author: CARTER, C.J.

text:
    TRANSCONTINENTAL GAS PIPE LINE CORPORATION, Texas Eastern Transmission Corporation, Florida Gas Transmission Company, and Gulf South Pipeline Company, L.P. v. LOUISIANA TAX COMMISSION; Frank Granger, III, In his Official Capacity as the Assessor of East Baton Rouge Parish; and Elmer B. Litchfield, In his Official Capacity as the Sheriff and Ex Officio Tax Collector for East Baton Rouge Parish. Florida Gas Transmission Company v. Louisiana Tax Commission; Elizabeth Guglielmo, In her Capacity as Chairperson of the Louisiana Tax Commission; Sheriff Wayne Melancon, Acadia Parish; Sheriff Mike Waguespack, Assumption Parish; Sheriff Tony Mancuso, Calcasieu Parish; Sheriff Theos Duhon, Cameron Parish; Sheriff Greg Phares, East Baton Rouge Parish; Sheriff Sid Hebert, Iberia Parish; Sheriff Brent Allain, Iberville Parish; Sheriff Richard Edwards, Jr., Jefferson Davis Parish; Sheriff Michael Neustrom, Lafayette Parish; Sheriff Craig Webre, Lafourche Parish; Sheriff Paul Raymond Smith, Pointe Coupee Parish; Sheriff Gregory Champagne, St. Charles Parish; Sheriff Ronald Ficklin, St. Helena Parish; Sheriff Bobby Guidroz, St. Landry Parish; Sheriff Ronald J. Theriot, St. Martin Parish; Sheriff David A. Naquin, St. Mary Parish; Sheriff Daniel Edwards, Tangipahoa Parish; Sheriff Michael Couvillion, Vermilion Parish; Sheriff Aubrey Jones, Washington Parish; and Sheriff Mike Cazes, West Baton Rouge Parish, in their Capacities as ex Officio Tax Collectors in and for their Respective Parishes. Hon. Russel L. Benoit, Acadia Parish; Hon. Wayne P. Blanchard, Assumption Parish; Hon. Richard J. Cole, Jr., Calcasieu Parish; Hon. Robert E. Conner, Cameron Parish; Hon. Brian Wilson, East Baton Rouge Parish; Hon. Rickey J. Huval, Sr., Iberia Parish; Hon. James H. Dupont, Iberville Parish; Hon. Donald G. Kratzer, Jefferson Davis Parish; Hon. Conrad Comeaux, Lafayette Parish; Hon. Michael H. Martin, Lafourche Parish; Hon. James A. Laurent, Pointe Coupee Parish; Hon. Clyde A. Gisclair, St. Charles Parish; Hon. Wesley Blades, St. Helena Parish; Hon. Rhyn L. Duplechain, St. Landry Parish; Hon. Lawrence Patin, St. Martin Parish; Hon. Sherel A. Martin, Jr., St. Mary Parish; Hon. Joaquin Matheu, Tangipahoa Parish; Hon. Michael Langlinais, Vermilion Parish; Hon. M. Randall Seal, Washington Parish; and Hon. Barney Altazan, West Baton Rouge Parish, in their Capacities as Assessors in and for their Respective Parishes.
    Nos. 2009 CA 0628, 2009 CA 0629.
    Court of Appeal of Louisiana, First Circuit.
    Aug. 10, 2009.
    Rehearing Denied Sept. 3, 2009.

      Linda S. Akchin, Baton Rouge, LA, for Plaintiff/Appellant, Florida Gas Transmission Company, Centerpoint Energy Mississippi River Centerpoint Energy Gas Transmission.
    Brian Eddington, Baton Rouge, LA, for Defendants/Appellees, Sheriff Wayne Me-lancon, Acadia Parish and Sheriffs and Assessors.
    Robert D. Hoffman, Jr. Mandeville, LA, for Defendant/Appellee, Louisiana Tax Commission.

      Michael J. Vallan, Baton Rouge, LA, for Defendant/Appellee, State of Louisiana Attorney General Office.
    Before CARTER, C.J., WHIPPLE and DOWNING, JJ.
   CARTER, C.J.

|/This is an appeal from the partial grant of a partial summary judgment filed in an ad valorem tax dispute between Florida Gas Transmission Company (the plaintiff), an interstate natural gas pipeline company, and the defendants, the Louisiana Tax Commission (LTC) and various sheriffs and assessors throughout the state of Louisiana. This appeal has been expedited in accordance with La. R.S. 47:1998.

At issue is whether Louisiana’s ad valo-rem tax scheme violates the Commerce Clause of the United States Constitution either in form or in application. After due consideration, that part of the district court judgment partially granting the assessors’ motion for summary judgment is affirmed. That part of the district court judgment partially denying the assessors’ motion for summary judgment is reversed, and we render judgment declaring La. R.S. 47:1851 K unconstitutional and La. R.S. 47:1851 M unconstitutional in part.

FACTS AND PROCEDURAL HISTORY

The facts of this case, although lengthy, are substantially undisputed. The plaintiff is the owner of interstate natural gas pipelines located in part within the territorial boundaries of Louisiana. At issue herein is the plaintiffs liability for 2006 Louisiana ad valorem taxes.

The plaintiff is a “pipeline company,” as defined in La. R.S. 47:1851 K, that owns, and owes ad valorem taxes on, “public service property,” as that category of property is defined in La. R.S. 47:1851 M. So | .-.defined, the plaintiff is subject to an assessment of 25% of fair market value, as determined by the LTC. See La. Const, art. VII, § 18. Other similarly situated, direct competitors operating in intrastate commerce do not meet the definition of “pipeline companies.” Their properties are not considered “public service properties,” and therefore, they are subject to assessments of 15% of fair market value, as determined by the local assessors. See La. Const, art. VII, § 18.

The plaintiff paid its 2006 ad valorem tax assessment under protest and filed suit, asserting therein that “challenges to the assessed valuation of its pipeline property by the LTC and to the Louisiana ad valorem tax scheme ... are solely constitutional issues.” The plaintiff sought a finding that “the Louisiana ad valorem tax scheme is unconstitutional [and] in violation of the Commerce Clause of the United States Constitution, in that it imposes an impermissible burden on interstate commerce by imposing a greater tax burden on interstate natural gas pipelines companies than it does upon intrastate natural gas pipeline companies.” Specifically, the plaintiff maintained that the assessment of its property at 25% of fair market value, as opposed to 15% of fair market value, is in violation of the Commerce Clause of the United States Constitution.

Named as defendants in this litigation are the LTC; Elizabeth Guglielmo, in her capacity as Chairperson of the LTC; and twenty sheriffs |fiand twenty assessors from parishes scattered throughout the state of Louisiana.

On motion of various assessors, this action (bearing docket number 551,435) was transferred and consolidated with district court docket number 491,453 (Transcontinental Gas Pipe Line Corporation, et al. v. Louisiana Tax Commission, et al.). Numerous distinct district court actions have been consolidated under docket number 491,453 and are currently pending in the Nineteenth Judicial District Court. Although there may be some overlap in the plaintiffs, the defendants, and the tax years in these consolidated actions, each action is unique. See Dendy v. City National Bank, 2006-2436 (La.App. 1 Cir. 10/17/07), 977 So.2d 8, 11 (noting that the consolidation of actions pursuant to La. Code Civ. P. art. 1561 is a procedural convenience designed to avoid multiplicity of actions and does not cause a case to lose its status as a procedural entity). In 17common, the plaintiffs in each suit are corporate interstate pipeline companies, all challenging the constitutionality of Louisiana’s ad valorem tax scheme.

Thirteen assessors collectively answered the plaintiffs petition. Thereafter, a motion for summary judgment was filed on behalf of twelve assessors. The assessors asked for a declaration as to the constitutionality of the Louisiana ad valorem tax scheme and, to the extent the district court determined the tax scheme to be unconstitutional, a judgment specifically striking the unconstitutional provisions. The assessors also asked for entry of summary judgment dismissing the plaintiffs claims for refunds and remanding this matter to the LTC for revaluation of the plaintiffs property by the parish assessors and reassessment at 15% of fair market value. Succinctly stated, through their motion for summary judgment, the assessors asked the district court to determine the legal efficacy of the plaintiffs claims.

1 RLater, Sheriff Greg Champagne of St. Charles Parish and Sheriff Sidney Gau-treaux filed their own answers to the plaintiffs petition. Sheriff Champagne and Sheriff Gautreaux did not join in the motion for summary judgment and are not parties to this appeal.

On December 16, 2008, the district court signed a written judgment granting in part and denying in part the motion for summary judgment filed by the “Assessors of Acadia; Cameron; East Baton Rouge; Iberia; Jefferson Davis; Lafourche; St. Landry; St. Martin; St. Mary; Vermilion and Washington Parishes in Docket No. 551,482.” The trial court rendered judgment, finding that in order to avoid a violation of the Commerce Clause of the United States Constitution, taxes on all pipeline property (whether operated in interstate or intrastate commerce) should be calculated at a 15% rate. Citing to Transcontinental Gas Pipe Line Corporation v. Louisiana Tax Commission, 2005-2604, 2005-2605 (La.App. 1 Cir. 3/31/06), 925 So.2d 777 (unpublished), writ denied, 2006-0988 (La.9/1/06), 936 So.2d 204, and ANR Pipeline Co. v. Louisiana Tax Commission, 2005-1142 (La.App. 1 Cir. 9/7/05), 923 So.2d 81, writ denied, 2005-2372 (La.3/17/06), 925 So.2d 547, cert. denied, 549 U.S. 822, 127 S.Ct. 157, 166 L.Ed.2d 38, the district court further remanded the matters to the LTC with instructions that the LTC require the named assessors “to determine the valuation of public service properties of the Plaintiff, Florida Gas | (/Transmission Company[,] in their respective parishes for each year at issue and calculate ad valorem taxes based on fifteen percent (15%) of those assessments.” The district court found it unnecessary to rule on the constitutionality of La. R.S. 47:1851 in reaching its decision.

On motion of the assessors, the trial court designated the partial judgment as final and immediately appealable pursuant to La.Code Civ. P. art. 1915 B. The plaintiff then moved for orders of appeal to both the Louisiana Supreme Court and to the Louisiana First Circuit Court of Appeal. After the plaintiffs appeal was lodged with this court, the LTC answered the appeal stating it is aggrieved by the trial court’s judgment “to the extent that the judgment holds that any portion of the Louisiana Ad Valorem property tax scheme is unconstitutional or otherwise illegal.” The assessors did not appeal the trial court’s judgment and have not answered the appeal.

