Administrative Law: Exhaustion of Administrative Appeals Doctrine State and Local Taxation: Severance lax; Wyoming Ad Valorem Tax: Wyoming

摘要

Merit, is an oil and gas producer that takes its production in kind as that term is denned in the regulations of the Wyoming Department of Revenue (WDOR). In October 2007, WDOR notified Merit that there were volumetric discrepancies between what Merit was reporting and what the operators of the wells where Merit was taking in kind were reporting. Despite a series of letters sent to Merit noting the discrepancies and giving Merit sixty days to respond, Merit never responded. In October 2007, WDOR sent a take-in-kind assessment of additional taxable value of a little over $15.6 million. In June 2010, WDOR sent a notice of valuation change to the counties where Merit's mineral interests were located based on the discrepancies. A courtesy copy is sent to Merit which appealed the notice of valuation change to the State Board of Equalization (SBOE). SBOE dismissed the appeal as untimely. Merit appealed to me District Court which likewise dismissed the appeal for failure to seek administrative relief within sixty days of the three letters. Held: affirmed. The scope of judicial review of an administrative decision is de novo as to questions or issues of law. Under the Wyoming oil and gas tax system, producers of oil and gas must make annual reports to WDOR relating to their production.