UNITED TELEPHONE COMPANY OF OHIO, APPELLANT, v. LIMBACH, TAX COMMR., APPELLEE.
No. 93-2428
SUPREME COURT OF OHIO
Submitted November 16, 1994—Decided December 23, 1994.
71 Ohio St.3d 369 | 1994-Ohio-209
Appeal from the Board of Tax Appeals, Nos. 91-Z-197, 91-Z-198 and 91-Z-199.
Tangible personal property owned by a public utility telephone company which is not “used in business” is not subject to personal property tax. (
{¶ 1} This matter is before the court on an appeal by United Telephone Company of Ohio (“United Telephone“), appellant, from a decision of the Board of Tax Appeals (“BTA“), appellee, affirming the disallowance by the Tax Commissioner of Ohio (“commissioner“) of certain deductions taken by United Telephone on its personal property tax returns for the 1987, 1988, and 1989 tax years.
{¶ 2} United Telephone is a public utility that provides local and toll access telephone service to its business and residential customers in Ohio. The company maintains one hundred eighty-eight central offices, each of which contains a main distribution frame (“MDF“), which act as switching stations. Cables containing a number of insulated wire pairs or fibers are connected to the MDF at each central office. At the customer‘s end, fiber or wires inside the cables are connected to “drop lines” which go into residences or businesses. Each wire pair or two fibers make a two-way conversation possible.
{¶ 4} United Telephone deducted the value of both its dead and bad pairs or fiber on its 1987, 1988 and 1989 personal property tax returns as property not “used in business” and therefore not personal property subject to taxation. It claimed deductions in the amount of $62,434,757, $68,388,234 and $75,098,071 for the 1987, 1988, and 1989 tax years, respectively.
{¶ 5} The Tax Commissioner disallowed United‘s claimed deductions for the value of the dead and bad pairs or fiber, affirmed the assessments, and issued Certificates of Determination for all three tax years. United Telephone appealed the commissioner‘s order in each case to the BTA. The BTA consolidated the appeals, and, after a hearing, affirmed the commissioner‘s orders. This matter is now before this court as an appeal as of right.
Jones, Day, Reavis & Pogue, Maryann B. Gall, Michael Dubetz, Jr., Jeffrey S. Sutton and George N. Nicholas; and W. Wayne Walston, for appellant.
Lee Fisher, Attorney General, and James C. Sauer, Assistant Attorney General, for appellee.
{¶ 6} Both the commissioner and the BTA found, pursuant to
{¶ 7}
“(B) Except as provided by division (C) of this section or otherwise expressly exempted from taxation:
“(1) All personal property located and used in business in this state, *** [is] subject to taxation regardless of the residence of the owners thereof.” (Emphasis added.)
{¶ 8} In Hatchadorian v. Lindley (1986), 21 Ohio St.3d 66, 68, 21 OBR 365, 367, 488 N.E. 2d 145, 147, we noted that property that is not “used in business” within the meaning of
{¶ 9}
“The property owned or operated by a public utility required to make a return to the tax commissioner of its property to be assessed for taxation by the
{¶ 10} The descriptive phrase “used in connection with or as incidental to the operation of” was removed from
“Except as otherwise provided by law, the taxable property of a public utility required to be assessed by the tax commissioner is each kind of property mentioned in section 5709.02 of the Revised Code and: ***
“(A) In the case of a railroad, all real property and tangible personal property owned or operated in this state ***;
“(B) In the case of all other public utilities except freight line and equipment companies, all tangible personal property owned and located in this state on the thirty-first day of December of the preceding year.” (Emphasis added.) (139 Ohio Laws, Part I, 2054.)
{¶ 11} The commissioner argues that
“First, all statutes which relate to the same general subject matter must be read in pari materia. See Maxfield v. Brooks (1924), 110 Ohio St. 566, 144 N.E. 725; State, ex rel. Bigelow, v. Butterfield (1936) 132 Ohio St. 5, 6 O.O. 490, 4 N.E. 2d 142. And, in reading such statutes in pari materia, and construing them together, this court must give such a reasonable construction as to give the proper force and effect to each and all such statutes. Maxfield v. Brooks, supra. The interpretation and application of statutes must be viewed in a manner to carry out the legislative intent of the sections. See Benjamin v. Columbus (1957), 104 Ohio App. 293, 4 O.O. 2d 439, 148 N.E.2d 695, affirmed (1957), 167 Ohio St. 103, 4 O.O.2d 113, 146 N.E.2d 854; In re Hesse (1915), 93 Ohio St. 230, 112 N.E. 511. All provisions of the Revised Code bearing upon the same subject matter should be construed harmoniously. State v. Glass (1971), 27 Ohio App.2d 214, 56 O.O.2d 391, 272 N.E.2d 893; State v. Hollenbacher (1920), 101 Ohio St. 478, 129 N.E. 702. This court in the interpretation of related and co-existing statutes must harmonize and give full application to all such statutes unless they are irreconcilable and in hopeless conflict. Couts v. Rose (1950), 152 Ohio St. 458, 40 O.O. 482, 90 N.E.2d 139.” Johnson‘s Markets, Inc. v. New Carlisle Dept. of Health (1991), 58 Ohio St.3d 28, at 35, 567 N.E.2d 1018, 1025.
{¶ 12} Applying these principles to the case at bar, we note that former
{¶ 13} Having determined that personal property not “used in business” by the taxpayer is not taxable, the decision of the BTA is unreasonable and unlawful, and we reverse and remand this cause to the BTA for further proceedings to determine whether the dead and bad pairs and fiber at issue were “used in business.” In so doing, the BTA should apply
Decision reversed and cause remanded.
MOYER, C.J., DOUGLAS, WRIGHT, F.E. SWEENEY and PFEIFER, JJ., concur.
RESNICK, J., concurs in the syllabus and judgment only.