After the record was lodged with this court, the Louisiana Supreme Court issued an opinion dismissing the plaintiffs appeal to the supreme court. The supreme court noted that “[bjecause there is no declaration of unconstitutionality in the district court’s judgment, there is no basis for the exercise of this court’s appellate jurisdiction. Appellate jurisdiction lies in the court of appeal. La. Const, art. V, § 10(A).” The appeal was transferred “to the court of appeal for consideration on the merits.” Florida Gas Transmission Co. v. Louisiana Tax Commission, 2009-0729 (La.05/15/09), 10 So.3d 1219, 1220 (per cu-riam ).

l10The remand from the Louisiana Supreme Court has been lodged with this court as Transcontinental Gas Pipe Line Corp. v. Louisiana Tax Commission, 2009-0966, consolidated with, Florida Gas Transmission Co. v. Louisiana Tax Commission, 2009-0967 (LaApp. 1 Cir. 8/10/09), 2009 WL 2462543 (unpublished). The issues raised by the plaintiff in the cases remanded by the Louisiana Supreme Court were raised herein. In addition, the LTC has answered this appeal. For these reasons, we will evaluate the merits of all claims herein and dismiss by separate action the appeal lodged under docket no. 2009-0966 c/w 2009-0967 as moot.

DISCUSSION

The Standard of Review and the Burden of Proof

Appellate review of the granting of a motion for summary judgment is de novo, using the identical criteria that govern the district court’s consideration of whether summary judgment is appropriate. King v. Illinois National Insurance Co., 2008-1491 (La.4/3/09), 9 So.3d 780, 784. A motion for summary judgment is properly granted only if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show there is no genuine issue of material fact, and the mover is entitled to judgment as a matter of law. See La.Code Civ. P. art. 966 B.

On a motion for summary judgment, the burden of proof remains with the movant. Samaha v. Rau, 2007-1726 (La.2/26/08), 977 So.2d 880, 883. However, if the mov-ant will not bear the burden of proof at trial, the movant’s burden on the motion does not require him to negate all essential elements of the adverse party’s claim, action, or defense. Samaha, 977 So.2d at 883. Rather, the movant’s burden is to point out to the court that |nthere is an absence of factual support for one or more elements essential to the adverse party’s claim, action, or defense. Samaha, 977 So.2d at 883. Thereafter, if the adverse party fails to produce factual support sufficient to establish that he will be able to satisfy his evidentiary burden of proof at trial, there is no genuine issue of material fact. Samaha, 977 So.2d at 888. Once the motion for summary judgment has been properly supported by the moving party, the failure of the non-moving party to produce evidence of a material factual dispute mandates the granting of the motion. Samaha, 977 So.2d at 883.

Herein, the significant facts are undisputed, and only questions of law remain. Because statutes are presumed to be constitutional, the party challenging the validity of a statute, the plaintiff herein, has the burden of proving its unconstitutionality. Fruge v. Board of Trustees of Louisiana State Employees’ Retirement System, 2008-1270 (La.12/2/08), 6 So.3d 124, 128. However, when engaged in a Commerce Clause analysis, the burden may shift between the taxpayer and taxing authority. For example, once a state law is shown to discriminate either on its face or in practical effect, the burden falls on the state to demonstrate that the statute serves a legitimate local purpose that cannot be achieved in a less discriminatory way. Maine v. Taylor, 477 U.S. 131, 138, 106 S.Ct. 2440, 91 L.Ed.2d 110 (1986).

[ 12Commerce Clause Analysis

The Commerce Clause of the United States Constitution grants Congress the power “[t]o regulate Commerce ... among the several States.... ” U.S. Const, art. I, § 8, cl. 3. “The very purpose of the Commerce Clause was to create an area of free trade among the several States.” McLeod v. J.E. Dilworth Co., 322 U.S. 327, 330, 64 S.Ct. 1023, 88 L.Ed. 1304(1944).

The Commerce Clause not only authorizes congressional action but also prohibits certain state taxation even when Congress has failed to legislate on the subject. Oklahoma Tax Commission v. Jefferson Lines, Inc., 514 U.S. 175, 179, 115 S.Ct. 1331, 131 L.Ed.2d 261 (1995). The Commerce Clause has a negative aspect that denies the states the power unjustifiably to discriminate against or burden the interstate flow of articles of commerce. Oregon Waste Systems, Inc. v. Department of Environmental Quality of the State of Oregon, 511 U.S. 93, 98, 114 S.Ct. 1345, 128 L.Ed.2d 13 (1994). This restrictive aspect of the Commerce Clause is referred to as the dormant Commerce Clause. See Oklahoma Tax Commission, 514 U.S. at 179, 115 S.Ct. 1331.

The dormant Commerce Clause prohibits states, unless authorized by Congress, from attempting to advance their own commercial interests by curtailing the movement of articles of commerce, either into or out of the state. IIP. Hood & Sons, Inc. v. DuMond, 336 U.S. 525, 535, 69 S.Ct. 657, 93 L.Ed. 865 (1949). Discrimination is the “differential treatment of in-state and out-of-state economic interests that benefits the former and burdens the latter.” Oregon Waste Systems, 511 U.S. at 99, 114 S.Ct. 1345. A state may not tax a transaction or incident more heavily when it crosses state lines than when it occurs entirely within the state. Armco Inc. v. Hardesty, 467 U.S. 638, 642, 104 S.Ct. 2620, 81 L.Ed.2d 540 (1984). No state may impose a tax that discriminates against interstate commerce by providing a direct commercial advantage to local business. Boston Stock Exchange v. State Tax Commission, 429 U.S. 318, 329, 97 S.Ct. 599, 50 L.Ed.2d 514 (1977).

This anti-discrimination principle arises from the basic purpose of the Commerce Clause, which is to prohibit the multiplication of preferential trade areas destructive of the free commerce anticipated by the Constitution. Maryland v. Louisiana, 451 U.S. 725, 754, 101 S.Ct. 2114, 68 L.Ed.2d 576 (1981). The dormant Commerce Clause’s fundamental objective is to preserve a national market for competition that is undisturbed by preferential advantages conferred by a state upon its resident competitors. See General Motors Corp. v. Tracy, 519 U.S. 278, 299, 117 S.Ct. 811, 136 L.Ed.2d 761 (1997).

Any notion of discrimination assumes a comparison of substantially similar entities. United Haulers Association, Inc. v. Oneida-Herkimer Solid Waste Management Authority, 550 U.S. 330, 342, 127 S.Ct. 1786, 167 L.Ed.2d 655 (2007); General Motors, 519 U.S. at 298, 117 S.Ct. 811. For the dormant Commerce Clause to apply, it is essential that there be actual or prospective competition between supposedly favored and disfavored entities in a single market, whether by express discrimination against interstate commerce or undue burden upon it. General Motors, 519 U.S. at 300, 117 S.Ct. 811. All 114parties agree that the natural gas pipeline companies operating in Louisiana, both those operating intrastate and interstate, are direct competitors and similarly situated; therefore, dormant Commerce Clause analysis is appropriate.

In Complete Auto Transit v. Brady, 430 U.S. 274, 279, 97 S.Ct. 1076, 51 L.Ed.2d 326 (1977), the Supreme Court set forth a four-part test that state taxes must pass in order to be valid under the Commerce Clause. The tax must:

1. Be applied to an activity that has a substantial nexus with the state;
2. Be fairly apportioned to activities in the state;
3. Not discriminate against interstate commerce; and
4. Be fairly related to services provided by the state.

Only the third requirement is at issue herein. Does the Louisiana ad valorem tax scheme discriminate against interstate commerce? A state tax discriminates against interstate commerce if it: (1) is facially discriminatory; (2) has a discriminatory intent; or (3) has the effect of unduly burdening interstate commerce. Amerada Hess Corp. v. Director, Division of Taxation, New Jersey Department of the Treasury, 490 U.S. 66, 75, 109 S.Ct. 1617, 104 L.Ed.2d 58 (1989).

Notably, even nondiscriminatory burdens on commerce may be struck down on a showing that they clearly outweigh the benefits of a state or local practice. Pike v. Bruce Church, Inc., 397 U.S. 137, 142, 90 S.Ct. 844, 25 L.Ed.2d 174 (1970). If interstate commerce is burdened, courts should consider three facts:

1. Is there a furtherance of a legitimate local public interest;
2. Does the statute regulate evenhandedly; and
| ls3. Does the statute place an undue burden on interstate commerce?

Pike, 397 U.S. at 142, 90 S.Ct. 844.

Unfortunately, there is no clear line separating the category of state regulation that is virtually per se invalid under the Commerce Clause and the category subject to the Pike balancing approach, Brown-Forman Distillers Corp. v. New York State Liquor Authority, 476 U.S. 573, 579, 106 S.Ct. 2080, 90 L.Ed.2d 552 (1986). In both situations, however, the critical consideration is the overall effect of the statute on both local and interstate activity. Brown-Forman, 476 U.S. at 579, 106 S.Ct. 2080.

When called upon to make the delicate adjustment between the national interest in free and open trade and the legitimate interest of the individual states in exercising their taxing powers, the Supreme Court has advised that the result turns on the unique characteristics of the statute at issue and the particular circumstances in each case. Boston Stock Exchange, 429 U.S. at 329, 97 S.Ct. 599. This case-by-case approach has left “much room for controversy and confusion and little in the way of precise guides to the States in the exercise of their indispensable power of taxation.” Northwestern States Portland Cement Co. v. Minnesota, 358 U.S. 450, 457, 79 S.Ct. 357, 3 L.Ed.2d 421 (1959).

With these legal precepts in mind, we turn our attention to Louisiana’s ad valorem tax scheme. “A state tax must be assessed in light of its actual effect considered in conjunction with other provisions of the State’s tax scheme.” Maryland, 451 U.S. at 756, 101 S.Ct. 2114. The assessment and collection of ad valorem taxes in Louisiana is provided for in our constitution, as well as in our revised statutes. Louisiana employs a classified property tax system in assessing ad valorem taxes. Under the Louisiana system, 116pipeline properties, both interstate and certain intrastate, are assessed at a higher ratio to fair market value (25%) than other intrastate pipeline properties (15%). The plaintiff maintains that Louisiana’s classification scheme subjects interstate natural gas pipelines to discriminatory taxation, which is prohibited under the Commerce Clause of the United States Constitution.

