HomeMy WebLinkAboutMINUTES - 04191994 - 1.188 1 .188 through 1 .191
THE BOARD OF SUPERVISORS OF
CONTRA COSTA COUNTY, CALIFORNIA
Adopted this Order on April 19,1994, by the following vote:
AYES: Supervisors Smith, DeSaulnier, Torlakson and Bishop
NOES: None
ABSENT: Supervisor Powers
ABSTAIN: None
SUBJECT: CORRESPONDENCE
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1.188 CLAIM received March 29, 1994, Robert Dunn, attorney, 201 California Street, San
Francisco 94111, submitted on behalf of SFPP, L.P., formerly known as Southern
Pacific Pipe Lines Partnership, L.P., for refund of taxes paid for assessment year
1989.
***REFERRED TO TREASURER-TAX COLLECTOR, ASSESSOR, AND
COUNTY COUNSEL
1.189 LETTER dated March 25, 1994, from Ann L. Fries, 91 Acacia Drive, Orinda,
proposing the development of recreational facilities and activities for teens.
***REFERRED TO DIRECTOR, GROWTH MANAGEMENT AND ECONOMIC
DEVELOPMENT AGENCY
1.190 LETTER dated March 28, 1994, from M. Menesini, Mayor, City of Martinez, 525
Henrietta Street, Martinez 94553, requesting the Board of Supervisors to adopt a
countywide moratorium to preclude the placement of a proposed telecommunications
tower and accessory buildings in the Franklin Hills area pending the adoption of
policies for structures such as these within the County.
*** REFERRED TO COMMUNITY DEVELOPMENT DIRECTOR
1.191 LETTER dated April 5, 1994, from Cletus Gravette, President, Contra Costa/Alameda
County Cattlemen's Association, 5554 Clayton Road, Concord 94521, urging the
Board to amend the recently passed "Tree Preservation Ordinance" to exempt privately
owned rangelands from its regulations.
***REFERRED TO INTERNAL OPERATIONS COMMITTEE, COMMUNITY
DEVELOPMENT DIRECTOR AND COUNTY COUNSEL
I hereby certify that this is a true and correct copy of
an action taken and entered on the minutes of the
Board of Su Ihe e s o n�
ATTEsTF.O:
PHIL BAT ELOR,Clerk of the Board
cc: Correspondents ( of Supervisors and County Administrator
County Administrator � ��,; - ,Deputy
Internal Operations Committee
Treasurer-Tax Collector
Assessor
County Counsel
Growth Management and Economic Development Agency
Community Development
BEFORE THE BOARD OF SUPERVISORS
COUNTY OF , Contra Costa
In regard to. Ad. Valorem VERIFIED CLAIM FOR REFUND
Property Taxes paid by SFPP,
L.P. , forme*rily known as
SOUTHERN PACIFIC PIPE LINES Tax Bill No. : 10/02/89 Letter
PARTNERSHIP, L.P. on State
Assessed Unitary Property with) MW DEUVEM
respect to assessment year
1989 RECEIVED
I.
MAR 2 9 L994
AMOUNT OF CLAIM CLERK BOARD OF SUPERVISORS
I CONIQ COSTA
SFPP, L.P. , formerly known as SOUTH RN PACIFIC PIPE
LINES PARTNERSHIP, L.P. ("Claimant") pursuant to California
Revenue and Taxation Code Sections 5096, 5097 and 5097.02 submits
this claim for refund of ad valorem property taxes, on Claimant's
state assessed unitary property for assessment year 1989 paid on
property valued as of the lien date January 1, 1989.
Claimant owns and operates a refined petroleum products s
intercounty pipeline system within the State of California and
five other western states which is assessed on a unitary basis by
the State Board of Equalization ("the Board") pursuant to Article
XIII., Section 19, of the California Constitution, the applicable
provisions of the California Revenue and Taxation Code and Rules
of the Board. For assessment year 1989, the Board also assessed
on a unitary basis Claimant's lands and rights of way. The Board
had no jurisdiction to assess Claimant's lands and rights of way.
