ML101550354

E-Mail Re NRC Follow-Up Request for Tax Info on Kewaunee License Renewal

ML101550354
Person / Time
Site:	Kewaunee
Issue date:	06/03/2010
From:	Aitken P Dominion Energy Kewaunee
To:	Susco J Office of Nuclear Reactor Regulation
References
Download: ML101550354 (6)

Text

Susco, Jeremy From: Paul Aitken [paul.aitken@dom.com]

Sent: Thursday, June 03, 2010 1:01 PM To: Susco, Jeremy

Subject:

FW: NRC follow-up request for Tax info related to Kewaunee license renewal Jeremy This is what I received from my tax person regarding your last question:

The megawatt-based payment is not a tax paid by DEK (Dominion Energy Kewaunee), but represents the methodology used by the state to allocate state funds to jurisdictions with utility infrastructure - the Utility Aid Payment. As noted in the Taxes Paid by DEK section, DEK pays a gross receipts tax to the state and does not directly pay any material taxes to the local jurisdictions. In years prior to 2009, the state computed the Utility Aid Payment based on net book value of utility assets subject to a cap and floor - Carlton's &

Kewaunee's Utility Aid Payment received from the state, not DEK, was based on net book value. Post 2009, the payment made to Carlton & Kewaunee County by the state (again not DEK) is based on a rate per megawatt for DEK. In my opinion, you only need to change the wording in the megawatt-based payment section as noted below. There has been no change in the property tax or gross receipts tax regime (although some changes have been proposed since D acquire the unit.) The only change directly related to DEK (other than a change in the income tax structure in the state in 2009) resulted in a change in allocation of revenues by the state to the local jurisdictions which had no effect on the taxes levied on DEK.

Meqawatt-based payment Through 2008, this component only appliesd to electric generating plants that began operation or were repowered' after December 31, 2003. Beginning in 2009, this component + app!yies to KPS in lieu of the ad valorem payment. The payment is $2,000 per MW of name-plate generating capacity. For a plant in a town, one-third ($666.67) is paid to the town and two-thirds ($1,333.33) is paid to the county. For a plant in a village or city, two-thirds ($1,333.33) is paid to the village or city and one-third ($666.67) is paid to the county.

Taxes Paid by DEK In lieu of property tax on its electrical generating plant and other facilities, DEK pays the State of Wisconsin a lump sum gross revenue tax. There is no direct correlation between the amount of taxes paid to the State of Wisconsin and the distribution of funds to local taxing jurisdictions. The allocation of tax revenue attributable to KPS to local taxing jurisdictions is not recorded. Wisconsin state law requires that utility aid funds be paid to the municipalities and counties where utility property is located. The utility aid payments to the town of Carlton and Kewaunee County from the state could be attributed to the presence of KPS in these jurisdictions. Tables 2-15 through 2-19 present information about the town of Carlton's and Kewaunee County's total 23 tax revenues and the utility aid payments to the town of Carlton and Kewaunee County from the State of Wisconsin (for all utility property located in the town of Carlton). As presented in Table 2-16, the utility aid payments represent approximately 58.0 to 69.2 percent of the town of Carlton's total tax revenues. The vast majority of the payments are attributed to KPS. In 2004 and 2005, the town of Carlton collected no general property tax from its residents (DEK, 2008). Additionally, as shown in Table 2-17, the utility aid payments to Kewaunee County represent approximately 2.3 to 3.8 percent of Kewaunee County's total tax revenue.

From: Susco, Jeremy [1]

Sent: Thursday, June 03, 2010 8:30 AM 1

To: Paul Aitken (Generation - 6)

Subject:

RE: NRC follow-up request for Tax info related to Kewaunee license renewal

Paul, Thanks for this info. From my original email, one question still remains open:

Page 2-48, Line 31: Does this tax now apply to KPS? We want to reword the second sentence of the paragraph to reflect the current tax situation. If this tax does now apply, we may need to reword the "Taxes Paid by DEK" section on the next page.

If you get the answer today, could you give me a call at 202-236-8931 (working from home)? Otherwise, I'll be back in the office tomorrow.

