U.S.

One Enron Unit Owes Back Taxes

February 6, 2002 / 7:16 AM EST / AP

Enron Broadband Services, one of Enron Corp.'s failed business ventures, owes about $440,000 in back taxes, according to Texas officials.

Enron Broadband Services was an unsuccessful Internet venture that filed for Chapter 11 bankruptcy protection on Dec. 26. It did not notify the Harris County, Texas, in 2001 that it had nearly $15 million in telecommunications equipment, county Tax Assessor Paul Bettencourt told the Houston Chronicle in Wednesday's editions.

The company neglected to list the equipment in its 2001 taxable property, Bettencourt said. The taxes were due by Jan. 31, 2002. Back tax owed to the county tax office is $207,000. About $237,000 is owed to Houston Independent School District, Bettencourt said. County records also show the company's property tax was $3,600 for 2001.

Enron spokesman Mark Palmer said bankruptcy does not preclude the company from paying taxes.

"I'm sure if they are appropriate, and if we owe them, we will pay them," Palmer said.

Bettencourt said his office notified Enron of the oversight and tax due Jan. 31. The firm has 30 days to appeal. If it doesn't, it has 45 days to pay the tax before becoming delinquent.

Enron created its broadband services unit in 1997, believing it could buy and sell Internet access like a commodity. But the venture reported steep losses each quarter.

In January 2001, Enron's then-president Jeff Skilling touted the unit's moneymaking potential at a time when its 2,000 employees were having trouble finding customers and the firm was trying to sell its single hard asset, an 18,000-mile fiber-optic data network.

In April 2001, the unit tried to sell millions of dollars worth of computers and telecommunications equipment stockpiled at a warehouse.