NO. 90-602
IN THE SUPREME COURT OF THE STATE OF MONTANA
1991
PACIFIC POWER & LIGHT COMPANY,
PUGET SOUND POWER AND LIGHT COMPANY,
PORTLAND GENERAL ELECTRIC CO.,
WASHINGTON WATER POWER CO.,
and THE MONTANA POWER COMPANY,
Petitioners and Appellants,
JUN : 1 1991
!
THE DEPARTMENT OF REVENUE OF CLERK O F SUPREME COURi
THE STATE OF MONTANA, STATE OF MONTANA
Respondent and Respondent.
APPEAL FROM: District Court of the ~ i r s t
Judicial District,
In and for the County of Lewis and Clark,
The Honorable Thomas C. Honzel, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Thomas H. Nelson; Stoel, Rives, Boley, Jones & Grey,
Portland, Oregon
Donald R. Murray; Murphy, Robinson, Heckathorn &
Phillips, Kalispell, Montana
For Respondent:
Paul Van Tricht, Montana Department of Revenue
Submitted: MaY 10, 1991
ecided: June 11, 1991
Filed: @s-4
Clerk
Chief Justice J. A. Turnage delivered the Opinion of the Court.
This is a judicial review of an administrative action. The
District Court for the First Judicial District, Lewis and Clark
County, affirmed the decision of the State Tax Appeals Board to
dismiss the challenge made by petitioners and appellants to the
classification of their "beneficial use" interest in electrical
transmission lines. We affirm.
The issue is whether a taxpayer whose assessment has been
revised by the Department of Revenue has a right to administrative
review of the assessment in its entirety, or of only those aspects
of the assessment which were changed in the revision.
Petitioners are investor-owned utility companies which use the
Bonneville Power Administration (BPA) 500 kV transmission lines and
have been taxed by the State of Montana for their "beneficial use"
of the lines running through the state. Beginning in 1984, respon-
dent Department of Revenue (DOR) has taxed the utilities for their
"beneficial usew of the BPA transmission lines between Townsend,
Montana, and Garrison, Montana, and since 1986 petitioners have
been taxed for use of portions of the lines west of Garrison.
Since 1984, petitionersf "beneficial usetfhas been classified as
Class 11 property under § 15-6-141, MCA.
Each year since 1984, the petitioners have paid their taxes
under protest and have filed suit to protest the taxes on constitu-
tional grounds. In 1988, DOR revised the beneficial use tax
assessments for 1986 and 1987. This revision resulted in addition-
al taxes to the petitioners of approximately $1.8 million for the
two tax years in question. Petitioners attempted to file amended
complaints in District Court raising the issue of whether their
"beneficial usen interest had been incorrectly classified as Class
11 property. The District Court ordered that the filing of amended
complaints would not be allowed. The District Court's decisions
in that case were affirmed in Pacific Pow. & Light v. Dept. of
Revenue (Mont. 1991), 804 P.2d 397, 48 St.Rep. 9.
Following the 1988 DOR revision of their taxes, petitioners
also filed this appeal to STAB. The appeal included a claim that
the ''beneficial u e l interest had been incorrectly classified as
sl
Class 11 property for the years 1986 and 1987. STAB granted DORIS
motion to dismiss that claim on grounds that the petitioners had
not challenged the classification in a timely manner and that STAB
was therefore without jurisdiction to hear the issue. Petitioners
appealed that ruling to District Court.
The District Court affirmed STAB'S ruling. It noted that
§ 15-2-302, MCA, requires that appeals to STAB must be made within
thirty days of receipt of notice of a DOR decision. Because the
revised assessments DOR sent out in 1988 for the years 1986 and
1987 did not change the property's classification, the court
reasoned, the appeal of the classification was not timely. The
appeals on the 1986 and 1987 classifications were not made until
twelve and twenty-four months after DOR classified petitioners1
property as Class 11 property for those years.
The standards for judicial review of an agency decision are
set forth in 5 2-4-704, MCA. The petitioners argue that the
standard applicable to this case is that the court may reverse or
modify if substantial rights of the appellant have been prejudiced
because the administrative findings, inferences, conclusions, or
decisions are in violation of constitutional or statutory provi-
sions. Section 2-4-704 (2)(a)(i), MCA. Petitioners assert that,
in this instance, "the usual application of administrative
expertise which forms the underlying basis for the abuse of
discretion standard is not present."
The District Court pointed out that STAB concluded that it was
without jurisdiction. The standard of review of conclusions of law
is merely to determine if the agency's interpretation of the law
is correct. Steer, Inc. v. Dept. of Revenue (Mont. 1990), 803 P.2d
601, 603, 47 St.Rep. 2199, 2200. We will apply that standard of
review, which allows us to consider petitioners1 arguments fully.
Section 15-2-302, MCA, provides in relevant part:
(1) A person may appeal to the state tax
appeal board any action of the department of
revenue involving:
(a) property centrally assessed under chapter
23 of this title;
(2) The appeal is made by filing a complaint
with the board within 30 days following
receipt of notice of the department action.
...
Petitioners argue that, because the 1988 revisions significantly
modified the DORIS overall assessment methodology, the entire tax
assessment is open to appeal. They claim that complex tax assess-
ments must be viewed as a whole, and cannot be separated neatly
into distinct unrelated parts.
We disagree. The processes of assessment of property and
classification of property are codified in different statutes. See
Part 1, Chapter 6 of Title 15 and Part 1, Chapter 23 of Title 15.
As this Court has stated, the process of classification is separate
from the assessment of property or the determination of assessed
value. Butte Electric Ry. Co. v. McIntyre (1924), 71 Mont. 21, 227
P. 61. Moreover,
[tlhe right to sue for taxes paid under pro-
test is purely statutory. Without the
statute, the right would not exist. The same
statute which confers the right, fixes the
time within which it must be exercised and the
grounds upon which the right may be asserted.
Dolenty v. Broadwater County (1912), 45 Mont. 261, 266, 122 P. 919,
The DOR1s action in 1988 changed only the assessment of
petitioners' property, not its classification as Class 11 property.
The function of a court in construing a writing, including a
statute, is "simply to ascertain and declare what is in terms or
in substance contained therein, not to insert what has been omitted
or to omit what has been inserted." Section 1-4-101, MCA. We
conclude that under S 15-2-302, MCA, the complaint filed with STAB
was limited to the action taken by DOR in the revised assessment.
Under that statute, any complaint based on alleged improper
classification of petitioners1 property must have been filed within
thirty days of the department action so classifying the property.
The petitioners1 claim that their property was improperly clas-
sified was untimely, and STAB was correct in concluding that it was
without jurisdiction to hear that portion of the complaint.
Affirmed.
We concur: