SENATE BILL REPORT

SB 5235

BYSenators McDermott, McDonald, Gaspard, Lee and Hayner; by request of Department of Revenue

Clarifying the public utility tax on sewerage collection businesses.

Senate Committee on Ways & Means

Senate Hearing Date(s):January 28, 1987

Majority Report:  Do pass.

      Signed by Senators McDermott, Chairman; Gaspard, Vice Chairman; Cantu, Deccio, Lee, McDonald, Moore, Owen, Saling, Talmadge, Wojahn, Zimmerman.

Senate Staff:Stephen Rose (786-7443)

                  January 29, 1987

AS REPORTED BY COMMITTEE ON WAYS & MEANS, JANUARY 28, 1987

BACKGROUND:

Engrossed Substitute Senate Bill No. 4228 (Chapter 471, Laws of 1985) made sewerage collection businesses subject to the public utility tax.  The Department of Revenue originally defined sewerage collection to include treatment and disposal.  In the summer of 1986, the Joint Administrative Rules Review Committee found that this interpretation did not reflect legislative intent.  The Department changed its ruling to exclude treatment and disposal.

SUMMARY:

The costs of treatment and disposal of sewerage is not included in the base upon which the public utility tax liability is calculated.

Fiscal Note:      available

Senate Committee - Testified: Barney McClure and Ed Faker, Department of Revenue