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NH Supreme Court rules for towns, against utilities

New Hampshire Union Leader

June 02. 2017 10:00PM

CONCORD — The state’s highest court delivered a big victory to more than 60 towns Friday, upholding local property tax assessments levied on property owned by two major electricity companies even though state tax appraisers have placed a much lower value on the same parcels.

In a unanimous ruling, Supreme Court Justice Robert Lynn called that discrepancy “troubling,” but said utility lawyers failed to prove these local assessments were unreasonable or unconstitutional.

“Disputes such as this one may be avoided, or at least reduced in complexity, by the adoption of a uniform method of utility valuation...,” Lynn wrote.

“However the decision to adopt such a uniform methodology belongs to the Legislature, not this court.”

Eversource Energy and the New Hampshire Electric Cooperative filed separate appeals with the Supreme Court affecting their property taxes owned in 64 municipalities going back to 2011 and 2012 tax years.

Their main argument was local property tax appraisers used a different assessment method to one the state Department of Revenue Administration applied as it collected a state utility property tax on the same property.

The decision clearly affects millions of dollars in property taxes.

“This NH Supreme Court case preserves tens of millions of dollars in properly assessed utility valuations here in Durham and across New Hampshire that are appropriately valued in accordance with state law,” said Durham Town Administrator Todd Selig, praising the decision.

“It is unfortunate we have had to expend tens of thousands of dollars collectively to prove an argument we all knew to be correct in the first place.”

In past years, Eversource with property in 210 communities has paid more than $25 million in property taxes and is the largest single payer of local taxes in New Hampshire.

NHEC has 80,000 customers in 115 communities and in addition several other major utilities filed briefs in support of these appeals in the hope that a favorable appeal would lead to lower taxes owed by them.

Eversource spokesman Martin Murray stressed property taxes are passed on in higher electric rates and the appeals had been limited to “extreme outliers” between local and state assessments.

“Eversource always seeks to pay our fair share of taxes and is the largest payer of property taxes in the state of New Hampshire. Ultimately, it is our customers who pay those costs, so we seek to ensure they are fair and reasonable,” he said.

A spokesman for NHEC said the company was pleased the high court spelled out the discrepancy in assessments.

Auburn Town Administrator Bill Herman said the difference between the two assessments in his town is $2.2 million, which would have meant an additional $21 in property taxes passed onto a homeowner with a $300,000 home.

“With Granite State municipalities, school districts and counties funded through the property tax, this is very simply a matter of fairness where property valuations need to be fair and equitable among all classes of property owners,” Herman said.

Meanwhile, a New Hampshire House panel voted in March to retain and study further a bill (HB 324) to apply that state assessment approach to the local property taxation of all utility property.

The New Hampshire Municipal Association on Friday seized on this court ruling to condemn that bill.

“It is difficult to see how the Legislature could justify requiring the use of a method that, at least as used in these cases, has been found significantly lacking,” the NHMA said in a statement.

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