Opinion ID: 2509156
Heading Depth: 1
Heading Rank: 45

Heading: Transportation fees downstream from Glenrock

Text: 158. Williams did not raise this issue of transportation deductions downstream from Glenrock until after the issuance of the final audit letter. Findings of Fact, ถถ77-78. In doing so, Williams reversed Barrett's original and consistent position that the point of sale was Glenrock. Findings of Fact, ถ19. Barrett represented Glenrock as the point of sale at the commencement of the audit, and the auditors accepted this representation as fact. Findings of Fact, ถ19. By not shifting its position until its appeal was filed on September 23, 2002, Williams deprived the auditors of any reasonable opportunity to investigate the claim prior to issuing either preliminary or final audit findings. 159. In presenting its case at the hearing, Williams relied entirely on testimony from Storts regarding inconsistencies between the results of a state mineral royalty audit and the audit in this case. Findings of Fact, ถ79. 160. However, Storts was unable to provide satisfactory evidence of the relationship between sales prices purportedly received downstream and the claimed transportation costs. Findings of Fact, ถ79. In fact, Storts testified exclusively from his own inferences based on purported Barrett records; Williams produced no witness who could knowledgeably testify about the records from which Storts drew his inferences. Findings of Fact, ถถ21, 77. Further, Williams did not call any witness to explain why Barrett had initially used Glenrock as its point of sale to determine both sales price and transportation costs. We conclude that Williams failed to carry the burden of showing that the Department determination is incorrect. The burden of proof remained with Williams. 161. During the Department's case, Simmons testified that the state royalty audit was conducted under different instructions than the tax audit. Specifically, the Office of State Lands and Investments gave the auditors different instructions than the Department of Revenue for the treatment of transportation expense beyond Glenrock. Findings of Fact, ถ78. Williams provided no rebuttal to Simmons' explanation, which we add to the matters of fact that lead us to conclude that Williams did not meet its burden of persuasion. We also conclude as a matter of law that the policies of the Office of State Lands and Investments regarding royalty calculations cannot determine the application of the tax statutes. See Kerr-McGee v. Wyo. Oil & Gas Conservation Commission, 903 P.2d 537, 544-545 (Wyo. 1995). 162. The Board has been wary of taxpayer claims made too late to allow the Department to investigate before final taking action. See Airtouch Communications, Inc., et al v. Department of Revenue, State of Wyoming, ___ P.3d ___, 2003 WY 114, ถถ52-55. A complete picture of natural gas transactions is essential if we are to reach the correct conclusions regarding application of Wyoming's tax statutes. E.g., In the Matter of EOG Resources, Inc., Docket No. 2000-71 (2002 WL 1998583) (Wyo. St. Bd. Eq.). A taxpayer must come forward with full and satisfactory documentation of transactions supporting its claims. Williams has not. We conclude that Williams failed to carry its burden of persuasion by a preponderance of the evidence.