The total assessed value determined by the Board, including both
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i
Claimant's pipeline property over which the Board had
jurisdiction, and Claimant's lands and rights of way, over which
the Board had no jurisdiction, was $475, 000, 000.
A portion of the total assessment so determined by the
Board was allocated to this county pursuant to the California
Revenue and Taxation Code sections 745, 755, and 756. Thereafter
Claimant paid ad valorem property taxes on such portion of such
assessment to this county. The 1989 assessment determined by the
Board of- Claimant's state assessed unitary property is void in
part, to the extent that it included assessment of Claimant's
lands . and rights of way, over which the Board had no
jurisdiction. The portion of the Board's assessment allocated to
this county is void in part, for the same reason. Additionally,
the 1989 assessment is void, in part, to the extent that it
included assessment of Claimant's leaseholds and easements which
are tax-exempt as the privately-owned lands subject to these
leaseholds and easements are taxed at full value to their owners.
The taxes paid were erroneously or illegally collected, or in the
alternative illegally assessed or levied, to the extent that. they
were levied or collected on the assessed value of Claimant's
lands and rights of. way over which the Board had no jurisdiction,
and (as to leaseholds and easements) which were tax-exempt.
The portion of the assessment allocated to this county
on Claimant's lands and rights of way which is void and the taxes
paid by Claimant to this county on the purported assessed value
of Claimant's lands and rights of way for which refund is sought
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are as set forth in attached Exhibit A, which is incorporated by
reference as part of this Claim for Refund.
II.
GROUNDS ON WHICH THE CLAIM IS FOUNDED
The ground on which the claim for refund of tax is
based are: (a) the taxes were erroneously or illegally
collected; and/or (b) the taxes were illegally assessed or
levied. The taxes were erroneously or illegally collected, or
illegally assessed or levied, because the Board's assessment
included an assessment of Claimant's lands and rights of way over
which the Board had no jurisdiction under Article XIII,
Section 19 of the California Constitution, the applicable
provisions of the California Revenue and Taxation Code, and
controlling judicial authority.
A. Statement of Facts.
Claimant is a Delaware limited partnership formed in
1988 to own and operate the refined petroleum products pipeline_
system of Santa Fe Pacific Corporation. Claimant is publicly
traded, with 56 percent of its ownership in public hands.
Claimant was formerly known as Southern Pacific Pipelines .
Partnership, L.P. (The name only has been changed; the entity is
the same. ) The pipeline system was previously owned by two
indirect wholly-owned subsidiaries of Santa Fe Pacific
Corporation: Southern Pacific Pipelines, Inc. and San Diego
Pipeline Company.
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Claimant, a common carrier, is subject to regulation by
the California Public Utilities Commission (the "CPUC") with
respect to intrastate shipments through its pipeline system and
the Federal Energy Regulatory Commission (the "FERC") with
respect to interstate shipments through its pipeline system.
Claimant's pipeline system is located principally on leased
rights of way or other leased property. The rights-of-way in
which much of the pipeline system is located are already taxed at
fair market value.
B. Elements of the Assessment Contested.
Claimant does not challenge the assessed values derived
from the Board's application of its property assessment methods
to Claimant's various properties. The Board's assessment is
illegal, erroneous and void because the Board improperly included
in its assessment certain property of Claimant over which the
Board lacks jurisdiction under the California Constitution, the
applicable provisions of the Revenue and Taxation Code, and
controlling judicial authority. In particular the Board assessed
the lands and rights of way of Claimant notwithstanding the fact
that Article XIII, Section 19 of the California Constitution does
not extend to the assessment of such properties and Revenue and
Taxation Code section 721 only confers upon the Board
jurisdiction to assess property "that is to be assessed by it
pursuant to Section 19 of Article XIII of the Constitution. "
Instead, Claimant's lands and rights-of-way can only be legally
the subject of local assessment, if at all. The Board's
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assessment of this property therefore violated California
Constitution Article XIII, Section 19, and Revenue and Taxation
Code section 721.
