In Allegheny Pittsburgh Coal Company v. County Comm’n of Webster County, WV, the U.S. Supreme Court held that the defendant's method of assessing real property violated the Equal Protection Clause of the United States Constitution.
Between 1975 and 1986, the Tax Assessor of Webster County, West Virginia fixed yearly assessments for property at 50% of the appraised value. As a result, a higher tax was placed on properties more recently conveyed at higher market prices than comparable properties purchased in earlier years. Some minor adjustments were made in the assessments of the properties that had not been recently sold, but they were "too small to seasonably dissipate the remaining disparity between these assessments and the assessments based on a recent purchase price."
The U.S. Supreme Court pointed noted that, on its face, the assessment scheme was not constitutionally flawed. In fact, short-term or "transitional" inequality is permissible. In this case, however, the property had been assessed at roughly eight to 35 times more than comparable neighboring property, and these discrepancies continued for more than ten years. It was this "gross disparity" that led the Court to reject Webster County's contention that its assessment scheme was rationally related to its purpose of assessing properties at true current value.
The U.S. Supreme Court was careful to note that the assessment scheme employed by the county assessor was not sanctioned by West Virginia law. While states have broad powers to impose and collect taxes, the Court stated "we are not advised of any West Virginia statute or practice which authorizes individual counties of the state to fashion their own substantive assessment policies independently of state statute." Moreover, the assessment scheme ran afoul of the guide published by the West Virginia Tax Commission. It was this "intentional systematic undervaluation" by a state official which denied the property owner equal protection of the law.
Allegheny Pittsburgh Coal Company v. County Comm’n of Webster County, WV, 488 U.S. 336, 109 S. Ct. 633 (1989).