2015 ORS 757.269¹
Setting of rates based upon income taxes paid by utility
  • limitation on use of tax information
  • rules

(1) When establishing schedules and rates under ORS 757.210 (Hearing to establish new schedules) for an electricity or natural gas utility, the Public Utility Commission shall act to balance the interests of the customers of the utility and the utility’s investors by setting fair, just and reasonable rates that include amounts for income taxes. Subject to subsections (2) and (3) of this section, amounts for income taxes included in rates are fair, just and reasonable if the rates include current and deferred income taxes and other related tax items that are based on estimated revenues derived from the regulated operations of the utility.

(2) During ratemaking proceedings conducted pursuant to ORS 757.210 (Hearing to establish new schedules), the Public Utility Commission must ensure that the income taxes included in the electricity or natural gas utility’s rates:

(a) Include all expected current and deferred tax balances and tax credits made in providing regulated utility service to the utility’s customers in this state;

(b) Include only the current provision for deferred income taxes, accumulated deferred income taxes and other tax related items that are based on revenues, expenses and the rate base included in rates and on the same basis as included in rates;

(c) Reflect all known changes to tax and accounting laws or policy that would affect the calculated taxes;

(d) Are reduced by tax benefits generated by expenditures made in providing regulated utility service to the utility’s customers in this state, regardless of whether the taxes are paid by the utility or an affiliated group;

(e) Contain all adjustments necessary in order to ensure compliance with the normalization requirements of federal tax law; and

(f) Reflect other considerations the commission deems relevant to protect the public interest.

(3) During a ratemaking proceeding conducted under ORS 757.210 (Hearing to establish new schedules) for an electricity or natural gas utility that pays taxes as part of an affiliated group, the Public Utility Commission may adjust the utility’s estimated income tax expense based upon:

(a) Whether the utility’s affiliated group has a history of paying federal or state income taxes that are less than the federal or state income taxes the utility would pay to units of government if it were an Oregon-only regulated utility operation;

(b) Whether the corporate structure under which the utility is held affects the taxes paid by the affiliated group; or

(c) Any other considerations the commission deems relevant to protect the public interest.

(4)(a) Because tax information of unregulated nonutility business in an electricity or natural gas utility’s affiliated group is commercially sensitive, and public disclosure of such information could provide a commercial advantage to other businesses, the Public Utility Commission may not use the tax information obtained under this section for any purpose other than those described in this section, in ORS 757.511 (Application for authority to exercise influence over utility) and as necessary for the implementation and administration of this section and ORS 757.511 (Application for authority to exercise influence over utility).

(b) The commission shall adopt rules to implement paragraph (a) of this subsection that:

(A) Identify all documents and tax information that an electricity or natural gas utility must file in its initial filing in a proceeding to change rates that include amounts for income taxes, recognizing that any party may object to providing such documents on the grounds that they are not relevant; and

(B) Determine the procedures under which intervenors in such proceedings may obtain and use documents and tax information to fully participate in the proceeding.

(5) As used in this section, "affiliated group" means a group of corporations of which the public utility is a member and that files a consolidated federal income tax return. [2011 c.137 §1]

Note: 757.269 (Setting of rates based upon income taxes paid by utility) was enacted into law by the Legislative Assembly but was not added to or made a part of ORS chapter 757 or any series therein by legislative action. See Preface to Oregon Revised Statutes for further explanation.

Note: Sections 1 to 3, chapter 754, Oregon Laws 2015, provide:

Sec. 1. The Legislative Assembly finds and declares that having access to natural gas is in the public interest and that the extension of natural gas pipelines and other infrastructure necessary for providing natural gas to areas that do not have access to natural gas is necessary for the communities of this state to preserve local economies, enlarge tax bases and generate additional economic opportunities. [2015 c.754 §1]

Sec. 2. (1) The Public Utility Commission shall form a work group for the purpose of conducting a study on methods by which a public utility that furnishes natural gas may expand the public utility’s service to areas that do not have access to natural gas. As part of the study, the work group shall review the commission’s authority to authorize, and the commission’s policies on, the expansion of natural gas services. At a minimum, the work group shall study:

(a) The commission’s policies regarding the extension of natural gas mains;

(b) Mechanisms for funding the expansion of natural gas services, including the use of tariffs, the imposition of charges and fees, the use of unclaimed refunds and the establishment of accounts dedicated to the expansion of natural gas services;

(c) The submission of recommendations by public utilities that furnish natural gas;

(d) Possible processes for including in a public utility’s rates the cost of projects involving the extension of natural gas pipelines and other infrastructure necessary for providing natural gas;

(e) Possible selection criteria for projects involving the extension of natural gas pipelines and other infrastructure necessary for providing natural gas; and

(f) The potential rate cap for projects involving the extension of natural gas pipelines and other infrastructure necessary for providing natural gas.

(2) The commission shall include in the work group:

(a) Representatives of public utilities that furnish natural gas, other energy suppliers, local governments and elected officials;

(b) Stakeholders who have an interest in the outcome of the study;

(c) Individuals who have knowledge about the subject matter of the study;

(d) One member from the House of Representatives who represents an area that does not have access to natural gas; and

(e) One member from the Senate who represents an area that does not have access to natural gas.

(3) The commission shall compile a report, including any recommendations for legislation, of the work group’s findings and conclusions. The commission shall submit the report in the manner provided in ORS 192.245 (Form of report to legislature) to an interim committee of the Legislative Assembly related to energy no later than September 15, 2016. [2015 c.754 §2]

Sec. 3. Sections 1 and 2 of this 2015 Act are repealed on January 2, 2017. [2015 c.754 §3]

Chapter 757

Notes of Decisions

Under regulatory scheme, Public Utility Commissioner has authority to promulgate rule limiting telephone company's liability for directory listing errors or omissions. Garrison v. Pacific NW Bell, 45 Or App 523, 608 P2d 1206 (1980)

Refund is proper exercise of Public Utility Commission's general powers if refund (1) is based only on in­for­ma­­tion in existence at time of rate order for which refund is being made; (2) is not based on evalua­tion of public utility's actual expenses or revenues; and (3) is not effectuated by offsetting future rates. Gearhart v. Public Utility Commission, 255 Or App 58, 299 P3d 533 (2013), aff'd 356 Or 216, 339 P3d 904 (2014)

Atty. Gen. Opinions

Authority of Governor and Public Utility Commissioner to enter into binding agree­ments with respect to uniform curtail­ment plans, (1977) Vol 38, p 861


1 Legislative Counsel Committee, CHAPTER 757—Utility Regulation Generally, https://­www.­oregonlegislature.­gov/­bills_laws/­ors/­ors757.­html (2015) (last ac­cessed Jul. 16, 2016).
 
2 Legislative Counsel Committee, Annotations to the Oregon Revised Stat­utes, Cumulative Supplement - 2015, Chapter 757, https://­www.­oregonlegislature.­gov/­bills_laws/­ors/­ano757.­html (2015) (last ac­cessed Jul. 16, 2016).
 
3 OregonLaws.org assembles these lists by analyzing references between Sections. Each listed item refers back to the current Section in its own text. The result reveals relationships in the code that may not have otherwise been apparent.