2015-0625, Appeal of New Hampshire Electric Cooperative, Inc.

joint brief), for responden t Town of Colebrook. Gardner, Fulton, & Waugh, PLLC, of Lebanon (Shawn M. Tanguay on the

Town of Thornton, and Town of Warren. Town of Lyme, Town of New Hampton, Town of Northfield, Town of Plainfield, Town of Andover, Town of B rentwood, Town of Grafton, Town of Lempster, Walter L. Mitchell on the joint brief, and Mr. Mitchell orally), for respondents Mitchell Municipal Group, P.A., of Laconia (Judith E. Whitelaw and

Electric Cooperative, Inc. Lick on the brief, and M s. Nelson orally), for the petitioner, New Hampshire Sulloway & Hollis, P.L.L.C., of Concord (Margaret H. Nelson and Derek D.

(New Hampshire Board of Tax and Land Appeals) APPEAL OF NEW HAMPSH IRE ELECTRIC COOPERA TIVE, INC.

No. 2015 - 0625 Board of Tax and Land Appeals

page is: http://www.courts.state.nh.us/supreme. a.m. on the morning of their release. The direct address of the court's home reporter@courts.state.nh. us. Opinions are available on the Internet by 9:00 to press. Errors may be reported by E - mail at the following address: editorial errors in order that corrections may be made before the opinion goes Hampshire, One Charles Doe Drive, Concor d, New Hampshire 03301, of any Readers are requested to notify the Reporter, Supreme Court of New well as formal revision before publication in the New Hampshire Reports. NOTICE: This opinion is subject to motions for rehearing under Rule p. 2 22 as 2

Hampshire Public Utilities Commission (PUC). Instead, NHEC’s member order. Unlike a private ly - owned utility, NHEC’s rates are not set by the New request it with in its territory and to keep its utility property in good working company. In return, NHEC is required to provide electric service to all who that grants NHEC a franchise to operate a monopolistic electric distribution incidental transmission services. NHEC operates under a “regulatory compact” but it does not engage in the generation of electricity and provi des only distribution services to approximately 80,000 members in 115 municipalities, that it is member - owned by its customers. NHEC provides electricity The relevant facts follow. NHEC is an electric cooperative, which means

respondent municipalities for tax year p. 2 2012. We affirm. in 11 of the respondent municipalities for tax year 2011 and 12 of the of NHEC’s 23 individual tax abatement appeals regarding its property l ocated order of the New Hampshire Board of Tax and Land Appeals (BTLA) denying 16 LYNN, J. New Hampshire Electric Cooperative, Inc. (NHEC) appeals an

as amicus curiae. M.L. Byrnes, of Concord, for New Hampshire Municipal Association, by brief, Judy A. Silva, Cordell A. Johnston, Stephen C. Buckley, and Margaret

Transmission, Inc., as amic i curiae. for Unitil Energy Systems, Inc., Northern Utilities, Inc., and Granite State Gas Pierce Atwood, LLP, of Portland, Maine (Jonathan A. Block on the brief),

Revenue Administration, as amicus curiae. assistant attorney general, on the brief), for the New Hampshire Department of Joseph A. Foster, attorney general (Laura E. B. Lombardi, senior

George E. Sansoucy, self - represented, by joint brief.

Town of Unity. and Eric A. Maher on the joint brief), for respondents Town of Epping and Donahue, Tucker & Ciandella, PLLC, of Meredith (Christopher L. Boldt p. 3 3

unit val ue, Dickman primarily used two valuation approaches: a cost individual municipalities where the utility’s property is located. To derive his of a utility’s property as a whole and then allocates that whole unit value to the appraise NHEC’s property. Under the unit method, an appraiser first values all 8 p. 3 3 - F statewide utility property tax. Dickman used the “unit method” to DRA appraisals that Dickman had prepared for the purpose of the RSA chapter Appraisal Division as a utility appraiser. Additionally, NHEC submitted the Hampshire certified general appraiser em ployed by the DRA in its Property NHEC also presented testimony from Scott E. Dickman, a New

new less depreciation (RCNLD) of NHEC’s property. estimated the value of NHEC’s property by calculating the reproduction cost depreciation (OCL B D) of NHEC’s property; and a second cost approach, which (NBV) of NHEC’s property by calculating the original cost less book net operating income; a cost approach, which estimated the net book value which estimated the value of NHEC’s property by capita lizing the company’s valuation approaches: a sales comparison approach; an income approach, the market value of NHEC’s property by reconciling the results of four Mainstream Appra isal Associates, LLC. In his appraisals, Lagassa estimated George K. Lagassa, a certified general real estate appraiser and the owner of presented expert witness testimony and an appraisal of NHEC’s property from regarding NHEC’s tax abatement appeals. During the hearing, NHEC consolidated hearing over nine days between Januar y and February 2015 assessments of its property that occurred in 2011 and 2012. The BTLA held a NHE C filed tax abatement appeals with the BTLA f rom 2 p. 3 3 municipal

the same property. abatement appeals were subst antially higher than the DRA’s assessments of the municipal assessments of NHEC’s property that are the subject of these tax tax. See RSA ch. 8 p. 3 3 - F (2012 & Supp. 2016). For the 2011 and 2012 tax years, NHEC’s pr operty at the state level for purposes of the RSA chapter 83 - F utility New Hampshire Department of Revenue Administration (DRA) appraises town according to the value of that part lying within its limits”). Separately, the utility property that is situated in more than one town “shall be taxed in each 75:1 (Supp. 2016); RSA 72:8 (2012); see also RSA 72:9 (2012) (stating that property locate d within the municipality, including utility property. See RSA A municipality’s selectmen are required to appraise the value of the

managed and that its property is in good condition and is well maintained. municipalities. The parties’ experts agreed that NHEC is professionally buildings, and other equipment located in some, but not all, of the and conduits over public and private rights - of - way, substations, land, NHEC’s property consists primarily of wood en utility poles, attachments

of service” principles. elected board of directors establishes N HEC’s electricity rates based up on “cost p. 4 4

errors of law, unless we are satisfied, by a clear preponderance of the evidence also RSA 5 p. 4 41:13. “We will not set aside or vacate a BTLA decision except for clearly unreasonable or unlawful.” Town of Charlestown, 166 N.H. at 499; see must show by a preponderance of the evidence that the BTLA’s decision was Town of Charlestown, 166 N.H. 498, 499 (2014). “To prevail, the [appellant] fact are deemed prima facie lawful and reasonable. See RSA 541:13; Appeal of appealed in accordance with RSA chapter 541 (2007)). The BTLA’s findings of RSA 541:13 (2007); RSA 71 - B:12 (2012) (providing that BTLA decisions may be Our standard for review ing BTLA decisions is set forth by statute. See

denying NHEC’s motion in September 2015. This appeal followed. NHEC filed a motion for rehearing. The BTLA issued a written order

disproportionality. assessment methodology do not, and cannot, carry NHEC’s burden of proving ruled that it need not address those points because challenges based up on assessors, as well as the municipalities’ responses to those criticisms, but it the criticisms leveled at the assessment methodologies used by the municipal the local assessments were disproportional. Additionally, the BTLA reviewed of market value and ruled that NHEC had not met its burden of proving that the Lagassa appr aisals and DRA appraisals did not result in a credible opinion the propert ies at issue. Regarding NHEC’s other appeals, the BTLA found that reached value conclusions reflective of a material degree of overassessment of granted, the BTLA found that the municipal assessors acknowledged or NHEC’s abatement appeals and denying the remainder. For the ap peals that it In July 2015, the BTLA issue d a thirty - two page order granting seven of

a publicly - owned utility. owned, regulated utility; and a second income approach that assumed a sale to RCNLD cost approach; an income approach that assumed a sale to a privately reconciled the results of four approaches: a sales comparison approach; an of NHEC’s property in the municipalities for which he was engaged, Sansoucy property in the municipalities for which he was engaged. T o estimate the value which he was engaged. Smith also used an RCNLD approach to value NHEC’s used an RCNLD approach to value NHEC’s property in the municipalities for Georg e E. Sansoucy, who is also a licensed New Hampshire engineer. Roberge of New England, Inc.; Frederick H. Smith, of Brett S. Purvis & Associates; and certified New Hampshire assessors: Gary J. Roberge, CEO of Avitar Associates The municipalities presented expert testimony and appraisals from three

value of NHEC’s property by capitalizing the company’s n et operating income. OCL B D of NHEC’s property; and an income approach, which estimated the approach, which estimated the value of NHEC’s property based upon the p. 5 5

f inder’ s hands with a rigid fair market value formula in the absence of but all also have weaknesses.” Id. “W e have never attempted to tie the fact listed.” Id. (quotation omitted). “All of the enumerated approaches are valid, a trier of fact need not allocate specific weight to any one of the approaches depreciation.” Id. at 38. “Typically all relevant factors must be considered, but alternative facilities, capitalized earnings, and reproduction cost less original cost less depreciation (rate base or net book), comparable sales, cost of combination of five app raisal techniques in valuing public utility property: this area.” Id. (quotation omitted). “The trier of fact may use any one or a “Because of this difficulty, we give the trier of fact considerable deference in market v alue on the property of a regulated utility.” Id. (quotation omitted). “[w]e have previously recognized the extraordinary difficulties in placing a fair Pennichuck Water Works, 160 N.H. 18, 37 (2010) (ellipsis omitted). However, “Determination of fair market value is an issue of fact.” Appeal of

which property is generally assessed in the to wn.” Id. at 368. assessed at a higher percentage of fair market value than the percentage at disproportionality, the taxpayer must establish that the taxpayer’s property is more than its proportional share of taxes. Id. “To carry the burden of proving has the burden of proving by a preponderance of the evidence that it is paying 1 p. 5 50 N.H. 363, 36 7 (2003). To succeed on a tax abatement claim, a taxpayer a taxpayer dissatisfied with an assessment.” Porter v. Town of Sanbornton, “New Hampshire tax abatement statutes provide the exclusive remedy to

argument in turn. the DRA appraisals; and (3) rejecting the Lagassa appraisals. We address each impact of regulation upon the market value of NHEC’s property; (2) rejecting NHEC argues that the BTLA erred by: (1) failing to properly account for the a ppraisals was legally erroneous, unjust, and unreasonable. Specifically, NHEC first argues that the BTLA’s decision to reject the NHEC and DRA

that are us ed to determine a municipality’s share of county taxes. municipal assessments to be significantly greater than the DRA assessments proportional by rejecting NHEC’s estoppel argument and allowing local constitutional and statutory requirements that taxation be uniform and methodological challenges to the municipalities’ assessments; and (3) violating appraisals and Lagassa’s appraisals; (2) ruling that NHEC had presented only On appeal, NHEC argues that the BTLA erred by: (1) rejecting the DRA

1 p. 6 66 N.H. at 499 - p. 5 500 (quotation and brackets omitted); see also RSA 5 41:13. before us, that such order is unjust or unreasonable.” Town of Charlestown, 6

net book and allowed certain acquisition costs to be charged to the utility’s Sansoucy and Lagassa cited sales in whic h the PUC has approved sales above costs to customers does n ot mean that the practice is forbidden. Indeed, both customers. However, simply because the PUC disfavors passing acquisition sale of the utility and that the PUC disfavors passing on acquisition costs to have upon the sale of a utility. It argues that PUC approval is required for any NHEC’s argument primarily relies upon the impact that regulation would

our review of the record, we agree with the BTLA. restrictive as to prove the local assessments were disproportional. Based upon operates, considering both the b enefits and burdens of such regulation, was so probative evidence that the utility regulatory environment in which NHEC property.” It therefore concluded that NHEC had failed to provide sufficient reg arding regulation and its alleged impact on the market value of [NHEC’s] The BTLA found that NHEC had made only “very general assertions

at 48 p. 6 6. evidence of higher market value.” Appeal of Public Serv. Co. of N.H., 124 N.H. property’s market value is equal to its [NBV], in the absence of any specific based on the [NBV] of the property, should be deemed to have proven that the restrictive as to limit any prospective purchaser of its property to a return the relevant methods of valuation, can establish the presence of regulation so H ampshire, we stated that “a utility which, after present ing evidence on all of market value was equal to its NBV. I n Appeal of Public Serv ice Co. of N ew Serv ice Co. of N ew H ampshire, 124 N.H. 479 (1984), to find that NHEC’s fair based u pon NBV, and, therefore, the BTLA was obligated by Appeal of Public specifically argues that the PUC would limit any utility purchaser to a return impact of regulation upon the market value of NHEC’s property. NHEC NHEC argues that the BTLA’s decision failed to properly account for the

1 p. 6 64 N.H. 62, 66 (2012). erroneous as a matter of law. See Town of Atkinson v. Malborn Realty Trust, factual findings unless the evidence does not support them or they are Pennichuck Water Works, 160 N.H. at 41. We will uphold the trier of fact’s LLK Trust v. Town of Wolfeboro, 159 N.H. 734, 740 (2010); see also Appeal of of fact is free to accept or reject an expert’s testimony, in whole or in part.” and brackets omitted). “When faced with conflicting [expert] testimony, a trier evidence in the record.” Appeal of Sutton, 141 N.H. 348, 350 (1996) (quotation but rather to determine whether the findings are supported by competent we would have found differently than did the board, or to reweigh the evidence, I n reviewing the board’s findings, “our task is not to determine whether

judgment is the touchstone.” Id. (quotation omitted). legislative directive.” Id. (quotation, brackets, and ellipsis omitted). “Rather, p. 7 7

to well - settled law, as explained earlier in the text. is that the BTLA was required to accept its version of disputed facts. That, of course, is contrary When considered in light of this evidence it becomes apparent that what NHEC is really arguing 2 N.H. at __ _ (d ecided June 2, 201 p. 7 7) (slip. op. at 7 - 8). stated in that case, we agree with the municipalities. See Appeal of Public Serv. Co. of N.H., ___ Hampshire, ___ N.H. ___, ___ (d ecided June 2, 2017) (slip. op. at 7 - 8). For the reasons that we CVEC. This same disagreement arose in the companion case, Appeal of Public Service Co. of New The municipalities argue that this sale demonstrates that PSNH paid $30 million to acquire the two utilities. NHEC argues that this sale demonstrates that PSNH acquired CVEC at its NBV. a $21 million payment to CVEC’s parent company to terminate a power supply contract between which included an approximately $9 million payment to CVEC, equal to the NBV of its assets, and Connecticut Valley Electric Co., N.H. PUC No. 24,176 (May 23, 2003). The PUC approved the sale, both Lagassa and Sansoucy: PSNH’s 2007 purchase of Connecticut Valley Electric Co. See In re NHEC and the municipalities disagree about the sale price in one of the sales that was used by 1

find that the market value of NHEC equaled its NBV. required by our holding in Appeal of Public Serv ice Co. of New Hampshire to the market v alue of NHEC was not limited to its NBV. Thus, the BTLA was not had sufficient specific evidence that, notwithstanding the impact of regulation, of utilities exceeded NBV by an even greater amount. Taken together, the BTLA NBV. Sansoucy analyzed nine sales that demonstrated th at the market value market value of the sold utilities was, on average, nineteen percent hig her than NBV. NHEC’s expert, Lagassa, analyzed 11 sales and concluded that the 2 from Sansoucy, Roberge, and Smith that NHEC’s market value exceeded its evidence of higher market value.” Id. Here, the BTLA heard expert testimony property’s market value is equal to its NBV “in the absence of any specific to a return based up on the NBV of the property, this proves only that the regulation is so restrictive as to limit an y prospective purchaser of its property Furthermore, even if we accept NHEC’s argument that it has proven that

