A California congressman wants to hit PG&E with heavy financial penalties the next time it tries to give executive bonuses while subjecting Californians to blackouts.
Rep. Josh Harder, D-Turlock, announced on Monday he’d submit a bill in response to the blackouts PG&E initiated across California as a precaution against wildfires.
Harder’s bill would revive a tax called the alternative minimum tax for utilities that offer executive bonuses but have failed to invest in climate-resilient infrastructure. The bill is written to specifically target PG&E, which has not paid federal income taxes in the past decade due to tax loopholes on depreciation, according to the Institute on Taxation and Economic Policy.
PG&E has deliberately shut off electrical power in a vast stretch of its service territory eight times this year.
Earlier this month the company had its largest blackout to date, throwing 1.5 million residents into darkness. PG&E officials have said such shutoffs could continue for a decade while they update and repair existing infrastructure, which state and federal officials have deemed unacceptable.
“Obviously weather events are to blame here, but so are the executives at PG&E who have opted to give themselves huge bonuses and pay millions to lobbyists instead of making their infrastructure climate resilient,” Harder said in a statement Monday. “It’s regular people in the Valley and across Northern California who are paying the price. My bill gives PG&E a choice – stop paying your executives bonuses and invest in your infrastructure or take a hit to your bottom line.”
PG&E responded to Harder’s proposal by listing climate change minded fixes that spokeswoman Lynsey Paulo called an “unprecedented inspection and repair process earlier this year.”
“More than 700,000 electric system poles, towers and substations were inspected, and any items needing immediate repair were repaired,” Paulo said. “PG&E has installed 600 weather stations and 100 high-definition cameras in high fire-threat districts for increased situational awareness.”
The tax cuts passed by Republicans in 2017 eliminated the alternative minimum tax for corporations, although it still applies to certain wealthy households. The tax was designed to keep wealthy corporations from using loopholes to avoid paying taxes.
The alternative minimum tax rate is 20 percent and does not allow for deductions such as depreciation.
Harder is finishing the official text of the bill. It’s not yet clear if other California lawmakers will support the bill.
The top eight PG&E executives were paid over $25 million in 2018 according to Securities and Exchange Commission filings. Earlier this year, PG&E proposed a $16 million bonus plan for its executives, which was rejected by a bankruptcy judge in August. Last week, PG&E’s CEO Bill Johnson would not commit to abandoning efforts to offer a new bonus plan for executives.
The company also spent approximately $10 million on lobbying in 2018, according to OpenSecrets.