PLACENTIA : Edison Corp. Denies Owing City $58,000

Southern California Edison Corp. is disputing the city’s claim that the company owes three years of unpaid business license taxes, plus penalties.

City officials billed the utility $58,000 for back taxes plus penalties after an outside audit of the city’s financial records revealed Edison had not been paying the license fee since 1949, when it was awarded a franchise.

Under the law, however, the city can attempt to collect the money for just the past three years. But Edison officials contend that the city’s own ordinance exempts public utilities from the tax and are refusing to pay.

Ronald Whittemore, Edison’s regional manager for the area that includes Placentia, said the city has not tried to collect a business license tax for the past 23 years.

“All of a sudden, in 1992 they told us we had to pay,” Whittemore said. “Our attorneys read the ordinance, and we contend (that the license fee) does not apply to us.”

Edison is basing its claim on the fact that utilities are not specifically mentioned in the section of the municipal code covering business licenses.

“In the list of categories of businesses subject to licensing, public utilities are not listed,” Whittemore said. “We feel we are exempt.”

The city demanded the tax from two other utilities, the gas and telephone companies. They have paid. The Southern California Gas Co. and Pacific Bell agreed to pay the back taxes if the city waived the penalties, which it did.

But Placentia Finance Director Howard Longballa said public utilities are considered businesses that offer a service, a category covered in the municipal code. Therefore, they are required to pay the tax, he said.

Edison turned down a similar deal, Longballa said, and now the city expects the company to pay the full amount.