In accordance with 5 CFR 1320, OMB is filing comment and withholding approval at this time. The agency shall examine public comment in response to the proposed rulemaking and will include in the supporting statement of the next ICR--to be submitted to OMB at the final rule stage--a description of how the agency has responded to any public comments on the ICR, including comments on maximizing the practical utility of the collection and minimizing the burden.
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36 Months From Approved
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The Tax Cuts and Jobs Act of 2017 reduced tax levels applicable to corporate and individual income, effective January 1, 2018. Pipelines subject to cost of service regulation pursuant to Section 4 of the Natural Gas Act (NGA) and Section 311 of the Natural Gas Policy Act (NGPA) are permitted to include projected income taxes as part of the cost of service, and are permitted the opportunity to recover those costs through their rates. Pipelines are not required to reduce their rates to reflect reduced income taxes. Proposed FERC-501G is required to implement the statutory provisions governed by Section 4 of the NGA and Section 311 of the NGPA that the pipelinesâ currently effective rates remain just and reasonable (NGA) or fair and equitable (NGPA).
On December 22, 2017, the President signed the Tax Cuts and Jobs Act. The Tax Cuts and Jobs Act, among other things, lowers the federal corporate income tax rate from 35 percent to 21 percent, effective January 1, 2018. This means that, beginning January 1, 2018, companies subject to the Commissionâs jurisdiction will compute income taxes owed to the IRS based on a 21 percent tax rate. The tax rate reduction will result in less corporate income tax expense going forward.
The tax rate reduction will also result in a reduction in accumulated deferred income taxes (ADIT) on the books of rate-regulated companies. The amount of the reduction to ADIT that was collected from customers but is no longer payable to the IRS is excess ADIT and should be flowed back to ratepayers under general ratemaking principles.
The proposed new FERC-501G is a one-time information collection (with various components) designed to provide the data to ensure natural gas pipeline rates are just and reasonable. FERC-501G is a one-time report (for which the various components are detailed in Question 12) with no continuing reporting requirement.
On behalf of this Federal agency, I certify that the collection of information encompassed by this request complies with 5 CFR 1320.9 and the related provisions of 5 CFR 1320.8(b)(3).
The following is a summary of the topics, regarding the proposed collection of information, that the certification covers:
(i) Why the information is being collected;
(ii) Use of information;
(iii) Burden estimate;
(iv) Nature of response (voluntary, required for a benefit, or mandatory);
(v) Nature and extent of confidentiality; and
(vi) Need to display currently valid OMB control number;
If you are unable to certify compliance with any of these provisions, identify the item by leaving the box unchecked and explain the reason in the Supporting Statement.
RM18-11_NOPR_501G supporting statement3-23-2018.docx
NOPR RM18-11-fact-sheet.pdf
NGPA section 311 and Hinshaw Pipelines with Cost-Based Rates