WAGONER – An electric company which disputes its property tax bill and asserted that its power generation plant located on Indian land should be exempt from local ad valorem taxes has dropped that claim.
Oneta Power LLC withdrew the argument that because its 1,150-megawatt co-generation power plant in Broken Arrow lies within the boundaries of the Creek Nation, it is questionable whether the Wagoner County Assessor has “lawful jurisdiction to levy and assess ad valorem tax on personal property” inside the tribal reservation.
In a 5-4 landmark decision two years ago that has reshaped the criminal justice system in Oklahoma, the Supreme Court of the United States ruled that the Muscogee (Creek) Nation’s reservation was never disestablished by Congress. As a consequence, crimes committed by or against Native Americans in “Indian country” must be prosecuted by the federal government and not in state courts.
The Creek Nation boundaries encompass three million acres in parts or all of eight eastern Oklahoma counties: Creek, Hughes, McIntosh, Muskogee, Okfuskee, Okmulgee, Wagoner and Tulsa, including most of the city of Tulsa.
Oneta Power is one of several companies and individuals who have pushed to extend the SCOTUS decision in the McGirt case to include tax issues, as well.
After Wagoner County Assessor Sandy Hodges raised Oneta’s valuation by 41.5%, from a little over $282 million in 2019 to more than $399 million in 2020, the company challenged its property tax in Wagoner County District Court.
A year later Hodges raised Oneta’s valuation to $417,649,194, while the company claimed that “the actual fair cash value” of its property was less than $246,900,000.
Oneta asks the district court to “correct and lower” its ad valorem valuation.
The state Attorney General’s Office intervened in the dispute because the state “has important sovereign interests at stake.”
The A.G.’s interest is in “defending the authority of the State and its localities to tax certain property within the bounds of the Creek reservation,” Solicitor General Mithun Mansinghani wrote. If the court were to rule that the Wagoner County assessor lacks taxing authority in the Oneta case, that would “impact the entire State’s ability to use its taxing power.”
Oneta Power dismissed its property tax exemption claim on May 31, 2022, but its property valuation protest continues.
The assessor’s office and the electric company were directed by District Judge Douglas Kirkley to attend a private mediation or judicial settlement conference by Oct. 28.