Kansas courts handed down two tax decisions today.
The Kansas Supreme Court affirmed a ruling of the Board of Tax Appeals concerning Boot Hill Casino in Dodge City, Kansas. At issue was whether Boot Hill should pay a compensating use tax for electronic gaming machines, even though it did not own the machines.
“We hold that Boot Hill did not exercise a right or power incident to ownership of personal property in order to be subject to a compensating use tax for that property,” the Supreme Court decision stated. “Because Boot Hill has not exercised such a power or right, we affirm BOTA’s refund and the Court of Appeals panel decision that upheld it.”
Under Kansas law, the state-owned casinos’ gaming machines are owned by the state of Kansas. Boot Hill had challenged its payment of $801,588.95 in compensating use tax for the years 2009 through 2011.
The attorneys for the casino included Matthew J. Limoli, of Edgar Law Firm LLC, of Kansas City, Missouri, Michael D. Pospisil, of the same firm, and Clinton E. Patty, of Frieden, Unrein and Forbes LLP, of Topeka.
In another tax case in the Kansas Court of Appeals, Sedgwick County had appealed the Board of Tax Appeals’ decision concerning four Target stores in the Wichita, Kansas, area in the 2015 tax year.
The Court of Appeals upheld the earlier Board of Tax Appeals decision. In that decision, valuations of the Target stores dropped millions of dollars from the Sedgwick County valuations.
The decision today stated that counties may no longer use carryover values to determine a current year’s valuation. The court also stated that when valuing a property, the appraiser may determine the difference between the value of the property under a hypothetical vacant condition and its value as occupied in order to isolate the value of the taxable real estate separate and apart from the business being conducted on it.
Attorney Linda Terrill of the Property Tax Law Group of Overland Park appeared for Target.
The casino decision is at http://www.kscourts.org/Cases-and-Opinions/opinions/SupCt/2017/20171229/112911.pdf and the Target decision is at http://www.kscourts.org/Cases-and-Opinions/opinions/CtApp/2017/20171229/116607.pdf.