Note: The following is an excerpt from the introduction to the article as published in The Tax Lawyer. Author citations have been omitted for brevity. Tax Section members may read the article in its entirety in Adobe Acrobat format.
ANR Pipeline: Beware of the Relief Sought
John B. Burns*
* Shareholder, Baker, Donelson, Bearman, Caldwell & Berkowitz, PC, Memphis, Tennessee; University of Mississippi, B.A., 1986; J.D., 1990; University of Florida, LL.M., 2001.
Recently, Louisiana’s courts were called upon to address the state’s disparate methods of assessing intrastate and interstate pipeline property for ad valorem tax purposes. On appeal, the state’s intermediate appellate court upheld principles of equality in the basis of assessment for ad valorem tax purposes and criticized the state’s practice of assessing similarly situated pipeline property based on its use in intrastate as opposed to interstate commerce.Although the decision is limited to Louisiana and the final chapter on the valuation to be given to the subject property has yet to be written, the case does represent a trend among states, in the wake of federal precedent, to critically analyze state taxing schemes and to strike those schemes which exhibit intentional and arbitrary discrimination rather than simply relying upon the traditional rational basis approach as a means to uphold challenged statutes.