BUCKHANNON — Pay up.
That’s the ruling the Upshur County Commission made Thursday morning when it approved granting the Upshur County Assessor’s Petition for Relief from Erroneous Assessments for tax years 2014, 2015 and 2016 against an Oklahoma-based oil and gas company.
The ruling in favor of the county assessor’s office and against Appalachian Midstream Services — which has since merged with the Williams Group — would allow the county to recoup more than $118,000 in back taxes which resulted from an assessment error over a three-year span. According to W.Va. Code 11-3-27, county commissions are charged with overseeing cases involving erroneous assessments.
During a July 20 public hearing on the matter, prosecuting attorney David Godwin and county assessor Dustin Zickefoose labeled the mistake as an “inadvertent clerical error” on the part of the assessor’s office. The mistake was discovered just days before Zickefoose took office in January.
At the hearing, Chris Hunter of the Charleston-based law firm Jackson Kelly argued that the company should not have to pay the back taxes, while Godwin made the case that the county was entitled to recover the money owed.
According to testimony at the hearing, Appalachian Midstream Services submitted both the fair market value and the assessed value of a piece of property located in Banks District. The fair market value is what the property would be priced if sold, while the assessed value — the value upon which properties are taxed — is 60 percent of the fair market value.
The assessor’s office mistakenly entered the assessed value instead of the fair market value in its computer program, which then automatically reduced it again, resulting in Appalachian Midstream Services paying $118,975.41 less than it should have over a three-year time period.
At Thursday’s meeting, commissioners Sam Nolte and Troy “Buddy” Brady said their decision in favor of the assessor’s office was a relatively clear cut one.
“After hearing all the evidence last week, I personally feel that it’s a tax that they owed and that they should definitely be responsible for paying it,” Nolte said. “I think some of it is the way the paperwork was filled out. Nobody else submits the 60 percent value (assessed value). I think that was the kicker. It might have changed my mind if that wasn’t done. But they’re the only ones that submitted the 60 percent value out of all the taxes that we look at, and technically, that’s not what we ask for.”
At the July 20 hearing, Zickefoose and deputy assessor Venus Drummond testified that companies typically do not submit an assessed value as well as a fair market value.
Brady said the tax was owed, regardless of any “technicalities” in the law.
“I don’t think there’s any argument here from last week that the tax isn’t owed,” he said. “I think the tax is owed. I don’t see any negligence on the part of the assessor’s office. I think they finally caught a mistake that was made. It’d be my decision that they need to pay it. Now with that being said, I’m certainly not an attorney or a circuit court judge. There may be technicalities here … but I’m ruling here that they need to pay it.”
Brady added that he was from “the old school” in which “if you owe a bill you should pay it.”
Nolte made a motion to approve the assessor’s petition for relief and sign the erroneous assessment, which was seconded by Brady and passed unanimously.
According to state code, the commission’s decision was required to be based on two factors — timing and whether the error was a mere “clerical” error or the result of “negligence or the exercise of poor judgment.” The code states that relief from an erroneous assessment can be granted if an error is “clerical” in nature, but cannot be granted if the error results from negligence. In addition, a party can be granted relief if the petition or claim is filed within one of two time periods — either within a year of when the tax books are delivered to the sheriff’s office or within “one year form the time such clerical error or mistake is discovered or could be reasonably discovered.”
Drummond testified that she discovered the mistake in December 2016 and reported it to Zickefoose in February 2017.
While Godwin argued that the error was clerical and had been discovered within a reasonable amount of time, Hunter countered that the error was a result of negligence and should have been discovered prior to when it was.
Following Thursday’s decision, Zickefoose said he approved of the commission’s decision.
“Obviously, I’m glad about the ruling,” he said. “It was an inadvertent clerical error. I don’t feel it was negligence.”
If Appalachian Midstream Services disagrees with the commission’s decision, it has the option of submitting an appeal to the Upshur County Circuit Court.
When contacted Thursday, Hunter said he couldn’t comment on the case.
“I can’t comment on pending litigation, especially when I haven’t received the decision,” Hunter said. “I can’t comment on what my client plans to do.”