Phone company, with $7 of revenue, offers to pay state $750 license fees
PIERRE -- Calling cards used in South Dakota a few times by a few Connecticut customers of an ATT subsidiary will cost the company a state licensing fee of $250.
A lawyer for SNET America offered to pay $750 -- at $250 per year for 2007, 2008 and 2010 when the cards were used in South Dakota -- but the state Public Utilities Commission decided Wednesday that $250 one time was sufficient.
The attorney, Bill Van Camp, of Pierre, said he calculated that about $7 of calls was made in South Dakota during the three years.
The problem was SNET America didn't have a state certificate of authority from the PUC to operate in South Dakota.
That meant the company didn't pay the state's gross-receipts tax on the $7 of revenue. State law sets an annual minimum charge of $250.
The matter hadn't been discovered by the PUC. SNET America contacted the PUC last month.
PUC chairman Gary Hanson suggested the $250 rather than accept the $750
Commissioner Chris Nelson said he agreed but he stressed the decision didn't set a precedent. "I look at this as a very unique, unfortunate situation," he said.
Commissioner Kristie Fiegen said the $250 made sense. "This is a good compromise and a just compromise," she said.
Hanson said the law should be adjusted so the commission or staff can have discretion when revenue is small. He noted the commission also doesn't have the authority to grant a refund if a company has overpaid.
"I think it should go both ways," Hanson said.