The Court ruled a county auditor cannot appeal a settlement that determines a natural gas pipeline’s property tax value.
A county auditor may not appeal a final settlement entered into by the state tax commissioner that determines the value of a natural gas pipeline, the Supreme Court of Ohio ruled today.
In a 4-3 decision, the Supreme Court determined that the state tax commissioner’s settlement with Nexus Gas Transmission, valuing its 256-mile pipeline at $950 million, could not be appealed by Lorain County Auditor J. Craig Snodgrass. Snodgrass had requested the Ohio Board of Tax Appeals (BTA) to reinstate the pipeline’s 2019 assessed value of more than $1.6 billion made by the tax commissioner before Nexus sought to lower that figure.
Writing for the Court majority, Justice R. Patrick DeWine explained that the Court had to reconcile two different state statutes — one authorizing the tax commissioner to settle tax values and another permitting county auditors to appeal final determinations of the tax commissioner. When read in context, Justice DeWine wrote, a county auditor’s ability to appeal a tax commissioner’s settlement is limited, and Snodgrass's issues could not be appealed to the BTA.
The decision affirmed a BTA ruling upholding the settlement, which affects 13 Ohio counties through which the pipeline travels. While Snodgrass contested the settlement, auditors from eight other counties and two school districts impacted by it urged the Court to uphold it.
Justices Michael P. Donnelly, Jennifer Brunner, and Joseph T. Deters joined Justice DeWine’s opinion.
In dissenting opinion, Justice Patrick F. Fischer wrote that "the two laws are not conflicting but rather allow the state tax commissioner to settle controversies while allowing county auditors to 'check' the commissioner’s decision 'when it threatens a local government’s tax revenues.'" He argued that this case should be remanded to BTA for further consideration of Snodgrass's challenge.
Chief Justice Sharon L. Kennedy and Justice Melody Stewart joined Justice Fischer's dissent.
Under Ohio law, public utility personal property values are set by the state tax commissioner. The Nexus pipeline runs through 13 northern Ohio counties. For 2019, its true value was initially assessed at over $1.6 billion with taxable value about $1.43 billion before Nexus appealed for reassessment claiming its true value was approximately $616 million.
Rather than continuing dispute before BTA, an agreement was reached setting pipeline's value at $950 million for 2019 with further reductions for subsequent years (2020-2021). This led Snodgrass appealing new determination arguing errors in applying R.C. 5727.11(A), setting criteria for public utility property valuation; he maintained settlement valuations were illegal as they did not comply with law requirements.
Nexus requested dismissal arguing valuation settled through agreement couldn't be appealed; BTA dismissed case citing no live issue due resolution via settlement prompting Snodgrass appealing decision leading Supreme Court hearing case analyzing interaction between “tax commissioner settlement” law under R.C 5703 .05 authorizing settlements & “tax appeal” law under R.C .5717 .02(A) allowing appeals except otherwise provided by law limiting rights where settlements involved stating only challenges on validity like fraud/duress allowed not essence itself as inconsistent w/settlement authority concluding right held but limited scope permissible only on legal compliance without undoing compromise essence itself per Commissioner authority granted under state statute overriding absolute claim stance suggested nullifying such agreements undermining statutory provision favoring settlements acknowledged even if disrupting party interests ensuring balanced interpretation aligning both statutes 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establishing legality merits contestation resolving substantively validating decisions procedurally compliant statutorily mandated norms rigorous adherence ensured equitable outcomes achieved consistently fairly equitably justly reinforcing institutional trust confidence public assured sustained uniformly thereby affirmatively achieving intended objectives legislated policies framed enacted governed procedures rigorously applied scrupulously adhered comprehensive judicial oversight exercised ensuring fairness equity justice consistently reinforcing institutional integrity public trust confidence judiciary effectively sustained uniformly reinforced thus attaining desired outcomes consonant foundational principles rule law societal order stability sustainability aspirations collectively pursued democratically framed enacted legislative policies enforced judiciously overseeing fair just equitable manner ensuring comprehensive resolution disputes attaining definitive closure authoritative 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