Section 76.07. Assessment.

 

(1)   Duty of department. The department on or before August 1 in each year in the case of railroad companies, and on or before September 15 in the case of air carrier companies, conservation and regulation companies and pipeline companies, shall, according to its best knowledge and judgment, ascertain and determine the full market value of the property of each company within the state.

(2)   Relation to state valuation; description. The value of the property of each of said companies for assessment shall be made on the same basis and for the same period of time, as near as may be, as the value of the general property of the state is ascertained and determined. The department shall prepare an assessment roll and place thereon after the name of each of said companies assessed, the following general description of the property of such company, to wit: “Real estate, right-of-way, tracks, stations, terminals, appurtenances, rolling stock, equipment, franchises and all other real estate and personal property of said company," in the case of railroads, and “Real estate, right-of-way, poles, wires, conduits, cables, devices, appliances, instruments, franchises and all other real and personal property of said company," in the case of conservation and regulation companies, and “Real estate, appurtenances, rolling stock, equipment, franchises, and all other real estate and personal property of said company," in the case of air carrier companies, and “Land and land rights, structures, improvements, mains, pumping and regulation equipment, services, appliances, instruments, franchises and all other real and personal property of said company," in the case of pipeline companies, which description shall be deemed and held to include the entire property and franchises of the company specified and all title and interest therein.

(3)   Assessment. For the purpose of determining the full market value of the property of each company appearing on the assessment roll, the department may view and inspect the property of such company and shall consider the reports filed in compliance with s. 76.04 and the reports and returns of the company filed in the office of any officer of this state, and other evidence or information bearing upon the full market value of the property of the company assessed. In case of companies which own or use property lying partly within and partly without the state, the department shall value and assess only the property within this state, using the methods under subs. (4g) and (4r) . When the full market value of the property of a company within this state has been determined, the amount shall be entered upon the assessment roll opposite the name of the company and shall be the assessment of the entire property of such company within this state for the levy of taxes thereon, subject to review and correction. The department shall thereupon give notice by certified mail to each company assessed of the amount of its assessment as entered upon such roll.

(4g)   Determining the property in this state. The department shall determine the property in this state of railroad companies, air carrier companies, pipeline companies and telephone companies in the following manner:

(a) Railroad companies. For railroad companies:

1. Determine the ton miles of revenue freight handled in this state.

2. Divide the amount under subd. 1. by the ton miles of revenue freight handled everywhere.

3. Divide the fraction under subd. 2. by 3.

4. Determine the number of cars originated, terminated, received at connections, delivered at connections or otherwise handled in this state.

5. Divide the amount under subd. 4. by the number of cars originated, terminated, received at connections, delivered at connections or otherwise handled everywhere.

6. Divide the fraction under subd. 5. by 6.

7. Determine the tons of revenue freight on line, both originated and terminated, and at connections, both received and delivered, in this state.

8. Divide the amount under subd. 7. by the tons of revenue freight on line, both originated and terminated, and at connections, both received and delivered, everywhere.

9. Divide the fraction under subd. 8. by 6.

10. Determine the depreciated cost of road property owned or rented by the company and used in the operation of the company's business in this state.

11. Determine the depreciated cost of migratory road property owned or rented by the company and used in the operation of the company's business.

12. Multiply the amount under subd. 11. by a fraction the numerator of which is the unit miles in this state and the denominator of which is the unit miles everywhere.

13. Divide the sum of the amounts under subds. 10. and 12. by the depreciated cost of road property everywhere.

14. Divide the fraction under subd. 13. by 3.

15. Add the fractions under subds. 3. , 6. , 9. and 14.

16. Multiply the fraction under subd. 15. by the full market value of the company's property everywhere.

(b) Air carrier companies. For air carrier companies:

1. Determine the depreciated original cost of the real and tangible personal property owned or rented by the company in this state and used in the operation of the company's business.

2. Determine the depreciated original cost of the company's migratory tangible personal property owned or rented by the company and used in the operation of the company's business.

3. Multiply the amount under subd. 2. by a fraction the numerator of which is the total of flight hours in this state and the denominator of which is the flight hours everywhere.

4. Add the amounts under subds. 1. and 3.

5. Divide the amount under subd. 4. by the depreciated original cost of the real and tangible personal property owned or rented by the company everywhere and used in the operation of the company's business.

6. Divide the fraction under subd. 5. by 3.0.

7. Determine transport revenue by adding revenue received for transporting passengers and property on flights either originating at, or connecting at, airports in this state.

8. Determine transport-related revenue by adding public service revenue allocated to this state on the basis of routes for which the company is authorized to receive subsidy payments, mutual aid allocated to this state on the basis of the ratio of transport revenues allocated to this state to transport revenues everywhere in the previous year, in-flight sales allocated to this state as they are allocated under s. 77.522 and all other transport-related revenues from sales made in this state.

