Utahns may see their utility bills drop by a collective $98 million if Congress passes a bill to give states more power over local gas and power companies, officials said.
Since 1986, utility companies have been paying taxes to the Internal Revenue Service at a 34 percent rate, down from what had been a 46 percent rate. Even when they were paying at the old rate, the companies did not have to pay the money immediately. The federal government deferred payment over several years.Consequently, utility companies have been saving a lot of money for taxes that will not have to be paid.
So far, the federal government has told the companies to refund the extra money gradually over 30 years, but the proposed law would let each state decide separately what its companies will do.
Utah officials say that sounds like a good idea.
"I can't imagine any state not wanting the power to look at this," said Ted Stewart, chairman of Utah's Public Service Commission, which sets rates for utility companies.
Nationwide, utility companies have saved about $19 billion that they no longer will have to pay in taxes, he said.
Dave Buhler, director of the state's Department of Commerce, said he estimates Utah Power & Light Co. has $60 million and US WEST has $37 million that would be affected by the bill. The state's other companies hold another $1 million combined.
The money may not all be returned to Utahns, but the PSC wants to at least have the power to make that choice.
"It's somewhat offensive for Congress to pre-empt states from looking at this," Buhler said.
Stewart and Buhler met with Gov. Norm Bangerter on Tuesday to ask him to support the bill, known as HR1150 and sponsored by Rep. Byron Dorgan, D-N.D. They want Bangerter to encourage Utah's congressional delegation to vote for the bill.
Bangerter asked both men to prepare a detailed report of the bill and its effects. "I'd need more information to know whether to go after the bill or not," he said.
After he receives the report, Bangerter said, he will go to the executive committee of the National Governor's Association in June and see how other governors feel about the bill.