TVA shares wealth of higher rates

Consumers may be hurting, but those higher electric rates from the Tennessee Valley Authority will end up helping their state and local governments.

The nation's largest public utility doesn't pay income taxes and is exempt from property taxes. But under the TVA Act, it must return 5 percent of its revenues to state and local governments in its territory.

In the current fiscal year, TVA will pay $495 million in lieu of taxes to state and local governments, up from $455 million last year. Depending upon what rates and power sales do in the next year, TVA could boost such tax-equivalent payments to nearly $600 million by 2010.

TVA President Tom Kilgore said the money helps operate schools, build roads and fund local government services