AG: 2 rulings save Nevada $200 million

CARSON CITY — Two recent court decisions regarding the collection of use taxes on coal used by utility companies will save Nevada $200 million, state Attorney General Catherine Cortez Masto said Thursday.

On Tuesday, Carson City District Judge James T. Russell ruled that Southern California Edison was not entitled to a state refund on use taxes it paid on coal purchases to the Nevada Department of Taxation for the period of March 1998 through December 2000.

With added use tax and interest accrued over the past 12 years, the refund would have been over $100 million.

Russell’s decision followed an eight-day bench trial in January. His decision was stayed pending a Nevada Supreme Court ruling on a similar case involving Sierra Pacific and Nevada Power companies’ appeal of a Washoe District Court ruling.

The Nevada Supreme Court on Dec. 4 denied that separate claim for a refund of $90 million.

A decision in favor of the utilities would have had a significant impact on the state budget, which is already facing a $162 million shortfall this year due to lower tax revenues and higher than expected school enrollments.

The Supreme Court case involved the NV Energy companies, which bring coal into Nevada to produce electricity and so pay a use tax. A state law exempts Nevada mine products from the use tax. The parties agreed that the state exemption for locally mined minerals violates the Commerce Clause of the U.S. Constitution, which prohibits such discrimination.

But because NV Energy showed no financial harm from the state statute, the court said the utility was not entitled to a refund.

Contact Capital Bureau reporter Sean Whaley at or 775-687-3900. Find him on Twitter: @seanw801.

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