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                 THE SUPREME COURT OF NEW HAMPSHIRE

                           ___________________________


Merrimack
No. 2013-221


     NORTHERN NEW ENGLAND TELEPHONE OPERATIONS, LLC D/B/A
                FAIRPOINT COMMUNICATIONS - NNE

                                         v.

                               CITY OF CONCORD

                          Argued: February 20, 2014
                        Opinion Issued: August 29, 2014

      Devine, Millimet & Branch, PA, of Manchester (Daniel E. Will and Joshua
M. Wyatt on the brief, and Mr. Will orally), for the petitioner.


      City Solicitor's Office, of Concord (James W. Kennedy, city solicitor, and
Danielle L. Pacik, deputy city solicitor, on the brief, and Mr. Kennedy orally),
for the respondent.

       HICKS, J. The respondent, the City of Concord (City), appeals rulings by
the Superior Court (McNamara, J.) granting summary judgment in favor of the
petitioner, Northern New England Telephone Operations, LLC d/b/a FairPoint
Communications - NNE (FairPoint), in its equal protection challenge to the
City’s taxation of FairPoint’s use and occupation of public property, and
striking the tax levied against FairPoint. We vacate and remand.
       The trial court found, or the record supports, the following facts. In
order to provide telecommunications services throughout the City, FairPoint
maintains poles, wires, cables, and other equipment within the City’s public
rights-of-way. For the 2000 through 2010 tax years, the City imposed a real
estate tax upon FairPoint for its use and occupation of this public property (the
right-of-way tax).1 See RSA 72:6 (1991); RSA 72:23, I (Supp. 2000) (amended
2002, 2003, 2006, 2011).

       Prior to 2010, the City did not impose a right-of-way tax upon Comcast,
which utilizes the City’s rights-of-way to provide cable services pursuant to a
franchise agreement. The City began imposing the tax upon Comcast in 2010
in response to a ruling by the New Hampshire Board of Tax and Land Appeals
(BTLA) that, notwithstanding the franchise agreement, Comcast was subject to
the tax. Prior to 2008, the City did not impose the same tax upon Public
Service of New Hampshire (PSNH) because it was unaware that PSNH had used
and occupied the rights-of-way. Similarly, the City did not tax certain other
users of its rights-of-way for their use and occupation of public property during
the relevant tax years because it was not aware of their usage.

       FairPoint brought an action challenging, in relevant part, the
constitutionality of the City’s right-of-way tax assessments against it for the
2000 through 2010 tax years. The parties filed cross-motions for summary
judgment. In granting FairPoint’s motion, and denying the City’s motion, the
trial court ruled, as an initial matter, that “intentionality” was not a required
element of FairPoint’s equal protection claim. Next, having implicitly found
that the City had selectively taxed FairPoint, the court reasoned:

       Concord’s decision not to tax others similarly situated was not an
       exercise of judgment; rather, it was due to a misunderstanding of
       the law with respect to Comcast, and a misunderstanding of the
       facts that other entities, such as PSNH and others[,] . . . were
       using Concord’s right-of-way. There can be no serious argument
       that the City of Concord had a rational governmental interest in
       deciding not to tax entities based on its misunderstanding of the
       law or its lack of diligence in investigating the facts. Concord
       could therefore not have had a “rational reason for selectively
       imposing [a] tax upon” FairPoint.

(Quoting Verizon New England v. City of Rochester, 156 N.H. 624, 631 (2007).)
The court concluded that “the City violated FairPoint’s right to the equal
protection of the laws under the State and Federal Constitutions,” and that

1 At oral argument, FairPoint conceded that the City did not tax it for the 1999 tax year. We
therefore consider only the 2000 through 2010 tax years, and deem FairPoint’s arguments
regarding the 1999 tax year waived.



                                                2
“the appropriate remedy is to strike [the] illegal tax.” The court denied the
City’s subsequent motion to reconsider, and this appeal followed.

       When reviewing a trial court’s grant of summary judgment, we
       consider the affidavits and other evidence, and all inferences
       properly drawn from them, in the light most favorable to the non-
       moving party. If our review of the evidence does not reveal any
       genuine issue of material fact, and if the moving party is entitled to
       judgment as a matter of law, we will affirm the trial court’s
       decision. We review the trial court’s application of the law to the
       facts de novo.

Anderson v. Motorsports Holdings, 155 N.H. 491, 494 (2007) (quotation
omitted).

       On appeal, the City argues that the trial court erred in granting summary
judgment in favor of FairPoint, and in striking the right-of-way tax levied
against FairPoint.2 Specifically, it argues that it neither “selectively impose[d]”
the right-of-way tax upon FairPoint, nor “single[d] FairPoint out for taxation,”
for the relevant tax years. It contends that, “[t]o the extent that [it] failed to tax
some entities that occupied the right-of-way” while taxing FairPoint, any such
difference in treatment resulted from errors of judgment, which “do not show
that [it] engaged in [an] arbitrary or otherwise intentional and deliberate
scheme to tax FairPoint and not others similarly situated.” Because
“FairPoint’s equal protection claim is without merit,” the City argues, “FairPoint
must be ordered to pay its assessed taxes owed to the City.”

