Northern New England Telephone Operations, LLC d/b/a FairPoint Communications-NNE v. City of Concord
166 N.H. 653
| N.H. | 2014Background
- FairPoint maintained poles, wires, cables, and related equipment in Concord’s public rights-of-way and was assessed a real estate "right-of-way" tax for tax years 2000–2010.
- Concord did not assess the same tax against Comcast before 2010 (changed after a BTLA ruling) and had not assessed PSNH or certain other right-of-way users for earlier years because the City was unaware of their use.
- FairPoint sued, alleging the City’s taxation of FairPoint (but not similarly situated entities) violated equal protection under the New Hampshire and U.S. Constitutions.
- The superior court granted summary judgment to FairPoint, finding the City had selectively taxed FairPoint and struck the tax, concluding discriminatory intent was not required for FairPoint’s claim.
- The City appealed, arguing it did not intentionally single out FairPoint and that any uneven enforcement resulted from errors of judgment or factual/legal misunderstandings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether selective taxation claim requires proof of intentional discrimination | FairPoint: intent not required; errors or lapses producing differential taxation are arbitrary and violate equal protection | Concord: must show conscious, intentional discrimination; mere errors of judgment or historical laxity are insufficient | Court held plaintiff must show conscious, intentional discrimination for selective taxation claims; discriminatory intent is required |
| Whether Concord selectively imposed the right-of-way tax on FairPoint | FairPoint: City selectively taxed FairPoint while exempting similarly situated users, violating equal protection | Concord: any differences arose from misunderstandings, lack of awareness, or judgment errors, not intentional selection | Trial court’s implicit finding of selective taxation was erroneous under the correct legal standard; vacated and remanded for further proceedings |
| Appropriate standard of review for constitutional challenge to tax application | FairPoint: rely on Rochester III rational-basis selective-enforcement analysis | Concord: applicable law requires showing intentional discrimination and rational-basis review if selective enforcement proven | Court applies rational-basis test but emphasizes that selection must be intentional before applying it; remands to trial court to determine intent under correct standard |
| Remedy for proven equal protection violation (striking tax) | FairPoint: illegal selective tax should be struck | Concord: if no violation, taxes should stand; if violation, remedy issues may be addressed below | Court did not resolve remedy because it vacated summary judgment and remanded to reconsider selective-taxation finding and any remedy under correct legal standard |
Key Cases Cited
- Anderson v. Motorsports Holdings, 155 N.H. 491 (2007) (selective enforcement requires conscious, intentional discrimination)
- Verizon New England v. City of Rochester, 156 N.H. 624 (2007) (Rochester III) (selective taxation of a single utility violates equal protection if no rational basis exists for selection)
- Sunday Lake Iron Co. v. Wakefield, 247 U.S. 350 (1918) (mere errors of judgment by officials do not establish discrimination)
- Allegheny Pittsburgh Coal Co. v. County Comm'n, 488 U.S. 336 (1989) (equal protection protects against intentional systematic undervaluation or discriminatory taxation)
- State v. Hofland, 151 N.H. 322 (2004) (distinguishing challenges to classification schemes from selective enforcement claims)
- Appeal of Hardy, 154 N.H. 805 (2007) (rejecting results that would produce absurd consequences when applying equal protection arguments)
- State v. Ball, 124 N.H. 226 (1983) (state constitutional analysis may rely on federal law for guidance)