November 2017 Newsletter

November 13, 2017 | Newsletter
  • CALIFORNIA – Airlines’ failure to challenge assessments on their commercial aircraft before local boards of equalization precluded claims that assessments were void because Counties had deviated from mandatory statutory formula.
  • MINNESOTA – Supreme Court rejects Tax Court’s use of Eurofresh standard, holding that to prove a property suffers from external obsolescence; utility taxpayers need not identify the specific causes of external obsolescence and precisely calculate the contribution of each asset to decreased revenues or profit margins.
  • SOUTH CAROLINA – Fourth Circuit Court of Appeals holds that South Carolina statute which singles out railroad property by excluding it from 15 percent assessment increase cap afforded other commercial and industrial property violates Railroad Revitalization and Regulatory Reform Act.
  • COLORADO – Supreme Court allows retroactive taxation where gas company underreported oil and gas selling price at the wellhead.
  • OHIO – Case remanded to Board of Tax Appeals to consider whether property owner established that initially reported value was not accurate reflection of parcel’s value and to independently determine parcel’s true value.

July 2017 Newsletter

July 1, 2017 | Newsletter
  • TEXAS – Court of Appeals rejects Appraisal District claim that changing or modifying the specific grounds for property tax appeal deprives District Court of jurisdiction.
  • TEXAS – Oil refinery not required to compare entire value of its refinery to entire value of other refineries in its unequal appraisal analysis, but rather may limit its property tax challenge to certain tax accounts and the portions of its refinery to which they correspond.
  • TEXAS – Supreme Court rejects Commerce Clause challenge to taxation of natural gas stored within state for resale and shipment out-of-state.
  • GEORGIA – Supreme Court agrees with State Revenue Commissioner that transporter of liquid natural gas is not a gas company and therefore not a public utility.
  • ARIZONA – Court of Appeals holds that the owner of power plant on tribal land may raise argument that federal law preempts state and local taxation despite prior ruling that plant was subject to state taxation because it was owned privately rather than by the tribe.
  • WYOMING – Supreme Court rejects coal company’s attempt to reclassify “the mouth of the mine”—the point of valuation for coal when reporting its value for property tax purposes—to exclude below-grade conveyor system.

January 2017 Newsletter

January 31, 2017 | Newsletter
  • ARIZONA – Arizona Court of Appeals holds that recently amended A.R.S. § 42-14155, allowing for reduction of taxable value by amount of tax credits or cash grants commonly afforded wind and solar energy equipment, does not apply retroactively.
  • CALIFORNIA – Court of Appeals holds that telephone company’s failure to request refund in petition for reassessment precludes claim for $9 million in overpaid taxes.
  • MASSACHUSETTS – Supreme Judicial Court rejects telephone companies’ constitutional claim to taxation of personal property at same rate as commercial and industrial real property.
  • OREGON – Cities’ interest in electrical transmission capacity, purchased from electrical cooperative and used to transmit electricity over region’s federally administered power grid, is subject to property tax by Department of Revenue as a property interest held by a taxpayer.
  • CONNECTICUT – Discounted cash flow method may be used in valuation of trash-to-energy plant.
  • OREGON – Supreme Court affirms Tax Court decision that non-core buildings constitute functional depreciation detracting from property’s real market value, and that when accounting for this depreciation under the cost approach, the “value of the loss”—the appropriate reduction in replacement value—must be determined with reference to the property’s highest and best use.

September 2016 Newsletter

September 1, 2016 | Newsletter
  • VIRGINIA – Supreme Court holds City of Richmond could not impose tax on natural gas consumed solely for purpose of generating electricity.
  • SOUTH CAROLINA – U.S. District Court rejects railroad’s claim that South Carolina Valuation Act, which limits increases in appraised values of certain industrial properties but not railroads and utility providers, violates the Railroad Revitalization and Regulatory Reform Act of 1976.
  • NORTH DAKOTA – County auditor may not use omitted property statutes to revalue oil and liquid petroleum gas terminals following reduction in prior year due to failure to notify taxpayer of Board of Equalization meeting.
  • COLORADO – Court of Appeals holds that counties may retroactively assess oil and gas leaseholds under the omitted property statutes where value has been underreported, even without evidence of omitted property or willfully false and misleading annual statements.
  • ALASKA – Department of Revenue regulation directing appeals of oil and gas property tax valuation to be heard by State Assessment Review Board while appeals of oil and gas property taxability were to be heard by Department violates statute granting Review Board exclusive jurisdiction over all appeals from Department’s assessments of oil and gas property.