         FairPoint argues that we “should affirm each of the trial court’s rulings.”
Specifically, it argues that, for the relevant tax years, “[the City] committed the
very equal protection violation adjudicated in prior cases by selectively taxing
FairPoint, but not other entities that used and occupied [the City’s] rights-of-
way . . . in the same manner as FairPoint.” It contends that, following our
decision in Verizon New England v. City of Rochester, 156 N.H. 624 (Rochester
III), “[i]t is now beyond dispute that a municipality’s failure to assess a right-of-
way tax against all entities that use and occupy the public rights-of-way
violates the State Constitution’s guarantee of equal protection.” It further
argues that discriminatory intent is not a required element for an equal
protection claim based upon selective taxation, and that “[the City] cannot
point to any New Hampshire authority on analogous facts that requires intent
to discriminate . . . to establish an equal protection violation.”


2 To the extent the City also argues that the court erred in denying its motion for summary
judgment, we deem that argument waived because the City failed to raise it in its notice of appeal.
See Granite State Mgmt. & Res. v. City of Concord, 165 N.H. 277, 294 (2013).



                                                 3
       In the alternative, it argues that the City “intentionally discriminated
against FairPoint” by: (1) taxing only FairPoint for the 2000 tax year; (2)
“deliberately cho[osing] not to assess a right of way tax against Comcast,
meaning [the City] intended not to tax Comcast”; and (3) “fail[ing] to tax other
right of way users, such as PSNH and [other] [a]ttachees, deliberately or
through deliberate ignorance.”

      We first address FairPoint’s equal protection claim under the State
Constitution and rely upon federal law only to aid our analysis. State v. Ball,
124 N.H. 226, 231-33 (1983). Because constitutional challenges to the
application of a tax raise questions of law, we review the trial court’s decision
de novo. Rochester III, 156 N.H. at 630.

       We conclude that FairPoint’s equal protection claim, like the one
analyzed in Rochester III, is one of “selective enforcement,” and not an equal
protection challenge to the tax scheme itself for “impermissibly establish[ing]
classifications and, therefore, treat[ing] similarly situated individuals in a
different manner.” State v. Hofland, 151 N.H. 322, 325, 326 (2004) (quotations
omitted). Although it employs the term “classification,” FairPoint challenges
what it calls the City’s “selective tax treatment,” not the tax scheme itself. In
any event, FairPoint has not shown that the tax “impermissibly established
classifications and, therefore, treated similarly situated individuals in a
different manner.” Id. at 326 (quotation omitted). Accordingly, we analyze
FairPoint’s claim of “selective tax treatment” under the rational basis test set
forth in Rochester III. See Rochester III, 156 N.H. at 630-31; see also Hofland,
151 N.H. at 325-26 (noting selective enforcement and classification as
alternative means of establishing equal protection violation).

      “The equal protection clause protects an entity from state action which
selects it out for discriminatory treatment by subjecting it to taxes not imposed
on others of the same class.” Rochester III, 156 N.H. at 630 (quotation and
brackets omitted). “[T]o determine whether [FairPoint’s] right to equal
protection is being violated, we must apply the rational basis test.” Id.
(quotation omitted). Under this test, we ask whether the City’s taxation of
FairPoint constituted selective taxation and, if so, whether the selection is
rationally related to a legitimate state interest. See id.

       To show “selective taxation,” id., FairPoint “must show that the selective
enforcement [of the tax] was a conscious, intentional discrimination,”
Anderson, 155 N.H. at 499 (emphasis added). Accordingly, in order to succeed
on its claim of selective tax treatment, FairPoint must demonstrate “something
more” than “mere errors of judgment by officials,” Sunday Lake Iron Co. v.
Wakefield, 247 U.S. 350, 353 (1918), or “that the enforcement was merely
historically lax,” Anderson, 155 N.H. at 499. In addition, FairPoint “has the
burden to prove that the selection is arbitrary or without some reasonable
justification and . . . to negative every conceivable basis which might support


                                         4
the selection, whether or not the basis has a foundation in the record.”
Rochester III, 156 N.H. at 631 (quotations, citation, and brackets omitted).

