Cable One, Inc. v. N.M. Taxation & Revenue Dep't
412 P.3d 1121
| N.M. Ct. App. | 2017Background
- Cable One operates two New Mexico cable systems (Rio Rancho and Roswell) that provide cable TV, broadband internet, and interconnected VoIP; its systems use optical transmission and include headend facilities.
- Between 2002 and 2011 Cable One repurposed channels to provide two-way services (internet and VoIP), prompting the New Mexico Taxation and Revenue Department to reclassify its tangible property as part of a "communications system" and centrally assess it under the Property Tax Code (§ 7-36-30).
- Cable One paid under protest, sued for a refund and declaratory relief (challenge to reclassification); the district court granted summary judgment to Cable One based largely on administrative practice and failed legislation (H.B. 617).
- The core legal question: whether Cable One’s tangible property fits the statutory definition of "communications system" (a system for transmission and reception of information by electronic, magnetic, or optical means and available for use by another for consideration) and thus is subject to central assessment and valuation under § 7-36-30.
- The Court of Appeals reviewed de novo, concluded the statutory definition is unambiguous and dispositive, reversed the district court, and held the Department correctly reclassified and valued Cable One’s property under § 7-36-30.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Cable One’s tangible property is a "communications system" under § 7-36-30(B)(1) | Cable One: term should be limited to traditional, regulated telecommunications companies; its property not intended for central assessment | Department: statute’s plain definition covers any system used for transmission and reception (including two-way services like broadband and VoIP); reclassification proper | Held: Cable One’s property meets § 7-36-30(B)(1); Department properly reclassified and centrally assessed it |
| Whether absence of "plant" (and use of USOA) excludes Cable One from § 7-36-30 | Cable One: "plant" definition and requirement of a uniform system of accounting (USOA) means its property cannot be centrally assessed | Department: "plant" and accounting regime relate to one valuation option only; classification depends on statutory definition of "communications system," not choice of valuation or accounting method | Held: "Plant" appears only in valuation provisions; lack of USOA does not prevent classification as a communications system |
| Whether legislative inaction or long-standing Department practice (and H.B. 617 failure) preclude reclassification | Cable One: long-standing administrative practice and failed 2008 bill show Legislature did not intend central assessment for cable property | Department: legislative text and 1985 amendments broadened scope; agency did not need additional rulemaking to apply the statute | Held: Legislative history (1985 amendments) supports broad scope; legislative inaction is not dispositive; administrative practice does not override plain statute |
Key Cases Cited
- Comcast Corp. v. Dep’t of Rev., 337 P.3d 768 (Or. 2014) (discussing central assessment/unit valuation and statutory updates to cover evolving communications technologies)
- Self v. United Parcel Serv., Inc., 970 P.2d 582 (N.M. 1998) (summary judgment standard cited)
- Cooper v. Chevron U.S.A., Inc., 49 P.3d 61 (N.M. 2002) (statutory interpretation reviewed de novo)
- Wilschinsky v. Medina, 775 P.2d 713 (N.M. 1989) (weight and limits of statutory definitions)
- Cable One, Inc. v. Ariz. Dep’t of Revenue, 304 P.3d 1098 (Ariz. Ct. App. 2013) (similar holding that Cable One’s provision of VoIP/broadband brought it within telecommunications/central-assessment statutes)