HomeMy WebLinkAbout1970 R. M. Holcomb Looks at Utility Revenuesiat 09ue
The opinions expressed in Dialogue
are solely those of the writer and as
not necessarily represent the opinion of
the Daily Eagle. Readers are repo
ed to limit their le rs to 300 r er
less. -�
R. M. olcomb Looks
At Utility Revenues
ro the Editor:
It appears to me that the utility rev -
eaue .olicy of the City of College Station
is forcing its citizens to pay more federal
income taxes than they should have to
pay.
According to the 1969 Annual Report
which has just been received, utility
revenues came to $975,600 and expenses
to only $700,000. The difference, $275,-
600, was diverted to general govern-
ment expenses. As an alternative, the
utility rates could have been lowered
so that revenues just equalled expenses
and the difference collected through ad-
ditional taxes.
Taxes collected as utility revenue are
not deductible expenses for a homeown-
er in computing his federal income tax.
If collected as property tax, however,
`they would be deductible.
Assuming the very low average rate
of 20 per cent for the top rate of the
income taxes, it would appear that the
savings would amount to some people
paying $55,000 — except that some
revenue comes from businesses rather
than homeowners. At any rate, it ap-
pears that our city has forced us to pay
some $50,000 more in federal income
taxes than we should have to pay.
This may not seem like much, but
compared to what we put into the Unit -
ed Fund, for instance, it looks big.
Aside from the amount of money in-
- 'volved, there is a pernicious quality to
paving ctiy expenses through utility
'revenue in that this is a "hidden" tax.
As such, it is probably seldom considered
as a tax by the average citizen, and is
less subject to control through open dis-
cussion and the ballot than if it were
properly identified and collected as a
tax. C
n,
Robert M. Holcomb
1100 Ashburn 9
College Station