municipal assessments were disproportional. evidence of restrictive regulation to carry its burden of demonstrating that the no error in the BTLA’s determination that NHEC had not pr esen ted sufficient own rates and does not need PUC approval. In light of this evidence, we find rate - making regulation. NHEC’s member - elected board of directors can set its Moreover, because NHEC is a publicly - ow ned utility, it is not subject to full regulated than more regulated, but constrained by... [a] competitive market.” regulation, Dickman conceded that New Hampshire utilities were “[l] ess regulatio n. W hen the BTLA asked Dickman for his opinion of the level of heard extensive testimony from Sansoucy and Roberge regarding the benefits of Although NHEC focused up on the burdens of utility regulation, t he BTLA

premium. premium from ratepayers — it just cannot earn an additional return on that If allowed to amortize the premium, the buyer can effectively recoup that can earn a rate of return), it may instead be allowed to amortize that premium. allowed to add the premium to its rate base (the amount upon which a utility ratepayers. Additionally, Sansoucy testified th at, although a buyer may not be 1 p. 8 8

perfect mechanism to effect this.” that allocation theory has been discussed, it is well understood that there’s no components in each municipality, Dickman acknowledged that “to the extent asked Dickman why he allocated on the basis of the original cost of the that Lagassa applied in his value reconciliations. Indeed, when the BTLA these weights: (a) shifted from year to year; and (b) differed from the weights regarding how much weight to afford his cost an d income approaches, and those used by Lagassa in his cost approach. Dickman made decisions calculated depreciation, selecting external obsol escence factors different from Dickman’s cost approach, h e made a discretionary decision in how he value, while Lagassa decided to conduct a sales comparison approach. In made a discretionary decision not to conduct a sales comparison approach to Lagassa decided to use both the OCLBD and RCNLD approach es. Dickman approach over th e RCNLD approach or r eplacement cost approach, while cost approach to value, he made a discretionary decision to select the OCLBD decided to use multiple cost approach es to value. Regarding Dickman’s one discretionary decision to use only one cost approach to value, while Lagassa large number of discretionary decisions. Here, f or example, Dick man made a similar approach. Each appraisal necessarily requires the appraiser to make a case does not mean that it must accept a subsequent appraisal that uses a J ust because the BTLA accepted a particular valuation approach in one

have rejected the appraisals. methodology and procedures to value NHEC’s property, the BTLA should not NHEC argues that, because the DRA’s appraisals used widely accepted appraisals did not result in a credible opinion of NHEC’s value. Essentially, NHEC next argues that the BTLA erred by finding that the DRA’s

that it found did not result in a credible opinion of market value. See id. persuasive. As the trier of fact, the BTLA could properly reject any appraisal used. Rather, i t found that the specific DRA appraisals in question were n ot 3 p. 8 8. In this case, the BTLA did not find that the unit method can never be “need not allocate specific weight to any one of the approaches listed.” Id. at given considerable deference regarding determinations of fair market value and evidence presented in a given case. Id. at 37. This is why the trier of fact is appraisal is a question of fact that the BTLA must decide based upon the Pennichuck Water Works, 160 N.H. at 38. To the contrary, the credibility of an combination of approaches is correct as a matter of law. See Appeal of We have never held that a single valuation approach or specific

unit method of valuation is contrary to New Hampshire law. We disagree. NHEC argues that the BTLA ’s rejection of DRA appraisals th at use d the

challenging the accuracy of Dickman’s allocation. In partic ular, Sansoucy Works, 160 N.H. at 41. Additionally, the municipalities presented evidence not required to accept Dickman’s testimony. See Appeal of Pennichuck Water both new investment and retireme nts to that system.” However, the BTLA was property to the value of the entire system and can flexibly take into account procedure properly reflects the contribution of each component of utility o riginal cost. NHEC argues that Dickman explained that this “allocation Here, Dickman submitted a unit appraisal that allocated on the basis of

opinion of market value is a factual issue for the trier of fact to decide. value. Rather, the determination of whether an allocation results in a credible value on the basis of original cost always results in a cre dible opinion of market Thus, Town of Bow does not stand for the proposition that allocating a unit which we can determine that the allocation has harmed [the municipality].” Id. disadvantage [the municipality], we ha ve insufficient evidence before us upon could be unfair: “While it is conceivable that the DRA’s method could unfairly was credible. In fact, we specifically noted that the DRA’s allocation method 133 N.H. at 203. We made no determination that the DRA’s allocation method extent of the harm to [the municipality] from such allocation.” Town of Bow, PSNH property over - values that total property within the [municipality], or the demonstrated mathematically exactly ho w the DRA’s method of allocation of found that “[t]he record does not reveal that [the municipality] has municipality’s argument that the DRA’s allocation method was unfair, we standard of review for appeals of BTLA decisions). In rejecting one Town of Bow, 133 N.H. at 1 p. 9 99; see also RSA 541:13 (pr e scribing the app licable appealing part ies, to establish that the DRA’s allocation method was unfair. In that case, the burden of proof was on the municipalities, as the

We find this argument unconvincing. procedures to be proper in Appeals of Town of Bow & a., 133 N.H. 1 p. 9 94 (1990). was flawed. Specifically, it points out that we found the DRA’s allocation that the DRA used to allocate its unit value of NHEC to the individual towns NHEC also argues that the BTLA erred by concluding that the method

