Flight Options, LLC v. State of Washington, Department of Revenue

Summary

The Supreme Court of Washington held that the Department of Revenue could impose an apportioned property tax on Flight Options' fleet of aircraft. The court concluded that the aircraft acquired a Washington tax situs through habitual use of the state's airspace, landing facilities, and related services, even without fixed routes or regular schedules. It also held that chapter 84.12 RCW authorized assessment against Flight Options as an airplane company that managed aircraft, including aircraft it did not wholly own.

Holdings

1. Fixed routes and regular schedules are sufficient but not necessary to establish a tax situs for instrumentalities of interstate commerce. Airplanes that habitually enter Washington may acquire a Washington tax situs even when they operate without fixed routes or regular schedules, and Flight Options's average of approximately two visits to Washington per day was sufficient.
2. Chapter 84.12 RCW authorizes the Department to assess apportioned property taxes against Flight Options because it is an airplane company that manages aircraft used to transport persons for compensation, the aircraft are situate in Washington through their constitutionally sufficient tax situs, and the specific operating-property provisions permit assessment against a nonowner that controls, operates, or manages the property.

Questions Presented

1. Whether the Due Process Clause requires fixed routes and regular schedules for airplanes or other instrumentalities of interstate commerce to acquire a taxable situs in Washington.
2. Whether chapter 84.12 RCW authorizes the Department of Revenue to impose apportioned property taxes on Flight Options's managed aircraft, including when Flight Options is not the sole owner of the aircraft.

Disposition

affirmed