Town of Seymour prevails in tax appeal decision vs. Regional Water Authority

Richard J Buturla

In a recent trial concerning a tax appeal case named Birmingham Utilities, Inc. vs. The Town of Seymour, the court found that property indirectly part of the South Central Regional Water Authority System is subject to local property taxes. The Town of Seymour was represented by Senior Partner Richard J. Buturla of Berchem, Moses & Devlin, P.C., who is the Director of the firm’s Litigation Department. Murtha Cullina was the opposing counsel on behalf of Birmingham Utilities and the South Central Regional Water Authority.

In 2010, Birmingham Utilities, Inc. constructed an addition to previously existing building on property that it owns at the Seymour Wellfield located at 151 Roosevelt Drive. Although the building is only a ten by fourteen foot structure, it houses an electrical transfer switch that can change the wellfield from utility power to generator power, along with a distribution panel that controls the flow of electricity. For purposes of the 2010 grand list, the town determined that the value of the building itself was zero but that the value of the equipment inside it was $237,500, which is classified as personal property. The water authority claimed that it was tax exempt for these improvements, but the Town of Seymour did not agree. Taxes and penalties were charged because the water authority did not properly declare this property.

A subsidiary of the authority named RWA21, Ltd. filed a suit objecting to 2010 and 2011 taxes due, and later filed a second amended complaint that substituted Birmingham Utilities as the named plaintiff, objecting to additional assessments on the town’s grand list for the years 2012-2014.

Attorney Buturla successfully argued that Birmingham Utilities is NOT a subsidiary corporation of the water authority because RWA21, Ltd. is the actual owner of Birmingham Utilities, Inc. The Court determined that Birmingham Utilities must be owned directly by the water authority in order to qualify for the tax exemption. Therefore, Birmingham Utilities is subject to taxation by the Town of Seymour.