Appeal of Sutton, 141 N.H. at 350. as a matter of law that the BTLA erred by rejecting Dickman’s appraisal. See support in the record for the BTLA’s credibility det ermination, we cannot find all of th e evidence, the BTLA rejected Dickman’s appraisal s. Because there is conflicting expert testimony. See LLK Trust, 15 p. 9 9 N.H. at 740. After weighing conclusions. As the fact fin der, it was proper for the BTLA to weigh this experts that criticized Dickman’s procedures, assumptions, calculations, and appraisals, heard his testimony, and heard testimony from the municipalities’ opinion of market value. In this case, the BTLA examined Dickman’s weigh the testimony and determine whether an appraisal presents an accur ate decisions is precisely why the BTLA, as the fact finder, is in the best position to The fact that each utility appraisal involves numerous discretionary p. 10 10

because of how Lagassa incorporated the three years of expense information The BTLA found Lagassa’s income approach to be flawed, in part,

findings are supported by the record. supported its determination that Lagassa ’s appraisals were flawed, and these property. We disagree. In its order, t he BTLA made numerous findings that appraisals, which, it claims, used well - accepted techniques to value NHEC’s NHEC next argues that the BTLA erroneously rejected Lagassa’s

Charlestown, 166 N.H. at 499 - 500. matter of law, unjust, or unreasonable, we uphold it. See Town of Th erefore, because the BTLA’s credibility determination is not erroneous as a which it could properly reject the DRA appraisals and allocated values. allocated values credible as a matter of law, and it had sufficient evidence from In sum, the BTLA was not required to find the DRA appraisals or

values that were not valid. methods employed by Dickman in the DRA appraisals resulted in ma rket impact of those flaws, we find no error in the BTLA’s finding that the allocation evidence before it regarding the flaws of Dickman’s allocation method and the value of th at part lying within its limits”). Therefore, because the BTLA had RSA 72: 9 (requiring utility property to be “taxed in each town according to the appraise only the specific property located within each municipality. See also Sansoucy testified that this allocation m ethod results in appraisals that fail to shifted, in part, to municipalities that do not contain that distressed property. valuable property. Similarly, the negative impact of distressed property is municipality is shifte d, in part, to municipalities that do n o t contain that unit value. Specifically, the positive impact of valuable property in one lead to inequities in how municipalities are allocated their portion of the DRA’s Sansoucy testified that allocating simply on the basis of original cost can

municipality. per mile basis by the total miles of pole - line wire that is located within a multiplying NHEC’s system - wide cost average for distribution equipment on a cost information for a specific town, those original cost values are derived by cost of any specific utility pole. When NHEC provides the DRA with o riginal average original cost of all of its utility poles, but it cannot identify the original using cost averages. Under this system, for example, NHEC can identify the equipment on a town - by - town basis and instead keeps track of original cost confirmed that NHEC does not keep original cost info rmation for distribution any specific town. NHEC’s financial services manager, Brenda Inman, only on a system - wide basis and does not have original cost information for NHEC’s market value in a given town because NHEC keeps original cost data testified that such an allocation would not result in a credible opinion of p. 11 11

pay more than rate base for the cooperative. independent evidence from which the BTLA could properly conclude that a buyer of NHEC would could properly weigh. Moreover, the sales cited by Lag assa and Sansoucy provided sufficient Liberty Report concluded otherwise and thus is relevant contradictory evidence that the BTLA contradicted Lagassa’s claim that no buyer of a utility would pay more than rate base. The made it clear in its order that it relied upon the Liberty Report only to the extent that it relevance whatsoever to the market value of NHEC distribution assets.” We disagree. The BTLA NH EC argues that the BTLA erred by relying upon the Liberty Report because it “has no 3

rate base. However, the BTLA heard contradictory testimony from the regulatory constraints would preclude a potential buyer from paying more than values dramatically higher or lower than NBV. Lagassa testified that 3 Report). The Liberty Report demonstrated that utility assets can have market report prepared jointly by the PUC and the Liberty Consulting Group (Liberty contradicted by seven of the ele ven sales that Lagassa cited as well as by a more for utility property than rate base. It found this argument to be The BTLA disagreed with Lagassa’s opinion that a buyer would not pay

rate base regulation by the PUC since the early 2000s. entity. Additionally, NHEC acknowledged that it has not been subject to full rather to set rates that balance the interests of the public and the regulated making authority is not necessarily to arrive at market value conclusions but relevant to “rate - making” for a re gulated utility, but the objective of the rate - NBV determination was a calculation of OCL B D. The BTLA noted that NBV is The BTLA also found Lagassa’s cost approaches to be flawed. Lagassa’s

as “an accident of the formula used to al locate expenses to Northfield.” having a net operating income of negative $100,514, a result that he described town basis. Consequently, Lagassa calculated one municipalit y, Northfield, as communi ty, despit e the fact that NHEC lacked expense records on a town - by - Lagassa also performed an independent income analysis for each

