Judges: CHARLES C. FOTI, JR., Attorney General
Filed Date: 10/11/2007
Status: Precedential
Modified Date: 7/5/2016
Dear Ms. Gonzalez:
You requested an Attorney General's opinion regarding characterization of a special storm surcharge that may be collected from the ratepayers of Entergy Louisiana, LLC ("ELL") and Entergy Gulf States, Inc. ("EGSI"), collectively (the "Companies"). You indicate that this surcharge would have to be authorized by the Louisiana Public Service Commission ("Commission"), and its size would be based upon the expenses found by the Commission to have been prudently incurred by the Companies in connection with rebuilding their systems as a result of the damage caused by Hurricanes Katrina and Rita. You question whether the surcharge in question is a tax or a regulatory charge.
The surcharge would be a "system restoration charge" approved and charged pursuant to the Louisiana Utilities Restoration Corporation Act ("Act"). The Act enacted Part VIII of Chapter 9 of Title 45 of the Louisiana Revised statutes and consists of R.S.
While your question is whether the system restoration charge is a tax or a fee, this question does not need to be reached to determine whether the Commission may approve the system restoration charge contemplated by the Act. The Act authorizes the Commission to approve a charge, which is termed a "system restoration charge". Because the Act grants the Commission this power, the Commission may, by law, approve the charge. *Page 2
We note that all statutes are presumed to be constitutional. The Louisiana Legislature is presumed to have intended to enact a constitutionally valid law. State v. Manuel,
A party who attacks the constitutionality of a statute bears a heavy burden, and he must prove by clear and convincing evidence that the statute violates a specific constitutional provision. Board of Directorsof La. Recovery District v. All Taxpayers, et al,
That being said, with respect to differentiating between a fee and a tax, the Louisiana Supreme Court stated in Audubon Insurance Company v.Bernard,
It is well settled generally and in Louisiana that not every imposition of a charge or fee by the government constitutes a demand for money under its power to tax. If the imposition has not for its principal object the raising of revenue, but is merely incidental to the making of rules and regulations to promote public order, individual liberty and general welfare, it is an exercise of the police power. (citations omitted) In similar fashion, the police power may be exercised to charge fees to persons receiving grants or benefits not shared by other members of society. (citations omitted) But if revenue is the primary purpose for an assessment and regulation is merely incidental, or if the imposition clearly and materially exceeds the cost of regulation or conferring special benefits upon those assessed, the imposition is a tax. (citations omitted)
Similarly, in Safety Net For Abused Persons v. Segura, 96-1978 (La. 4/8/97),
The nature of a charge is determined not by its title, but by its incidents, attributes and operational effect. Thus, the nature of a charge must be determined by its substance and realities, not its form . . .
A charge that has as its primary purpose the raising of revenue, as opposed to the regulation of public order, is a tax.
In another recent case, Voicestream GSM / Operating Co, LLC v. LouisianaPublic Service Commission, 05-2578 (La. 11/29/06),
Thus, it would appear that as long as the charge imposed by the Commission is part of a regulatory program, and the charge is not intended to raise revenue, the courts would likely consider the charge to be a "fee" as opposed to a "tax".
Trusting this adequately responds to your request, we remain
Yours very truly,
CHARLES C. FOTI, JR. ATTORNEY GENERALM
BY:__________________________ KENNETH L. ROCHE, III Assistant Attorney General
CCF, JR/KLR, III/crt