City and County of San Francisco, Consumers Arise Now

6 Cal. 3d 119 (1971), 490 P.2d 798

The Court reversed a Commission decision in which the Commission had refused to consider the merits of flowing through to ratepayers tax benefits a utility derived from accelerated appreciation to the utility’s rate payers.  The issue of ratemaking treatment of income taxes was before the court many times in the 1970s.  (See Paras. 56, 62 and 65, supra.)  The issue of how tax benefits are to be passed on to ratepayers remains under debate at the Commission; two application for rehearing are now  pending that address the propriety of imputing income taxes for utilities organized as sub-chapter S corporations or partnerships.

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