Noaa Maryland, LLC v. Gsa ( 2021 )

Case: 20-1548 Document: 43 Page: 1 Filed: 05/13/2021
United States Court of Appeals
for the Federal Circuit
______________________
NOAA MARYLAND, LLC,
Appellant
v.
ADMINISTRATOR OF THE GENERAL SERVICES
ADMINISTRATION,
Appellee
______________________
2020-1548
______________________
Appeal from the Civilian Board of Contract Appeals in
Nos. 5269, 5659, Administrative Judge Catherine B. Hyatt,
Administrative Judge Harold C. Kullberg, Administrative
Judge Beverly M. Russell.
______________________
Decided: May 13, 2021
______________________
DIANA PARKS CURRAN, Curran Legal Services Group,
Inc., Marietta, GA, argued for appellant. Also represented
by HADEEL MASSEOUD, Atlanta, GA.
JOHN MCADAMS, Commercial Litigation Branch, Civil
Division, United States Department of Justice, Washing-
ton, DC, argued for appellee. Also represented by JEFFREY
B. CLARK, MARTIN F. HOCKEY, JR., ROBERT EDWARD
KIRSCHMAN, JR.
Case: 20-1548 Document: 43 Page: 2 Filed: 05/13/2021
2 NOAA MARYLAND, LLC v. GSA
______________________
Before MOORE, TARANTO, and CHEN, Circuit Judges.
TARANTO, Circuit Judge.
The Civilian Board of Contract Appeals held that two
taxes imposed on the lessor of a building (NOAA Maryland,
LLC) do not come within a lease provision that requires the
General Services Administration (GSA), as lessee, to reim-
burse NOAA Maryland for “real estate taxes” NOAA Mar-
yland must pay above a lease-set base amount. The Board
interpreted the provision to exclude all “future” taxes, i.e.,
taxes enacted after the date of the lease or its extension,
even if those taxes meet the three expressly stated criteria
for being a real estate tax. We reject the Board’s interpre-
tation, and because GSA has not preserved any argument
that the two taxes at issue fail to meet those criteria, we
reverse.
I
A
1
On September 2, 2005, GSA entered into a Lease for
Real Property with Maryland Enterprise, LLC (NOAA
Maryland’s predecessor-in-interest) to lease a building in
Prince George’s County, Maryland from Maryland Enter-
prise for a term of 13 years. J.A. 22–25 (Lease). Under the
Lease, GSA pays a specified annual rent, with payments
made in monthly installments. J.A. 22. The rent includes
an agreed-on amount for “[b]ase year taxes,” i.e., “an
amount negotiated by the parties that reflects an agreed
upon base for a fully assessed value of the property.” J.A.
45 (§ 3.3(B)); see J.A. 117 (making clear that when a new
tax base was negotiated, the annual rent, paid in monthly
installments, rose by that amount). The Lease states that
the original negotiated tax base was $711,900.00. J.A. 23
(§ 6(F)); see also J.A. 117.
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NOAA MARYLAND, LLC v. GSA 3
The Lease provides, as relevant here, that in addition
to the annual rent, GSA must compensate the lessor,
through a “single annual lump sum payment,” for “any in-
crease in real estate taxes during the lease term over the
amount established as the base year taxes.” J.A. 45
(§ 3.3(E)). The Lease defines “real estate taxes”:
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 build-
ing is located, without regard to benefit to the prop-
erty, for the purpose of funding general
Government services. Real estate taxes shall not
include, without limitation, general and/or special
assessments, business improvement district as-
sessments, 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.
J.A. 45 (§ 3.3(A)). The Lease declares that GSA “shall pay
its share of tax increases or shall receive its share of any
tax decrease based on the ratio of the rentable square feet
occupied by the Government to the total rentable square
feet in the building or complex (percentage of occupancy).”
J.A. 45 (§ 3.3(F)). For the “purpose of calculating future
Tax Adjustments,” the Lease identifies GSA as occupying
100% of the rentable area, which it says is 268,782 square
feet. J.A. 23 (§ 6(F)).
In December, 2011, the original lessor assigned the
Lease to NOAA Maryland, and on April 6, 2012, GSA and
NOAA Maryland executed a Supplemental Lease Agree-
ment. The agreement extended the term to April 5, 2025,
slightly altered the annual rent, but, as relevant here, left
“[a]ll other terms and conditions of the Lease . . . in force
and in effect.” J.A. 116. On January 15, 2014, the parties
executed another supplemental agreement, effective April
6, 2013—Supplemental Lease Agreement No. 10 (SLA No.
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4 NOAA MARYLAND, LLC v. GSA
10), which set a new (“revised”) tax base of $1,387,574.20,
an increase of $675,674.20 from “the original tax base of
$711,900.00.” J.A. 117. The increase in the tax base, plus
an increase in an “Operating Cost Base,” increased the an-
nual rent. J.A. 117. “All other terms and conditions of the
Lease,” SLA No. 10 says, “shall remain in full force and ef-
fect.” J.A. 117. The above-quoted provision on “real estate
taxes” therefore still governs.
2
In 2016, NOAA Maryland asked GSA to reimburse it,
under the Lease provision for reimbursing real estate taxes
over the base amount, for four taxes it paid. The four are:
(1) the Stormwater/Chesapeake Bay Water Quality tax
(stormwater tax); (2) the Washington Suburban Transit
Commission tax (transportation tax); (3) the Clean Water
Act Fee (clean water tax); and (4) a Supplemental Educa-
tion Tax (education tax). See J.A. 118–30, 162–67. All four
appear as line items in the list of “taxes and fees” on the
“consolidated tax bill for tax year” July 1, 2016, to June 30,
2017. J.A. 120; see also J.A. 119 (printout from county of
“real property tax information” for fiscal year 2017). Of
those four taxes, two—the clean water tax and education
tax—remain in dispute on this appeal.