depreciation would result in Lagassa calculating a lower net operating income. depreciation is higher than actual physical depreciation, use of book relation to current market value. T he BTLA found that, to the extent that book up on historical cost or another previously established figure that may have no The BTLA noted that book depreciation, unlike actual depreciation, is based Lagassa also relied upon book d epreciation rather than actual depreciation. items are not typically included in an income approach to market valuation. amortization from his income approach. The BTLA found that such non - cash Lagassa for deducting the non - cash items of actual book depreciation and average of the previous three years of expenses. The BTLA also criticized to the next. Instead, Lagassa limited his analysis to a simple arithmetic recurring or why any category of expenses changed dramatically from one year independent analysis to determine whether any of the expenses were non that NHEC provided him. The BTLA noted that Lagassa did not conduct any p. 12 12

flaw ed methodology does not, in and of itself, prove the disproportionate that a flawed methodology may lead to a disproportionate tax bu rden, the proving disproportionality. See Porter, 150 N.H. at 36 9 (“While it is possible that an assessor used flawed methods does not carry a taxpayer’s burden of The BTLA cited our decision in Por ter for the proposition that evidence

present evidence that the municipalities’ assessments exceeded market value. only methodological challenges to the m unicipalities’ experts and did not NHEC next argues that the BTLA erred by ruling that NHEC presented

them. determination. Because these findings are supported by the record, we uphold in a credible opinion of market value, and it made finding s to support its In sum, the BTLA determined that the Lagassa appraisals did not result

inadequate. The BTLA found Lagassa’s explanations for these inconsistencies to be comparison approach from 1.17 in 2011 to 1.0 in 20 p. 12 12 for three other towns. the record shows that Lagassa changed the multiple used in his sales comparison approach from 1.17 in 2011 to 1.0 in 2012. In fact, our review of income approach, and in Grafton, he changed the multiple used in his sales that for some towns he reconciled to NBV, for others he averaged NBV and his between tax years for individual municipalities. The BTLA noted, for example, multiple valu ation approaches, both from municipality to municipality and The BTLA also found inconsistencies in how Lagassa reconciled his

approach to value.” Southern N.H. Water Co., 139 N.H. at 14 3. would have had no reason to approve reprod uction cost as a valid, independent to be nothing more than a way to equate reproduction cost with rate base, we 139 (1994), in which we reasoned that if we “had meant economic depreciation decision in S outhern N ew Hampshire Water Co. v. Town of Hudson, 139 N.H. criticized Lagassa’s decision to take such large deductions and noted our economic obsolescence, sometimes leading to a value below NBV. The BTLA depreciation of over 50% of original cost and a further 27% deduction for accessed. Lagassa’s computation of depreciat ion included physical appraisers, and inferior to multiple cost manuals that Lagassa could have credible because it was outdated, performed by architects rather than underground utilities in Vermont. Sansoucy testified that this study was not for the purpose of examining the pros and cons of using overhead versus approach, Lagassa relied upon a 2003 survey prepared by landscape architects The BTLA also criticized Lagassa’s RCNLD cost approach. In this

regarding the impac t of regulatory constraints. municipalities’ experts and thus was free to reject Lagassa’s testimony p. 13 13

ar rive at its assessment value). focused upon the actual harm, not the methodology that the town used to NHEC. See Porter, 15 0 N.H. at 369 (stating that the trial court should have market value, it also failed to prove that the municipal assessments harmed NHEC’s property, but because NHEC failed to provide a credible opinion of 740. NHEC claims that the municipal assessors overstated the value of BTLA was not required to accept that testimony. See LLK Trust, 159 N.H. at that these flaws had on the municipal assessors ’ resulting market values, the 369. To the extent that Dickman and Lagassa testified regarding the impact cannot, standing alone, carry NHEC’s bu rden of proof. See Porter, 150 N.H. at calculations that those assessors made. This evidence of flawed methodology municipal assessors utilized as well as the estimates, assumptions, and primarily methodological. NHEC criticized the valuation approaches that the As NHEC apparently recognizes, the evidence upon which it relies is

to properly value this type of property.” (Emphasis added.) flawed but overstated value and demonstrated a lack of the necessary expertise appraisals proffered by the various towns not only were methodologically appraisals of Roberge and Smith. NHEC the n concluded: “In short, the his sales comparison approach. NHEC raised similar criticisms regarding the approach; (3) perceived flaws in his income approach; and (4) perceived flaws in the valuations of Lagassa and Dickman; (2) perceived flaws in Sansoucy’s cost that NHEC points to includes: (1) variances between Sansoucy’s valuations and evidence that the municipal assessments were disproportionate. The evidence municipal assessors’ method s of appraising NHEC ’s property, it did present As to the second point, NHEC argues that, beyond simply criticizing the

