CBCA 7359

MOTIONS FOR SUMMARY JUDGMENT GRANTED: November 10, 2022 CBCA 7359, 7360, 7361, 7362, 7363, 7364 CESC MALL, LLC, Appellant in CBCA 7359, and BNA WASHINGTON INC., Appellant in CBCA 7360, and CESC CRYSTAL/ROSSLY II, L.L.C., Appellant in CBCA 7361, and CESC SQUARE LLC, Appellant in CBCA 7362, and FOURTH CRYSTAL PARK ASSOCIATES LP, Appellant in CBCA 7363, and CBCA 7359, 7360, 7361, 7362, 7363, 7364 2 CESC GATEWAY SQUARE L.L.C., Appellant in CBCA 7364, v. GENERAL SERVICES ADMINISTRATION, Respondent. Stuart W. Turner and Amanda J. Sherwood of Arnold & Porter Kaye Scholer LLP, Washington, DC, counsel for Appellant. James F. H. Scott and Jessica Gunzel, Office of General Counsel, General Services Administration, Washington, DC, counsel for Respondent. Before Board Judges BEARDSLEY (Chair), VERGILIO, and DRUMMOND. BEARDSLEY, Board Judge. These consolidated appeals involve a dispute over reimbursement of taxes under six leases in Arlington County, Virginia, between appellants and respondent, the General Services Administration (GSA). Appellants appealed GSA’s denial of claims for reimbursement of the Transportation Tax and the Sanitary District Tax pursuant to the Tax Adjustment clauses in the leases. The Board finds that both taxes fall under the leases’ definition of real estate taxes, for which GSA is financially responsible. We therefore grant the appeals. Findings A. The Leases GSA holds six leases with appellants to rent properties located in Arlington County, Virginia. Amended Joint Statement of Stipulated Facts (Joint Stipulation) at 1. The leases state that GSA is responsible for real estate taxes for the property it occupies. Id. Each lease provides one of three similar definitions for real estate taxes in its Tax Adjustment clause. Leases GS-11B-01873 (CBCA 7359) and GS-11B-02085 (CBCA 7363) include the following definition: CBCA 7359, 7360, 7361, 7362, 7363, 7364 3 Real Estate taxes, as referred to in this paragraph, are only those taxes which are assessed against the building and/or the land upon which the building is located, without regard to benefit to the property, for the purpose of funding general Government services. Real Estate taxes shall not include, without limitation, general and/or special assessments, business improvement district assessments, or any other present or future taxes or governmental charges that are imposed upon the Lessor or assessed against the building and/or the land upon which the building is located. Exhibit 2, Solicitation for Offers at 17, para. 3.4A; Exhibit 3, Solicitation for Offers at 16, para. 3.5A.1 Lease GS-11B-80614 (CBCA 7364) includes the following substantially similar definition: For purposes of this clause, “real estate taxes” means those taxes that are assessed on an ad valorem basis against the Building and/or the land upon which the Building is located, without regard to any benefit to the property, for the purpose of funding general government services. Real estate taxes shall not include, without limitation, any other general and/or special assessments, service or user charges, licenses, fees, taxes on related personal property, taxes on excess land, or any other present or future taxes or governmental charges that are imposed upon Lessor or assessed against the Building and/or the land upon which the Building is located. Exhibit 1, Solicitation for Offers at 11, para. 2.4(c). Leases GS-11B-02289 (CBCA 7360), GS-11P-12679 (CBCA 7361), and GS-11B-12534 (CBCA 7362) include the following definition: Real Estate Taxes are those taxes that are levied upon the owners of real property by a Taxing Authority (as hereinafter defined) of a state or local Government on an ad valorem basis to raise general revenue for funding the provision of government services. The term excludes, without limitation, special assessments . . . for specific purposes . . .