By: Schwertner S.B. No. 1364
 
  (Murphy, Deshotel)
 
   
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the computation of an electric utility's income taxes.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Subsection (a), Section 36.060, Utilities Code,
  is amended to read as follows:
         (a)  If an expense is allowed to be included in utility rates
  or an investment is included in the utility rate base, the related
  income tax benefit must be included in the computation of income tax
  expense to reduce the rates. If an expense is not allowed to be
  included in utility rates or an investment is not included in the
  utility rate base, the related income tax benefit may not be
  included in the computation of income tax expense to reduce the
  rates. The income tax expense shall be computed using the statutory
  income tax rates.  [Unless it is shown to the satisfaction of the
  regulatory authority that it was reasonable to choose not to
  consolidate returns, an electric utility's income taxes shall be
  computed as though a consolidated return had been filed and the
  utility had realized its fair share of the savings resulting from
  that return, if:
               [(1)     the utility is a member of an affiliated group
  eligible to file a consolidated income tax return; and
               [(2)  it is advantageous to the utility to do so.]
         SECTION 2.  This Act takes effect September 1, 2013.