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Last Updated: 12/29/2017

Utility and Pipeline Property Types

Utility and pipeline companies use several property type descriptions to report their operating property to the Minnesota Department of Revenue. (View a list of property type descriptions used by the department.) 

These descriptions are necessary so counties can administer the property tax correctly. For example: 

  • Some High Voltage Transmission Lines may affect the Power Line Credit and others may not.
  • Some property is taxed at the local tax rate and other at the countywide average.
  • Structures on owned land are taxed as real property; structures on leased land are treated as personal property.
  • Class rates are different for different types of property. (See Minnesota Statute 273.13)
  • The state general property tax applies to some property types, but not to others. (See Minnesota Statute 275.025)
  • The department recommends the values of some property types to counties, but orders values for others.
Companies need to report their property correctly to the department in order to ensure the correct property tax administration. This means listing differing property types separately even if hey are located on the same parcel of land. 
 

Electric Utilities 

Electric Utilities may own and report several types of operating property to the department. For example, Figure 1 (below), shows a typical substation that includes:

  • Transmission lines
  • Distribution lines
  • Machinery (transformers, lighting arresters, etc.)
  • Structures (control house, etc.)

The owner of this substation would report each property type separately - rather than listing only the substation - because each type may be taxed differently. 

Figure 1. Typical Electrical Substation 

Typical Electrical Substation.png    

Note: This is a basic example. For more-detailed information about electrical substations and equipment, see Electric Power Illustrated Glossary on the U.S. Labor Department website.   

Pipeline Systems 

Pipeline companies may own and report a wide range of operating property to the department. For example, Figures 2 and 3 (below) show typical natural gas and petroleum pipeline systems. In addition to pipelines, these systems may include: 

  • Production and storage facilities
  • Refineries and processing plants
  • Pump or compressor stations
  • Distribution terminals

The owners of these systems and facilities need to report pipelines, structures, and machinery separately - rather than listing only pipeline property, for example - because each property type may be taxed differently.

Figure 2. Natural Gas Pipeline Systems

Natural Gas Pipeline Systems.png 

Courtesy of U.S. Transportation Department 
 

Figure 3. Petroleum Pipeline Systems  

Petroleum Pipeline Systems.png 

Courtesy of U.S. Transportation Department  

Note: for more-detailed information about pipeline systems and equipment, see Natural gas Pipeline Systems and Petroleum Pipeline Systems on the U.S. Transportation Department website. You can also search by keyword in their Pipeline Glossary.