BTLA, therefore, found it unnecessary to address such criticisms. could not, standing alone, carry its burden of proving disproportionality. The burden, NHEC ’s remaining criticisms of the municipal assessors’ methods because NHEC had not presented sufficient credible evidence to meet its findings are supported by the record. The BTLA ultimately concluded that, appraisals of Lagassa and Dickman. As discussed above, the BTL A’s factual thorough and specific findings explaining why it rejected the testimony and its burden of proving disproportionality. Furthermore, the BTLA made determined that NHEC had not p resented sufficient credible evidence to carry assessments were disproportional. The BTLA, in its role as fact finder, taxpayer, NHEC, bears the burden of showing that the municipalities’ With respect to NHEC’s first argument, t he BTLA correctly noted that the

demonstrated that the municipalities’ assessments were dispropo rtional. presented evidence — that was not purely methodological — which make specific factual findings to support its reliance on Porter; and (2) NHEC the BTLA’s reliance on Porter. Instead, NHEC argues that: (1) the BTLA did not result.”). NHEC, on appeal, does not challenge either the validity of Porter or p. 14 14

estopped.” Id. advantage or impose an unfair detriment on the opposing party if not party seeking to assert an inconsistent position would derive an unfair persuading a court to accept that party’s earlier position; and (3) whether the inconsistent with its earlier position; (2) whether the party has succeeded in the following three factors: (1) whether the party’s later position is clearly judicial estop pel may be invoked vary with each situation, the court considers moment.” Id. (quotation omitted). “While the circumstances under which parties from deliberately changing positions according to the exigencies of the judicial estoppel is “to protect the integrity of the judicial process by prohibiting (quotation, brackets, and ellipsis omitted). The purpose of the doctrine of because its interest s have changed, assume a contrary position.” Id. and succeeds in maintaining that position, it may not thereafter, simply 848 (2005). “Where a party assumes a c ertain position in a legal proceeding, its common law. See Kelleher v. Marvin Lumber & Cedar Co., 152 N.H. 813, New Hampshire has adopted the doctrine of judicial estoppel as part of

Federal Constitution renders those federal claims waived.”). passing reference in his brief to retrospective laws and vested rights u nder the p. 14 142 N.H. 89, 92 (1997) (“[T]he defendant’s failure to devote anything more than we analyze its arguments under the State Constitution only. See State v. Burr, brief. Accordingly, we conclude that NHEC has waived its federal claims, and its brief, NHEC made no further reference to the Federal Constitution in its Amendment to the Federal Constitution in the “Questions Presented” section of argument that the BTLA’s decision violated Section 1 of the Fourteenth As a preliminary matter, we note that although NHEC advanced the

assessment values to determine NHEC’s share of the municipality’s taxes. calculating that municipality’s share of county taxes but then use higher local municipality can accept the DRA’s lower assessed values for purposes of challenge the DRA’s assessment. NHEC argues that, without estoppel, a greater th an the DRA’s assessed value because the municipalities did not should operate to bar municip alities from assessing NHEC’s property at a value estoppel argument. NHEC contends that the doctrine of judicial estoppel requirements that taxation be uniform and proportional by rejecting NHEC’s NHEC next argues that the BTLA violated constitutional and statutory

appraisal methods could not, standing alone, carry NHEC ’s bur den. statement that NHEC ’s remaining criticisms of the municipal assessors’ its burden of proving disproportionality, we find no error in the BTLA’s conclusion that NHEC had not presented sufficient credible evidence to meet B ecause the BTLA made specific factual findings that supported its p. 15 15

reasonably relied, to its detriment, upon any act or assertio n of the municipalities. Accordingly, other party for relying upon that prior renunciation). However, NHEC has not argued that it that he was entitled to a share of that estate because the change in position would injure the party who previously renounced and waived his interest in an estate was estopped from ass erting Dictionary 669 (10th ed. 2014); see also Farnum v. Bryant, 34 N.H. 9, 22 (1856) (ruling that a assertion if it would ha rm another who reasonably relied on the act or assertion.” Black’s Law for NHEC. Quasi estoppel is “[a]n equitable doctrine preventing one from repudiating an act or municipalities from assessing NHEC’s property at a value greater than the DRA’s assessed value NHEC argues that, in addition to judicial estoppel, quasi estoppel should operate to bar the 5 valuations for the purpose of determining a municipality’s share of county taxes. each municipality.” Thus, it is the DRA, not the municipalities, that is electing to use the DRA’s includes the value of utility property and uses the allocated value from its RSA 83 - F appraisal for “[i]n determining a municipality’s equalized valuation for purposes of the county tax, the [DRA] appraisal when determining equalized value.”). In fact, the DRA stated in its amicus brief that (“[N]othing in the plain language of RSA 21 - J:3, XIII prohibits the DRA from using its utility tax its equalization process. See Appeal of Coos County Comm’rs, 166 N.H. 379, 385 (2014) XIII (Supp. 2016). However, the DRA is no t required to use the local assessments for purposes of reports, is required to equalize annually the value of the property in the state. See RSA 21 - J:3, must report their local assessments to the DRA. See RSA 21 - J:34, I. The DRA, using these town Each municipality is required to assess the property within its jurisdiction. The municipalities 4

doctrine of judicial estoppel. 5 statutory or constitutional taxation principles in the BTLA’s refusal to apply the purpose is not implicated here. Therefore, we find neither error nor violation of exigencies of the moment.” Kelleher, p. 15 152 N.H. at 848 (quotation omitted). That prohibiting parties from deliberately changing positions according to the purpose of the doctrine is “to protect the integrity of the judicial process by protec t statutory and constitutional principles under these circumstances. The requires the application of the common law doctrine of judicial estoppel to NHEC’s estoppel argument, NHEC has not pointed to any authority that constitutional principles of uniform and proportional taxation by rejecting To the extent NHEC argues that the BTLA violated state statutory and

