Senator Joe Markley Appears before the State Supreme Court

March 23, 2011

Hartford CT – Senator Joe Markley, represented by attorneys Doug Dubitsky and Peter Bowman, took his case against an illegal Department Public Utility Control (DPUC) tax to the State Supreme Court today.

Senator Markley is fighting a surcharge on utility bills that were set to expire, which the legislature instead turned into a tax to cover the deficit in the current year’s budget.

“This is a matter of skullduggery on the part of the Legislature, and we must not stand for it,” said Senator Markley. “The DPUC exists to regulate utilities, to work with the utility companies and the ratepayers for fair rates and safety. The legislature has tried to turn it into a taxing authority, and the result is inequity and confusion.”

The utility charges were originally added to consumers’ bills to help utilities recover some of the value of power plants they could no longer use, otherwise known as ‘stranded costs’. Lawmakers approved keeping the charge in place as part of a securitization deal, which sells future revenue at a loss to get funds now.

Markley has said this was a sneaky trick played on utility customers. Even Governor Malloy in his State of the State Address admitted the charge as now constituted is a tax.

“This sneaky tax is a way for the State to pay for its general fund obligations, simply a way to get out of a problem that they themselves created,” said Senator Markley. “This tax is unfair for two reasons: It is levied by a state agency, which doesn’t have the authority to do so; and there are six towns that would be exempt from paying the tax. As a result, not all Connecticut citizens are being hit with the extended utility charges to help shore up the state’s budget.”

Markley initiated his lawsuit against the Department of Public Utility Control in the New Britain Superior Court last year. In December, the lower court dismissed the case on a technicality. In February, the Attorney General’s Office requested the State Supreme Court take the case directly. Until Senator Markley’s case is decided, State Treasury officials can’t offer the approximately $700 million in securitization.