### IN THE COURT OF APPEALS OF TENNESSEE AT NASHVILLE June 26, 200 1Session WILLIAMSON COUNTY, ET AL 

### . v. TENNESSEE STATE BOARD

OF EQUALIZ ATION Appeal from the Chancery Court for Davidson County Nos. 00-522-III, 00-558-III Ellen Hobbs Lyle, Chancellor

No. M2000-03178-COA-R3-CV - Filed December 10, 2001

In this case, a consortium of counties and cities appeals the dec ision of the Chancery Court of Davidson County

upholding

the actio n of the Te

nnessee State Board of Equalization in apply ing deprec iable

life schedules f

ormin g a par

t of Tenne ssee Code

Annotate d section

67-5-903 (f) to commercial and industrial tangible personal property and i n ho lding that personal property is not constituti onally

require d to be valued at its actual value in the implementation of Tennessee Code Annotated section 6 7-5-1509 (a). The only issues before thiscourt ar e the con sti tutionali ty of Tennessee Code Anno tated se ction 67- 5-903(f ) and Te nnessee Code Anno tated se ction 67-5- 1509(a). We hold both statutes to be constitutional and affirm the Chancellor. Tenn. R. App.P. 3 Appe al as of Right ; Judgme nt of the Cha

ncery Court Affirm

ed
W IL LI AM B. C AIN , J., delivered the opinion of the court, in which B EN H. C ANT RELL , P.J., M.S. and P AT RICIA J. C OTT RELL , J., joined. Jeffrey De an Moseley, F

ranklin, Tennessee, for the appellant, Williamson County , Tennessee.
James Charles and Jennifer Clinard Surber, Nashville, Tennessee, for the appellant, Metropol ita n Go ve rn me nt of

Na sh vi ll e a nd Da vi ds on Co un ty. Donnie E. Wilson and RobertB. Ro lw in g, Me mp hi s, Te nn es se e, fo r t he ap pe ll an t, Sh el by C ou nt y, Tennessee.
Jea n Dy er Harr

ison, Nas hville, Te

nnessee , for the

appella nts, Tennessee Cit

y G overnme

nts an d Tenness ee County

Governm

ents. Paul G. Summers , Attorne y General & Repor ter; and Jimmy G . Creec y, C hief Spec ial Counse l, Nashville, Tennessee, for the appellee, Te nnessee State Board of Equalization.
T. Arthur Scot t, Jr. a nd Suzanne S. Cook, Kingsport, Tennessee, for the appellees, Appala chian Power Company and King sport Power Company. Brigid M. Carpenter, Nashville, Tennessee; James W. McBride, Washington, D.C.; and Stephen D. Goodwin, Memphis, T ennesse e, for the In terveno rs/Appellees, Coa

lition of Pub lic Utilitie s.1 As the two sister case s prev iously decided inv olved cent rall y ass essed utili ty proper ty, direct revie w of th e fi nal decis ion was v est ed in the Middle Di vis ion of the Tennessee Court of Appeals pursuant to Tennessee Code Annotated sect ion 4-5-322(b)(1). By that same code section, t

his ca se, invol ving l ocally asses sed personal property , was s ubject to revie w in the C hanc ery Co urt of D avids on C ounty w ith the de cision o f the Ch ance llor ap pea lable to this Co urt. -2- Everett B. Gibson, Memphis, Tennessee, for the I ntervenors/Appellees , Colonial Pip el in e C om pa ny, MCI Metro Ac cess Tra

nsmission Se

rvices, Inc ., MCI

Telecom m unicatio ns Corpor ation and Norfolk So ut he rn Ra il wa y Co mp an y. Charles A. Trost and Michael G. Stewart, Nashville, Tennessee, f or t he Intervenor/Appe

llee, Tenness ee Assoc iation of B usiness. OPINION This case follows in the wake of two sister cases alread y decided by

the appe llate courts. The first of these cases, In Re All Assessments 1998 , No. M1998-00243-SC-R11-CV, 2000 WL 1710174 (Tenn. Nov. 16, 2000), involved centra lly a ssessed public utility p ersonal propert y equalization for 1998. In tha

t case, t he Supre me Court of

Tenness ee, rev ersing

the Court of

Appeals, held: “The Tennessee Board

of Equalization is authorized to reduce (or increase) the appraised (and the refore corresponding assessed) valueof centr ally -assess ed public

utility tangible personal property as part of the equa lization pr

ocess, th e purpose of which is to equalize the ratio of the apprais ed value to fair mar ket value of public utility property in any particular

