The city of Milwaukee will have to return more than $530,000 in taxes and interest to an oil company, according to an appellate court decision released Tuesday that found the company was taxed differently than similar businesses.
Vincent Moschella, a deputy city attorney, said his office has not decided whether to petition the Wisconsin Supreme Court for a review of the decision. Even if not appealed, the decision will not have a significant effect, he said.
“We may have lost the battle, but we probably won the war,” Moschella said. “All of the other businesses are now assessed on the same basis.”
The decision of the District I Court of Appeals was based on a lawsuit brought by U.S. Oil Co. Inc. in 2006 challenging the city’s assessments for 2004 and 2005 of company terminals at North 107th Street and Granville Road.
A city assessor, in preparation for a Board of Review hearing, subpoenaed the company’s audits, financial statements, balance sheets, operating statements, auditor’s opinion, gross income and lease information. The assessor argued the property value should be based on the capacity of the terminals and oil prices.
The property’s $6 million assessment was boosted to $14 million. U.S. Oil filed suit in Milwaukee County Circuit Court.
Before a judge ruled in the case, Milwaukee retroactively reassessed the 2006 and 2007 value of terminals belonging to four other oil companies using the same method applied to U.S. Oil. Those companies sued together in state court, contending the assessments should be based on comparable property values. The case is pending.
A circuit court judge in the U.S. Oil case found Milwaukee violated the uniformity clause of the state constitution because the city did not use the same standard for terminals owned by other oil companies.
The city appealed.
Joseph Pickart, a lawyer representing U.S. Oil, said despite the city’s decision to assess all the oil companies in the same manner, his client believes it still is being overcharged on property taxes.
“We have an appeal pending on the city’s valuation,” Pickart said. “That’s a fight for another day.”