Thanks, Jeremy CONFIDENTIALITY NOTICE: This electronic message contains information which may be legally confidential and or privileged and does not in any case represent a firm ENERGY COMMODITY bid or offer relating thereto which binds the sender without an additional express written confirmation to that effect. The information is intended solely for the individual or entity named above and access by anyone else is unauthorized. If you are not the intended recipient, any disclosure, copying, distribution, or use of the contents of this information is prohibited and may be unlawful. If you have received this electronic transmission in error, please reply immediately to the sender that you have received the message in error, and delete it. Thank you.

2

Received: from mail.1.nrc.gov (148.184.176.41) by TWMSO1 .nrc.gov (148.184.200.145) with Microsoft SMTP Server id 8.1.393.1; Thu, 3 Jun 2010 13:01:02 -0400 X-Ironport-ID: mail1 X-SBRS: 5.3 X-MID: 15174952 X-IronPort-Anti-Spam-Filtered: true X-IronPort-Anti-Spam-Result:

AicCAG58BOyeajRGmWdsb2JhbACBP5x7AQEBAQEICwoHESK/ZIJQASKCIwQ X-IronPort-AV: E=Sophos;i="4.53,355,1272859200";

d="scan'208,217";a="1 5174952" Received: from ojrpm03.dom.com (HELO dom.com) ([158.106.52.70]) by maill.nrc.gov with ESMTP; 03 Jun 2010 13:01:02 -0400 Received: from ([10.108.41.110]) by ojrpm03.dom.com with ESMTP id 5203301.18706106; Thu, 03 Jun 2010 13:00:57 -0400 Received: from INBEXCW81 0.mbu.ad.dominionnet.com ([10.8.230.45]) by smtpmta.va.dominionnet.com (Lotus Domino Release 6.5.4FP2) with ESMTP id 2010060313005625-390198; Thu, 3 Jun 2010 13:00:56 -0400 Received: from DOM-MBX03.mbu.ad.dominionnet.com ([fe8O::960:51b9:8d61:7c4d])

by INBEXCW810.mbu.ad.dominionnet.com ([::1]) with mapi; Thu, 3 Jun 2010 13:00:56 -0400 From: Paul Aitken <paul.aitken@dom.com>

To: "Susco, Jeremy" <Jeremy. Susco@nrc.gov>

Date: Thu, 3 Jun 2010 13:00:52.-0400

Subject:

FW: NRC follow-up request for Tax info related to Kewaunee license renewal Thread-Topic: NRC follow-up request for Tax info related to Kewaunee license renewal Thread-Index:

AcrwSBOCK2iXU LcgQdSOjH Ry9Y8iBg BucpywAR5NOMACAd UZQAAFI/ZQASBHA7AAAGHWMAAHtGa QAAFgfMA=

Message-ID: <23A2D9F7553E664B859332 B337ACA83E04000B4776@DOM-MBX03.mbu.ad.dominionnet.com>

Accept-Language: en-US X-MS-Has-Attach:

X-MS-TN EF-Correlator:

acceptlanguage: en-US MIME-Version: 1.0 X-MIMETrack: Itemize by SMTP Server on MAI LO 1/SERVERSNANCPOWER(Release 6.5.4FP2ISeptember 12, 2005) at 06/03/2010 01:00:56 PM, Serialize by Router on MAIL01/SERVERSNANCPOWER(Release 6.5.4FP2lSeptember 12, 2005) at 06/03/2010 01:00:57 PM, Serialize complete at 06/03/2010 01:00:57 PM Content-Language: en-US Content-Type: multipart/alternative; boundary="_000_23A2D9F7553E664B859332B337ACA83E04000B4776DOMMBX03mbuad" Return-Path: paul.aitken@dom.com

Affected Environment Table 2-15. Wisconsin Shared Revenue Utility Payments to the Town of Carlton for Utility 2 Property in the Town of Carlton, 2004 to 2008 Utility Property: Net Book Value:

Wisconsin Power& 48,276,451 44,689,234 6 6 6 Light I Wisconsin Public 70,717,380 73,240,209 0 240,250 154,309 Service Dominion Energy 0 0 75,773,083 36,556,659 37,503,448 Kewaunee American 1,310,499 1,281,173 1,872,469 2,209,085 2,043,656 Transmission Total 120,304,330 .119,210,616 77,643,558 39,006,000 39,701,413 Value Guarantee 1,093,714 0 17,062,594 55,702,152 55,006,739 Total Value 121,398,044 119,210,616 94,708,152 94,708,152 94,708,152 Payment:

Payment Rate 0.003 0,003 0.003 0,003 0.003 Payment- Rate X 364,194.13 357,631.85 284,124.46 284,124.46 284,124.46 Total Value Population 1,032 1,037 1,031 1,034 1,081 Payment LImit - Per 300.00 300.00 300.00 300.00 300.00 Capita Maximum Payment 309,600.00 311,100.00 309,300.00 310,200.00 318,300,00 Value-Based 309,600.00 311,100.00 284,124.46 284,124.46 284,124.46 payment Spent Nuclear Fuel 50,000.00 50,000.00 50,000.00 50,000.00 50,000.00 payment Total Utility Payment 359,600.00 361,100.00 334,124.46 334,124A6 334,124.46 Source: DEK, 2008 Note; The shared revenue payment is funded from general state revenues; it is not paid by the utilities In the town. It is a payment for the presence of the utilities in the town and county.

FebruaryI 20P 0 D N 1 437,t rp e #40I2-5 UAA Draft NUREG-1437, Supplement 40 2-50 February 2010

Affected Environment 1 Table 2-16. Wisconsin Shared Revenue Utility Payments to Kewaunee County for Utility 2 Property in the Town of Carlton, 2004 to 2008

......

.0

... 4 2007r`

Utility Property: Net Book Value:

Wisconsin Power 48,276,451 44,689,234 6 6 6

& Light Wisconsin Public 70,717,380 73,240,209 0 240,250 154,309 Service Dominion Energy 0 0 75,773,083 36,556,659 1' 37,503,448 -

Kewaunee American 1,310,499 1,281,173 1,872,469 2,209,085 2,043,656 Transmission Total 120,304,330 119,210,616 77,643,558 39,006,000 39,701,413 Value Guarantee 1,093,714 0 17,062,594 55,702,152 55,006,739 Total Value 121,398,044 119,210,616 94,708,152 94,708,152 94,708,152 Payment:

Payment Rate 0.006 0.006 0.006 0.006 0.006 Payment - Rate X 728,388.26 715,263.70 568,248.91 568,248.91 568,248.91 Total Value Population 20,648 21,082 12,157 21,198 21,358 Payment Limit - 100.00 100.00 100.00 100.00 100.00 Per Capita Maximum 2,064,800.00 2,108,200.00 2,115,700.00 2,119,800.00 2,135,800.00 Payment Value-Based 728,388.26 715,263.70 568,248.91 568,248.91 568,248.91 payment Spent Nuclear 50,000.00 50,000.00 50,000.00 50,000.00 50,000.00 Fuel payment Total Utility 778,388.26 765,263.70 618,248.91 618,248.91 618,248.91 Payment Source: DEK, 2008 Note: The shared revenue payment Is funded from general state revenues; it is not paid by the utilities in the town. It is a payment for the presence of the utilities in the town and county.

Febua21 2-541o no NUREG-437, W February 2010 2-51 Draft NUREG-1437, Supplement 40

Table 2.7-3 WSR Utility Payments for Utility Property in the Town of Carlton 2009 Actual Data Carlton Kewaunee Combined Total Utility Property: Net Book Value Non KPS Utility Property -- Carlton 2,145,830.00 2,145,830.00 2,145,830.00 Total 2,145,830.00 2,145,830.00 2,145,830.00 Payment Rate for Towns &Villages 0.003 0.006 Value Based Payment 6,437.49 12,874.98 19,312.47 Megawatt - Based Payment:

$ per MW of Capacity 666.67 1,333.33 2,000.00 MW Capacity 535.00 535.00 535.00 MW - Based Payment 356,666.67 713,333.32 1,070,000.00 Maximum Payment:

Population 1,064 21,488 Payment Limit - Per Capita 425.00 125.00 Maximum Payment 452,200.00 2,686,000.00 3,138,200.00 Utility Property -- Value Based Payment 6,437.49 12,874.98 19,312.47 Utility Property -- Megawatt Based Payment 356,666.67 713,333.32 1,070,000.00 Spent Nuclear Fuel Payment 50,000.00 50,000.00 100,000.00 Total Utility Aid Payment 413,104.16 776,208.30 1,189,312.47

$