I 

108TH CONGRESS 

2D SESSION H. R. 4726 

To prevent discriminatory taxation of natural gas pipeline property by the 

States. 

IN THE HOUSE OF REPRESENTATIVES 

JUNE 25, 2004 

Mr. CARTER introduced the following bill; which was referred to the 

Committee on the Judiciary 

A BILL 

To prevent discriminatory taxation of natural gas pipeline 

property by the States. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. PREVENTION OF DISCRIMINATORY TAXATION 

4 OF NATURAL GAS PIPELINE PROPERTY. 

5 (a) DEFINITIONS.—In this section— 

6 (1) the term ‘‘assessment’’ means valuation for 

7 a property tax levied by a taxing district; 

8 (2) the term ‘‘assessment jurisdiction’’ means a 

9 geographical area used in determining the assessed 

10 value of property for ad valorem taxation; 
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1 (3) the term ‘‘natural gas pipeline property’’ 

2 means all property, real, personal and intangible, 

3 owned or used by a natural gas pipeline providing 

4 transportation or storage subject to the jurisdiction 

5 of the Federal Energy Regulatory Commission; 

6 (4) the term ‘‘commercial and industrial prop7 erty’’ means property, other than natural gas pipe8 line property, public utility property and land used 

9 primarily for agricultural purposes or timber grow10 ing, devoted to a commercial or industrial use and 

11 subject to a property tax levy; 

12 (5) the term ‘‘public utility property’’ means 

13 property, other than natural gas pipeline property, 

14 devoted to public service and owned or used by any 

15 company which performs a public service and which 

16 company is regulated by any governmental agency, 

17 and 

18 (6) the term ‘‘State’’ as the meaning given such 

19 term in section 110(d) of title 4 of the United States 

20 Code. 

21 (b) PROHIBITED ACTS.—The following acts unrea22 sonably burden and discriminate against interstate com23 merce, and a State, subdivision of a State, authority act24 ing for a State or for a subdivision of a State, or any 
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1 other taxing authority, taxing jurisdiction, or taxing dis2 trict established under State law may not do any of them: 

3 (1) Assess natural gas pipeline property at a 

4 value that has a higher ratio to the true market 

5 value of the natural gas pipeline property than the 

6 ratio that the assessed value of other commercial 

7 and industrial property in the same assessment ju8 risdiction has to the true market value of the other 

9 commercial and industrial property. 

10 (2) Levy or collect a tax on an assessment that 

11 may not be made under paragraph (1). 

12 (3) Levy or collect an ad valorem property tax 

13 on natural gas pipeline property at a tax rate that 

14 exceeds the tax rate applicable to commercial and in15 dustrial property in the same assessment jurisdic16 tion. 

17 (4) Impose any other tax that discriminates 

18 against a natural gas pipeline providing transpor19 tation subject to the jurisdiction of the Federal En20 ergy Regulatory Commission. 

21 (c) JURISDICTION OF COURTS.—Notwithstanding 

22 section 1341 of title 28 of the United States Code, or no23 tions of comity, and without regard to the amount in con24 troversy or citizenship of the parties, a district court of 

25 the United States shall have jurisdiction, concurrent with 
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1 other jurisdiction of courts of the United States, States, 

2 and all other taxing authorities and taxing jurisdictions 

3 to prevent a violation of subsection (b). Relief may be 

4 granted under this subsection only if the ratio of assessed 

5 value to true market value of natural gas pipeline property 

6 exceeds by at least 5 percent the ratio of assessed value 

7 to true market value of other commercial and industrial 

8 property in the same assessment jurisdiction. If the ratio 

9 of the assessed value of other commercial and industrial 

10 property in the assessment jurisdiction to the true market 

11 value of all other commercial and industrial property can12 not be determined to the satisfaction of the district court 

13 through the random-sampling method known as a sales 

14 assessment ratio study (to be carried out under statistical 

15 principles applicable to such a study), the court shall find, 

16 as a violation of this section— 

17 (1) an assessment of the natural gas pipeline 

18 property at a value that has a higher ratio to the 

19 true market value of the natural gas pipeline prop20 erty than the assessed value of all other property 

21 subject to a property tax levy in the assessment ju22 risdiction has to the true market value of all other 

23 commercial and industrial property; and 

24 (2) the collection of an ad valorem property tax 

25 on the natural gas pipeline property at a tax rate 
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1 that exceeds the tax rate applicable to taxable prop2 erty in the taxing district. 

3 SEC. 2. EFFECTIVE DATE; APPLICATION OF ACT. 

4 (a) EFFECTIVE DATE.—Except as provided in sub5 section (b), this Act shall take effect on the date of the 

6 enactment of this Act. 

7 (b) APPLICATION OF ACT.—The Act shall not apply 

8 with respect to any taxable year that begins before the 

9 date of the enactment of this Act. 

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