The Supreme Court of Georgia on Monday ruled in favor of Southern LNG, which had sued the Georgia Commissioner of Revenue over a tax-related issue.
The 6-1 decision sent the issue of who should assess the value of the Elba Island LNG facility — Chatham County or the state — back to Fulton County District Court, whose analysis was “incomplete,” according to the state Supreme Court. This is the second time this case has been appealed to the state Supreme Court.
With a tax bill of more than $4.4 million, owner Southern LNG is the largest taxpayer in Chatham County, where the Board of Assessors does the assessment.
But the company, which imports liquefied natural gas into enormous storage tanks on the Savannah River, argued that it should be treated as a public utility and as such be assessed by the Georgia Department of Revenue.
State law requires public utilities to make annual tax returns of all property located in Georgia to the revenue commissioner.
When the Elba Island facility first began operating in 1978, the company filed its property tax returns with Chatham County, the state’s attorneys noted in their brief. It was not until 2002 after reopening following a long hiatus that Southern LNG requested it be permitted to file the ad valorem tax returns with the state commissioner rather than Chatham County.
It did so after becoming dissatisfied with the ad valorem assessments from Chatham County, the state’s attorneys noted.
In its ruling, the high court sent the matter back to Fulton County to address the issue of whether the Commissioner of the Georgia Department of Revenue could be compelled to take Southern LNG’s return.
The Chatham County Board of Assessors is monitoring the case, said attorney Abda Quillian.
Along with the Supreme Court case, Southern LNG continues its legal battle with Chatham County over the value of its entire investment in Chatham County. That case is pending in Superior Court of Chatham County.
Quillian said Monday’s ruling did not make clear the county’s next move.
“We’re going to have to sit down and assess whether we should get a ruling here on the substantive issue,” she said. “Or do we just wait and let Fulton try to do theirs? A ruling in Chatham wouldn’t be binding on the revenue commissioner. A decision in Fulton may or may not be binding on us.”
Through spokesman Richard Wheatley, Southern LNG’s parent company Kinder Morgan declined to comment, citing active litigation.
Plans call for the value of the Elba Island property to increase significantly. Kinder Morgan, which bought Southern LNG’s previous parent company El Paso in 2012, anticipates that along with partner Shell it will invest about $1.5 billion to build a liquefaction train on Elba to facilitate LNG export.