86-1997 - Centrally Assessed

 

BEFORE THE STATE TAX COMMISSION OF UTAH

_____________________________________

XXXXX,

Petitioner, :

v. : INFORMAL DECISION

:

PROPERTY TAX DIVISION OF THE : Appeal No. 86 1997

STATE TAX COMMISSION OF UTAH, )

Respondent. :

_____________________________________

STATEMENT OF CASE

This is an Appeal from a market value appraisal made by the Utah State Tax Commission, Property Tax Division of the State of Utah for the property of Petitioner located in XXXXX County, Utah.

The matter was heard before Joe Pacheco, Commissioner, who acted as Hearing Officer. XXXXX represented the Respondent. Present and representing the Petitioner were XXXXX, President of XXXXX, and XXXXX, Operations Manager of XXXXX.

Upon opening of the hearing, a preliminary motion was made by the Property Tax Division that the hearing be dismissed because Petitioner did not timely file the appeal request as required by statute. The Property Tax Division presented evidence that the Petitioner did not submit an appeal request until XXXXX, some 8 months after the statutory deadline of XXXXX. However, the Property Tax Division did not notify Petitioner of their intent to present a motion to dismiss until today's scheduled hearing. Petitioner appeared at this hearing at the scheduled time, after traveling from California. The Hearing Officer, upon hearing the arguments of the parties, ruled that the Informal Hearing should proceed as scheduled.

Petitioner argued that the assessment is improper because the valuation at XXXXX, is based on XXXXX production and at a time when prices were high. Petitioner argued that XXXXX was a difficult year for the oil business because of the drastic decline of oil and gas prices during XXXXX and XXXXX of XXXXX. The company did not see the affects of the decline until XXXXX. Petitioner feels that the overall decrease in market values from XXXXX is somewhat in the neighborhood of 60 to 70 percent, and that there was no way of knowing by XXXXX what was happening in the market place, and consequently what the real property value is as of the assessment date. The Petitioner argued that they are being assessed at an unfair market value. However, they acknowledge that they will be assessed at lower values for XXXXX, unless prices continue to decline so that they may never catch up to the higher taxes paid on higher valuation at the assessment date unless prices decrease. This position is based on establishing a value at a time prior to the drastic fall in oil prices. Petitioner did not present written documentation to support its position.

The statutory lien date for assessment of oil and gas is XXXXX per statute, Utah Code Ann. 59-5-52, and is based on the prior year production.

The Respondent prepared the assessment as of XXXXX based on XXXXX production, and has complied with all rules and statutes.

The drop in oil and gas prices during XXXXX and XXXXX of XXXXX, is subsequent to the lien date for the tax year in question.

DECISION AND ORDER

Based upon the foregoing facts and the evidence presented at the hearing, it is the decision of the Utah State Tax Commission that the Property Tax Division did properly value the properties of XXXXX, XXXXX, in accordance with Section 59-5-52. The Petitioner presented no evidence to move the Commission to change the XXXXX Assessment.

DATED this 6 day of May, 1987.

BY ORDER OF THE STATE TAX COMMISSION OF UTAH.

R. H. Hansen Roger O. Tew

Chairman Commissioner

Joe B. Pacheco G. Blaine Davis

Commissioner Commissioner