of the bill, stated:

"For several years, the large electricity and gas utilities regulated by the Oregon Public Utility Commission have been charging to Oregon ratepayers hundreds of millions of dollars for "state income taxes" and "federal income taxes" that in fact have not been paid to any government. Currently, the best available estimate of these charges to Oregon ratepayers is $150 million per year."

SB 408 directs the Oregon Public Utility Commission not to allow utilities to charge ratepayers more for "income taxes" than the utilities actually pay to governments.

"Since 1997, PGE has charged Oregon ratepayers over $750 million for so-called `state and federal income taxes' that in fact neither PGE nor Enron has paid to either the state or federal government, said Dan Meek, attorney for the Utility Reform Project (URP). Meek discovered this scam in late 2002 and filed a formal complaint with the OPUC. In April 2003, the OPUC refused to even consider the complaint. URP appealed and obtained a court order requiring the OPUC to pay attention. Yet, the OPUC has done nothing to stop the scam, and PGE continues to charge Oregon ratepayers $93 million per year for "income taxes" that in fact will never be paid to government.

The other regulated energy utilities, such as PacifiCorp, are engaged in similar practices, although on a smaller scale. Senator Walked concluded that "Oregon ratepayers over the past 8 years have paid these utilities over $1 billion for federal income taxes and state income taxes that have not been paid to any government." She pointed out that regulatory commissions in 19 other states have taken actions to stop utilities from charging ratepayers for income taxes that the utilities actually do not pay.

SB 408 requires each regulated utility (except water utilities) to file an annual tax report with the OPUC, stating the amount of income taxes actually paid to government by the utility or by its consolidated group and properly attributed to the utility. If the Commission finds that the amount of income taxes actually paid is different from the amount of income taxes charged to ratepayers, then it shall create an automatic adjustment clause in the utility's rate structure, so that the charges to ratepayers for income taxes are no more and no less than the income taxes actually paid to governments by the utility (with appropriate interest to account for the time value of money).

SB 408 is endorsed by the Oregonian, the Statesman-Journal, and the Albany Democrat-Herald, all joining the earlier statement of outrage by the Daily Astorian. It has been opposed by no editorials. It is supported by all of the major customer groups and business groups, including the largest ones, such as Associated Oregon Industries (AOI) and the Building Owners and Managers Association (BOMA).

The vocal proponents of the bill on the Senate floor were Senator Walker and the chairs of the two committees that heard the bill as it moved through the Senate: Rick Metsger and Ryan Deckert. The bill was supported by all Senate Democrats and by Senate Republicans by an 8-4 margin. The "no" votes were cast by Senators Atkinson, Beyer, Kruse, and Nelson. The bill now moves to the Oregon House of Representatives. "No doubt the utilities will try to kill this bill in the House," said Meek. "All Oregonians need to contact their Representative and urge "yes" on the utility tax scam bill, SB 408. Just call 503-986-1000 and ask to speak with your Representative or get the email address from the operator."

Constituents can send email to all members of the Oregon House of Representatives at the same time by sending it to this one address: orhouse2005@oreg.net.

The audio recording of today's Senate floor session is available at:
http://www.leg.state.or.us/listn/archive/archive.2005s/SENATE-2005060810...