RAPID CITY, S.D. - Sept. 5, 2018 - Black Hills Corp. (BKH) today announced that its South Dakota electric utility subsidiary, Black Hills Energy, will provide $7.7 million in federal tax reform benefits to its customers in South Dakota for calendar year 2018 and an ongoing benefit in 2019 and beyond. The benefit for calendar year 2019 is estimated at $8.9 million.
The South Dakota Public Utilities Commission approved a settlement agreement for Black Hills Energy on Sept. 4 allowing the company to pass on to customers the benefits of a lower corporate federal income tax rate, which was reduced from 35 percent to 21 percent beginning in 2018 with the passage of the Tax Cuts and Jobs Acts.
The settlement agreement provides for the 2018 benefits of tax reform to be passed on to customers through a one-time credit on their October bill. The aggregate 2018 benefit for all customers is estimated at $7.7 million. For 2019, the settlement agreement authorizes an $8.9 million aggregate reduction in base rates for customers. This reduction will be reflected on customers` monthly bills beginning in January 2019.
"We are pleased to finalize a plan to deliver savings from tax reform directly to our South Dakota customers," said Linn Evans, president and chief operating officer of Black Hills Corp. "We strive to deliver long-term value to our customers, and it is our privilege to be able to provide these financial benefits to our customers."
Upon passage of the Tax Cuts and Jobs Act in December 2017, Black Hills announced its intent to collaborate with utility commissions in the states in which it provides utility service to deliver to customers the benefits of a lower corporate federal income tax rate. Black Hills has now received state utility commission approvals in five states to provide the benefits of federal tax reform to utility customers. Discussions are underway with utility commissions in the remaining states and final approval is expected prior to year-end. A list of states where benefits to customers of federal tax reform have been approved is listed below.
|State|| Approximate 2018 |
Benefit for Customers
| Start Date for |
|Colorado||$10.8 million||July 2018|
|Iowa||$2.4 million||June 2018|
|Kansas||$1.9 million||April 2018|
|Nebraska||$3.8 million||July 2018|
|South Dakota||$7.7 million||Oct. 2018|
Black Hills Corporation
Black Hills Corp. (BKH) is a customer focused, growth-oriented utility company with a tradition of improving life with energy and a vision to be the energy partner of choice. Based in Rapid City, South Dakota, the company serves 1.25 million natural gas and electric utility customers in eight states: Arkansas, Colorado, Iowa, Kansas, Montana, Nebraska, South Dakota and Wyoming. More information is available at www.blackhillscorp.com, www.blackhillscorp.com/corporateresponsibility and www.blackhillsenergy.com.
Jerome E. Nichols
24-Hour Media Relations Line
Caution Regarding Forward Looking Statement
This news release includes "forward-looking statements" as defined by the Securities and Exchange Commission, or SEC. We make these forward-looking statements in reliance on the safe harbor protections provided under the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, included in this news release that address activities, events or developments that we expect, believe or anticipate will or may occur in the future are forward looking statements. This includes our ability to acquire utility commission approvals for delivering benefits to customers related to federal tax reform. These forward-looking statements are based on assumptions which we believe are reasonable based on current expectations and projections about future events and industry conditions and trends affecting our business. However, whether actual results and developments will conform to our expectations and predictions is subject to a number of risks and uncertainties that, among other things, could cause actual results to differ materially from those contained in the forward-looking statements, the risk factors described in Item 1A of Part I of our 2017 Annual Report on Form 10-K filed with the SEC, and other reports that we file with the SEC from time to time.
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Source: Black Hills Corporation via GlobeNewswire