Kingfisher County Assessor Carolyn Mulherin and DCP Operating Co. reached a negotiated settlement this month setting a fair cash value for property tax purposes after five years of litigation.

The agreed valuation for the company’s property located in the county totals $490.25 million for tax years 2015-19, which is 21% less than the county’s total original valuation of nearly $621 million.

However, it is more than double the company’s claimed total valuation of $230,721,146.

Each year, Total Assessment Solutions Corp., a private company contracted by the county, determines the fair cash value of property owned by every energy company within the county.

Those valuations are the figures upon which each company’s ad valorem tax bill is based.

By state law, DCP has paid the total tax based on the county’s figures to the county treasurer’s office each year, but the amount the company was protesting has been retained in an escrow account.

Over the five-year period, those retained funds now amount to a total of $3,020,480.89, County Treasurer Robin Rother said.

While the exact amount to be refunded to DCP has not been determined, the 21% reduction in valuation suggests approximately $634,000 might be returned to the company.

The remainder will be distributed among the entities funded by county ad valorem taxes.

School districts in which real and personal property is located receive the lion’s share of the ad valorem tax, 83.2%, with the county general fund receiving 13.8%, the county health department 2.8% and the local emergency medical (ambulance) district 0.2%.

The exact dollar amounts of those apportionments and the company’s refund are in the process of being determined.

DCP Operating Co., formerly DCP Midstream, appeared before the Kingfisher County Excise Board each of the last five years protesting its assessments.

The company filed district court appeals when those protests were denied and the disputes were finally resolved through mediation conducted Sept. 18 in Edmond.

Mulherin represented the county during the mediation with the assistance of Jerry Wisdom of Total Assessment Solutions Corp., District Attorney Mike Fields’ office and the Oklahoma City law firm of Tisdale & O’Hara.

DCP was represented by the Oklahoma City law firm of Elias, Books, Brown & Nelson.

The mediated property valuations agreed to by both DCP and the county are a compromise between the original assessed values and the valuations sought by DCP in its lawsuits.

The company’s appeals for tax years 2015-18 were consolidated and resolved in a single journal entry, while the most recent protest for 2019 was decided separately.

The accompanying chart shows the original valuations for each year assessed by the county, the company’s requested valuations and the valuations eventually agreed to and approved in district court.

Resolution of the DCP tax appeals still leaves about $3.1 million in ad valorem taxes in escrow, subject to unresolved protests by Kingfisher Wind, located in southern Kingfisher County, and Red Dirt Wind in the north part of the county.

Property valuations for ad valorem tax purposes are currently determined on a county-by-county basis, which sometimes creates inconsistent results for energy infrastructures which cross county lines, such as oil and gas pipelines or wind farms.

An interim legislative study involving input from all stakeholders has been examining the possibility of legislation that would establish standardized energy property valuation methods across the state.