Colonial Pipeline Co. v. Collins

Citation921 F.2d 1237
Decision Date22 January 1991
Docket NumberNo. 89-8750,89-8750
PartiesCOLONIAL PIPELINE COMPANY, and Other Persons Similarly Situated, Plaintiff-Appellant, v. Marcus E. COLLINS, Sr., et al., Defendants-Appellees.
CourtUnited States Courts of Appeals. United States Court of Appeals (11th Circuit)

Nickolas P. Chilivis, Chilivis and Grindler, John K. Larkins, Jr., Ronnie L. Quigley, Davis, Matthews & Quigley, E. Diana Hamner, Atlanta, Ga., for plaintiff-appellant.

Cynthia G. Weaver, Heard, Leverett & Phelps, PC, Elberton, Ga., for Counties Boards of Tax Assessors, Tax Equalization and Com'rs.

E.S. Sell, Jr., Macon, Ga., for Bibb County Bd. of Comm. and Macon-Bibb County Tax Assessors.

Lucy T. Sheftall, Georgia Dept. of Law, Atlanta, Ga., for Marcus E. Collins, Hogan and Crawford & State.

Hogan, Crawford and State Bd. of Equalization Warren R. Calvert, Georgia Dept. of Law, David A. Runnion, Senior Asst. Atty. Gen., Atlanta, Ga., Jefferson James Davis, Sp. Asst. Atty. Gen., Decatur, Ga., for Collins et al.

Albert Sidney Johnson, DeKalb County Attorney, Decatur, Ga., for DeKalb County Bd. of Tax Assessors and DeKalb County Bd. of Equalization.

Appeal from the United States District Court for the Northern District of Georgia.

Before JOHNSON and CLARK, Circuit Judges, and BROWN *, Senior District Judge.

CLARK, Circuit Judge:

Colonial Pipeline Company, a public utility doing business in Georgia, brought this action pursuant to 42 U.S.C. Sec. 1983 (1988) challenging the recently amended Georgia ad valorem tax system. Ga.Code Ann. Secs. 48-2-18; 48-5-1 to -545 (1982 & Supp.1990). Colonial alleges that they and other similarly situated entities 1 have been denied equal protection and due process of law as a result of certain inequities resulting from this system. The gravamen of Colonial's claim is that poor administration of the ad valorem tax system by the state and counties has lead to a pattern of proportionately higher assessments of the property of "centrally assessed" taxpayers relative to non-centrally assessed taxpayers. In addition, Colonial contends that the review and appeal process specified in this tax scheme is so infected with cumbersome procedures and poor administration that it is impossible to obtain adequate review of its unequal tax assessment claim.

As relief, Colonial requested an injunction covering the following items:

1) prohibiting the state revenue commissioner from approving any county's tax digest from 1989 and onward until the digest is in complete compliance with Georgia constitutional and statutory requirements and the federal constitution;

2) ordering the abatement of accrued and accruing interest on the unpaid portion of Colonial's proposed assessments from 1985 onward;

3) suspending the statute of limitations on the filing of refund claims in the counties and municipalities;

4) directing the state and county taxing authorities to hire adequate staffs;

5) directing the state and county taxing authorities to assess equally and uniformly all taxable property as mandated by the Georgia Constitution;

6) ordering the state Board of Equalization to hire hearing officers to expedite pending appeals before it;

7) ordering the state and county taxing authorities to compile statistically valid ratio studies for the tax years 1985 onward as to real and personal tangible property; and

8) appointment by the district court of a monitor to oversee compliance with any judgment in this case.

The district court dismissed the suit for lack of subject matter jurisdiction on the grounds that the Tax Injunction Act, 28 U.S.C. Sec. 1341 (1988), barred Colonial's claims. The court found that the requested relief would interfere with the administration of the state tax system and that the state already provided an adequate remedy within the meaning of section 1341. Because we find that Colonial has alleged sufficient facts to support its claim that the state ad valorem tax review and appeal remedy is inadequate, we REVERSE the judgment of the district court and REMAND for further proceedings to determine whether the state review system as it currently functions is in fact inadequate.

I. BACKGROUND
A. Centrally-Assessed Taxpayers Under Georgia's Ad Valorem Tax System

All tangible property in Georgia must be returned for taxation at its fair market value and assessed at 40% of that value. Ga.Code.Ann. Secs. 48-5-6 to -7. The Georgia Constitution mandates equalization and uniformity of taxation on all real and personal property. Ga. Const. of 1983, art. VII, Sec. 1, p 3.

The administration of these basic rules, however, has created a substantial disparity between the assessments levied against "centrally assessed" taxpayers such as public utilities that must file with both the state and counties in which it owns property and all other taxpayers who file only with the counties. 2 See Ga.Code Ann. Secs. 48-5-511, -519, -541. This disparity arises because the returns required to be filed by centrally assessed taxpayers give the state comprehensive, annually updated information on the fair market value of all property owned by such taxpayers. Colonial alleges that based on this information, the state Board of Equalization then routinely assesses centrally assessed taxpayers at the maximum legal rate of forty percent.

