Roehl Transport, Inc. v. Indiana Dept. of State Revenue

• Decision Date: 10 July 1995
• Docket Number: No. 49T10-9404-TA-00141,49T10-9404-TA-00141
• Citation: 653 N.E.2d 539
• Parties: ROEHL TRANSPORT, INC., Petitioner, v. INDIANA DEPARTMENT OF STATE REVENUE, Respondent.
• Court: Indiana Tax Court

Page 539

653 N.E.2d 539

ROEHL TRANSPORT, INC., Petitioner, v. INDIANA DEPARTMENT OF STATE REVENUE, Respondent.

No. 49T10-9404-TA-00141.

Tax Court of Indiana.

July 10, 1995.

Norman R. Garvin, Lynne D. Lidke, Steven A. Pletcher, Scopelitis, Garvin, Light & Hanson, Indianapolis, Richard C. Hutchison, Hutchison, Neidner, Ward & King, Salt Lake City, UT, for petitioner.

Pamela Carter, Atty. Gen., Joel Schiff, Deputy Atty. Gen., Indianapolis, for respondent.

FISHER, Judge.

Roehl Transport, Inc. (Roehl) appeals the Indiana Department of State Revenue's (the Department) final determination imposing the Motor Carrier Fuel Tax and Motor Carrier Fuel Surcharge Tax (collectively motor carrier fuel tax) under IND.CODE 6-6-4.1 for the years 1989 and 1990 (years in issue).

ISSUES

Roehl raises two issues for this court's review:

I. Whether a motor carrier is liable for motor carrier fuel tax on fuel consumed while its vehicles idle off the highway.

II. Whether the inclusion of fuel, consumed by a motor carrier while idling off the highway, in the formula used to calculate motor carrier fuel tax liability is unconstitutional.

FACTS AND PROCEDURAL POSTURE

The undisputed facts reveal that Roehl is an interstate trucking business headquartered in Marshfield, Wisconsin. As part of its business activities, Roehl operates commercial motor vehicles that travel in and through the State of Indiana. Accordingly, the fuel Roehl consumes while in Indiana is subject to the motor carrier fuel tax.

In 1989, in an effort to increase driver efficiency and reduce vehicle idle time, Roehl purchased and installed a number of Rockwell Trip Master computers in its vehicles. These on-board computers record the amount of time a vehicle idles. More specifically:

[the computers] record[ ] engine revolutions and speedometer movement. When the driver starts the vehicle's engine, the Trip Master begins to record the time as "idle time." The Trip Master continues to record this time as idle time until it receives a signal from the speedometer that wheel movement has begun.

After wheel movement begins, the Trip Master will only resume its recordation of idle time if the engine sensor sends a signal and the speedometer sensor does not; however, the Trip Master is programmed to allow for an eight minute delay before it begins to record idle time. This eight minute delay is to allow for on-highway idle time, such as delays at railroad crossings and traffic jams. If during this eight minute delay the vehicle moves even slightly, none of the time is recorded as idle time and the eight minute period recommences. Therefore, the Trip Master records only idle time that is greater than eight minutes in duration.

Stipulated Facts at p 15. Consequently, Roehl maintains that there are two types of idle time: 1) idle time of less than eight minutes, and 2) idle time of greater than eight minutes. Roehl asserts that idle time of less than eight minutes occurs on the public highway for the purpose of stopping at traffic signals and railroad crossings. Roehl further asserts that idle time of greater than eight minutes occurs off the public highway while: 1) the driver sleeps or rests in the vehicle, 2) the driver leaves the vehicle for short period to eat, or 3) a product is being loaded on or off the vehicle. Roehl explains that its drivers keep the vehicles running during these extended periods of time to maintain the vehicle's cabin temperature and to prevent the vehicle's fuel from congealing. See generally Stipulated Facts at p 16, 17; Petitioner's Affidavit of Everett Roehl at 3.

Pursuant to I.C. 6-6-4.1-10, Roehl prepared and filed all required motor carrier fuel quarterly reports for the years in issue. In calculating the amount of tax it owed, Roehl excluded the fuel consumed by its vehicles while idling for periods of eight minutes or longer.

In 1992, the Department audited Roehl's motor carrier fuel tax returns for the years in issue. The Department determined that Roehl had erred in excluding the fuel consumed while idling for periods of eight minutes or longer. As a result, the Department assessed Roehl an additional $18,952.65 in unpaid taxes, plus interest.

Roehl protested the assessment on February 5, 1993. On July 14, 1993, the Department held a hearing by telephone. On October 27, 1993, in its written letter of findings, the Department denied Roehl's protest on the basis that fuel consumed while a vehicle idles, whether on or off Indiana's highways, is to be included for purposes of calculating motor carrier fuel tax liability. On February 18, 1994, Roehl paid under protest the total assessment, including accrued interest, in the amount of $26,915.21. Roehl filed an appeal with this court on April 12, 1994. The case is now before the court on the parties' cross-motions for summary judgment. Additional facts will be supplied as necessary.

