Aimee Williams Hebert
& Sara Mouledoux
Louisiana does not tax oil & gas in place
 Parish-level property tax on movables,
based on a uniform percentage of
assessed fair market value
(La. R.S. § 47:1701-2332)
 Fair market value is “the price for
property which would be agreed upon
between a willing and informed buyer
and a willing and informed seller under
usual and ordinary circumstances.”
(La. R.S. § 47:2321)

Statutory Guidelines
for Oil & Gas Properties
Louisiana Administrative Code
Title 61, Part V, Chapter 9




Self-report taxable property on LAT12
form
(April 1)
Official assessment based on LAT12
data
Notice to taxpayer on day 1 of 15-day
mandatory
inspection period (between August 15
and September 15)
Possible meeting with assessor to
discuss assessment




Challenge at Board of Review (7 days
prior
to hearing, held after inspection period
above)
Possible appeal to La. Tax Commission
(10 days)
Possible appeal to La. District Court (30
days)
Assessor files for collection by sheriff
(November 15)
Louisiana allowed the oil & gas industry to
self report taxable property beginning in
the 1990s, following recommendations
from LOGA.
 The state also shifted from a well-by-well
valuation scheme to a total field valuation
scheme.
 A decade later, enter VLS…

 Owned
vs. rented equipment
 Component
 Economic
 Public
parts of field equipment
obsoleteness
services (i.e. interstate pipelines)
 Reliance
on state records
2009 taxes: Reassessments according to
Louisiana statutory procedure, based on
both under-reported and unreported
property
2006-2008 taxes:
One-page settlement
agreements largely based on unreported
property only, but limited to those tax
years
--“Premium” penalty
Bonvillain v. Louisiana Land & Exploration
Company: leading case filed May 14, 2009
 Named defendants:

 LL&E
 Employees
who signed the LAT12
Subsequent suits also name corporate
officers
 31 suits filed against oil & gas companies
and executives as of Oct 12, 2009


Three counts common to all 31 suits:
 Seeking
to recover unreported and/or underreported parish ad valorem taxes since 1994
 RICO violations seeking treble damages
 Fraud seeking damages “in the nature of”
taxes
•
•
•
•
Criminal and Civil lawsuits…
A "person damaged in his business or property"
can sue one or more "racketeers" for treble
damages resulting from a “pattern of racketeering
activity.”
A “racketeer” is a person who is a member of a
“criminal enterprise” engaged in “a pattern of
racketeering activity.”
A “pattern of racketeering activity” is defined as
the commission of two or more acts of certain
state or federal offenses, within a period of ten
years.
•
•
•
•
•
•
•
•
Any violation of state statutes against gambling, murder,
kidnapping, extortion, arson, robbery, bribery, dealing in
obscene matter, or dealing in a controlled substance or
listed chemical (as defined in the Controlled Substances
Act);
Any act of bribery, counterfeiting, theft, embezzlement,
fraud, dealing in obscene matter, obstruction of justice,
slavery, racketeering, gambling, money laundering,
commission of murder-for-hire, wire fraud, and several
other offenses covered under the Federal criminal code
(Title 18);
Embezzlement of union funds;
Bankruptcy fraud or securities fraud;
Drug trafficking;
Money laundering and related offenses;
Bringing in, aiding or assisting aliens in illegally entering
the country (if the action was for financial gain);
Acts of terrorism.




Employees were the “racketeers.”
LL&E was the “criminal enterprise.”
Using LL&E to mail false LAT12 tax forms
to the assessor over several years was the
RICO-predicate criminal act under U.S.
wire-fraud laws.
Bonvillain seeks all taxes, treble damages
under RICO, and damages under a fraud
theory.
"I think four or five more assessors are going
to file shortly.”

Gene Bonvillain, Terrebonne Parish Tax Assessor