Louisiana Constitution article VII, section 18 B provides for the classification of property subject to ad valorem taxes in Louisiana and the percentage of fair market value applicable to each classification for the purpose of determining the assessed valuation. Significant to this litigation, “public service properties,” excluding land, are subject to a 25% assessed valuation. “Other property’ is subject to a 15% of fair market value assessment. Article VTI, section 18(B) provides that “[t]he legislature may enact laws defining ... public service properties.”

The legislature has defined “public service properties” as “immovable, major movable, and other movable property owned or used but not otherwise assessed in this state in the operations of each ... pipeline company[.]” La. R.S. 47:1851 M. “Pipeline company” is defined in La. R.S. 47:1851 K as:

[A]ny company that is engaged primarily in the business of transporting oil, natural gas, petroleum products, or other products within, through, into, or from this state, and which is regulated by (1) the Louisiana Public Service Commission, (2) the Interstate Commerce Commission, or (3) the Federal Power Commission, as a “natural gas company” under the Federal Natural Gas Act, 15 U.S.C. §§ 717-717w, because that person is engaged in the transportation of natural gas in interstate commerce, as defined in the Natural Gas Act.

Article VII, section 18(D) provides for the method of determining the fair market value of property subject to ad valorem taxation. Specifically:

1 17Each assessor shall determine the fair market value of all property subject to taxation within his respective parish or district except public service properties, which shall be valued at fair market value by the Louisiana Tax Commission or its successor. Each assessor shall determine the use value of property which is to be so assessed under the provisions of Paragraph (C). Fair market value and use value of property shall be determined in accordance with criteria which shall be established by law and which shall apply uniformly throughout the state.

When a constitutional provision is plain and unambiguous and its application does not lead to absurd consequences, its language must be given effect. Board of Directors of Indus. Development Bd. of City of Gonzales, Louisiana, Inc. v. All Taxpayers, Property Owners, Citizens of City of Gonzales, 2005-2298 (La.9/6/06), 938 So.2d 11, 20. Under the clear language of La. Const, art. VII, § 18(D), the LTC determines the fair market value of “public service properties.” The fair market value of all other property subject to taxation within a parish is determined by the assessor of the parish where the property is located.

To summarize, pursuant to La. R.S. 47:1851 K and M and La. Const, art. VII, § 18(D), companies that transport natural gas within, through, into, or from this state and which are subject to specific regulation are defined as “pipeline companies.” These statutorily defined “pipeline companies” possess immovable, major movable, and other movable properties that are statutorily defined as “public service properties.” These statutorily defined “public service properties” are subject to an assessment based on 25% of fair market value as determined by the LTC.

The plaintiffs pipelines are regulated by the Federal Energy Regulatory Commission (FERC), successor agency of the Federal Power Commission, under the Federal Natural Gas Act (NGA), 15 U.S.C. §§ 717-1 18717w. Accordingly, the plaintiff is a “natural-gas company” as that term is defined under the NGA, 15 U.S.C. § 717a(6). As an FERC-regulated natural gas company under the NGA, the plaintiff is a “pipeline company,” as that term is defined in La. R.S. 47:1851 K, which owns “public service property,” as that term is used in La. R.S. 47:1851 M. So defined and in accordance with La. Const, art. VII, § 18, the plaintiff is subject to a 25% assessment of fair market value, as determined by the LTC.

To determine whether this ad valorem tax assessment procedure discriminates against interstate commerce, we now examine the Amerada Hess factors. A state tax discriminates against interstate commerce if it: (1) is facially discriminatory; (2) has a discriminatory intent; or (3) has the effect of unduly burdening interstate commerce. Amerada Hess, 490 U.S. at 75, 109 S.Ct. 1617. The plaintiff does not argue that Louisiana’s tax assessment procedure has a discriminatory intent; therefore, the second Amerada Hess factor is not at issue. Rather, the plaintiff submits that Louisiana’s ad valorem tax scheme violates the first and third factors in that the tax scheme is facially discriminatory or unduly burdensome on interstate commerce.

The assessors respond that the higher tax assessment is not based on whether a natural gas pipeline company is engaged in interstate or intrastate commerce. Rather, the higher assessment is based on whether a natural gas pipeline company is subject to rate regulation, regardless of whether it is engaged in interstate or intrastate commerce. The assessors submit that, where taxation is concerned and assuming no specific federal right is imperiled, states have large leeway to establish classifications that produce a reasonable system of taxation. The right to create classifications, however, |mis not without restraint, and a classification cannot be maintained if it results in a violation of the United States Commerce Clause.

The United States Supreme Court does not recognize a de minimis defense to a charge of discriminatory taxation under the Commerce Clause. Fulton Corp. v. Faulkner, 516 U.S. 325, 333 n. 3, 116 S.Ct. 848, 133 L.Ed.2d 796 (1996). A court “need not know how unequal the Tax is before concluding that it unconstitutionally discriminates.” Maryland, 451 U.S. at 760, 101 S.Ct. 2114. The fact that intrastate as well as interstate commerce may be adversely affected is immaterial to the determination of whether a law is discriminatory for Commerce Clause purposes. Sanifill, Inc. v. Kandiyohi County, 559 N.W.2d 111, 115 n. 3 (Minn.App.1997). Regulations that treat all out-of-state companies in a disparate manner will be treated as discriminatory even though some instate companies also are adversely affected by the regulation. Kentucky Power Co. v. Huelsmann, 352 F.Supp.2d 777, 786 (E.D.Ky.2005).

In Bacchus Imports, Ltd. v. Dias, 468 U.S. 263, 104 S.Ct. 3049, 82 L.Ed.2d 200 (1984), the Supreme Court struck down as facially discriminatory certain liquor tax exemptions that benefitted two specific, locally produced alcoholic beverages. The tax exemptions applied to some, but not all, locally produced beverages. The court offered, “as long as there is some competition between the locally produced exempt products and non-exempt products from outside the state, there is a discriminatory effect.” Bacchus Imports, 468 U.S at 271, 104 S.Ct. 3049. Actual discrimination, wherever it is found, is impermissible, and the magnitude and scope of the discrimination have no bearing on the determinative question of whether discrimination has | ^occurred. Associated Industries of Missouri v. Lohman, 511 U.S. 641, 650, 114 S.Ct. 1815, 128 L.Ed.2d 639 (1994).

More recently, in the matter of In re CIG Field Services Co., 279 Kan. 857, 112 P.3d 138, 150 (2005), the Kansas Supreme Court held that a property tax statute that differentiated between interstate and in-tercounty natural gas gathering systems and intracounty systems was facially discriminatory under the Commerce Clause. As in the case at hand, there was no differential treatment of certain intrastate entities in comparison to entities in interstate commerce. After a careful study of Supreme Court jurisprudence, the court concluded that “this imperfect discrimination is nevertheless discrimination.” CIG, 112 P.3d at 150. Because there exists no de minimis exception to facial discrimination under the United States Commerce Clause, we are compelled to conclude that, in its present state, Louisiana’s ad valorem tax scheme facially discriminates against the plaintiff in violation of the Commerce Clause of the United States Constitution.

Facial discrimination against interstate commerce invokes the strictest scrutiny of any professed legitimate local purpose and of the absence of nondiscriminatory alternatives. Hughes v. Oklahoma, 441 U.S. 322, 337, 99 S.Ct. 1727, 60 L.Ed.2d 250 (1979). In 1994, the Supreme Court stated that if a restriction on commerce is discriminatory, it is “virtually per se invalid.” Oregon Waste, 511 U.S. at 99, 114 S.Ct. 1345. Once a state law is shown to discriminate either on its face or in practical effect, the burden falls on the state to demonstrate that the statute serves a legitimate local purpose that cannot be achieved in a less discriminatory way. Maine v. Taylor, 477 U.S. 131, 138, 106 S.Ct. 2440, 91 L.Ed.2d 110 (1986). This is an extremely |⅞1 difficult burden placed on taxing authorities, so heavy that facial discrimination by itself may be a fatal defect. Camps Newfound/Owatonna, 520 U.S. at 582, 117 S.Ct. 1590. “Once a state tax is found to discriminate against out-of-state commerce, it is typically struck down without further inquiry.” Chemical Waste Management, Inc. v. Hunt, 504 U.S. 334, 342, 112 S.Ct. 2009, 119 L.Ed.2d 121 (1992). Moreover, the record before us offers no adequate proof of either a legitimate local purpose or of the absence of nondiscriminatory alternatives such as might defeat the strict scrutiny accorded a facially discriminatory scheme.

Finding Louisiana’s ad valorem tax scheme in its present form is facially discriminatory against natural gas pipeline transportation companies operating in interstate commerce, we must fashion a legal remedy.

The Remedy

Louisiana’s ad valorem tax scheme encompasses both constitutional and statutory provisions. As already observed, the plaintiff is a “pipeline company,” as defined in La. R.S. 47:1851 K, that owns and owes taxes on “public service property,” as that category of property is defined in La. R.S. 47:1851 M. So defined, the plaintiff is subject to an assessment of 25% of fair market value, as determined by the LTC. See La. Const, art. VII, § 18. Other similarly situated, direct competitors operating in intrastate commerce do not meet the definition of “pipeline companies” because they are unregulated. Their properties are not considered “public service properties,” and therefore, they are subject to assessments of 15% of fair market value, as | ^determined by the local assessors. See La. Const, art. VII, § 18. It is this discrepancy in classifying some, but not all, similarly situated and competing natural gas pipeline transportation companies as “pipeline companies” that creates the facial discrimination against interstate commerce. In fashioning a legal remedy for the plaintiff, we find it unnecessary to declare the entire ad valorem tax scheme unconstitutional when removal of the limited, offensive provisions of that scheme can accomplish the necessary result.

During oral argument, counsel for the plaintiff suggested that the current discrimination is a result of the amendment to La. Const, art. VII, § 18(B) by 1979 La. Acts No. 799. The preamble to Act 799 provided for “an additional classification of property subject to ad valorem taxation for public service properties as defined by law ... and [provided] that the percentage of fair market value applicable for the purpose of determining assessed valuation for such public service properties, excluding land, shall be twenty-five percent.” The proposed amendment was presented to, and approved by, the electors of the state of Louisiana at the October 27, 1979, gubernatorial general election. See 1979 La. Acts No. 799, § 2.

