RESPONDENT:Board of Equalization of the State of South Dakota
LOCATION:Arizona State Prison
DOCKET NO.: 85-732
DECIDED BY: Rehnquist Court (1986-1987)
LOWER COURT: South Dakota Supreme Court
CITATION: 480 US 123 (1987)
ARGUED: Nov 03, 1986
DECIDED: Feb 24, 1987
Mark V. Meierhenry – on behalf of Appellees
Raymond J. Rasenberger – on behalf of Appellants
Media for Western Air Lines, Inc. v. Board of Equalization of the State of South Dakota
Audio Transcription for Opinion Announcement – February 24, 1987 in Western Air Lines, Inc. v. Board of Equalization of the State of South Dakota
Sandra Day O’Connor:
The second case Western Airlines versus the Board of Equalization comes to the Court on appeal from the Supreme Court of South Dakota.
It involves the South Dakota Airline Flight Property Tax.
The South Dakota tax is imposed on air carriers on the basis of the value of the aircraft.
State law requires that the proceeds of the tax be allocated to the airports used by the carriers and to be used exclusively for airport purposes.
Appellants, four airline companies operating in South Dakota, paid their flight property taxes for the year and question under protest and unsuccessfully sought refunds in State Court.
Appellants argued that the taxation of flight property when most other personal property was exempt from taxation, violated the Federal Airport and Airway Improvement Act of 1982, which prohibits the imposition of discriminatory state or local taxes on air carriers.
The lawsuits were consolidated for review in the North Dakota Circuit Court and that court held that the South Dakota flight property tax was an in lieu tax which was fully utilized for airport and aeronautical purposes, and therefore exempt by federal law from the antidiscrimination provisions.
The South Dakota Supreme Court disagreed with the holding but affirmed on an alternative ground.
In an opinion filed today for a unanimous Court we affirm the judgment of the South Dakota Supreme Court and hold that the South Dakota Air Flight Property Tax is an in lieu tax, which is wholly utilized for airport and aeronautical purposes within the meaning of the Federal Act, and therefore not in violation of it.
Justice White has filed a concurring opinion.