UAH-Hydro Kennebec, L.P. v. Town of Winslow

Summary

The Maine Supreme Judicial Court upheld the assessment of UAH-Hydro Kennebec’s hydroelectric facility by the Town of Winslow. The court held that the purchase power agreement and the facility’s status as a PURPA qualifying facility were relevant, inextricably intertwined value-influencing factors that could be considered in valuing the tangible property for ad valorem taxation. The assessment therefore did not constitute unjust discrimination or an illegal tax on intangible property.

Holdings

1. An assessor may consider the plant's PURPA qualifying-facility status and purchase power agreement as relevant factors in determining just value under the income method because those features distinguish the property from nonqualifying plants and reflect a presently possible, legally permissible use. Their consideration did not violate the principle of uniformity or constitute unjust discrimination.
2. Considering the purchase power agreement as an intangible feature in determining the just value of the tangible hydroelectric plant did not constitute an illegal assessment because the agreement was inextricably intertwined with the plant's current use and substantially influenced its value.
3. UAH failed to prove that the assessment was manifestly wrong because it did not establish substantial overvaluation, unjust discrimination, fraud, dishonesty, or illegality.

Questions Presented

1. Whether consideration of UAH's PURPA status and purchase power agreement in valuing its hydroelectric plant violated Maine's constitutional requirement of uniform property taxation and resulted in unjust discrimination.
2. Whether considering the value-influencing effects of the purchase power agreement in valuing the tangible hydroelectric plant constituted an illegal assessment of intangible property.
3. Whether the taxpayer proved that the assessment was manifestly wrong.

Disposition

affirmed