In essence, the plaintiff submits this court should remedy the discriminatory treatment imposed upon it by the Louisiana ad valorem tax scheme by ordering the LTC to reduce its tax burden to reflect the 15% assessed valuation applicable to those intrastate natural gas pipelines that are not defined as “pipeline companies” under the ad valorem tax scheme. The plaintiff seeks to maintain its properties’ status as “public service properties,” thus having its properties centrally valued by the LTC. However, it seeks an assessment of 15% of that value. To grant the plaintiff l^the relief it requests would be to disregard the clear directives of La. Const, art. VII, § 18. Only “public service properties,” subject to an assessment at 25% of fair market value, are to be valued by the LTC. All “other property,” subject to an assessment of 15% of fair market value, is to be valued by the local assessors.

The constitution is the supreme law, to which all legislative acts and all ordinances, rules, and regulations of creatures of the legislature must yield. Macon v. Costa, 437 So.2d 806, 810 (La.1983). We decline to strike a Louisiana constitutional provision, approved by the electors of this state, when a fair and equitable result can be reached by striking the statutory provision that creates the discrimination. For these reasons, we turn our attention to the relevant statute — La. R.S. 47:1851 — and, in particular, subsections K and M.

We are ever mindful of the presumption that the legislature acts within its constitutional authority in enacting legislation, and courts must construe a statute so as to preserve its constitutionality when it is reasonable to do so. Fruge, 6 So.3d at 128. The unconstitutionality of one or more portions of a law does not render the entire law unenforceable if the remaining portions are severable from the offending portions. Louisiana Associated General Contractors, Inc. v. State, 95-2105 (La.3/8/96), 669 So.2d 1185, 1201; see La. R.S. 24:175 A. Severance requires a determination that the legislature would have passed the act in the absence of the invalid portion. Thus, the issue is would the legislature have passed La. R.S. 47:1851 had the legislation been presented with the invalid features removed? See Louisiana Associated, 669 So.2d at 1201. Where the purpose of the statute is defeated by the invalidity of part of the act, the ¡^entire act is void. Louisiana Associated, 669 So.2d at 1201. Conversely, however, when the general objectives of the act can be achieved without the invalid part, the remaining parts of the act will be upheld. Louisiana Associated, 669 So.2d at 1201; see also World Trade Center Taxing Dist. v. All Taxpayers, Property Owners, 2005-0374 (La.6/29/05), 908 So.2d 623, 637-638.

Louisiana Revised Statutes 47:1851, subsections K and M, were enacted by 1976 La. Acts No. 703, § 1 (prior to 1979 La. Acts No. 799, which amended La. Const, art. VII, § 18(B)). Section 4 of Act 703 specifies:

If any provision or item of this Act or the application thereof is held invalid, such invalidity shall not affect other provisions, items, or applications of this Act which can be given effect without the invalid provisions, items, or applications, and to this end, the provisions of this Act are declared to be severable.

Louisiana Revised Statutes 47:1851 need not be stricken in its entirety. It is the definition of “pipeline company” found in subsection K that results in disparate treatment between interstate and some intrastate pipeline companies. Thus, we are compelled to conclude that subsection K is unconstitutional and in violation of the Commerce Clause. So concluding necessitates a declaration that inclusion of “pipeline company” in La. R.S. 47:1851 M is unconstitutional and in violation of the Commerce Clause, and the phrase “pipeline company” should be stricken from La. R.S. 47:1851 M. The remaining portions of La. R.S. 47:1851 are independent and capable of being given effect without reference to the invalid portions. Thus, the remaining part of La. R.S. 47:1851 M and other provisions of La. R.S. 47:1851 (excluding subsection K) are severable and valid. As a result of these declarations, the plaintiffs properties will be classified as “other properties” for purposes of Louisiana’s ad valorem tax scheme and will be ^assessed in compliance with La. Const, art. VII, § 18 at 15% of fair market value as determined by the assessors of the parishes within which the plaintiffs properties are located.

The plaintiff submits that upon remand for de novo assessment by the local assessors, the local assessors will be motivated to arrive at higher valuations than those set by the LTC. We find the plaintiffs contention unpersuasive. At the hearing on the motion for summary judgment, the plaintiff offered into evidence, without objection, the affidavit of Nancy Heller Hughes. Ms. Hughes attested that she is an Accredited Senior Appraiser of public utility property. Although the LTC and the local assessors use different valuation methods, Ms. Hughes concluded:

Fair market value is fan* market value. If applied properly to reflect all forms of depreciation (physical, functional and economic), the cost approach used by local parish assessors should produce similar results as the correlated cost and income approaches used by the Louisiana Tax Commission to assess the value of public service property.

Moreover, the local assessors’ valuations of properties are not unbridled. Article VII, § 18(D) requires that “[flair market value and use value of property shall be determined in accordance with criteria which shall be established by law and which shall apply uniformly throughout the state.” Like the plaintiff herein, the plaintiff in ANR Pipeline advanced a similar ^argument. This court noted that the assessors are required, pursuant to La. R.S. 47:1992 A(l), to prepare a list showing the assessment of immovable and movable property of the affected companies in and for the parish or district and expose the list daily for inspection by the plaintiff and any other interested parties for a period of fifteen days. ANR Pipeline, 923 So.2d at 97. Thereafter, the lists shall be certified to the board of review within three days in accordance with La. R.S. 47:1992 B. Accordingly, the plaintiff herein “will have ample opportunity to object, if necessary, to the local assessors’ valuations.” See ANR Pipeline, 92B So.2d at 97-98.

So concluding, we agree with the district court that the proper remedy is a remand to the LTC so that it can allow the parish assessors to assess the value of the plaintiffs properties for tax year 2006 and calculate taxes based on 15% of those assessments. Such relief complies with the mandates of La. Const, art. VII, § 18 and ensures that all natural gas pipeline companies, those operating intrastate and interstate, are treated identically. There will exist no differential treatment of instate and out-of-state economic interests that benefits the former and burdens the latter. See Oregon Waste, 511 U.S. at 99, 114 S.Ct. 1345. A remand for reassessment, both as to rate and methodology, of properties owned by the plaintiff is a “just and equitable” remedy. See ANR Pipeline, 923 So.2d at 98; Transcontinental Gas, 2005-2604, 2005-2605 at p. 6 (unpublished).

CONCLUSION

For the foregoing reasons, we affirm that portion of the district court judgment partially granting the motion for summary judgment filed on behalf of the Assessors of Acadia, Cameron, East Baton Rouge, Iberia, Jefferson Davis, Lafourche, St. Landry, St. Martin, St. Mary, Vermilion, and Washington parishes, and ordering that ad valorem taxes on all pipeline property (whether operated in interstate or intrastate commerce) must be calculated at 15% of fair market value as determined by the assessors of the parishes within which the plaintiffs properties are located. We reverse that part of the district court judgment declining to consider the constitutionality of La. R.S. 47:1851 and render judgment declaring La. R.S. 47:1851 K unconstitutional and in violation of the Commerce Clause of the United States Constitution. We further render judgment declaring that inclusion of the phrase “pipeline company” in La. R.S. 47:1851 M is unconstitutional and in violation of the Commerce Clause of the United States Constitution; so finding, we order the phrase “pipeline company” be stricken from La. R.S. 47:1851 M. The relief requested in the answer filed by the Louisiana Tax Commission is denied. The parties to this appeal are to bear their own costs.

JUDGMENT AFFIRMED IN PART; REVERSED IN PART; AND RENDERED. ANSWER TO APPEAL DENIED.

      . Although the facts are fairly simple, the same cannot be said for the procedural history of this complex consolidated district court proceeding. Discrepancies in the pleadings and unusual legal process have created what can best be described as a legal labyrinth.

      . In its petition, the plaintiff also challenged the ad valorem tax scheme under the Equal Protection and Due Process Clauses of the United States and Louisiana Constitutions, and the Uniformity Clause of the Louisiana Constitution. During oral argument, counsel for the plaintiff confirmed that the sole issue before this court is whether the Louisiana ad valorem tax scheme violates the Commerce Clause of the United States Constitution.

      . The sheriffs and assessors named as defendants in this suit are: Sheriff Wayne Me-lancon, Acadia Parish; Sheriff Mike Wag-uespack, Assumption Parish; Sheriff Tony Mancuso, Calcasieu Parish; Sheriff Theos Duhon, Cameron Parish; Sheriff Greg Phares, East Baton Rouge Parish; Sheriff Sid Hebert, Iberia Parish; Sheriff Brent Al-lain, Iberville Parish; Sheriff Richard Edwards, Jr., Jefferson Davis Parish; Sheriff Michael Neustrom, Lafayette Parish; Sheriff Craig Webre, Lafourche Parish; Sheriff Paul Raymond Smith, Pointe Coupee Parish; Sheriff Gregory Champagne, St. Charles Parish; Sheriff Ronald Ficklin, St. Helena Parish; Sheriff Bobby Guidroz, St. Landry Parish; Sheriff Ronald J. Theriot, St. Martin Parish; Sheriff David A. Naquin, St. Mary Parish; Sheriff Daniel Edwards, Tangipahoa Parish; Sheriff Michael Couvillon, Vermilion Parish; Sheriff Aubrey Jones, Washington Parish; and Sheriff Mike Cazes, West Baton Rouge Parish, in their capacities as ex officio tax collectors in and for their respective parishes. Hon. Russel L. Benoit, Acadia Parish; Hon. Wayne P. Blanchard, Assumption Parish; Hon. Richard J. Cole, Jr., Calcasieu Parish; Hon. Robert E. Conner, Cameron Parish; Hon. Brian Wilson, East Baton Rouge Parish; Hon. Rickey J. Huval, Sr., Iberia Parish; Hon. James H. Dupont, Iberville Parish; Hon. Donald G. Kratzer, Jefferson Davis Parish; Hon. Conrad Comeaux, Lafayette Parish; Hon. Michael H. Martin, Lafourche Parish; Hon. James A. Laurent, Pointe Coupee Parish; Hon. Clyde A. Gisclair, St. Charles Parish; Hon. Wesley Blades, St. Helena Parish; Hon. Rhyn L. Duplechain, St. Landry Parish; Hon. Lawrence Patin, St. Martin Parish; Hon. Sherel A. Martin, Jr., St. Maty Parish; Hon. Joaquin Matheu, Tangipahoa Parish; Hon. Michael Langlinais, Vermilion Parish; Hon. M. Randall Seal, Washington Parish; and Hon. Barney Altazan, West Baton Rouge Parish, in their capacities as assessors in and for their respective parishes.

