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Show Public, Private Power Prompts Editorm Public Power Officials Says Profits Return To People KSL Editorial Says Public Avoids Taxes I'm Carolyn McNiel, general gener-al manager of the Intermoun-tain Intermoun-tain Consumer Power Agency, KSL recently supported Utah Power and Light's efforts to secure hydroelectric power from federal dams on the Colorado Col-orado River, but it overlooked two important facts: AS A privately owned company, com-pany, Utah Power and Light is obligated to make a profit and return dividends to its stockholders. stock-holders. Public power companies, com-panies, on the other hand, are owned by our consumers. We needn't make a profit at their expense; our sole obliga tion is to keep our rates as low as possible. This is the only competitive advantage public power companies hold over private utilities and it is the only reason our rates have been historically lower. IT IS now, as KSL suggests, because we do not pay taxes. Public power companies pay fees in lieu of ad valorem taxes; we pay sales and use taxes. Rural electric associa--tions also pay property taxes and the Intermountain Power Project must pay gross receipts re-ceipts tax. The numerous tax write-offs available to. Utah Power and Light resulted in the company paying only $21,000 in federal taxes on net income of $190 million in 1982--or only 1-100 of one percent of net income. FURTHERMORE, Utah Power and Light is not denied access to low cost federal hydro hyd-ro power. The utility takes millions mil-lions of killowatt hours per year from the federally generated gener-ated Bonneville Power Administration Admi-nistration in the Northwest. Public power companies contracted for hydroelectric power from the federal government govern-ment 20 years ago when it would have been cheaper for us to build our own coal-fired plants or even bu! from Utah -; But knowing '. making an future, we h P rates for our turned theinf. terest to the foment. fo-ment. t j IT IS not tax; , low cost po public power "j1.; Utah Pow" a d rates, since the P benefit both of , tage is our o . tufe-ourconsj control UM Utah Power and Light Company's Com-pany's efforts to secure low-priced low-priced hydroelectric power for all the people of Utah has resurrected re-surrected the battle between private power and public power. OF COURSE, private power includes those companies such as UP&L, which are owned by stockholders. Private companies com-panies pay taxes to federal, state, and local governments on property and income, and stockholders pay taxes on their income. Private utility rates are set by the Public Service Ser-vice Commission. Public power companies are owned by taxpayers, and so they have no tax obligation to federal, state, or local governments. govern-ments. They pay no property tax and no income tax. THE TAXES they do not pay are added to the tax obligations obliga-tions of private power companies com-panies and their customers. And the state Public Service Commission has no control over public power rates. Half a century ago, the public pub-lic power companies convinced con-vinced Washington they should have preference for power generated at federal dam sites. That meant public power was given a virtual monopoly over inexpensive federal power, while private companies had to generate their own needs. UTAH POWER and Light contends that private power customers have as much right as .public power customers to electricity from federal dams. KSL believes the Company's Com-pany's argument makes sense. Customers of private power pay more taxes than customers of public power. Both are entitled enti-tled to the benefits of public investments. |