422 Pa. 463 | Pa. | 1966
Opinion Per Curiam,
These are cross appeals from orders of the lower court affirming and modifying certain real estate tax assessments on the Fairless Works, a steel mill owned by United States Steel Corporation (Steel). The parties other than Steel are the Board of Assessment and Revision of Taxes of Bucks County (Board), the School
The assessments in question concern the years 1960 through 1963. The relevant taxing statute is §602 of The Fourth to Eighth Class County Assessment Law,
If that were the only basis upon which the Board’s assessment might be assailed, we would be required to uphold the Board’s valuation and disregard the lower court’s modification. Nonetheless, there is cause to modify the assessment. In Jones & Laughlin Tax Assessment Case, 405 Pa. 421, 175 A. 2d 856 (1961), we held that improvements, whether fast or loose, which (1) are used directly in manufacturing the products that the establishment is intended to produce; (2) are necessary and integral parts of the manufacturing process; and (3) are used solely for effectuating that pur
Without involving this opinion with a lengthy discussion of the process by which steel is made, we will simply note that the components of steel are iron ore, coke and limestone. After its arrival at the steel works, the iron ore is mixed and blended until the proper grade is produced. The coke is processed from coal, which is heated and quenched until it turns into coke; the coke is then refined until the particles reach the proper size for blending with the iron ore and limestone. These three basic materials are processed into molten steel, which is poured into various molds to form ingots of raw steel, which ingots are further fabricated into numerous shapes, sizes, types and grades of the finished steel product. A valuable by-product of
That portion of the railroad track used exclusively in manufacturing serves as a massive conveyor belt for the Fairless Works whereby materials essential to the steel manufacture process are transferred from one processing station to the next. Its function is the same as that of a standard sized conveyor belt in a factory which turns raw material into a finished product. Clearly, this trackage is excluded from taxation under the Jones d Laughlin standard.
The craneways for overhead cranes provide support for the rails upon which massive overhead cranes move through the buildings carrying iron, steel and other in-process products. If the railroad track serves as a conveyor belt between processing stations, then the crane-ways serve the same function within a station. These craneways, although attached to the supporting columns of the buildings, provide no support as such therefor and are not subject to assessment.
The ore yard facilities — located between the vessel slip and the blast furnaces — “are used not only as a transshipments and temporary storage area (providing, a ‘surge’ or reserve capacity for a three to ten days’ supply of ore for the blast furnaces) for iron ore as discharged from the water or rail carriers, but also constitute receptacles used fundamentally and primarily for the programmed spreading, layering and blending of the nonuniform shipments of grades and sizes of ore received in various cargoes, so as to achieve uniformity for processing in respect to chemical analysis
The blast furnace stock bins — immediately adjacent to the ore yard and the blast furnaces — were well described by the court below: “The blast furnace stock bins are steel structures which contain surge receptacles designed for the in-process purpose of assembling and temporarily holding the various materials used directly to supply the blast furnaces themselves. Iron
These bins are not, in the main, storage facilities and we agree with the court below they must be excluded from taxation.
The slag pits are located behind the blast furnaces and serve to receive the molten slag as it is discharged from the blast furnace. The slag deposited in the pits is treated by a water-cooling system built into the concrete walls. Slag is an industrially valuable byproduct of the iron making process. The lower court found that the slag pits constitute equipment which serves an integral and essential part of the production of slag, and are used directly and solely in the manufacturing process. The cooling process performed by the slag pits produces slag of the required texture and is part of the manufacturing process. We agree with the lower court that these pits should not be assessed.
The open hearth charging platforms are elevated platforms (20-25 feet high) located in the open hearth building. They are used to support machines and cars which run on tracks imbedded in the platforms and which carry materials into the open hearth furnaces. The platforms are removable, are supported independently of the building, and add no structural strength thereto. They are alike in function to the craneways for overhead cranes, which, we have said, are analogous to over-sized conveyor belts and are not assessable. Likewise, these platforms should not be taxed.
The soaking pits platforms are elevated steel platforms located in the soaking pits building. They are supported by their own foundations and certain of the steel building columns. They are located above the soaking pits and provide no support for the soaking pits building. The soaking pits serve to reheat the steel ingots after they have been removed from their molds and prior to their being fabricated into the desired shapes and sizes. The platforms provide support for the soaking pits control equipment and access for personnel to that equipment. They can be removed without damage to the building and are excluded from assessment.
The catwalks and special stairways are stairwells which, unlike the regular stairways in Steel’s office buildings, are not built into the buildings but are mounted thereto. They provide necessary access to the
The blast furnace cast houses are actually parts of the blast furnaces and provide shelter for the furnace equipment and overhead platforms and channels for the flow of hot molten iron from the blast furnaces into cars for transport to the open hearth furnaces. These facilities should be excluded under Jones & Laughlin.
The orders of the court below are modified and the case remanded for entry of orders in conformity with this opinion.
On January 1, 1962, Bucks County was reclassified from a fifth class to a third class county. Nonetheless, The Fourth to Eighth Class County Assessment Law has remained in effect for real estate taxation assessment purposes in Bucks County, by reason of the Act of July 29, 1953, P. L. 974, as amended, 72 P.S. §5347 (1965 p.p.).
Portion of Finding of Fact 29.
Finding of Fact 30.
Steel lias large facilities for ore storage for this plant in the Philadelphia area.
Finding of Fact 33.
Finding of Fact 34.