      . The twelve assessors named as defendants who joined in answering the petition were: Hon. Russel L. Benoit, Acadia Parish; Hon. Richard J. Cole, Jr., Calcasieu Parish; Hon. Robert E. Conner, Cameron Parish; Hon. Brian Wilson, East Baton Rouge Parish; Hon. Rickey J. Huval, Sr., Iberia Parish; Hon. Donald G. Kratzer, Jefferson Davis Parish; Hon. Michael H. Martin, Lafourche Parish; Hon. Rhyn L. Duplechain, St. Landry Parish; Hon. Lawrence Patin, St. Martin Parish; Hon. Sherel A. Martin, Jr., St. Mary Parish; Hon. Michael Langlinais, Vermilion Parish; and Hon. M. Randall Seal, Washington Parish. Although not named as a defendant in this litigation, an answer also was filed on behalf of Hon. Gene P. Bonvillain, assessor of Terrebonne Parish.

      .The eleven assessors named as defendants who joined in the motion for summary judgment were: Hon. Russel L. Benoit, Acadia Parish; Hon. Robert E. Conner, Cameron Parish; Hon. Brian Wilson, East Baton Rouge Parish; Hon. Rickey J. Huval, Sr., Iberia Parish; Hon. Donald G. Kratzer, Jefferson Davis Parish; Hon. Michael H. Martin, Lafourche Parish; Hon. Rhyn L. Duplechain, St. Landry Parish; Hon. Lawrence Patin, St. Martin Parish; Hon. Sherel A. Martin, Jr., St. Mary Parish; Hon. Michael Langlinais, Vermilion Parish; and Hon. M. Randall Seal, Washington Parish. Joining in the motion was the Hon. Gene P. Bonvillain, assessor of Terrebonne Parish, who answered the petition but was not named as a defendant. The Hon. Richard J. Cole, Jr., assessor of Calcasieu Parish, who joined with the other movers in answering the petition, did not join in the motion for summary judgment.

      . The answer does not identify the parish with which Sheriff Sidney Gautreaux is affiliated.

      . Clearly the reference to docket number 551,432 is a typographical error, as the judgment is captioned "JUDGMENT IN DOCKET NO. 551,435.” Notably, the judgment is not entered in favor of the Hon. Gene P. Bonvil-lain, Assessor of Terrebonne Parish, who answered the petition and joined in the motion but was not named by the plaintiff as a defendant.

      . To the extent this court may lack appellate jurisdiction over all of the issues raised on appeal, we exercise our supervisory jurisdic-lion and consider die merits of the plaintiffs claims. See Hood v. Cotter, 2008-0215, 2008-0237 (La.12/2/08), 5 So.3d 819, 823-824.

      . A facially discriminatory tax may survive Commerce Clause scrutiny if it is, in fact, a compensatory tax designed to make interstate commerce bear a burden already borne by intrastate commerce. The state bears the burden of showing that the requirements of the compensatory tax doctrine are clearly met. Fulton Corp. v. Faulkner, 516 U.S. 325, 331, 344, 116 S.Ct. 848, 133 L.Ed.2d 796 (1996). Herein, no argument has been advanced, nor evidence presented, that the ad valorem tax is a justifiable compensatory tax. Notably, the Supreme Court has stated that there is "doubt that such a showing can ever be made outside the limited confines of sales and use taxes.” Fulton, 516 U.S. at 344, 116 S.Ct. 848.

        . As noted by the Alabama Supreme Court in Ex parte Hoover, Inc., 956 So.2d 1149, 1153 (Ala.2006), dormant Commerce Clause analysis is not without criticism. See e.g., Camps Newfound/Owatonna, Inc. v. Town of Harrison, 520 U.S. 564, 610, 117 S.Ct. 1590, 137 L.Ed.2d 852 (1997) (Thomas, J„ joined by Rehnquist, C.J., and Scalia, J., dissenting) ("The negative Commerce Clause has no basis in the text of the Constitution, makes little sense, and has proved virtually unworkable in application.”).

      . A finding of facial discrimination eliminates the need for this court to evaluate whether the third Amerada Hess factor (undue burden on interstate commerce) is present.

      . The plaintiff observes that airline and railroad companies, although classified as owning “public service properties,” are assessed at the lower 15% assessment of fair market value as determined by the LTC — not the local assessors. The United States Congress has elected to treat airline and railroad companies differently from pipeline companies. Specific federal legislation has been passed in regard to taxation of airline and railroad companies. See 49 U.S.C. § 40116(2)(A); 49 U.S.C. § 11501(b). We are unaware of similar federal legislation in favor of natural gas pipeline companies. Moreover, because the plaintiff's properties will no longer be classified as "public service properties” for purposes of La. Const, art. VII, § 18, the plaintiff’s arguments regarding the alleged disparity in treatment between itself and other owners of “public service properties” is moot.

      . In ANR Pipeline, this court evaluated the Louisiana ad valorem tax scheme in the context of equal protection and uniformity challenges. Therein, interstate natural gas pipeline companies that met the definition of "pipeline companies” owning "public service properties” were not being appraised and assessed in the same manner as intrastate pipeline companies that also met the definition of "pipeline companies” owning "public service properties.” Rather, the intrastate companies were being assessed as if they owned non-public service properties. This court determined that the appropriate remedy for a denial of uniformity in taxation "is to employ the same valuation and assessment methodology as that used to assess the preferred properties.” ANR Pipeline, 923 So.2d at 97.


source: Caselaw Access Project

author: PARRO, J. McCLENDON, J.,

license: Public Domain

text:
    Matthew C. SHARP v. ST. TAMMANY MARINE & POWERSPORTS.
    No. 2008 CA 1992.
    Court of Appeal of Louisiana, First Circuit.
    Sept. 10, 2009.

      John H. Musser, V., Emily Stevens Hardin, Murphy, Rogers, Sloss & Gambel, New Orleans, LA, for Plaintiff-Appellant Matthew C. Sharp.
    J. Douglas Sunseri, Peter J. Perez, Jr., Nicaud & Sunseri, L.L.C., Metairie, LA, for Defendant-Appellee St. Tammany Marine & Powersports.
    Before: PARRO, McCLENDON, and WELCH, JJ.
   PARRO, J.

|2In this workers’ compensation case, Matthew Sharp appeals the amount of attorney fees, the denial of penalties, and the failure to assess interest and costs in a judgment awarding him $550 in attorney fees after finding his employer had underpaid compensation benefits by $143.46. We amend the judgment and affirm it as amended.

BACKGROUND

On December 3, 2005, Matthew Sharp was an eighteen-year-old college student working part-time for St. Tammany Marine & Powersports (St. Tammany) and was seriously injured when he fell during the repair of a roof damaged by Hurricane Katrina. St. Tammany’s insurer began paying compensation benefits on December 15, 2005, paid $121 per week for the first two weeks following his accident, and thereafter paid $105 per week through April 27, 2006. It also paid medical benefits in the total amount of $41,100.80.

On January 17, 2007, Matthew filed a disputed claim for compensation, alleging that his wage compensation rate was incorrect, that vocational rehabilitation had been denied, and that he had not been provided with copies of his medical records. He sought additional compensation benefits, penalties, interest, and attorney fees. In November 2007, he amended his claim to allege that his wage compensation rate should have been $112.97 per week, that additional medical treatment, speech therapy, and prescriptions had been denied, and that payment of medical bills had been untimely. Pretrial mediation was ordered, but some of the issues were unresolved, and the case was submitted to the workers’ compensation judge (WCJ) for trial based on joint exhibits and stipulations and pre-trial briefs.

The only issues to be decided by the WCJ were whether St. Tammany should be assessed penalties and/or attorney fees. After reviewing the evidence, stipulations, and briefs, the WCJ noted that St. Tammany had miscalculated the employee’s wage compensation benefits, for a total underpayment of $143.46, and assessed $550 in |sattorney fees against St. Tammany. Stating that any other missteps regarding timely payment of medical benefits or failure to timely supply requested information were not done maliciously, arbitrarily, or capriciously, the WCJ denied all other claims for penalties and attorney fees. The issues in this appeal are whether penalties and additional attorney fees should have been assessed for underpayment of compensation benefits and for St. Tammany’s failure to timely provide copies of medical records and timely pay certain medical bills and mileage expenses, and whether the WCJ erred in failing to assess interest and costs.

APPLICABLE LAW

There are two statutes in Louisiana’s workers’ compensation laws that provide for penalties and/or attorney fees when an employer or its insurer has failed to handle payments of an employee’s claim properly. Louisiana Revised Statute 23:1201(F) provides for penalties and reasonable attorney fees for failure to pay compensation or medical benefits in accord with LSA-R.S. 23:1201. However, the provision does not apply if the claim is reasonably controverted or if the nonpayment results from conditions over which the employer or insurer had no control. LSA-R.S. 23:1201(F)(2). Louisiana Revised Statute 23:1201(1) authorizes the assessment of penalties and reasonable attorney fees when the employer or insurer discontinues payment of claims, when such discontinuance is found to be arbitrary, capricious, or without probable cause. Another statute under which penalties and attorney fees may be imposed is LSA-R.S. 23:1125, which allows a $250 penalty and reasonable attorney fees if the claimant is not timely provided with a copy of medical records of his treatment by the employer’s choice of health care provider. See LSA-R.S. 23:1125(C).

These statutes provide for the imposition of penalties and attorney fees to discourage indifference and undesirable conduct by employers and insurers and are essentially penal in nature. Although the workers’ compensation law is to be liberally construed with regard to benefits, penal statutes are to be strictly construed. Cooper v. St Tammany Parish Sch. Bd., 02-2433 (La.App. 1st Cir.11/7/03), 862 So.2d 1001, 1009, writ denied, 04-0434 (La.4/23/04), 870 So.2d 300. The determination of |4whether an employer should be cast with penalties and attorney fees is essentially a question of fact, and the WCJ’s findings shall not be disturbed absent manifest error. Authement v. Shappert Eng’g, 02-1631 (La.2/25/03), 840 So.2d 1181, 1188—89; Hayes v. Louisiana State Penitentiary, 06-0553 (La.App. 1st Cir.8/15/07), 970 So.2d 547, 563, writ denied, 07-2258 (La.1/25/08), 973 So.2d 758. However, if legal error interdicts the fact-finding process, the manifest error standard no longer applies, and if the record is otherwise complete, an appellate court should make its own de novo review of the record. Evans v. Lungrin, 97-0541 and 97-0577 (La.2/6/98), 708 So.2d 731, 735; see also Bertrand v. Dow Chemical Co., 05-1246 (La.App. 1st Cir.12/20/06), 951 So.2d 263, 269, writ denied, 07-0098 (La.3/9/07), 949 So.2d 453.

