THE OF Inland Natural D 3
T tti R K.E. M in R R.J. B.J. R.J. Fletcher J.A. Grei J. N N Ltd. Ltd. B. C. Coal Lim of Commission Staff Court
ns - Direct Basis the of Estimated Costs 1A l, 5, 6, No. Tax of G J K N 0
I. fol 3 and 3, Commission issued the of 3, taxes to that in discounted ter 3r of s." The orders IJV a and crossover terms for both satisfied that information it matters one of intervenors 3 G-69-83 measurement of 2, to matters the and the measurement of that such 3 and Inland and have t with both the measurement ity review is and the to Orders and such
one response intervenors a ,J the the event 31 submission of In the absence act r the direction in Orders No. G-38-83 and matter tax. are similar in After a val treatment uncert also utili the matter may the 2 Commi the tax the which were without further it is to of 31, 198 3 the Commission crossover as in is a recent for the The out some the ssion, It it is a not
II. norm costs and the in rates. In that situation the taxes matches costs revenues all taxes ln years will be i formula reimburse recoverable C. A. appear either "norm (b) cost norm must be the income taxes as in 3470 the but recovery taxes "a reasonable that the rate the at that time" Inland and It would permit the use of method income taxes tax would a at current income taxes not occur so in run
is measure curr that 1 its 31 taxes as more than a a matter of such costs will . • s II l 5 -crossover curr ter To increase to utilities correct ter the the amount is a costs cannot be as the cost
He that factors the rate loadi i.e. a heavier bei the !a ter users. the the return rate and causes the same service the users taxes result m rate base taxes to demonstrate that tax minor one. on tv users a return of should the return an in users than later users. the consequence of users the later years. the the end and that not ional a
hence it is v it rate to tomer .At the tax collected, additional .All fees and taxes tax increase is as treated to the lt is dollar be collected ed
customers is "before tax" the reasons therefore resultant Dr. Waters the calc from such action. The has been able to obt Corn "after tax" dollars wher this the to ice ssion to extent it contr the
however, rn that deferred taxes on r itted in to 1977, the was on pre sen indicate that the that a fi a was also that unit cost over shifts the loss f, its its taxes titution benefit-cost of taxes. had edrtors s. to balance s be account for It who cannot to be taxes concerns customers it consider to a shifts i
is the mission allowed Inland raised e 1983 to 1977 economic downturn 3 saw been the lower customers ssion v and other customers shou a HI. reasons as the interest 11 a return to income tax In order to tr to 1977 that taxes. The two the severe s to , a structure issue 15 ti costs ic stances consideration i ace the financial commun to mi that February I, 1
The balance deferred taxes at of both and wi be TED at the Decem 1 31, 984 will remain on the books rate nee 1 3.
,r::,'f\ COL.u ~.:.,lll;)il t:JLUfili.W. $ ~ '1?<$> .!\!OS ;; ""4,/ .u-:'oLu \"',:_\..\ "'V UTILITIES COMMISSION ORDER NUMBER G-91-83 PROVINCE OF BRITISH COLUMBIA BRITISH COLUMBIA UTILITIES COMMISSION IN THE MATTER OF the Utilities Commission Act, S.B.C. 1980, c. 60, as amended and IN THE MATTER OF Accounting for Income Taxes by - Columbia Natural Gas Limit·ed - Inland Natural Gas Co. Ltd. BEFORE: M. Taylor, Chairman; and December 20, 1983 R.J. Ludgate, Commissioner 0 R D E R . ' WHEREAS the matter of accounting for income taxes related to Columbia Natural Gas Limited ("Columbia") and Inland Natural Gas Co. Ltd. ("Inland") was heard in public during the period October 5 through 8, 1982, with final argument December 7 and 8, 1982; and WHEREAS a May 25, 1983 Commission Decision as amended June 21, 1983 pertaining to Inland, and a July 12, 1983 Decision pertaining to Columbia deferred a decision on the method of accounting for income taxes to be utilized by both utflities; and WHEREAS Commission Orders No. G-38-83 and G-48-83 were issued to Inland and Columbia respectively and di~ected that "the Commission wishes to hear evidence concerning the potential timing of the "crossover" point and the measurement of that future liability in discounted terms", and directed the filing of such information on or before August 31, 1983; and ... /2 TwtNTY fiRST FLOOR. 1177 wtST HASTINGS STREET VANCOUVER 8 C V& 2l7. CANADA TELEPHONE 160416119·1831. TELEX 04-5<536
;Jl'IUTIES COMMISSION 2 ORDER NUMBER G-91-83 WHEREAS Commission Orders No. G-68-83 and G-69-83 as issued to Inland and Columbia respectively directed service of the August 31, 1983 filing on all Intervenors with responses to be submitted by October 15, 1983; and WHEREAS filings responsive to the aforenoted Commission Orders were made and the Commission has considered the issues and related responses as outlined in a Decision issued concurrently with this Order; and WHEREAS the Commission has concluded that it is in the public interest that Columbia and Inland change the method of accounting for income tax from the "normalized" method to the "flow-through" method effective February 1, 1984; and WHEREAS the matter of the method of accounting for income taxes in respect of both utilities was deferred in decisions related to a 1983 test period. NOW THEREFORE the Commission orders Inland Natural Gas Co. Ltd. and Columbia Natural Gas Limited as follows: 1. The method of accounting for income taxes by both utilities will change from the present "normalized" method to the ''flow-through" method effective February l, 1984. 2. Inland and Columbia shall each file revised rate schedules to be effectiveFebruary l, 1984 which will reflect the adjustment necessary to provide for a reduction in un t rates based on the 1983 test period dealt with in the May 25, 1983 Decision, as amended, with respect to Inland and the July 12, 1983 Decision with respect to Columbia. 3. The balance of deferred taxes as at January 31, 1984 will remain on the books of both companies and will be applied as a reduction to rate base. DATED at the City of Vancouver, in the Province of British Columbia, this )!J day of December, 1983. BY ORDER / / i/ ~) \/' Chai
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