Annual Annual EPS
Close Close Percent 52-Wk 52-Wk Div Div Book P/E Last
Company Region 12/29/95 03/29/96 Change High Low Rate Yield Value Ratio 12 Mos.
A coalition of congressmen and private-interest groups has put the Rural Utilities Service on its hit list, aiming to save taxpayers about $11.5 billion over five years.
Dubbed "Stop Corporate Welfare," the coalition has targeted 12 programs. The RUS is first on the roster.
The coalition group notes that the RUS subsidizes loans for electric cooperatives, which serve 10 percent of the population. The group also says that loans to co-ops are made at interest rates not only below the Treasury's borrowing costs but well below that of investor-owned utilities.
"Today, there is no need for the government to do this," reads the group's statement. The coalition notes the RUS's predecessor was established in the Depression to bring electricity to rural areas.
"In fact, many rural utilities are facing increased competition from investor-owned utilities," and a bailout of several rural electric suppliers investing in nuclear power plants has wasted money, the statement says. Citing the Congressional Budget Office, the coalition maintains that because loan interest accounts for a small percentage of a consumer's bill, "eliminating the subsidy would have little effect on utility rates that most borrowers charge their customers."
The coalition estimates that ending financial support for co-op loans would save $190 million over five years.
Also on Stop Corporate Welfare's list is fossil energy research and development ($1.37 billion), and clean coal technology ($500 million).
Congressmen heading the coalition include John Kasich (R-Ohio), Rob Andrews (D-N.J.) and Ed Royce (R-Calif.). Lobby members include the National Taxpayer's Union, U.S. Public Interest Research Group and Americans for Tax Reform. (em JS
Articles found on this page are available to Internet subscribers only. For more information about obtaining a username and password, please call our Customer Service Department at 1-800-368-5001.