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Kan. court upholds Keystone pipeline tax ruling

Published on NewsOK Modified: April 26, 2013 at 4:03 pm •  Published: April 26, 2013

TOPEKA, Kan. (AP) — The Kansas Court of Appeals on Friday upheld a ruling in 2012 by a state tax court affirming a property tax exemption for the Canadian company building the Keystone XL pipeline.

In a ruling written by Judge David Bruns, the court said TransCanada was entitled to the property tax exemption because Kansas refineries have indirect access to the crude oil that passes through the pipeline daily.

Six Kansas counties — Butler, Clay, Cowley, Dickinson, Marion and Washington — and the Kansas Department of Revenue appealed the Court of Tax Appeals ruling last year, saying they were entitled to levy taxes against TransCanada because there was no direct access to the oil in Kansas. The exemption is believed to be worth nearly $19 million.

Jeannine Koranda, spokeswoman for the revenue department, said the agency was reviewing the ruling and declined to comment.

TransCanada spokesman Shawn Howard said that pipeline officials were pleased with the ruling on the Kansas tax law, which he said was a factor when TransCanada made the decision to locate the project.

The pipeline segment is part of the proposed Keystone XL pipeline that will extend from Canada to the Gulf Coast in Texas. The Kansas portion would link the pipeline to Cushing, Okla. The project requires approval from President Barack Obama because the route crosses international boundaries.

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