DISCUSSION

Although the parties used the term “arbitrary and capricious” in their briefs to this court and the WCJ also used that terminology in his judgment, that standard is applicable only when the employer or its insurer discontinues payment of benefits. See LSA-R.S. 23:1201(1). There are no allegations in this case concerning discontinuance of benefit payments; therefore, the WCJ legally erred in using the arbitrary and capricious standard. See Brown, v. Texas-LA Cartage, Inc., 98-1063 (La.12/1/98), 721 So.2d 885, 889 and 891 n. 5. The correct standard to be applied when the claims involve denials or untimely payments of certain benefits is whether those claims were “reasonably controverted” by the employer and/or its insurer. See LSA-R.S. 23:1201(F)(2). To reasonably controvert a claim, the defendant must have some valid reason or evidence upon which to base his denial or non-payment of benefits. Thus, to determine whether the claimant’s right has been reasonably controverted, the court must ascertain whether the employer or its insurer engaged in a nonfrivolous legal dispute or possessed factual and/or medical information to reasonably counter the factual and medical information presented by the claimant. Brown, 721 So.2d at 890; see also Roussell v. St Tammany Parish Sch. Bd., 04-2622 (La.App. 1st Cir.8/23/06), 943 So.2d 449, 462, writ not considered, 06-2862 (La.1/8/07), 948 So.2d 116.

In light of the legal error by the WCJ, we must use the appropriate legal | r,standard set out in LSA-R.S. 23:1201(F) and make our own independent de novo review and assessment of the record with regard to the issues impacted by the application of that statutory provision to determine whether St. Tammany’s actions warrant the imposition of penalties and attorney fees. See Bertrand, 951 So.2d at 269. The assignment of error in this appeal lists four areas in which St. Tammany or its insurer is alleged to have handled Matthew’s claim improperly and for which penalties and attorney fees should be awarded. Those are: underpayment of compensation benefits based on a miscalculation of his average weekly wage, late payments of mileage and prescription expenses, late payment of medical bills, and refusal to supply a copy of his medical records prior to suit. We will address each of those claims in turn.

Compensation Benefits

According to LSA-R.S. 23:1021(12)(a)(iii), if the employee is paid on an hourly basis and the employee is a part-time employee, the average weekly wage is his hourly wage rate multiplied by the average actual hours worked in the four full weeks preceding the date of the injury. The record contains the following wage history for the week of Matthew’s accident and the weeks preceding it:

12/01/05-12/07/05 $133.13 (17.75 hours @ $7.50/hour) 11/24/05-11/30/05 Thanksgiving — did not work this week 11/17/05-11/23/05 $97.50 (13 hours @ $7.50/hour) 11/10/05-11/16/05 $105.00 (14 hours @ $7.50/hour) 11/03/05-11/09/05 $116.25 (15.5 hours @ $7.50/hour) 10/27/05-11/02/05 $116.25 (15.5 hours @ $7.50/hour)

Matthew was injured on Saturday, December 3, 2005, and was released to full employment on Friday, March 31, 2006. The first full week of work before the date of Matthew’s injury was November 17, 2005, through November 23, 2005. Based on a total of 58 hours, the average of his actual hours worked in the four full weeks preceding the date of injury was 14.5 hours, and his hourly wage rate was $7.50. Therefore, his average weekly wage should have been $108.75, not $112.97, as he claimed.

IfiKristin Shortess, the adjuster who handled Matthew’s claim for St. Tammany’s insurer, testified in her deposition that when she computed the average weekly wage, she obtained an amount that was below the applicable minimum. See LSA-R.S. 23:1202(A)(2) and (B). Therefore, she adjusted the payments to $105 per week, the amount she believed was the applicable minimum compensation at that time. However, according to LSA-R.S. 23:1202(A)(2), in any case where the employee was receiving wages at a rate less than the applicable minimum compensation, the compensation is to be the employee’s “wages,” ie., his average weekly wage at the time of the accident. See LSA-R.S. 23:1021(12).

The record shows that Matthew was paid $121 per week for the first two weeks and $105 per week for the remainder of the time, when his weekly payments should have been $108.75. Based on this payment history, Matthew’s compensation benefits after the first two weeks were underpaid. See LSA-R.S. 2S:1201(A) and (B). Since St. Tammany’s insurer does not dispute that the amount due to Matthew was miscalculated and he was underpaid the weekly benefits during most of the term of his disability, we find that St. Tammany did not reasonably controvert his claim for additional wage benefits. Therefore, pursuant to LSA-R.S. 23:1201(F), a penalty and reasonable attorney fee must be assessed for this claim.

The penalty for each disputed claim shall be an amount up to the greater of twelve percent of any unpaid compensation or medical benefits, or fifty dollars per calendar day for each day in which any and all compensation or medical benefits remain unpaid; however, the fifty dollars per calendar day penalty shall not exceed a maximum of two thousand dollars in the aggregate for any claim. See LSA-R.S. 23:1201(F) and 1201(F)(2). Because a penalty of $50/day for the time period involved would exceed the statutory cap of $2000 for each claim, we will assess a penalty of $2000 for the underpayment of compensation benefits. The judgment -will be amended accordingly.

We note that the only issues before the WO at trial and before this court on 17appeal concern the awards of attorney fees and/or penalties. The judgment rendered by the WCJ did not order payment of the alleged underpayment of $143.46, but awarded $550 in attorney fees for this claim. However, although LSA-R.S. 23:1201(F) states that reasonable attorney fees are mandatory for “each disputed claim” for which a violation of Section 1201 has been found, LSA-R.S. 23:1201(J) modifies that provision, stating in part:

Notwithstanding the fact that more than one violation in this Section which provides for an award of attorney fees may be applicable, only one reasonable attorney fee may be awarded against the employer or insurer in connection with any hearing on the merits of any disputed claim filed pursuant to this Section.

Therefore, instead of evaluating the reasonableness of the $550 award, we will make a single award of a reasonable attorney fee after considering the other claims under which such an award might be required by other provisions of Section 1201. See Russell v. Regency Hosp. of Covington, LLC, 08-0538 (La.App. 1st Cir.11/14/08), 998 So.2d 301, 306.

Mileage and Prescription Expenses

Louisiana Revised Statute 23:1201(E) requires that medical benefits are to be paid within sixty days after the employer or insurer receives written notice thereof. Failure to pay in accordance with this provision subjects the employer or its insurer to the penalties and attorney fees mandated by LSA-R.S. 23:1201(F).

On January 25, 2008, Matthew submitted a mileage reimbursement request for 390 miles traveled to various doctors’ appointments from October 2, 2007, through January 25, 2008. On February 25, 2008, he submitted a request for reimbursement of $44.09 for a prescription filled November 5, 2007. On April 3, 2008, he resubmitted those requests, along with an additional request for a separate mileage reimbursement for 106.8 miles traveled. These submissions were not paid until April 16, 2008, when |sSt. Tammany’s insurer issued a check in the amount of $262.68 to cover both mileage requests and the prescription expense. Matthew does not dispute the amount of this payment, but claims that pursuant to LSA-R.S. 23:1201(F), he is entitled to penalties of $2000 for late payment of the mileage reimbursement, $2000 for late payment of the prescription expense, and reasonable attorney fees for each claim.

St. Tammany concedes that a “technical violation of the statute occurred” when its insurer failed to timely pay the mileage reimbursement request that was initially sent on January 25, 2008, but remained unpaid until April 16, 2008, following its re submission on April 3, 2008. St. Tammany did not offer any indication that it challenged or controverted this mileage request in any way. The only possible explanation for the delay in payment was Ms. Shortess’s deposition testimony that during this period, the insurance company was in transition to “paperless” documentation, and that occasionally, there were “glitches in the system” that may have delayed payment of some benefits. However, this was a condition over which the insurer had control. Accordingly, under the mandatory wording of the statute, a penalty is required.

The payment of $262.68 included $44.09 for the prescription expense; therefore, the amount paid to reimburse the total mileage of 496.8 miles was $218.59, a rate of 44 <t /mile. Accordingly, $171.60 was attributable to the 390 miles for which payment was 22 days past due. Assessing the greater of 12% of the past due amount or $50/day, the statutorily mandated penalty is $1100 for this claim.

Concerning the prescription expense of $44.09, we note that the time between its submission on February 25, 2008, and payment on April 16, 2008, is only 51 days. Therefore, this payment was within the sixty-day period specified by LSA-R.S. 23:1201(E), and no penalty or attorney fees are due with respect to this claim.

Medical Bills

Matthew contends that a number of medical bills were not paid within the statutory sixty-day time limit, as required by LSA-R.S. 23:1201(E). He seeks penalties and attorney fees for each of these claims.

|9The first claim involves three bills in the amounts of $197, $35, and $172 from Ochsner Clinic related to services provided on March 13, 2006; the first two bills were not paid until June 19 and the last was not paid until October 13, 2006. Ms. Shortess testified that the reason for the late payments was that the bills were sent on health insurance claim forms (HCFAs) without any accompanying medical records from which the insurer could determine whether the services were necessary or were related to Matthew’s injury. She stated that claimants may be receiving medical treatments for unrelated diseases or injuries, and without the explanatory information, the insurer cannot confirm that these bills are payable as workers’ compensation medical benefits. Therefore, when such unexplained HCFAs were received, the insurer requested medical records and paid the bills after those were provided, if those records confirmed the treatments were medically necessary and related to the work injury. We find, from our examination of the record, that the Ochsner Clinic bills in question were reasonably controverted, because when they were initially received by the insurer, there was nothing explaining why the services associated with the bills were needed or showing the relationship to Matthew’s injury. The insurer did not ignore the invoices, but requested supporting medical records on two different occasions. As soon as that information was received and connected to the appropriate invoices, the bills were timely paid. Therefore, the penalty provision does not apply to this claim. Cf. Roussell, 943 So.2d at 462 (award of penalties and attorney fees affirmed when neither the employer nor insurer made any attempt to determine whether the medical bills were medically necessary and related to the work injury).

