CLAYTON, Mo. (CN) – Ameren and Union Electric underreport revenue to duck municipal taxes, two Missouri cities say in a class action. Winchester and Creve Coeur say the power giants, which own their electric-transmission poles, refuse to pay taxes on the extra money they earn by letting cable TV companies and other telecoms attach devices to the poles.
Ameren and Union Electric claim that cities’ gross receipts tax laws apply only to their income from power distribution, not to the extra revenue from telecom attachments.
“Plaintiffs do not know the nature and extent of other gross receipts that defendants have unilaterally excluded from the license tax base,” the cities say. “Plaintiffs’ codes and ordinances require defendants to file statements showing the gross receipts derived from their business(es) in plaintiffs and, at the same time, to pay license taxes thereon. In practice, defendants report a total amount of gross receipts without itemization. Plaintiffs have reason to believe that there is underreporting based on defendants’ stated position that only customer service rates in tariffs approved by the Missouri Public Service Commission are subject to municipal taxation, which is incorrect as a matter of law.”
The class consists of all Missouri municipalities and political subdivisions that tax businesses that provide electrical service. They seek declaratory judgment that gross receipts from pole attachments are subject to taxation, accounting, and an injunction.
They are represented in St. Louis County Court by John Hoffman with Korein Tillery.