New Jersey Enacted Legislation Requiring Municipal Utilities
NEW JERSEY ENACTED LEGISLATION REQUIRING MUNICIPAL UTILITIES to pay corporate business tax if they make sales within a franchise area served by another electric utility. Municipal utilities with eroding customer bases due to deregulation are under pressure to look outside city limits to ensure they retain a large enough revenue base to pay debt service on outstanding bonds. The debate has spilled over into Congress. Congress is expected to consider this year to what extent munis selling outside municipal boundaries should be forced to forfeit access to taxexempt financing for their facilities.