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SB 408 - Utility Taxes
Oregon SB 408 Utility Tax Law
Senate Bill 408 was passed by the 2005 Oregon Legislature. The new law (Oregon Laws 2005, chapter 845) required four regulated electric and natural gas utilities—Portland General Electric, PacifiCorp, NW Natural and Avista—to file tax reports with the Commission annually on October 15th. Taxes recovered in customers’ rates beginning January 1, 2006 were subject to an adjustment each year.  The Commission adopted permanent rules to implement SB 408 in Dockets AR 499 and AR 517.
The law was originally passed to address the so-called “Enron problem,” in which the Texas energy conglomerate collected millions of dollars in taxes to their estimated tax liabilities but paid little to no taxes.
The law created mixed results. While some utility customers received refunds, it resulted in an overall surcharge to customers of approximately $17.6 million.
Before the 2011 legislative session, at the request of legislators, the Commission brought together various parties to find a better way to address the problem. The product of this effort was crafted into legislation by a Senate Committee.
On March 29, 2011, Senate Bill 967 was introduced in the Oregon Senate to repeal the existing law governing the annual regulatory adjustment for income taxes paid by certain utilities. The bill passed the Senate on April 20, 2011, and was passed by the Oregon House of Representatives on May 9, 2011, and was later signed into law by Governor John Kitzhaber.