United States v. Lewis County

A federal statute, 7 U.S.C. § 1984 , partially waives the immunity of the federal government from state taxation by authorizing state and local governments to tax farm property owned by the federal Farm Service Agency (“FSA”) “in the same manner and to the same extent as other property is taxed.” Id. Lewis County, Washington, imposed taxes, interest and penalties upon twenty parcels of farm property acquired by the FSA, and foreclosed on one of the parcels. The United States filed this action in district court, challenging these actions of the County. The United States contends that, because the County does not tax a comparable *674 state agency, its tax is discriminatory and does not meet the requirements of § 1984 that the federal property be taxed “in the same manner and to the same extent as other property.” Id. The United States also argues that, in any event, § 1984 does not authorize the County to collect interest and penalties, or to foreclose in the event of delinquency. The United States also disputed the County’s application of a higher nonagrieultural tax rate to three of the parcels. The United States now appeals from the district court’s judgment for the County on…