of judicial estoppel is inapplicable here. NHEC based upon th ose local assessed value s. For these reasons, the doctrine of NHEC’s property. This position is consistent with assessing taxes against asserting is that their local assessed values represent the correc t market value supplied by the municipalities. Thus, the “p osition” the municipalities are 4 from its RSA chapter 83 - F utility appraisal for the local assessed values J:34, I (2012). It is the DRA that unilater ally substitutes the allocated values municipalities submit their local assessed values to the DRA. See RSA 21 serves the municipalities’ interests, as NHEC argues. To the contrary, the munici palit ies are not accepting the DRA’s lower assessed values when it demonstrated that the municipalities have taken inconsistent positions. The equalization process is not a legal proceeding. Second, NHEC has not municipalities did not take a position in a legal proceeding because the DRA and then, subsequently, takes a contrary position. See id. Here, however, the First, the doctrine applies when a party takes a position in a legal proceeding We find the doctrine of judicial estoppel to be i napplicable to this case. p. 16 16

the doctrine of quasi estoppel is inapplicable here.

within each municipality. its property was being assessed disproportionately compared to other taxpayers s hare of county taxes. As discussed above, NHEC failed to demonstrate that that each property owner in the municipality would pay of the municipality’s within its borders. These assessments were used to determine the proportion Each municipality assessed the fair market value of all the property

disagree. of the county tax than other non - utility residents of tha t municipality. We higher market value for that property, the utility is paying a higher proportion argues that if a municipality thereafter levies taxes upon a utility based upon a in part, based upon the DRA’s chapter RSA 83 - F utility assessments. NHEC As discussed above, a municipality’s share of county taxes is calculated,

administered in a practical way.” Id. (quotation omitted). mathematical equality is not o btainable in all respects if taxation is to be some practical inequalities.” Id. (quotation and brackets omitted). “Absolute However, “the demand of constitutional equality in taxation anticipates

....” Sirrell v. State, 146 N.H. 364, 370 (2001). percentage of its true value as all the taxable property in th e taxing district CONST. pt. II, art. 5. “Each taxpayer’s property must be valued at the same residents within, the said state; and upon all estates within the same.” N.H. and reasonable assessments, rates, and ta xes, upon all the inhabitants of, and Constitution grants the legislature the power to “impose and levy proportional p. 16 166 N.H. 321, 328 (2014) (quotation omitted). Part II, Article 5 of the State each individual’s just share, and no more, shall fall upon him.” Eby v. State, and that taxes must be not merely proportional, but in due proportion, so that article requires that a given class of taxable property be taxed at a uniform rate his share i n the expense of such protection.” N.H. CONST. pt. I, art. 12. “This enjoyment of his life, liberty, and property; he is therefore bound to contribute “[e]very member of the community has a right to be protected by it, in the Part I, Article 12 of the New Hampshire Constitution establishes that

Burr, 142 N.H. at 92. Federal Constitution was violated, it s federal claim is deemed waived. See reference to the Federal Constitution and did not brief its claim that the municipalit y’s share of county taxes. Because NHEC made only a passing significantly greater than the DRA assessments th at are used to determine a uniform and proportional by allowing local municipal assessments to be constitutional, and federal constitutional requirements that taxation be NHEC also argues that the BTLA violated state statutory, state p. 17 17

DALIANIS, C. J., a n d HICKS, CONBOY, and BASSETT, JJ., concurred.

Co. of N. H., ___ N.H. at ___ (d eci ded June 2, 20 p. 17 17) (slip. op. at 16). property belongs to the legislature, not this court. See Appeal of P ublic S erv. Furthermore, the decision to adopt a uniform methodology for valuing utility value. S ee RSA 75:1; Appeal of Pennichuck Water Works, 160 N.H. at 38. methodology that should be used to determine a utility property’s full and true utility property, we note that the legislature has provided no guidance on the methodological conflicts in how the DRA and municipalities are appraising the municipalities’ assessments of NHEC’s property is caused by To the extent that th e discrepancy between the DRA’s assessments and

2, 20 p. 17 17) (slip. op. at 16). situation. See Appeal of Public Serv. Co. of N.H., ___ N.H. at ___ (d ecided June H ampshire, NHEC is benefiting from, rather than being harmed by, this discussed in the companion case, Appeal of Public Serv ice Co. of N ew share of taxes.” (emphasis added)). Furthermor e, for the same reasons that we abatement case is whether the taxpayer is paying more than his proportional Lebanon, 122 N.H. 29, 32 (1982) (“It is well settled that the test in an (quotation and brackets omitted) (emphasis added)); Stevens v. City of taxpayers in a town be assessed at the same proportion of fair market value.” Nashua, 138 N.H. 261, 266 (1994) (“Our constitution mandates that all N.H. at ___ (d ecided June 2, 2017) (slip. op. at 15 - 16); see also Appeal of City of constitutional or statutory violation. See Appeal of Public Serv. Co. of N.H., ___ disproportionately compared to the other municipal residents, and there is no of county taxes owed by the municipality, NHEC is not being taxed Because NHEC pays the same proportion of local taxes, regardless of the value a municipality would owe to the municipality would also remain unchanged. remain unchanged, the proportion of county taxes that each property owner in Under that circumstance, h owever, becau se the local utility assessments would municipalities would have been apportioned a higher share of county taxes. used, when determining each municipality ’ s share of county taxes, these assessme nt figures, which were generally higher than the values that the DRA NHEC correctly argues that i f the DRA had used the local utility