Was Alliant tax refund legal? Utah's top court will decide

Salt Lake County Assessor Lee Gardner says he was shut out of a deal between the former Salt Lake County Commission and Alliant Techsystems Inc. that resulted in the county giving the rocket booster company a $5 million tax refund.

Now, after hearing oral arguments Wednesday, the Utah Supreme Court will determine if the commission, acting as the Salt Lake County Board of Equalization, could force the independently elected assessor into an agreement that he says was illegal.

The legal fight has also brought in the Granite School District, which is backing Gardner, and the Utah Tax Commission, which wants to resolve the issue on its own.

"This is about maintaining checks and balances in county government," Gardner said after the hearing. "It would be very dangerous to have one person with the power to make that decision."

If the decision stands, Gardner said, it would mean the county mayor (who took over for the commission in the change of county government form four years ago) could settle such things independent of the assessor or any other elected official.

The case revolves around a settlement between Alliant and the commission after Alliant contested the valuations of its property from 1995 to 1999. Alliant claimed that a portion of its property was used by the U.S. Navy to monitor Alliant's operations and was therefore exempt from property taxes. Alliant appealed the county assessor's property valuations to the county board of equalization and to the Utah Tax Commission. The case eventually wound up in court.

Except for one meeting held in September 2000, Gardner was barred from attending settlement discussions. It was his position that "the proposed refund was unfair and would, in effect, be asking other taxpayers to pay Alliant's taxes," according to court documents.

In fact, he said Wednesday, he was "flabbergasted." Gardner was so strongly opposed to the decision that he hired his own attorney, Kelly Wright, and told him if the county didn't pay his fees, Gardner would do it out of his own pocket. (Fortunately for the assessor, the county did agree to pay.)

In March 2001, the state Tax Commission rejected the county's agreement with Alliant, and a tax court in September of that year also disapproved, saying the $5 million refund was not divided among any of the tax years and not based on any established fair market value on the land.

Alliant filed a petition for judicial review in district court, which allowed the agreement to go through.