Mark DePasquale v. Linda Cwiek, in her capacity as Tax Assessor for the Town of North Kingstown
129 A.3d 72
| R.I. | 2016Background
- In 2011 the DePasquales permitted a wind turbine (owned by WED NK Green, LLC, of which Mark DePasquale is sole member) to be installed on their North Kingstown property; the turbine generates electricity sold to National Grid under a power purchase agreement and none is sold directly to the public.
- The Town assessed the turbine as tangible personal property (valued at $1.9 million) and issued tax bills for 2012.
- The DePasquales appealed the assessment administratively and then sued in Superior Court seeking an exemption under Rhode Island statutes for manufacturing machinery/equipment.
- The Superior Court granted summary judgment for the DePasquales, concluding the turbine constituted manufacturing equipment exempt from taxation.
- The Town appealed, arguing (1) the sale to National Grid amounted to a wholesale sale that brings the turbine within an exclusion for certain power producers, and (2) renewable energy systems are taxable unless a municipality enacts an exemption ordinance.
- The Supreme Court reviewed de novo, rejected the Town’s statutory arguments, and affirmed the Superior Court judgment.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the wind turbine qualifies as "manufacturing" machinery/equipment exempt from property tax under § 44-3-3 | DePasquale: turbine transforms wind (raw material) into electricity (finished product) and is used exclusively for that purpose, so it fits the manufacturer definition and is exempt | Town: sale of electricity to National Grid is effectively a sale at wholesale, bringing the turbine within exclusions for certain power producers so exemption inapplicable | Held: turbine fits the statutory manufacturer definition and is exempt; Town conceded it is not a public utility or retail-selling non‑regulated power producer, and the Town’s wholesale-sale argument fails under the statute’s plain language |
| Whether the statutory exclusion for "non-regulated power producers" bars exemption when electricity is sold wholesale | DePasquale: statute’s exclusion applies only to non‑regulated power producers that sell at retail or took title on/after July 1, 1997; those conditions are not met here | Town: sale to National Grid is a wholesale sale and thus places the turbine within the exclusion | Held: court interprets § 44-3-3(20) literally; the exclusion is limited as written and does not encompass all wholesale sellers; Town’s argument unpersuasive |
| Whether § 44-3-21 (municipal authorization to exempt renewable energy systems) means renewable systems are taxable unless a municipality enacts an ordinance | DePasquale: § 44-3-21 grants municipalities authority to grant additional exemptions but does not negate existing exemptions in § 44-3-3 | Town: § 44-3-21 reflects legislative intent that renewable systems are taxable unless a municipality opts in by ordinance | Held: § 44-3-21 is permissive and harmonizes with § 44-3-3; it does not limit statutory exemptions already provided, so turbine exemption stands |
| Preservation of issues for appeal (procedural) | DePasquale: not contested | Town: some arguments were not pressed below | Held: Court notes Town may have waived some arguments by failing to adequately raise them below, but resolves merits and finds Town’s substantive arguments meritless |
Key Cases Cited
- Pichardo v. Stevens, 55 A.3d 762 (de novo review of summary judgment)
- Delta Airlines, Inc. v. Neary, 785 A.2d 1123 (summary judgment standard)
- Olamuyiwa v. Zebra Atlantek, Inc., 45 A.3d 527 (statutory interpretation—plain meaning)
- Planned Environments Management Corp. v. Robert, 966 A.2d 117 (statutory interpretation—plain language controls)
- DeMarco v. Travelers Insurance Co., 26 A.3d 585 (legislative intent from statute language)
- Peloquin v. Haven Health Center of Greenville, LLC, 61 A.3d 419 (raise-or-waive rule for appellate review)
- South County Post & Beam, Inc. v. McMahon, 116 A.3d 204 (harmonizing statutes on same subject)
- Tarzia v. State, 44 A.3d 1245 (statutory interpretation—give effect to legislature’s intent)
- Kingston Hill Academy v. Chariho Regional School District, 21 A.3d 264 (statutory text as best indicator of intent)