STANDARD OF REVIEW

Summary judgment is appropriate only when no genuine issues of material fact exist and a party is entitled to judgment as a matter of law. Ind.Trial Rule 56(C); Knauf Fiber Glass, GmbH v. State Bd. of Tax Comm'rs (1994), Ind.Tax, 629 N.E.2d 959, 960. Cross motions for summary judgment do not alter the standard for granting summary judgment. Safayan v. Indiana Dep't

of State Revenue (1994), Ind.Tax, 631 N.E.2d 25, 26.

DISCUSSION AND DECISION

I

Indiana imposes a motor carrier fuel tax "on the consumption of motor fuel by a carrier in its operations on highways in Indiana." I.C. 6-6-4.1-4(a); I.C. 6-6-4.1-4.5(a) (collectively, subsection (a)). Roehl contends that this language is unambiguously clear--the tax is imposed on fuel consumed on Indiana highways only. Therefore, fuel consumed off the highway is not taxable. Thus, Roehl claims that the Department erred in including in its calculation of motor carrier fuel tax liability that fuel consumed by Roehl while its vehicles idled for a period of eight minutes or longer, as that fuel was consumed in privately owned parking lots and loading areas, and not "on highways."

While Roehl's argument is persuasive, the foremost rule of statutory construction is to determine the legislature's intent in drafting a statute. Johnson County Farm Bureau Coop. Ass'n v. Indiana Dep't of State Revenue (1991), Ind.Tax, 568 N.E.2d 578, 580, aff'd (1992), Ind., 585 N.E.2d 1336. To accomplish this task, the court will not only give statutory words and phrases their plain, ordinary, and usual meaning, Knauf Fiber Glass, 629 N.E.2d at 961, but it will also read the statute as a whole, and not sections or parts of it piecemeal. State v. Adams (1992), Ind.App., 583 N.E.2d 799, 800, trans. denied. Indeed, "[e]ach part [of a statute] must be considered with reference to all other parts [of a statute]." Id.

Of particular importance, then, is the language in I.C. 6-6-4.1-4(b) and I.C. 6-6-4.1-4.5(b) (collectively, subsection (b)), which provides:

[t]he amount of motor fuel consumed by a carrier in its operations on highways in Indiana is the total amount of motor fuel consumed in its entire operations within and without Indiana, multiplied by a fraction. The numerator of the fraction is the total number of miles traveled on highways in Indiana, and the denominator of the fraction is the total number of miles traveled within and without Indiana.

(Emphasis added). See also 45 I.A.C. 13-4-5; 45 I.A.C. 13-8.5-2. Thus, by reading subsection (a) and subsection (b) together, it is apparent that subsection (a) establishes that the motor carrier fuel tax will be imposed when there is "consumption of motor fuel by a carrier in its operations on highways in Indiana." See also Area Interstate Trucking, Inc. v. Indiana Dep't of Revenue (1992), Ind.Tax, 605 N.E.2d 272, 277, cert. denied, 510 U.S. 864, 114 S.Ct. 183, 126 L.Ed.2d 142. For purposes of calculating how much motor carrier fuel tax is due, however, subsection (b) defines the amount of fuel consumed by a carrier "in its operations on highways in Indiana." That definition provides that the total amount of fuel consumed in a carrier's entire operations, regardless of where or in what manner it was consumed, is to be included in the formula used to calculate motor carrier fuel tax liability.

Roehl asserts, however, that the definition provided in subsection (b) is ambiguous. Specifically, Roehl argues that because the phrase "entire operations" is not defined, it must be read literally. As a result, "entire operations" means "every gallon of motor fuel consumed by every vehicle, machine and fuel consuming equipment belonging to the motor carrier," including fuel used to power Roehl's lawn mowers, generators, and company automobiles. Petitioner's Brief in Support of Motion for Summary Judgment at 12. That interpretation, maintains Roehl, results in an absurdity because the legislature did not intend to tax all motor fuel. Accordingly, Roehl maintains that the phrase "entire operations" must mean "entire operations of nonexempt commercial motor vehicles on the highways." Petitioner's Brief in Support of Motion for Summary Judgment at 11.

This court will not overemphasize a strict literal or selective reading of the phrase "entire operations." See Area Interstate, 605 N.E.2d at 274. The legislature's manifest intent in enacting the motor carrier fuel tax is to charge motor carriers for operating their commercial motor vehicles on the

                roads of Indiana.  Id. at 277.   A commercial motor vehicle is defined as
                

(1) passenger vehicle that has seats for more than nine (9) passengers in addition to the driver;

(2) road tractor;

(3) tractor truck;

(4) truck having more than two (2) axles;

(5) truck having a gross weight greater than twenty-six thousand (26,000) pounds; and

(6) vehicle used in combination if the gross weight of the combination is greater than twenty-six thousand (26,000) pounds;

that is propelled by motor fuel.

I.C. 6-6-4.1-2(a). Consequently, Roehl need not be worried about paying motor carrier fuel tax on...