Another disputed medical bill was from Dr. Carl Lowder at the Ochsner Clinic, relating to treatment on January 30, 2006. This invoice was not paid until May 2006. Although Matthew’s brief to this court suggests the invoice was “issued” February 1, 2006, which corresponds with the date on the invoice, there is no evidence in the record to show when it was sent to the insurer. The only evidence in the record is a date-stamp in the left margin of the invoice, showing “REC 4/3/2006” and Ms. Shortess’s testimony that her records indicate that this invoice, with accompanying | inmedical records, was received on that date. She also testified, and the insurer’s payment record corroborates, that the check cleared May 9, 2006. This was well within the sixty-day period, and -we find the evidence does not show that a penalty was applicable to this claim.

Another invoice that was paid late was one concerning treatment at Lakeview Regional Medical Center on December 3, 2005, showing a total charge of $1,474. This invoice was sent directly to Matthew’s parents by Van Meter and Associates, which apparently was a billing services contractor handling Lakeview’s accounts. There was some confusion about when the invoice was received by the insurer, but again, the invoice was on an HCFA form with no accompanying medical records. The insurer asked Van Meter for medical record documentation to support the claim, and the response was that this information would have to be requested directly from the hospital. That was done on October 12, 2006, but the date-stamp on the medical records shows they were not received by the insurer until January 3, 2007. Ms. Shortess testified that as soon as she received the supporting documents, she put this invoice in line for payment “ASAP,” and it was paid February 8, 2007. We find that the bill was reasonably controverted, because it initially included no medical documentation explaining the services associated with the bill or relating it to Matthew’s injury, and was paid within sixty days after receipt of that information. Therefore no penalty is applicable to this claim.

Finally, an invoice in the amount of $3,225 from Dr. Bianchini summarized treatments provided February 15, 2006, through June 26, 2006. At the top of the invoice is the handwritten notation, “ *REPORT ATTACHED.” However, there is no datestamp on this invoice to show when it was received by the insurer, nor is there any other evidence in the record concerning when it might have been sent or received. The record does contain two additional invoices from Dr. Bianchini — one for $2,268 and the other for $957 summarizing the same treatments. These are date-stamped as received on “7/2/2007.” The insurer’s payment log shows the check to Dr. Bianchini for $3,225 cleared on “8/3/07.” As there is no evidence in the record to show that the ^insurer received the first invoice over sixty days before it was paid, we cannot assess penalties for this claim.

Medical Records

The record shows that Matthew and his parents requested his entire file from St. Tammany’s insurer in September 2006. A memo from Ms. Shortess shows that she sent his medical records and a print-out of payments to him and his parents on January 24, 2007. Matthew claims a $250 penalty is due, pursuant to LSA-R.S. 23:1125, for the insurer’s failure to timely respond to his request for copies of his medical records.

We disagree. This penalty statute applies only if the claimant is not timely provided with medical records of his treatment by the employer’s choice of physician. See LSA-R.S. 23:1125(A) and (B). We find that Matthew was being treated by his choice of physicians. Therefore, this provision is inapplicable, and no penalty is due.

Attorney Fees

After reviewing all the claims in this proceeding, we have concluded that penalties and reasonable attorney fees must be awarded for the claims for underpayment of compensation benefits and untimely payment of mileage expenses. As previously noted, the WCJ awarded $550 in attorney fees for the underpayment of compensation benefits, but under LSA-R.S. 23:1201(J), this court may award only one reasonable attorney fee in connection with the hearing on the merits of the disputed claims. Factors to be considered in the imposition of reasonable attorney fees in workers’ compensation cases include the degree of skill and work involved in the case, the amount of the claim, the amount recovered, and the amount of time devoted to the case. Russell, 998 So.2d at 306.

Matthew’s attorney litigated these claims through discovery and mediation and presented them clearly in briefs and documents submitted to the WCJ. However, the pleadings were formulaic, the legal issues were not complex, the monetary amounts involved in the claims were nominal, the case was not orally presented to the WCJ at a hearing, and the results were inconsistent. Based on these considerations, we will amend the WCJ’s judgment to award $1200 as reasonable attorney fees in this matter.

| iJLegal Interest and Court Costs

Finally, Matthew claims the WCJ erred in failing to award him legal interest and court costs. With respect to whether legal interest is due, we note that the claims before us involve only penalties and attorney fees. On such awards, interest is due from the date of judgment until paid. Sharbono v. Steve Lang & Son Loggers, 97-0110 (La.7/1/97), 696 So.2d 1382, 1388-89. This court will amend the judgment to reflect such an award.

Under LSA-R.S. 23:1310.9, an award of the total costs of the proceedings is mandatory upon a finding that a compensation proceeding has not been brought on a reasonable ground or that denial of benefits has not been based on a reasonable ground. This court has concluded that St. Tammany did not reasonably controvert Matthew’s claims for underpayment of compensation benefits and untimely payment of certain mileage expenses. Therefore, the costs of this proceeding, including the costs of this appeal, must be assessed against St. Tammany. The judgment will be amended accordingly.

CONCLUSION

Based on the foregoing, the judgment of June 11, 2008, is amended to award Matthew Sharp $3100 in penalties and $1200 in attorney fees, plus legal interest from the date of judgment until paid, and all costs, including the costs of this appeal.

AMENDED AND AFFIRMED AS AMENDED.

McCLENDON, J., concurs and assigns reasons.

McCLENDON, J.,

concurs and assigns reasons.

| initially, and admittedly, an error was made in the calculation of benefits. However, while it is not clear that the exception developed in the jurisprudence for a mere miscalculation was abrogated by Brown v. Texas-LA Cartage, Inc., 98-1063, p. 3 n. 2 (La.12/1/98), 721 So.2d 885, 887, defendants’ failure to review or recalculate when the error was brought to their attention was a more egregious act than simple miscalculation. Thus, regardless of the standard used or whether an exception exists for simple miscalculation, the result on this issue would be the same. For these reasons, I respectfully concur.

      . Matthew's treating physician had released him to heavy duty employment without restrictions on March 31, 2006. However, he continued to receive treatment and medication for problems with memory, focus, and attentiveness, which were related to the head injury.

      . According to the Louisiana Workforce Commission, the actual minimum payment established by the administrator of the Louisiana Employment Security Law for the date of Matthew’s injury was $121 per week. See LSA-R.S. 23:1202(B); http//brgo.com/Dep(/ Parish Attorney/PDF/AvgWage_MinMax-Rates.pdf.

      . The judgment stated:
      IT IS ORDERED, AJUDGED (sic) AND DECREED that the employer, St. Tammany Marine & Powersports[,] miscalculated employee’s indemnity benefits for a total underpayment of $143.46. Consequently, the Court awards Matthew C. Sharp $550.00 in attorney fees against St. Tammany Marine and Powersports.


author: PARRO, J.

text:
    PLAQUEMINES PARISH GOVERNMENT v. DEPARTMENT OF NATURAL RESOURCES, State of Louisiana.
    No. 2008 CA 2094.
    Court of Appeal of Louisiana, First Circuit.
    Sept. 10, 2009.
    L.V. Cooley, IV, Special Assistant Parish Attorney, Belle Chasse, LA, for Plaintiff-Appellant Plaquemines Parish Government.
    Thomas E. Balhoff, Judith R. Atkinson, Roedel, Parsons, Koch, Blache, Balhoff & McCollister, Baton Rouge, LA, for Defendant-Appellee Department of Natural Resources, State of Louisiana.
    Scott A. O’Connor, C. Peck Hayne, Jr., Sara E. Mouledoux, Gordon, Arata, McCol-lam, Duplantis <& Eagan, L.L.P., New Orleans, LA, for Intervenors-Appellees Board of Commissioners of the Southeast Louisiana Flood Protection Authority-East on behalf of/and the Orleans Levee District.
    Before: PARRO, McCLENDON, and WELCH, JJ.
   PARRO, J.

| aThe Plaquemines Parish Government, on behalf of and as the governing authority of the Grand Prairie Levee District (GPLD), filed a petition for judicial review of a final decision by the Department of Natural Resources (DNR) concerning the return of public lands in the area of the Bohemia Spillway in Plaquemines Parish to the GPLD, a prior owner. The district court sustained DNR’s peremptory exception raising the objection of no cause of action, and from that judgment, the Plaquemines Parish Government appeals. For the following reasons, we affirm.

Factual and Procedural Background

According to the GPLD, in the mid-1920s, the Orleans Levee District (OLD) acquired thousands of acres of land in Plaquemines Parish from it for the construction of the Bohemia Spillway. This land has produced millions of dollars in mineral revenues. The GPLD sought to have the DNR certify it as the prior landowner in order to facilitate the return of the now-unused land to the GPLD. However, the DNR refused to determine certification based on its conclusion that a legislative resolution was needed for the return of land from one quasi-governmental entity to another. The GPLD disagreed and filed a petition for judicial review, seeking the reversal of the DNR’s decision and seeking certification that the GPLD was the previous landowner. The GPLD urged that the DNR is statutorily obligated to certify ownership. The GPLD asserted that once its ownership of the property was certified, section 1 of 1984 La. Acts, No. 233 (Act 233) required that the land be returned to the GPLD.

In response to the GPLD’s petition for judicial review, the DNR filed an exception raising the objections of no right of action and no cause of action. The district court sustained the DNR’s objection of no cause of action and dismissed the GPLD’s petition based on a finding that Act 233 does not require the return of public lands. The GPLD appealed, contending the district court erred in finding that (1) Act 233 applied only to | ^private landowners, (2) there can be no expropriation of public lands, and (3) the GPLD was not an existing entity.

