ACHRNEWS

May 17, 2004: PHCC Advocates Against Rural Electric Cooperative Rule

May 17, 2004
WASHINGTON - The Plumbing-Heating-Cooling Contractors-National Association (PHCC) announced that it is advocating for White House intervention on a federal rule that would benefit rural electric cooperatives in their effort to diversify into other business areas, such as HVAC.

According to the PHCC, the U.S. Department of Agriculture is issuing a regulation regarding a loan guarantee program that will enable rural electric cooperatives to obtain below market rate financing. Cooperatives could use such financing to their competitive advantage and diversify their businesses into areas currently served by HVAC contractors. The association notes that cooperatives have identified the HVAC area as ripe for entry.

Cooperatives are exempt from federal taxation; in effect, contractors would be paying for the subsidies being given to cooperatives, which would then use these subsidies to compete directly against contractors, says PHCC.

Publication date: 05/17/2004