Subsurface Coal Rights and Real Estate Tax Assessments

Exceptions and Challenges of Rausch Creek Land, L.P., 2012 Pa. Commw. LEXIS 311 (2012)

Frank Kosir, Jr., Esquire
fk@muslaw.com

This matter addressed the issue of whether the owner of subsurface coal rights was permitted to challenge, before the County tax claim bureau, the validity of real estate tax assessments levied upon those coal rights.  Rausch Creek Land, L.P. (“Rausch Creek”) was the owner of subsurface coal rights under five separate parcels of real property situated in Schuylkill County, Pennsylvania, designated as Tax Parcel Nos. 13-0-54803019, 13-0-054841304, 13-0-54951301, 22-0-54851319, and 22-0-54930102 (“Parcels”).  Rausch Creek failed to pay the 2009 real estate taxes assessed on these coal rights and, in 2010, the Schuylkill County Tax Claim Bureau (“Bureau”) served Rausch Creek with letters advising that the coal rights would be sold at tax sale if the delinquent taxes were not paid by December of 2010.  In response, Rausch Creek filed individual challenges and exceptions for each parcel under Section 309(c) of the Pennsylvania Real Estate Tax Sale Law (“Law”), (72 P.S. § 5860.309(c)) (which requires that all real property against which a claim is asserted be accurately described), alleging that the Parcels were not sufficiently identified in the Schuylkill County Tax Mapping Department and that the Parcels’ identification numbers were based upon Pennsylvania Department of Environmental Protection surface mining permits, not real property records.  The Bureau overruled the challenges and exceptions, and the trial court affirmed.

 

On appeal, our Commonwealth Court affirmed.  In issuing its ruling, the court concluded that the challenges and exceptions that Rausch Creek had raised before the Bureau did not attack the validity of the liens themselves but, rather, challenged the underlying assessments.  Therefore, the proper course of action for Rausch Creek to undertake would have been to file assessment appeals with the Schuylkill County Board of Assessment Appeals.  However, as it had failed to do so, and Section 314 of the Law (72 P.S. § 314) allows for a tax claim to be set aside or found invalid only “for any other reason not involving a question which could have been raised by an appeal provided for by law,” Rausch Creek’s failure to raise these challenges in the form of an assessment appeal precluded it from raising these issues before the Bureau.  As such, Rausch Creek was not entitled to its requested relief, and the trial court had properly dismissed the challenges and exceptions.