Federal Tax Law Investigation
On January 3, 2018, the IURC opened an investigation "into the impacts of the Tax Cuts and Jobs Act of 2017 and possible rate implications." The Commission formally closed the investigation in a January 27, 2021 order.
The new federal law reduced the corporate tax rate for most investor-owned utilities from 35 percent to 21 percent. Utilities that pay federal income taxes may recover them through rates on a dollar-for-dollar basis.
The OUCC participated on behalf of Indiana consumers in Cause No. 45032. All rate-regulated, investor-owned utilities were parties to the case. Municipal and not-for-profit utility rates were not at issue.
The investigation had two phases:
- Immediate rate relief
- Longer term tax issues
PHASE ONE: IMMEDIATE RATE RELIEF
Rates for most Indiana utilities have decreased to reflect the federal corporate income tax reduction utilities received on January 1, 2018. More specifically, tariffs have been adjusted to reflect the new 21 percent rate.
PHASE TWO: LONGER TERM TAX ISSUES
The case's second phase examined longer term issues including customer credits for rates collected at the 35-percent tax rate since January 1, 2018 and deferred income tax accounting matters.
Phase Two issues for each utility were addressed in separate subdockets, with links to each case file below. Commission orders have been issued in all subdockets.
Indianapolis Power & Light (IPL)
Phase One: A settlement agreement received IURC approval.
Additional info: OUCC Testimony | Case File
Phase Two: All issues were addressed in the utility's 2017/2018 rate case.
NATURAL GAS - LARGE UTILITIES
Citizens Gas was not a respondent as it is not an investor-owned utility.
NATURAL GAS - SMALL UTILITIES
Citizens Gas of Westfield was dismissed from the case.
Switzerland County Natural Gas: The utility's proposed revised tariff was denied.
WATER/WASTEWATER - LARGE UTILITIES
Phase One Approved Tariffs: Aboite Wastewater, Darlington, Lake County Sewer, Lake County Water, Sani Tech, South Haven, Southern Hills, Southeastern, Wedgewood Park, Wildwood, White Oak, Wymberly
South Haven: Approved Settlement Agreement | OUCC Testimony | Case File
All Other Territories: Approved Settlement Agreement | OUCC Testimony | Case File
Citizens Water/Wastewater was not a respondent as it is not an investor-owned utility.
WATER/WASTEWATER - SMALL UTILITIES
The Citizens Energy Group utilities serving Westfield were dismissed from the case.
Community Utilities of Indiana
Phase One: Issues were considered through post-order filings in the utility's most recent rate case.
Phase Two: IURC Order | Settlement Agreement | OUCC Testimony | Case File
Other Small Water/Wastewater Utilities
The OUCC did not object to proposed tariffs from Devon Woods Sewer Utility and Howard County Utilities.
The OUCC did not object to dismissal requests from the following: Apple Valley Utilities, Bluffs Basin Utility, Doe Creek Sewer Utility, JLB Development, Kingsbury Utilities, Pioneer Water, Pleasantview Utilities, Wastewater One, and Webster Development.
All publicly filed documents in both phases of the investigation are available from the IURC's website.