In re Town of Chester

174 N.H. 424

265 A.3d 21

APPEAL OF TOWN OF CHESTER & a. (New Hampshire Board of Tax and Land Appeals)

No. 2020-0475

Supreme Court of New Hampshire.

Argued: June 22, 2021

Opinion Issued: September 16, 2021

Donahue, Tucker & Ciandella, PLLC, of Exeter (Christopher L. Boldt, Eric A. Maher, and William K. Warren on the brief, and Eric A. Maher orally), for the petitioners.

Sulloway & Hollis, P.L.L.C., of Concord (Margaret H. Nelson, Derek D. Lick, and Trevor J. Brown on the brief, and Derek D. Lick orally), for the respondent.

DONOVAN, J.

The petitioners, the Towns of Chester and Hudson (collectively, Towns), appeal an order of the Board of Tax and Land Appeals (BTLA) granting the respondent, Public Service Company of New Hampshire d/b/a Eversource Energy (PSNH), abatements of taxes assessed against its property located in Chester for tax years 2014 and 2016 and in Hudson for tax years 2014, 2015, and 2016. We affirm.

The following facts are supported by the record or are otherwise undisputed. PSNH, an electric utility company, sought abatements of taxes assessed against its property located in the Towns for the relevant tax years. See RSA 76:16 (Supp. 2020). The Towns’ assessors denied the requests, and PSNH appealed to the BTLA. See RSA 76:16-a, I (Supp. 2020). PSNH's appeals focused primarily upon its "electric utility property," which included, among other things, transmission and distribution (T&D) assets as well as transmission easements and the use of public rights-of-way (PROW) associated with the T&D assets.

In support of its appeals, PSNH submitted an appraisal report prepared by its expert, Concentric Energy Advisors, Inc. (Concentric), setting forth the expert's opinion of the aggregate fair market value of PSNH's taxable property located in each municipality for each tax year. In determining the fair market value of PSNH's land interests — specifically, the transmission easements and use of PROW as well as PSNH's fee land and buildings — Concentric relied, at least in part, upon the Towns’ assessed value of those interests. With respect to the fee land and buildings, Concentric determined that the assessed value of those assets reasonably reflected their fair market value. With respect to the transmission easements and use of PROW, Concentric relied upon the average assessed value of fee land per acre in each municipality and adjusted the values based upon various factors that, in its opinion, impact the value of regulated utility property. Two appraisers employed by the Towns’ expert, George E. Sansoucy, P.E., LLC (GES), used a substantially similar methodology in appraising the fair market value of the land interests.

At the BTLA's request, the parties submitted stipulations regarding PSNH's property interests in each municipality, including, as relevant here: (1) the aggregate assessments for each tax year; (2) the applicable equalization ratios for each tax year; and (3) GES's and Concentric's final determinations of fair market value. After holding a consolidated hearing, the BTLA granted PSNH abatements of taxes assessed by the Towns for each relevant tax year. In reaching its decision, the BTLA applied the parties’ stipulated equalization ratios to the aggregate fair market values set forth in GES's report — which the BTLA credited over Concentric's report — to calculate the "Market Value Adjusted by Level of Assessment," or, in other words, "equalized market value," for each municipality for each tax year. (Capitalization and bolding omitted.) The BTLA then compared the equalized market value to the aggregate assessed value for each municipality for each tax year. The BTLA concluded that an assessment was unreasonable and granted an abatement when it determined that the difference between the equalized market value and the aggregate assessed value was greater than five percent.

Following the BTLA's decision, the Towns moved for partial reconsideration. The Towns argued that because both GES and Concentric relied upon the assessed value of PSNH's land interests in reaching their opinions of fair market value, the values that the BTLA incorporated into its analysis "were already proportionate" and "should not have had the equalization ratio[s] applied to them." The Towns asserted that, instead of equalizing the aggregate fair market value of PSNH's property in each municipality, the BTLA should have equalized the fair market value of the T&D assets and added the resulting number to the "already proportionate" land interests when calculating the equalized market value.