county with the corr

esponding ratio for industrial and commercial property in that county.” Id. The second c ase was In Re All Assessments 1999 & 2000 , No. M2000-00399-COA-R12-CV, 2001 WL 1077948, (Tenn. Ct. App. Sept. 14, 2001). That case, again involving ce ntrally assessed public utility

tangibl e person al prope

rty assessme nts for the tax years 1999 a nd 2000, was reduced in scope by the supre

me court decision of November 16, 20 00 to a chall enge of the co nstitutiona lity of Tennessee Code Annotated section 67-5-903(f) a nd Tennessee Code Annotated section 67-5- 1302(b)(1). The September 14, 2001 decision of this Court uphel d the cons titutionality o f both statutes. The case at bar is limited to a second attack upon the constitutionality of Tennessee Code Annotated se ction 67-5-903(f ) and an attack upon the constitutionality of Tennessee Code Annotated section 67-5-1509(a). 1 The Chancellor affirmed the Tennessee Board of Equalization upholding the constituti onality

of both Te

nnessee Code Anno tated se ctio n 67-5-903(f) and Tennessee Code Annotated section 67-5-1509(a).
On appeal, where only

the const itutionality o f these tw o statutesis putin issue, th ere is lit tle to be gained by

repetition of the two previous decisions. It suffices to say that, whe n the Supre

me Courtof Tennessee, in In Re All Assessments 1998 , specifically he ld that the Tennessee Board of Equalization was auth orized to reduce the value of centrally assessed public utility tangible pe rsonal-3-

propert y as part of the equalizati on process, it effectively cut the heart out of the appellant’s argument that Art icle II , sect ion 28 of the Constitution of Tennessee, subsequent to the 1972 amendments, requires property to be assessed at its actual value. Once this holding, predica ted as it was upon Marion County v. State Bd. of Equalization , 710 S.W.2d 521 (Tenn. Ct. Ap p. 1986) (permission to appeal denied), and Sherwood Co. v. Clary , 734 S.W.2d 318 (Tenn. 1987), was issued by the highest court in the state, neither the State Boar d of Equalization, the Chancery Court of David son County, nor this Court had any basis upon which to constitutionally invalidate the elabora te statutory scheme pr

omulgated by

the General Assembly

and implicitly upheld by the supreme court. Following the November 16, 2000 decision of the Supreme Court of Tennessee, this Court upheld the const

i tutionality of both Tennessee Code Annota ted sections 67-5-903(f) and 67-5- 1302(b)(1)(Supp. 2000) for reasons articulated in page s 14 through 20 of In Re All Assessments 1999 and 2000 , 2001 WL 1077948, at *10-15. I t remains only to address now the constitutionality of Tennessee Code Annotated section 67-5-1509(a).
It is assertedby the appellants that wha tthe sales appraisal ratio does is undervalue persona l propert y by a perc entage derived from rea l es ta te values on top of the undervaluation already resulting from the application of the depreciation schedules set forth in Tennessee Code Annotated section 67-5-903(f). The pertinent provision of Tennessee Code An notated section 67-5-1509(a) (1998) provides: “The board shall by order or rule direct that co mmerc ial and in dustrial t angible personal property a ssessments be equalized using the appraisal ratios adopted by the Board in each jurisdiction. Such equalization shall be available only to taxpay er s wh o have filed the reporting schedule required by

law.”
In In Re All Assessments 1999 & 2000 , we held : Use of such sales ratios may provide the least unsat isfac tory method of appra ising tangibl e personal property , but such is a legislative decision unshackled by constitutional prohibition. Section 67-5-1509(a) of the Code mandates that locally assessed industrial and commercial personal property be adjusted by

the sales ratio in each co

unty . It necessar

ily f ollows tha

t, to achi eve equ alizati on, p ublic utility personal property must likewise be a djusted under

section 6 7-5-1302 (b)(1) . It isnot the prerogative of this Court, or of the State Boar d of Equalization, to question the reasonableness of a

statute or second

guess the policy

judgments of the legislature. Bell South Telecomm., Inc. v. Greer , 972 S.W.2d 663, 673 (Tenn. Ct. App. 1997). Id. 2000 WL 1077948, at *15.
Once it is establish

ed that “ one hundr

ed perc ent of actual valu e” is no longe r constitu tionally mandatedby A

rticle I I, se ction 28 of

the Tennessee Co nstituti on , the legislative prerogative evidenced

by Title 67, Chapter

5, part 15 of Tenne ssee Code Annotate d is, wisely or unwisely , free-4-

of constitutional infirmity. The constitutional challenge to Tennessee Code Annotatedsection 67-5- 1509(a) must fail. The judgmen

t of the Cha

ncell or i s in all respects affirmed with costs assessed aga inst the appella nts.

___________________________________ WILL IAM B. CAI

N, JUDGE