Opinion: Enbridge wins tax battle, will work with counties
The Minnesota Tax Court recently ruled that the state's Department of Revenue incorrectly assessed the value of Enbridge's pipelines located in Minnesota for tax years 2012-2014.
As a result, the counties in which Enbridge's mainline system operates have been placed in the unfortunate position of determining how to navigate a possible budget shortfall.
Throughout this multi- year process, we have been in continual conversations with county leaders every step of the way. It is important for people in the impacted counties to understand that we are not interested in creating any hardship for them.
In Minnesota, the state assesses the tax, the counties collect it, and taxpayer pays it. In this instance, Enbridge has been paying an inflated tax while seeking an equitable solution to the higher assessed value. Despite the Tax Court's ruling, nothing is going to happen immediately. Specific county-level allocations still need to be determined and there is a 30-day process in which all parties can file an appeal.
Enbridge recognizes counties are caught in the middle of a tax dispute, which started in 2012 with the DOR's decision to change its valuation methodology and excessively increase the taxes we pay on our infrastructure in the state.
We anticipated a 16 percent increase based on the traditional valuation methodology, which was acceptable. However, under its new methodology, the DOR rendered an assessment that raised taxes by 24 percent.
Enbridge attempted to mediate with the DOR to find an acceptable solution to this issue. Unfortunately, despite those efforts, we had to petition the Tax Court for review of the Department's valuation method.
Enbridge understands that the counties were not responsible for the flawed assessments and we are committed to working with them to help alleviate the financial impact. From the beginning, Enbridge has been focused on resolving this tax dispute amicably and with an equitable solution for those involved. That commitment continues and we look forward to working closely with our county partners to resolve this matter equitably and amicably.
(Wetmore is director of Operations, Liquids Petroleum, Midwest Region for Enbridge in Superior, Wis.)