The owners of Cookeville Boat Dock haven’t paid all their property taxes to DeKalb County for more than a decade and a Judge assigned to hear the case in Chancery Court still has not ruled on it, though a decision could come soon. The total tax bill owed comes to almost $200,000 including interest and penalties.
From 1998 through the 2012 tax year, owners of Cookeville Boat Dock & Resort, Inc. have been named as defendants in DeKalb County Chancery Court lawsuits filed against delinquent taxpayers. The amount Cookeville Boat Dock & Resort, Inc. owes through 2012 in delinquent taxes comes to $183,289.94 (taxes on personal property and leased property including the base tax plus interest and penalty, attorneys fees, and court costs). Further penalties are assessed each month. Additionally for the 2013 tax year, the Trustee’s Office reports that Cookeville Boat Dock & Resort Inc. owes a total of $9,307 in delinquent taxes including interest and penalty to date. The marina also owes $8,213 for the 2014 tax year, which comes due February 28, 2015.
In a Chancery Court delinquent tax lawsuit, the marina owners claim that they can’t be forced to pay ad valorem (property) taxes on constitutional grounds. But in 2013, Tennessee Attorney General Robert E. (Bob) Cooper, Jr. gave an opinion that the marina’s claim is without merit and should be dismissed by the court.
The attorney for Cookeville Boat Dock, Jon E. Jones of Cookeville contends the owners of the marina are being discriminated against in that the county is trying to force them to pay ad valorem taxes on the boat dock facility which is leased from the U.S. Army Corps of Engineers (federal government property) while other properties in Tennessee leased from the state or local government entities (under Article II, Section 28 of the Tennessee Constitution) are exempt from payment of ad valorem taxes. This, he claims is a violation of the Supremacy Clause of the U.S. Constitution making the tax assessment against Cookeville Boat Dock & Resort, Inc. invalid. In 2013 Jones filed an amended answer to the county’s Chancery Court lawsuits against delinquent taxpayers including Cookeville Boat Dock & Resort along with a counter complaint seeking a declaratory judgment for his clients.
Attorney General Cooper, who was made a party to the case to defend the constitutionality of Article II, section 28 of the Tennessee Constitution, asserts in his answer to the marina’s counter complaint that the state constitution does not grant a property tax exemption to commercial taxpayers that operate a business on land owned by the state or local government. Cooper further asserts that Cookeville Boat Dock’s constitutional challenge is not properly before the court because the marina owners failed to first pursue other statutory remedies available to them.
Cookeville Boat Dock owns and operates a commercial boat dock and concession on land in DeKalb County that is leased from the federal government. The marina has been assessed ad valorem taxes on the boat dock property since 1998; however, it apparently has not paid these taxes and, thus, the boat dock property has been included in the delinquent tax proceedings of DeKalb County covering the tax years from 1998 through 2012. “It is the Attorney General’s understanding that Cookeville Boat Dock has not been assessed for the underlying real estate that is owned by the federal government or for any leasehold interest in the real estate. Rather, Cookeville Boat Dock has been assessed only for the buildings and other structures that make up the boat dock property,” wrote Attorney General Cooper in his answer.
In their Trial Brief, “Cookeville Boat Dock & Resort, Inc. is asking the Court to declare that DeKalb County’s assessment of ad valorem taxes against boat dock facilities leased by Cookeville Boat Dock & Resort, Inc from the United States is a violation of the Supremacy Clause of the U.S. Constitution because Tennessee exempts boat dock facilities from taxation when the lessor is an agency of the state.”
In his answer, attorney general Cooper wrote that ” the Federal Supremacy Clause does not prevent DeKalb County from assessing the property of a taxpayer that operates a commercial boat dock on land leased from the federal government”.
Former Chancellor Vernon Neal recused himself from hearing the delinquent tax case against Cookeville Boat Dock & Resort, Inc. in 2002 citing a personal conflict. Former Circuit Court Judge John Turnbull was designated and appointed to hear the case to its conclusion. After Turnbull retired from the bench, the case was passed on to Judge Amy Hollars but it still has not been settled in court. The case is reportedly under review by Judge Hollars and a decision is expected soon.
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