KNOXVILLE, TN ― The Tennessee Valley Authority provided nearly $524 million in tax equivalent payments in fiscal year 2018 to state and local governments served by its energy generation or in areas supporting TVA properties.
At its meeting Wednesday, TVA’s board of directors approved the final tax equivalent payments for the current fiscal year, which are approximately $7 million more than 2017. The board also approved the estimated tax equivalent payments for FY2019.
“These funds represent another way TVA works with state and local government to invest in continued economic development, improved quality of life and overall community growth to benefit those we serve,” said Bill Johnson, TVA president and CEO.
TVA returns five percent of power sales revenues from the previous year in the form of tax equivalent payments in the eight states where it sells electricity or owns generating plants, transmission lines, substations and other assets, and directly to 146 local governments where TVA owns power facilities. The funds are distributed in monthly payments, with final payments approved at the end of each fiscal year.
The payments compensate state and local governments that cannot levy property or sales taxes on TVA as a federal entity, and make TVA one of the largest contributors to state budgets in Tennessee and Alabama. In addition to the seven states and many counties in the Tennessee Valley region, the state of Illinois and two of its counties receive payments for coal reserves TVA owns there.
In fiscal year 2018, the following tax equivalent payments were made to each state:
· Alabama – $87,534,312
· Georgia – $8,509,917
· Illinois – $366,581
· Kentucky – $36,212,968
· Mississippi – $39,695,488
· North Carolina – $2,801,726
· Tennessee – $347,361,704
· Virginia – $1,204,481
· TOTAL – $523,687,177
State and local governments distribute the funds according to their own formulas and discretion to support a variety of initiatives, including schools, fire departments and other emergency response agencies, tourism and recreation, and human service organizations.
Since 1941, TVA has made more than $13.5 billion in tax equivalent payments, with payments in the past 10 years totaling over $5 billion.
Media Release/TVA/Jim Hopson, Knoxville