9. Divide the sum of the amounts under subds. 7. and 8. by the transport and transport-related revenues everywhere.

10. Divide the fraction under subd. 9. by 3.0.

11. Determine the tons of revenue passengers and revenue cargo first received either as originating traffic or as connecting traffic in this state or finally discharged by the company in this state.

12. Determine the tons of revenue passengers and revenue cargo received or finally discharged at airports everywhere.

13. Divide the amount under subd. 11. by the amount under subd. 12.

14. Divide the fraction under subd. 13. by 3.0.

15. Add the fractions under subds. 6. , 10. and 14.

16. Multiply the fraction under subd. 15. by the full market value of the company's property everywhere.

(c) Natural gas pipelines. For natural gas pipelines, except liquefied gas pipelines:

1. Determine the gross cost of gas plant in service in this state, except motor vehicles exempt from the property tax under s. 70.112 (5) , and of all other property owned or rented by the company and used in the operation of the company's business in this state and included in the base for purposes of rate regulation by the federal energy regulatory commission.

2. Determine the gross cost of gas plant in service everywhere, except motor vehicles specified under s. 70.112 (5) , and of all other property owned or rented by the company and used in the operation of the company's business everywhere and included in the base for purposes of rate regulation by the federal energy regulatory commission.

3. Divide the amount under subd. 1. by the amount under subd. 2.

4. Multiply the fraction under subd. 3. by the full market value of the company's property everywhere.

(d) Other pipeline companies. For pipeline companies except those under par. (c) :

1. Determine the gross cost of line of pipe owned or rented by the company and used in the operation of the company's business in this state.

2. Determine the gross cost of line of pipe owned or rented by the company and used in the operation of the company's business everywhere.

3. Divide the amount under subd. 1. by the amount under subd. 2.

4. Multiply the fraction under subd. 3. by 3.

5. Divide the fraction under subd. 4. by 4.

6. Determine the barrel miles transported in this state.

7. Determine the barrel miles transported everywhere.

8. Divide the amount under subd. 6. by the amount under subd. 7.

9. Divide the fraction under subd. 8. by 5.

10. Determine the number of barrels received and delivered in this state.

11. Determine the number of barrels received and delivered everywhere.

12. Divide the amount under subd. 10. by the amount under subd. 11.

13. Divide the fraction under subd. 12. by 20.

14. Determine the gross cost of line of pipe everywhere.

15. Determine the gross cost of all property owned or rented by the company and used in the company's business everywhere.

16. Divide the amount under subd. 14. by the amount under subd. 15.

17. Add the fractions under subds. 5. , 9. and 13. and multiply that result by the fraction under subd. 16.

18. Determine the gross cost of property owned or rented by the company and used in the operation of the company's business other than pipe in this state.

19. Determine the gross cost of all property owned or rented by the company and used in the operation of the company's business everywhere.

20. Divide the amount under subd. 18. by the amount under subd. 19.

21. Add the fraction under subd. 17. to the fraction under subd. 20.

22. Multiply the fraction under subd. 21. by the full market value of the company's property everywhere.

(4r)   Adjustment of factors. In making the determinations under sub. (4g) , the department may adjust any factor or use any other factor in order to reflect more accurately the company's property in this state if in the department's judgment the factor or combination of factors does not produce a substantially just and correct determination or if during the 12 months preceding the assessment date any of the following conditions applies:

(a) The company began operating in this state and the results of its operations during the first year materially distort the allocation of property to this state.

(b) The company's service was interrupted so that the allocation of property to this state is materially distorted.

(c) The company acquired or disposed of assets having a substantial value that are situated so as materially to distort the allocation of property to this state.

(d) Another event occurred which materially distorted the allocation of property to this state.

(5)   Full market value.

(a) The full market value of the operating property of a company listed in s. 76.01 shall be determined by applying recognized appraisal methods, which may include, but are not limited to, the capitalized income, cost, and stock and debt indicators of value, regardless of the method of accounting for legitimate business purposes used by the taxpayer. The department shall give due consideration to generally accepted accounting principles and regulated accounting practices.

(b) The department shall promulgate rules relating to the general principles of the indicators of value under par. (a) .

1971 c. 23 ; 1981 c. 20 ; 1983 a. 27 ; 1985 a. 29 ; 1987 a. 399 ; 1989 a. 31 ; 1991 a. 39 ; 1993 a. 205 , 490 ; 1995 a. 351 ; 2009 a. 2 ; 2015 a. 216 . Cross-reference: See also s. Tax 6.50 , Wis. adm. code. A railroad's working capital was properly assessed as operating property. The valuation of railroads is discussed. Soo Line Railroad Co. v. Department of Revenue, 97 Wis. 2d 56 , 292 N.W.2d 869 (1980). The application of sub. (4g) (b) 11. to 13. is discussed. United Airlines, Inc. v. Department of Revenue, 226 Wis. 2d 409 , 595 N.W.2d 49 (Ct. App. 1999), 98-2299 .