April 2016 Newsletter

April 1, 2016 | Newsletter
  • MARYLAND – Tax Court rejects coal-fired electrical generating plant’s claim that highest and best use of its property is a natural gas plant.
  • NEW YORK – Appellate Division holds that Town may be third-party beneficiary of a provision limiting the generator’s right to appeal property tax assessments in a supply agreement between an energy generating company and a power authority.
  • UNITED STATES DISTRICT COURT – District Court for the District of Rhode Island holds that challenge to state statute limiting interest awards to power company prevailing in tax appeal is not ripe for review.
  • OHIO – Supreme Court holds that Board of Tax Appeals lacks the authority to consider whether the county auditor has issued property tax assessment frivolously and in bad faith, such as to warrant sanctions.
  • INDIANA – Tax Court holds that assessed value of business tangible personal property reported on taxpayer’s return prevailed where County Tax Assessment Board of Appeals failed to issue timely determination.

July 2015 Newsletter

July 5, 2015 | Newsletter
  • TEXAS – Natural gas production and processing equipment is taxable by a county if located in the county on January 1 for more than a temporary period, even if county is not the equipment owner’s principal place of business.
  • MARYLAND – Tax Court rejects taxpayer’s cost approach valuation based on assumption that efficient, environmentally compliant coal-fired electric generating plant would be replaced with natural gas facility.
  • HAWAII – Intermediate Court of Appeals holds that wind turbines are not taxable real property under Maui County Code.
  • VERMONT – Supreme Court holds that value of utility easements and rights of way not taxable to easement holder.
  • GEORGIA – Supreme Court allows Southern LNG to seek declaratory judgment compelling State Revenue Commissioner to recognize it as a “public utility” and to accept its property tax returns rather than requiring filing with the County.
  • NEW HAMPSHIRE – Department of Revenue Administration could use utility tax appraisal of renewable energy windpark in determining the equalized value for property tax purposes.
  • MINNESOTA – Tax court not bound to use Minn. R. 8100, Commissioner of Revenue’s framework for valuation of utility property for assessment purposes, in determining fair market value of gas distribution pipeline system.
  • NEBRASKA – Payment in lieu of tax exempted public power and irrigation district from liability for property taxes on leased parcels, regardless of whether the parcels were used for an authorized public purpose.

December 2014 Newsletter

December 8, 2014 | Newsletter
  • ALASKA – Municipalities awarded attorneys fees and costs as prevailing parties in Trans-Alaska Pipeline Tax Appeal.
  • CALIFORNIA – Court of Appeal holds that the drilling and deepening of oil and gas wells constitutes new construction, and that assessor's use of the cost method was not unreasonable.
  • VERMONT – Value of utility easements and rights of way held by electrical utility is not properly included in property tax assessment.
  • TEXAS – Court of Appeals reverses order requiring refinery owner to provide sensitive financial information, because not necessary to produce accurate appraisal.
  • OHIO – Auction sale of foreclosed property could be considered voluntary and arm's length such that auction price is evidence of value of property for tax purposes.

September 2014 Newsletter

September 29, 2014 | Newsletter
  • KENTUCKY – Franchise of a public service company is not subject to statutory property tax exemptions and its valuation not entitled to be spread over other types of assets when assessing property taxes.
  • MARYLAND – Ground leases by which taxpayer leased income producing commercial real property from city could be considered in valuing the property for property tax purposes only if they contained restrictions diminishing the value of the property.
  • GEORGIA – Gas company seeks to compel State Revenue Commissioner to recognize it as “public utility” and to accept its property tax return.
  • NEBRASKA – Mailing of personal property tax return could constitute filing of return, even if not received by the county assessor.
  • KANSAS – Out-of-state natural gas marketing companies and out-of-state municipalities are not “public utilities” under Kansas law and therefore entitled to the merchants’ and manufacturers’ inventory exemption for their natural gas held for resale.

July 2014 Newsletter

July 1, 2014 | Newsletter
  • CALIFORNIA – Intangible assets have a quantifiable fair market value which must be deducted from an income stream analysis prior to taxation.
  • MASSACHUSETTS – Leasehold improvements made by tenant of tax-exempt property not subject to property tax.
  • CONNECTICUT – Prior owner lacks standing to challenge property tax assessment of office building.
  • MICHIGAN – Owner-occupied big box stores properly valued for property tax purposes as vacant and available, rather than occupied.
  • COLORADO – Supreme Court affirms Appellate Court, holds that assessing cable service providers differently than public utilities does not violate state constitution.

May 2014 Newsletter

May 1, 2014 | Newsletter
  • CALIFORNIA – Petroleum refinery property, unlike most other industrial property where fixtures and land are separately assessed, may be taxed as a unit.
  • CALIFORNIA – Underutilization adjustment based on economic obsolescence requires proof of causation by external factors, as opposed to taxpayer’s own actions.
  • COLORADO – Country club memberships are not the equivalent of “rental income” and should not be used in an income-approach valuation of club property.
  • NEW JERSEY – Tax Court rejects municipality’s argument that impact of environmental contamination and the cost of remediation on true market value is limited to contaminated portions of an industrial site.
  • MONTANA – Telecommunications service company which provides cable, voice and internet services should be centrally assessed; cannot report voice and internet services locally.