Newspaper article THE JOURNAL RECORD

Group Files Request on Overcollection

Newspaper article THE JOURNAL RECORD

Group Files Request on Overcollection

Article excerpt

A state regulatory agency was asked Friday to stop Southwestern bell Telephone Co. from collecting income taxes at the 46 percent level, which was reduced to 34 percent by the Tax Reform Act of 1986.

The Oklahoma state legislative committee of the American Association of Retired Persons has intervened in the Oklahoma Corporation Commission case, and filed the motion Friday in the interim of a final commission order.

The Tax Reform Act of 1986 took effect July 1, 1987, and could involve as much as $57 million in overcollections since that time because of the discount to Southwestern Bell Telephone.

In October 1986, however, the corporation commission filed a cause of inquiry as to the effect of the measure on public utility rates, including those of Southwestern Bell Telephone and the case has not been resolved. In turn, on July 1, 1987, the telephone company stipulated it would make any refund deemed proper by the commission at such time the decision was made.

"There has been no determination that we are in overearnings," said Dennis Smiley, spokesman for Southwestern Bell Telephone.

AARP asserts any and all overcharges should be returned directly to ratepayers.

Telephone rates are set by the corporation commission based on the utility's expenses compared to revenues, which take into account taxes charged the company.

Corporation commission staff have suggested any unprotected overcharges be allowed by the telephone company to make capital improvements to its system.

Dixie Linnenbrink, corporation commission accountant, said it was seen as the most equitable way to reimburse ratepayers since it would be difficult to identify and prorate overpayments. A particular consideration in that issue, she said, was that base rates are below the actual cost of the service. …

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