Applicable Legislation

The creation of the GPLD and the transfer of public land from the Parish of Plaquemines to the GPLD was provided for in 1898 La. Acts, No. 24. The lower boundary of the GPLD was extended by 1900 La. Acts, No. 43. Subsequently, 1924 La. Acts, No. 99 (Act 99) gave the Board of Levee Commissioners of the OLD authority to acquire property, either by purchase, donation, or expropriation, for the purpose of creating the Bohemia Spillway in Plaquemines Parish. Bd. of Com’rs of Orleans Levee Dist. v. Dept. of Natural Resources, 496 So.2d 281, 285 (La.1986); Frank v. Bd. of Levee Com’rs of Orleans Levee Dist., 04-0858 (La.App. 4th Cir.4/6/05), 900 So.2d 1063, 1064, writ denied, 05-1171 (La.11/28/05), 916 So.2d 144. Section 3 of Act 99 provided:

The Orleans Levee District is hereby required, as a condition precedent to removing any levees or taking possession of any property, to acquire by purchase or expropriation and to pay for all lands and property privately owned within the area covered by the proposed plan from the upper to the lower limits thereof and from the Mississippi River to the sea.

The legislature also authorized the OLD to levy such taxes as may be required for the purpose of constructing the Bohemia Spillway. Bd. of Com’rs of Orleans Levee Dist. v. Dept. of Natural Resources, 496 So.2d at 285. Pursuant to this authority, the OLD acquired the properties necessary for construction of the spillway. The court in Bd. of Com’rs of Orleans Levee Dist. v. Dept. of Natural Resources stated:

Although located in Plaquemines Parish 50 miles [downriver] from Orleans Parish, on the site of what was formerly the Bohemia Plantation, the spillway was designed to assist in protecting the City of New Orleans from flooding by providing a rapid exit for surplus water from the Mississippi River into the Gulf of Mexico, thereby reducing the water level upstream. Of the 33,000 acres required for the creation of the spillway, which was constructed in 1924 to 1926, 3% of the land was acquired by expropriation, 48% by purchase in lieu of expropriation, and 49% by transfer of public lands from the state. The transfer of public lands was accomplished by Acts 246 of 1928 and 311 of 1942, whereby the Legislature conveyed to the Orleans Levee District from the 14Grand Prairie Levee District all of the state or public land in the spillway. Id.

Portions of Act 24 of 1898 were amended and re-enacted by 1928 La. Acts, No. 246, which recreated and re-established the GPLD, reducing its size by moving its upper boundary southward. This size reduction removed approximately 11 miles of public lands between the lower line of the Bohemia Plantation and the Cuselich Canal from the GPLD’s original territorial boundaries. See Richardson & Bass v. Bd. of Levee Com’rs of Orleans Levee Dist., 231 La. 299, 307-08, 91 So.2d 353, 356-57 (1955), dismissed sub nom. Pottharst v. Richardson & Bass, 352 U.S. 948, 77 S.Ct. 325, 1 L.Ed.2d 241 (1956). The right, title, ownership, and possession of the OLD to all public lands in the area of the Bohemia Spillway in Plaquemines Parish were confirmed, quieted, and acknowledged by 1942 La. Acts, No. 311, § 1 (Act 311), which was referred to by the court in Richardson & Bass, 91 So.2d at 358 n. 5, as being a legislative conveyance, vesting title in the OLD without necessity of a formal act of conveyance.

In 1983, LSA-Const. art. VII, § 14(B) was amended to authorize the return of property, including mineral rights, to a former owner from whom the property had previously been expropriated, or purchased under threat of expropriation, when the legislature by law declares that the public and necessary purpose that originally supported the expropriation had ceased to exist and orders the return of the property to the former owner under such terms and conditions as specified by the legislature. See LSA-Const. art. VII, § 14(B)(4). This amendment provided an exception to the prohibition regarding the donation of public property. Pursuant to this constitutional amendment, the legislature enacted 1984 La. Acts, No. 233 (Act 233), which declared that the public and necessary purpose that may have originally supported the ^expropriation of certain property in Plaquemines Parish for the construction of the Bohemia Spillway had ceased to exist, and ordered the OLD to return the ownership of the property to the owners or their successors from whom the property was acquired by expropriation or by purchase under threat of expropriation. Section 2 of Act 233 vested rule-making and procedure-making authority in the DNR to establish procedures and guidelines for the return of such property by the OLD and ordered it to evaluate applications submitted by former owners or putative heirs. See Bd. of Com’rs of Orleans Levee Dist. v. Dept. of Natural Resources, 496 So.2d at 286; see also Frank, 900 So.2d at 1065. The secretary of the DNR was made responsible for certifying owners or successors to owners from whom such property was so acquired. See 1985 La. Acts, No. 819, § 4 (amending section 4 of Act 233 of 1984). The legislation authorized the attorney general to file all pleadings necessary to claim lands on behalf of the state that had been ceded to the OLD. See 1997 La. Acts, No. 1364, §§ 2 and 3, which further amended and reenacted section 1 of Act 233 of 1984.

Discussion

Article VII, § 14(A) of the Louisiana Constitution provides that “the funds, credit, property, or things of value of the state or any political subdivision shall not be loaned, pledged, or donated to or for any person, association, or corporation, public or private.” The purpose of this constitutional provision is to protect the electorate from the possibility that a politically powerful individual or interest group could importune the legislature or other governmental entity into making a donation of assets of the state. In re Members of Class of Descendants of Former Owners of Cheniere Ronquillo, 01-1548 (La. App. 4th Cir.4/24/02), 817 So.2d 324, 327, writs denied, 02-1448 and 02 — 1454fi (La.9/20/02), 825 So.2d 1170 and 1171. However, the prohibition against the donation of property of the state or of any political subdivision to any person, association, or corporation is subject to certain enumerated exceptions. One of those enumerated exceptions is provided in LSA-Const. art. VII, § 14(B), as follows:

Nothing in this Section shall prevent ... (4) the return of property, including mineral rights, to a former owner from whom the property had previously been expropriated, or purchased under threat of expropriation, when the legislature by law declares that the public and necessary purpose which originally supported the expropriation has ceased to exist and orders the return of the property to the former owner under such terms and conditions as specified by the legislature ....

Under the clear wording of this constitutional provision, the state is authorized to return its property to a former owner if certain requirements have been met. First, the legislature by law must declare that the public and necessary purpose which originally supported the expropriation has ceased to exist and order the return of the property. Second, the property, including mineral rights, must have previously been expropriated or purchased under threat of expropriation.

Pursuant to the authority of LSA-Const. art. VII, § 14(B), section 1 of Act 233 states:

[T]he Legislature of Louisiana hereby declares that the public and necessary purpose set forth in Act No. 99 of 1924, which may have originally supported the expropriation of property, or any right of ownership thereto, on the east bank of the Mississippi River in the parish of Plaquemines for the construction of a spillway, known as the Bohemia Spillway, has ceased to exist insofar as it ever may have affected the ownership of property, including mineral rights. The Legislature of Louisiana hereby orders the Board of Levee Commissioners of the Orleans Levee District, the board, to return the ownership of said property to the owners or their successors from whom the property was acquired by expropriation or by purchase under threat of expropriation.... [Emphasis added.]

Therefore, pursuant to the provisions of LSA-Const. art. VII, § 14(B)(4), as well as the provisions of Act 233 as amended, the GPLD has no claim for return of the land unless it was acquired through expropriation or by purchase under threat of expropriation. See In re Members of Class of Descendants of Former Owners of Cheniere Ronquillo, 817 So.2d at 327.

|7The public property in question had initially been transferred from Plaque-mines Parish to the GPLD pursuant to legislative acts. Act 99 of 1924 gave the OLD the power to acquire the Bohemia Spillway property by purchase, donation, or expropriation. Approximately 51 percent of the acreage acquired by the OLD was acquired by expropriation or by purchase under threat of expropriation. See Bd. of Com’rs of Orleans Levee Dist. v. Dept. of Natural Resources, 496 So.2d at 285. The remaining 49 percent was acquired by transfer of public lands from the state pursuant to Act 246 of 1928 and Act 311 of 1942, whereby the legislature conveyed all of the state or public land in the spillway to the OLD from the GPLD. See Id.

Because the land was acquired by the OLD from the GPLD through the actions of state officials pursuant to acts of the legislature, the OLD’s acquisition of this land was not affected by means traditionally associated with expropriation. See In re Members of Class of Descendants of Former Owners of Cheniere Ronquillo, 817 So.2d at 327-29; cf. Angelo v. Ales, 94-0320 (La.App. 1st Cir.12/22/94), 649 So.2d 1042, 1044, writ denied, 95-0176 (La.3/17/95), 651 So.2d 274; Bd. of Com’rs of Orleans Levee Dist. v. Gomez, 621 So.2d 826, 833-34 (La.App. 1st Cir.1992), amended on reh’g, 621 So.2d 837 (La.App. 1st Cir.), writ denied, 623 So.2d 1282 (La.1993). Consequently, the exception enumerated in LSA-Const. art. VII, § 14(B)(4) does not apply, and the GPLD has no cause of action for the return of the subject property.

Decree

For the foregoing reasons, the judgment of the district court is affirmed. Costs of this appeal are assessed to Plaquemines Parish Government.

AFFIRMED.

      . The Board of Commissioners of the Southeast Louisiana Flood Protection Authority-East and OLD intervened to join the DNR in opposing the GPLD's petition.

      . See also section 5 of Act 99.

      . Both the OLD and the GPLD are creatures or agencies of the state, and, as to such agencies, it is the inherent right of the state to abrogate, rescind, and nullify any grant of title to land made by it to one of the districts and to vest complete title thereto in the other. Richardson & Bass, 91 So.2d at 372 (on second reh’g).

      .Pursuant to 1983 La. Acts, No. 729, § 2, a proposal to amend paragraph (B) was submitted to the electors of the state of Louisiana and ratified by them on October 22, 1983. The amendment was effective on November 23, 1983.

      . The constitutionality of Act 233 was upheld in Bd. of Com’rs of the Orleans Levee Dist. v. Dept. of Natural Resources, 496 So.2d at 287-99.

      . Section 2 of Act 1364 of 1997 included the following provision:
      The [OLD] shall return to the owners and/or the successors of the owners of such property an amount equal to all revenues produced since June 29, 1984 until paid from property which was acquired by the board by expropriation or by purchase under threat of expropriation....

      . The references to expropriation or by purchase under threat thereof in Act 233 of 1984, Act 1364 of 1997, and LSA-Const. art. VII, § 14(B)(4) demonstrate the awareness of the legislature of the constitutional limitations on the legislature's ability to return property to private owners. See In re Members of Class of

        Descendants of Fortner Owners of Cheniere Ronquillo, 817 So.2d at 327-28.