State tax commission defers salt dome issue

An attorney for four salt dome operators in Assumption Parish charged Tuesday that Assessor Wayne “Cat” Blanchard is abusing due process rules and ignoring state law in a push to assign new values to underground salt dome caverns.

Attorney Cheryl Kornick told the state Tax Commission that Blanchard was trying to have it certify tax bills against its own rulings and with a short time for taxpayers to fight them.

“That’s what going on here. There’s no reason for that to happen. That’s an abuse of the rules,” said Kornick, who represents Dow and other operators.

The assessor is seeking to have seven companies with caverns carved from the Napoleonville Dome added to the tax rolls in the parish, potentially resulting in four years of unpaid taxes totaling $14.4 million.

Blanchard said the emergence of the Bayou Corne sinkhole, which resulted from the failure a cavern in the salt dome in 2012, led to an inquiry about what is in the dome. An audit found only 17 of the nearly 60 caverns in the dome were reported as assets, Blanchard said.

When questioned later by a commissioner about Kornick’s due process claims, Blanchard said required public notices went in the parish’s official journal but the companies were not sent letters.

“Whatever the law required us to do is what we did,” he said.

Blanchard and Sheriff Mike Waguespack wanted the rolls approved so bills could go out and the issue settled in court. Several suits have been filed.

Kornick wanted the commission to exercise its oversight power, deny the rolls, make Blanchard start over and say tax bills would not be sent out.

On a 4-0 vote, the commission did neither and, citing the dispute’s complexity, deferred action to meet with both sides.

At the heart of the fight is a debate about how a salt dome cavern should be classified for tax purposes: Are they just holes in the ground or commercial improvements such as a building?

While both sides debated these points Tuesday, the fight over procedure reflected that broader question.

Blanchard argues the caverns, which are mined from the salt and then used to store material, are commercial improvements. He assessed the caverns as a commercial assets at 15 percent of market value.

Kornick cited court cases and the state constitution in arguing the caverns are inseparable from the land and should be assessed as land, at 10 percent of market value. Property owners pay tax based on assessed values.

She argued the caverns are land, which the assessor must value himself through reassessment.

“If he thinks he’s been assessing it at a value that’s too low, there’s a remedy for that,” Kornick said.