Other ad valorem taxpayers, however, are not required to file annual returns and the valuation and assessment of their properties is commonly carried forward from year to year without any increases by county tax officials because of the failure to hire sufficient staff to regularly review records, valuations, and assessments. See id. Sec. 48-5-20. As a result, Colonial alleges that most counties have incomplete tax records that do not include large percentages of taxable property, and the records themselves have not been updated in ten to twenty years resulting in assessments of recorded property at far below market value. In Colonial's view, this problem is exacerbated by the state revenue commissioner's regular approval of these county records with full knowledge that they are incomplete and that listed properties are undervalued and underassessed. 3 As a result, centrally-assessed taxpayers are taxed on the basis of more complete and current valuations and assessments of their property relative to other ad valorem taxpayers which causes them to pay a proportionately greater amount of tax.

B. Review and Appeal Process

Colonial also claims that the review and appeal process incorporated in Georgia's ad valorem tax system is plagued with similar problems that render it virtually useless for correcting unequal tax assessments. Before the 1988 amendments to Georgia's ad valorem tax system, centrally-assessed taxpayers could appeal to the state Board of Equalization on issues of valuation and assessment. Id. Sec. 48-2-18 (1982) (amended 1988). Colonial alleges, however, that only two part-time hearing officers are available to hear these appeals which has resulted in a backlog of more than 70 appeals filed by centrally assessed taxpayers for proposed assessments from tax years 1985 to 1988. Only one appeal has been heard and no decisions have ever been rendered by the Board. 4

The 1988 amendments introduced several significant changes to the treatment of centrally-assessed taxpayers by expanding the role of the counties in making assessment determinations and handling appeals. Under this new regime, the commissioner prepares and the state Board approves an initial assessment of the property of centrally-assessed taxpayers--referred to in the legislative history as the "proposed assessment"--which is then transmitted to the counties. 5 Id. Sec. 48-2-18(c) (Supp.1990). After receipt of the "proposed assessment", a county may, but is not required to, use these figures as the county's own tax assessment. Whether the county accepts the state assessment as its own or issues a locally generated assessment, the county must issue within 30 days a "final assessment" to the taxpayer. Id. Sec. 48-2-18(d).

The expanded role of the counties under this new regime was accompanied by the establishment of a two-part appeals process. First, the 1988 amendments eliminated a centrally-assessed taxpayer's right to appeal directly to the state Board from a "proposed assessment"; rather, a taxpayer must now appeal to the Fulton County Superior Court within 30 days of the receipt of a "proposed assessment". Id. Sec. 48-2-18(c). Second, appeals from "final assessments" must be pursued at the county administrative level within 30 days from the date of notice of such assessments. 6 Id. Secs. 48-2-18(d), -5-311(e).

Colonial alleges that this new appeals procedure is excessively burdensome because it creates circumstances where a centrally-assessed taxpayer must pursue simultaneous appeals in the Fulton County Superior Court for the "proposed assessment" and appeals in each county in which it owns property. Thus, Colonial contends that in any given year it could be required to litigate in each of the 37 counties in which it owns property and also pursue an appeal in the Fulton County Superior Court against the state Board's "proposed assessment". 7

In a recent interpretation of this new statutory scheme, the Georgia Supreme Court attempted to reconcile these two branches of appeals by eliminating some of their duplicitous elements. See Telecom * USA, Inc. v. Collins, 260 Ga. 362, 393 S.E.2d 235 (1990). As a matter of statutory interpretation, the court held that when a county adopts the state Board's "proposed assessment" as its own "final assessment" without modification, an appeal from a decision of the state Board under section 48-2-18(c) is conclusive as to all issues, thereby obviating the need for a separate appeal in that particular county. See id. at 366, 393 S.E.2d at 239. On the other hand, when a county changes a "proposed assessment" before issuing its own "final assessment", a centrally-assessed taxpayer should pursue a separate appeal in the...

To continue reading

Request your trial
132 cases
  • Interim Healthcare, Inc. v. Interim Healthcare of Se. La., Inc.
    • United States
    • U.S. District Court — Southern District of Florida
    • June 10, 2020
    ... ... evidence and decide for itself the factual issues that determine jurisdiction." Colonial Pipeline Co ... v ... Page 10 Collins , 921 F.2d 1237, 1243 (11th Cir. 1991). As such, "[w]hen a ... ...
  • Muransky v. Godiva Chocolatier, Inc., No. 16-16486 & 16-16783
    • United States
    • U.S. Court of Appeals — Eleventh Circuit
    • October 28, 2020
    ... ... See Colonial Pipeline Co. v. Collins , 921 F.2d 1237, 1243 (11th Cir. 1991) (explaining that a district court ... ...
  • Havana Docks Corp. v. Norwegian Cruise Line Holdings, Ltd.
    • United States
    • U.S. District Court — Southern District of Florida
    • August 31, 2020
    ... ... evidence and decide for itself the factual issues that determine jurisdiction." Colonial Pipeline Co. v. Collins , 921 F.2d 1237, 1243 (11th Cir. 1991). "When a defendant properly ... ...
  • Price v. University of Alabama
    • United States
    • U.S. District Court — Northern District of Alabama
    • October 23, 2003
    ... ... Page 1087 ... outside the pleadings in ruling on a motion under Rule 12(b)(1). Colonial Pipeline Co. v. Collins, 921 F.2d 1237, 1243 (11th Cir.1991). However, the Eleventh Circuit has ... ...
  • Request a trial to view additional results

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT