Who pays more taxes overall in North Dakota to state and local government-the IOUs or the RECs?
On the issue of who generates the most tax revenue for state and local government, it is not a close contest. The RECs contribute more tax dollars because the RECs have invested heavily in North Dakota’s lignite industry to supply electric power to the state and region. In 1996, for example, REC power-plant investments accounted for over $27 million in coal-conversion and coal severance-tax revenues, compared to somewhat over $2 million for the IOUs. Taking all sources of state and local tax revenue into account, including income taxes, the RECs contributed about three times more in taxes to state and local government than the IOUs ($36.9 million compared to $13.2 million). The IOUs say the RECs should pay more taxes than the IOUs because the RECs own more electric generation in the state. It’s true that the RECs do own more generation. But state policymakers should understand just how important the REC contributions have been to the state’s economy. If the discussion turns to tax equi
