7/14/1987 - Laserfiche WebLink

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M s Code of 1986, it, in effect, eliminated the Section of the prior Revenue Code, which provided that receipt of donations to the capital of a utility, whether they be money or property, was a tax free event, and in most situations that tax free event was recognized, as it is seen in the Florida Public Service Commission idea of regulation, as a below -the -line item, i.e., a rate of return was not allowed on the receipt of contributions made in aid of construction. When Congress "grossed up" or eliminated that, Bent Pine took the position that failing to "gross up" connection charges to make up the tax deficiency that would be created otherwise would be a taking, and they put that in a letter to the county. Chairman Scurlock inquired whether they wrote the Commission or staff about this, and Attorney Sundstrom noted that they believed what went to staff would get to the Commission. They can't help it if the staff doesn't tell the Commission what is going on. Attorney Vitunac asked if they ever asked for a public hearing to increase their rates as they just discussed. Attorney Sundstrom stated they did not. They took the position that failure to take that action would be a unilateral rate reduction. He noted that the Florida Public Service Commission passed an order allowing utilities to do it retroactively. Attorney Vitunac asked if they ever got a letter from staff or the Commission stating that if they had applied for a public hearing asking for a rate increase, it would have been denied, and Attorney Sundstrom stated that they were told this by staff member Lisa Abernethy. They do not have it in writing, however. Attorney Vitunac noted that in spite of that comment, they unilaterally raised their rates without a public hearing. Attorney Sundstrom confirmed that they did, and stated it is also true that none of those fees inure to the benefit of the utility - they inure to the benefit of the federal government. JUL 14.1981 55 BOOK D FA;c 891