Mining company allowed to argue tax

MONTGOMERY | A coal mining company should have the opportunity to argue against paying an equipment tax to both Fayette and Tuscaloosa counties, the Supreme Court ruled Friday.

The Supreme Court 5-0 reversed a decision by Tuscaloosa County Circuit Judge Charles Malone against Pittsburg & Midway Coal Mining Co., now known as Chevron Mining Inc.

The company sought a hearing before the Tuscaloosa County tax board to discuss taxes claimed by Tuscaloosa County that had also been paid to Fayette County. The court ruled the company is entitled to that hearing.

Attorney Bruce Ely represented P&M Coal and argued that the company should pay taxes to only one county. 'Just tell me which county to pay and we will pay it once,' Ely said.

Robert Spence, the attorney for Tuscaloosa County, said the decision was wrong, and that P&M Coal waited too long to request a hearing under the law.

'It's a basic disagreement over whether a local act controls this,' Spence said. 'Our position has been that local acts apply over state general acts unless the state act specifically repeals the local act.'

According to the Supreme Court, P&M Coal appealed to the tax board within 30 days of a final assessment. But the tax board, in a May 31, 2006, letter, in effect denied the appeal.

P&M Coal went to Tuscaloosa County Circuit Court, lost and appealed to the Supreme Court.

'Because the notice of appeal was timely filed, the trial court erred in dismissing the company's remaining claims as an impermissible substitute for a timely appeal,' Justice Patricia Smith said in the opinion.

From 1999 to 2005, P&M Coal paid taxes to Fayette County on equipment, supplies and fixtures used in digging coal in the company's North River Mine.

The entrance to the underground mine is in Fayette County, but the mine itself is beneath both Fayette and Tuscaloosa counties.

The Tuscaloosa County tax board said a 'large portion' of the taxes should have been paid to Tuscaloosa County. The county assessed the company $1.2 million in 2005, but apparently that was reduced to $749,197 in 2006.

At the same time, P&M Coal asked Fayette County for a refund but was refused.

Pittsburg & Midway Coal Mining Co., which is one of the oldest mining companies in the U.S., and Molycorp Inc., both subsidiaries of the Chevron Corp., merged in 2007 to form Chevron Mining Inc., which is based in Englewood, Colo.