C. Legal Background.
In General Pipeline Co v Board of Equalization, 5
Cal. 2d 253 (1936) ("General Pipeline") , the California Supreme
Court defined "pipeline" under then Article XIII, Section 14 of
the California Constitution, the predecessor of Article XIII,
Section 19. The Court excluded lands and rights of way from its
definition. Moreover, immediately after General Pipeline was
decided, the Board properly deleted from its reporting
instructions the reporting requirement for lands and rights of
way. The Board continued its administrative practice of not
assessing lands and rights of way every year for 48 years, before
improperly resuming its assessment of lands and rights of way.
Exclusion of lands and rights of way from the constitutional
definition of "pipeline" is therefore mandated not only by
General Pipeline, but also by the Board's many years of
administrative practice of excluding lands and rights of way from
the definition.
In Southern Pacific Pipe Lines, Inc. v. State Board of
Equalization, 14 Cal. App. 4th 42 (1993) ("Southern Pacific") ,
the Court of Appeal reaffirmed that as a matter of law lands and
rights-of-way are not included within the definition of
"pipeline" in California Constitution Article XIII, Section 19.
The Court of Appeal construed the decision in General Pipeline
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"as barring the SBE from assessing the lands and rights-of-way of
private, intercounty oil pipelines. " (14 Cal. App. 4th at 53) .
Moreover, to the extent that the Board included in its
assessment leaseholds, easements, and other interests in
privately-owned land less than fee interests, the assessment of
these interests created illegal double taxation. As to leasehold
estates, the owner of the fee is deemed to be the owner of the
whole estate for the purposes of taxation. Graciosa Oil Co. v.
County of Santa Barbara, 155 Cal. 140 (1909) . The land subject
to these leaseholds and easements is taxed at full value to its
owners. The value of the ownership interest includes the value
of. all lesser interests, which are accordingly tax-exempt. Other
owners of leaseholds and easements are not assessed on the value
of these interests. This discriminatory assessment was in
violation of Claimant's rights of due process and equal
protection under Article I, Section 7 of the California
Constitution and Amendment XIV, Section 1 of the United States _
Constitution.
III.
NOTICE
Any notice, communication or inquiry regarding this
claim should be sent to: Mr. David P. Smith, Manager, Property
Taxes and Insurance, Santa Fe Pacific Pipeline Partners, L.P. ,
888 So. Figueroa St. , 2d Floor, Los Angeles, California 90017.
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IV.
PRAYER FOR RELIEF
THEREFORE, it is respectfully requested that this Board
of Supervisors issue an order directing the appropriate officials
to refund to . Claimant no less than the amount described in the
preceding Section 1 and set forth on Exhibit A hereto, or such
other amounts as may be determined to be lawfully refundable,
plus interest thereon allowed by law.
Dated: March '24 , 1994, at Los Angeles, California.
SFPP, L.P. , a Delaware Limited
Partnership,
By its General Partner SANTA FE
PACIFIC PIPELINES, INC.
BY4Z
obert L. Edwards.
Of counsel: Senior Vice President/CFO
Robert L. Dunn, Esq.
Peter W. Michaels, Esq.
Cooper, White & Cooper
201 California Street, 17th Floor
San Francisco, CA 94111
(415/433-1900)
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VERIFICATION
I am Senior Vice President & CFO , of SANTA FE
PACIFIC PIPELINES, INC. , general partner of SFPP, L.P. a Delaware
Limited Partnership, and am authorized to make this verification
for and on behalf of SFPP, L.P. I have read the annexed. Claim
For Refund of SFPP, L.P. Based on such information as is
available to SFPP, L.P. , I am informed and believe that the
matters stated in the document are true and correct and on that
ground allege that the matters stated therein are true and
correct.
I declare under penalty of perjury that the foregoing
is true and correct, and that this Verification is executed this
24 day of March, 1994 at Los Angeles, California.
68670.1
40bertL. Edwards
Senior Vice President/CFO
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