Milford chronicle., 1940-05-03
CUTTING THE TAP ROOT

One result of the Federal program
to socialize the light and power in.
d1stry is to create an immense taz
problem for states and municipali.
ties.
The latest example is provided BY
Oregon, where the drive to displace
the long ablished private electric
utilities with tax sabnidized public
utility districts tPUDs) to use pow
er from Bonneville dam, is being ag-
gressively pursued The Northwest
Electric Light and Power Associa-
tion has made q thorough factual
survey Of the property taxes paid
by the private utilities in the state
in relation to total property taxes
collected. Here are some of its
startling disclosures:
All utilities, including electric
companies, railroads, telephone, etc.
pay $7,OO0,000 in Oregon property
taxes each year This represents II
per cent of all property taxes levied.
or this total the electric utilities pay
approximately 10 per cent.
In depression years when tax de-
linquencieS are heavy, the utilities
cash tax payments reach a consider
ably higher proportion of total eOl-
lections
There are. 90 counties in Oregon,
and in IA of these utility taxes
amount to more than 20 per cent of
all property taxes levied. Maximum
is almost 30 per cent.
In only seven of the 81 counties do
utility taxes represent less than 10
per cent
Under a new Oregon law, public
utility districts created to use the
federal power are required to pay
property taxes (bnt not franchise
fees, or income taxes) However, it
is exceedingly doubtful if property
tax payments Of PUDs would be
anywhere near as large as those Of
the private companies, for the simple
reason that it is now the general
policy to assess private utility COM
panies as high as possible as a mat
ter OF good political public relations.
III the case of the PUDs, the trend
would IN all probability be reversed,
still as matter of good political
public relations. All possible pres
sure would be used to cut assess
ments to the bone so that the PUBS
might make a superficially good
showing In reducing rates. OF course,
the already heavily burdened gem
eral taxpayers would have TO make
up the loss in tax revenue.
What IS true of Oregon is trpe to
a greater or lesser extent of every |
other state where government Is go
ing into the power business. In Ten
nessee, for instance. where govern
ment has a virtual monopoly Of the
business since 1XA purchased the
Tennessee Electric Power Company,
the tax problem has become acute,
and closure Of schools has been
for lack OF money.
On top Of that. the advocates Of so
cialized power, despite all its spe-
cial privileges and subsidies, have
not been able TO show that they can
make material reduction Ia cleo
tric rates. In Oregon. Bonneville
rate schedules are but slightly lower
II most instances for the hopsehold-
ef. than those now charged by the
heavily taxed, self-supporting, state- Il
private industry. u looks
as II cutting a few cents of the aver
age light bill can be done only by
adding dollars to the tax bill.
Little by little the people are be-
Ing given the chance to learn the
facts concerning the power contro- !
gersy IN spite Of the political bally- h
hoo and deception which has 50 long 4
Dbscured the issue All those facts 9
lead inescaDably to one conclusion Z
costs plenty And lts final q
cost Is the destruction Of those rights q
lai eberiies Of the people which are
he tap root Of democracy. IL