The York County Board of Supervisors has signed off on a settlement that will close out litigation it is facing from Western Refining over what that company believes is real estate assessed and taxed at a rate higher than it should have been.
Western Refining filed tax appeals in York-Poquoson Circuit Court looking to have the extra money refunded to it. That company owned the Yorktown Refinery until it shut down operations there in September 2010. The refinery has since been bought by Plains All American Pipeline, which has recrafted operations at the site into what’s now known as Yorktown Terminal.
The county will pay Western Refining a total of $55,000, representing the difference in assessments on the large refinery parcel the county has agreed to lower for 2010 and 2011. That parcel features many of the structures that embody the Yorktown Terminal. The tax appeal filed by Western Refining included 27 other parcels of mostly undeveloped land that surround the terminal, however the settlement will leave the rates on those parcels as is.
Had the county gone to court and lost, it could have cost up to $480,000.
“We do not expect the settlement to have any impact on the assessed values of the property which is now owned by Plains and used as a petroleum products terminal,” York County Attorney James Barnett Jr. wrote in an email explaining the settlement.
He said the county’s appraisers had supported the assessed values but that the county had to weigh the costs of going forward in court with the uncertain nature of court proceedings. The settlement “was in the best interests of the public,” Barnett wrote.
The settlement does not encompass another tax assessment appeal Western Refining has filed with York-Poquoson Circuit Court. It is uncertain whether that appeal will move forward as the county has yet to be served with papers concerning it.
When news broke of the appeals in May, a dollar figure of up to $7.8 million was floated as the potential cost to the county if all the appeals were to go against the county. Barnett said the appeal that has yet to be served to the county represents the bulk of that figure, which was described in May by Barnett as a “worst-case scenario.”
That dollar figure was accidentally released to a York County citizen who had filed a Freedom of Information Act request earlier this year.
That second appeal is related to the machinery and tools at the site, which the county assessed to be worth $96.14 million in 2010 and $99.1 million in 2011. According to the appeal, which was filed in York-Poquoson Circuit Court in December 2012, those assessments were based on the original price of the equipment and failed to take into account fair market value for used equipment. The refinery began operating in 1954.
That appeal alleges the county’s assessment of value was “far greater” than the far market value of the machinery and tools.
A two-day jury trial was scheduled for Tuesday and Wednesday of this week to sort out the real estate tax appeal, but that trial has been canceled due to the settlement.
Since Plains All American Pipeline bought the refinery, the company has poured $110 million of improvements into the site. Those improvements come on top of the $200 million the company spent to purchase the refinery.
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