       As an initial matter, we note that FairPoint misconstrues our rational
basis test, as articulated in Rochester III — a case that it insists “control[s]”
this appeal. In Rochester III, we analyzed whether the City of Rochester’s
“taxation of only Verizon for its use and occupancy of public property,” id. at
627, constituted “selective taxation . . . [not] rationally related to a legitimate
state interest,” id. at 630. Our initial determination in Rochester III — that
Rochester “[was] selectively applying RSA 72:23, I, against Verizon,” id. at 631
— necessarily followed from Rochester’s failure to contest that it had “singled
Verizon out” for taxation, id. at 629 (quotation omitted) — an allegation that, by
its terms, implied a conscious decision to treat Verizon differently (i.e., “a
conscious, intentional discrimination,” Anderson, 155 N.H. at 499). Next,
because “[Rochester] offer[ed], the record reveal[ed], and we [could] conceive of,
no rational reason for selectively imposing this tax upon Verizon,” we
concluded that Rochester’s “selective application” of the tax “[was]
discriminatory and violat[ed] our Equal Protection Clause.” Rochester III, 156
N.H. at 631.

       FairPoint argues that, following Rochester III, “a municipality’s failure to
assess a right-of-way tax against all entities that use and occupy the public
rights-of-way violates the State Constitution’s guarantee of equal protection.”
(Emphasis added.) This argument overlooks the fact that, in order for us to
rule that an entity has been “select[ed] . . . out for discriminatory treatment,”
id. at 630 (quotation omitted), the selection itself must be intentional. See
Anderson, 155 N.H. at 499. Here, unlike in Rochester III, the City does not
concede that it singled out FairPoint for taxation. Because FairPoint alleges
that the City’s enforcement of the right-of-way tax constitutes selective tax
treatment, FairPoint “must show more than that the enforcement was merely
historically lax.” Id. “It is also clear that mere errors of judgment by officials
will not support a claim of discrimination.” Sunday Lake Iron Co., 247 U.S. at
353. “Instead, [FairPoint] must show that the selective enforcement was a
conscious, intentional discrimination.” Anderson, 155 N.H. at 499 (emphasis
added); see also Sunday Lake Iron Co., 247 U.S. at 353.

       FairPoint argues, to the contrary, that discriminatory intent is not a
required element of its equal protection claim. It contends that an erroneous
failure to tax one or more entities necessarily results in selective enforcement,
and that such selection, because it was based merely upon an error, is
arbitrary (i.e., without rational basis). To follow FairPoint’s reasoning, an
erroneous failure to tax even one entity constitutes selective taxation without a
rational basis — and thus forms the basis for an equal protection claim — for
every other similarly situated, taxed entity. FairPoint’s counsel defended this
hypothetical at oral argument, by insisting that, if ninety-nine out of 100
similarly situated homeowners were assessed a real estate tax, but one


                                         5
homeowner was not taxed due to an error, each of the ninety-nine taxed
homeowners would have a valid equal protection claim. We do not agree that
such errors in taxation, without intentional selection, violate the equal
protection rights of taxpayers. Cf. Appeal of Hardy, 154 N.H. 805, 814 (2007)
(“To accept the [respondent’s] argument would lead to absurd results.”).

      In the alternative, FairPoint argues that, even if it were required to
demonstrate discriminatory intent to succeed on its equal protection claim,
“the undisputed facts before the trial court demonstrated that [the City]
intentionally discriminated against FairPoint.” Because it ruled, erroneously,
that FairPoint need not demonstrate discriminatory intent, the trial court did
not explicitly address whether the City intentionally discriminated against
FairPoint, and we decline to consider the issue in the first instance.
Accordingly, we leave the issue to the trial court to address on remand. See
State v. Pepin, 159 N.H. 310, 313 (2009).

       Thus, because the trial court applied an erroneous legal standard in
ruling that the City selectively imposed the tax upon FairPoint,3 cf. Rochester
III, 156 N.H. at 631, we vacate the trial court’s rulings (1) granting summary
judgment in favor of FairPoint and (2) striking the right-of-way tax imposed
upon FairPoint, and remand for further proceedings consistent with this
opinion.

         The Federal Constitution offers FairPoint no greater protection than does
the State Constitution under these circumstances. See Allegheny Pittsburgh
Coal v. Webster County, 488 U.S. 336, 345-46 (1989) (“The equal protection
clause protects the individual from state action which selects him out for
discriminatory treatment by subjecting him to taxes not imposed on others of
the same class. We have no doubt that petitioners have suffered from such
intentional systematic undervaluation by state officials of comparable property
. . . .” (emphasis added) (quotations, citation, and ellipsis omitted)); Rochester
III, 156 N.H. at 630-31. Accordingly, we reach the same result under the
Federal Constitution as we do under the State Constitution.

                                                               Vacated and remanded.

       DALIANIS, C.J., and CONBOY, LYNN, and BASSETT, JJ., concurred.

3 After implicitly finding that the City had selectively taxed FairPoint, the trial court proceeded to
the second step of the rational basis test. The court concluded that “[t]here can be no serious
argument that the City of Concord had a rational governmental interest in deciding not to tax
entities based on its misunderstanding of the law or its lack of diligence in investigating the facts.”
Because we hold that its implicit finding of selective taxation was in error, we need not address
the court’s explicit finding that there was no rational basis for the selection. In addition, we need
not address the parties’ arguments regarding the appropriate remedy for an equal protection
violation.



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