HOUSE BILL REPORT

ESSB 6342

As Amended by the House

BYSenate Committee on Energy and Utilities (originally sponsored by Senators Lee and Talmadge)

Requiring breakdown of taxes paid in utility bills.

House Committe on Energy & Utilities

Majority Report:  Do pass with amendments. (12)

      Signed by Representatives Nelson, Chair; Armstrong, Barnes, Brooks, Jacobsen, Jesernig, May, Meyers, Miller, Sutherland, Unsoeld and S. Wilson.

House Staff:Fred Adair (786-7113)

AS PASSED HOUSE MARCH 3, 1988

BACKGROUND:

Some utility billing statements clearly state direct taxes paid by the customer.  In the case of light and power businesses, certain taxes are levied against the income of the business and not on specific transactions.  For example, the public utility tax is calculated as part of the base rate and not charged directly to the customer.

Concern has been raised that the base rate for some utility customers may include taxes levied by a taxing district which does not include these customers.  One example could occur when municipal taxes are included as part of a rate base charged to all customers, including those residing outside of municipal boundaries.

SUMMARY:

All billing statements by light and power businesses and gas distribution businesses must indicate direct taxes paid by the customer, as well as the rate, origin, and approximate amount of taxes levied upon the revenues of the light and power business or gas distribution business and added as a component of the amount charged to a customer.  Federal and certain statewide taxes may be exempted from listing on bills.

Fiscal Note:      Not Requested.

House Committee ‑ Testified For:    Tom Mortimer, Public Utility District Association; Greg Hanon, Pierce County Cooperatives Association; Ron Newbry, Pacific Power and Light; Steve McLellan, Utilities and Transportation Commission (neither pro nor con; called forward by chairman to answer questions).

House Committee - Testified Against:      None Presented.

House Committee - Testimony For:    Disclosure is desirable and clarification of tax expense would be helpful to customers.  Some utilities pay up to 11 or 12 percent taxes, which it would be helpful for customers to realize.  Federal and certain state taxes are costly to break out for individual customers and should be exempted.  Also, so should a greater number of the smaller utilities, for whom the listing requirement would be difficult and costly.

House Committee - Testimony Against:      None Presented.