PSNH objected, arguing that the Towns were not entitled to reconsideration because: (1) they failed to timely raise their equalization argument at the hearing, as required by New Hampshire Administrative Rule, Tax 201.37(g) ; (2) they stipulated to the applicable equalization ratios and aggregate fair market values that the BTLA used in its analysis; and (3) even if the BTLA erred, any such error was harmless. The BTLA denied the Towns’ motion, noting that it based its calculations upon values that "were supplied by the [Towns] themselves in the stipulations agreed to by them" and adopting the arguments PSNH raised in its objection. This appeal followed.

Our standard for reviewing BTLA decisions is set forth by statute. Appeal of Keith R. Mader 2000 Revocable Trust, 173 N.H. 362, 365, 239 A.3d 937 (2020) ; see RSA 71-B:12 (2012); RSA 541:13 (2021). We will not set aside or vacate a BTLA decision except for errors of law, unless we are satisfied, by a clear preponderance of the evidence, that such order is unjust or unreasonable. Mader 2000 Revocable Trust, 173 N.H. at 365, 239 A.3d 937 ; see RSA 541:13. The appealing party has the burden of demonstrating that the BTLA's decision was clearly unreasonable or unlawful.

Mader 2000 Revocable Trust, 173 N.H. at 365, 239 A.3d 937 ; see RSA 541:13. The BTLA's findings of fact are deemed prima facie lawful and reasonable. Mader 2000 Revocable Trust, 173 N.H. at 366, 239 A.3d 937 ; see RSA 541:13.

On appeal, the Towns argue that the BTLA erred by equalizing the aggregate fair market value of PSNH's taxable property without first excluding the value of PSNH's land interests. According to the Towns, PSNH failed to challenge the assessments of its land interests, and, therefore, the BTLA "erroneously applied the equalization ratios to already-proportionate property values, creating inaccurate calculations" and "effectively granting abatements to PSNH for unchallenged parcels." The Towns also assert that the BTLA erred by denying their motion for partial reconsideration for the reasons stated in PSNH's objection. PSNH counters that the BTLA made no error in its equalization analysis and that, for the reasons stated in its objection, the BTLA properly denied the Towns’ motion for partial reconsideration. PSNH also argues that the Towns failed to preserve their argument that the BTLA improperly equalized the aggregate fair market value of its taxable property.

For the purposes of this appeal, we assume, without deciding, that the Towns adequately preserved their arguments for our review. Nonetheless, we conclude that the BTLA did not err by applying the stipulated equalization ratios to the aggregate fair market values set forth in GES's report to determine whether the Towns’ assessments were proportionate.

In tax abatement appeals, the taxpayer bears the burden of proving by a preponderance of the evidence that it has paid more than its proportional share of taxes. See Appeal of Pub. Serv. Co. of N.H., 170 N.H. 87, 93-94, 165 A.3d 695 (2017). To satisfy this burden, the taxpayer must show that its property is assessed at a higher percentage of fair market value than the percentage at which property is generally assessed in the municipality. See id. at 94, 165 A.3d 695 ; see also Appeal of Andrews, 136 N.H. 61, 64-65, 611 A.2d 632 (1992) (explaining that, in order to achieve proportionality, all taxpayers must be assessed at the same percentage of fair market value). Thus, when resolving tax abatement appeals, the BTLA must make specific factual findings regarding the fair market value of the taxpayer's property and the general level of assessment for the municipality. See Appeal of City of Nashua, 138 N.H. 261, 263, 638 A.2d 779 (1994). We will uphold the BTLA's factual findings unless the evidence does not support them or they are erroneous as a matter of law. See Appeal of Pub. Serv. Co. of N.H., 170 N.H. at 94, 165 A.3d 695.

As an initial matter, the Towns argue that the BTLA lacked subject matter jurisdiction to grant abatements of taxes assessed against PSNH's fee simple land interests. We disagree. The powers of the BTLA and the rights of...