The clean water tax took effect in 2013. See J.A. 165.
It is collected annually “from owners of property located
within [Prince George’s] County,” Prince George’s County
Code § 10-302(a)(1), although property owners in the City
of Bowie are exempt because the city has its own “approved
stormwater management design,” id. § 32-174(4). All pro-
ceeds from the tax are deposited into the Local Watershed
Protection and Restoration Fund, see id. § 10-302(b), which
is a fund used for multiple purposes related to stormwater
management and wetland restoration, including capital
improvements, public education and outreach, and opera-
tion and management of stormwater systems, id. § 10-
303(a). The clean water tax is “collected in the same
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NOAA MARYLAND, LLC v. GSA 5
manner as County real property taxes and [has] the same
priority, rights, and bear[s] the same interest and penal-
ties, and [is] enforced in the same manner as County real
property taxes.” Id. § 10-302(a)(6).
The education tax took effect in 2015. See J.A. 127,
165. It effected a “$0.15 increase in the county real prop-
erty tax rate, from $0.96 to $1.11 per $100 of assessed
value,” with the increased revenue to be used for “the
Prince George’s County Public School System.” S.B. 939,
2015 Leg., Reg. Sess. (Md. 2015).
B
1
On January 25, 2016, NOAA Maryland submitted to
GSA a claim for reimbursement for the four taxes listed
above, asking for a final decision by a GSA contracting of-
ficer. On April 5, 2016, NOAA Maryland, deeming its claim
denied (for lack of a timely final decision from the contract-
ing officer), filed a notice of appeal to the Civilian Board of
Contract Appeals (Board). On May 3, 2016, the Board di-
rected GSA to issue a final decision on NOAA Maryland’s
claim, and GSA’s contracting officer did so on May 31, 2016.
In her final decision, the contracting officer denied
NOAA Maryland reimbursement for all four taxes, finding
that none of them comes within the definition of “real es-
tate taxes” set forth in the Lease. J.A. 163. She defined
“[r]eal estate taxes” as those taxes that are: (1) “assessed
against the building and/or the land upon which the build-
ing is located”; (2) “without regard to benefit to the prop-
erty”; (3) “for the purpose of funding general Government
services”; and (4) not a “future tax or governmental charge,
special assessment, or [business improvement district] as-
sessment.” J.A. 163. Of central importance to the present
appeal, the last component of the contracting officer’s defi-
nition categorically excludes all “future” taxes from cover-
age by the “real estate taxes” provision of the Lease, even
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6 NOAA MARYLAND, LLC v. GSA
if they meet the three stated criteria in the first sentence
of the provision (the first three items in the contracting of-
ficer’s definition).
With respect to the clean water tax, the contracting of-
ficer found that the amounts collected are “dedicated to
[the] narrow purpose” of “addressing and mitigating the
impact of stormwater runoff and improving water quality”
and that the tax is “assessed at a flat rate” rather than on
an ad valorem basis. J.A. 165. Moreover, the contracting
officer reasoned, because the clean water tax became effec-
tive after the parties had renegotiated the tax base in 2013,
it constitutes a “future” charge that cannot be a real estate
tax under the Lease. J.A. 165. The contracting officer then
found that the education tax likewise does not qualify as a
“real estate tax” because the tax “came into effect well after
the Lease was effective.” J.A. 165–66. She also found that
the tax does not qualify for an additional reason: “[T]he
charges are not deposited into the general county revenue
for funding general services,” but instead “go[] directly to
the county’s school system.” J.A. 166.
On October 27, 2016, NOAA Maryland submitted an
updated claim for tax reimbursement, in the amount of
$353,060.59. J.A. 185. When the prescribed period for a
contracting-officer decision ended without a decision,
NOAA Maryland deemed the new claim to have been de-
nied. NOAA also filed a new notice of appeal to the Board,
which the Board consolidated with NOAA Maryland’s ear-
lier notice of appeal.
2
Before the Board, NOAA Maryland argued that the
Lease requires GSA to reimburse it for amounts paid for all
real estate taxes above the agreed-on base-year amount,
i.e., for all taxes that are “assessed against the building
and/or the land upon which the building is located, without
regard to benefit to the property, [and] for the purpose of
funding general Government services.” CBCA Nos. 5269,
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NOAA MARYLAND, LLC v. GSA 7
5659, Dkt. 67, at 2, 4 (May 31, 2019) (NOAA Post-Hearing
Br.) (internal quotation marks omitted). It contended that
the Lease did not exclude all “future” taxes from GSA’s
real-estate-tax liability. Id. at 7–8. And it argued that all
four taxes meet the definition of “real estate taxes” rather
than being “special assessment[s]”; specifically, all four
taxes fund general government services, are assessed
against properties in Prince George’s County, and are as-
sessed without regard to benefit to specific properties. See
id. at 14, 16.
GSA advanced two bases for its contention that all four
disputed taxes are not real estate taxes under the Lease: it
asserted that all four are both “‘special assessments’ and,
using the date of the Lease as a ‘start point[,]’ . . . ‘future
tax[es].’” CBCA Nos. 5269, 5659, Dkt. 50, at 2 (July 13,
2018) (GSA Pre-Hearing Statement). As to the first basis,
GSA argued that none of the four taxes meet the Lease’s
definition of “real estate taxes” because the proceeds that
the county collects from them “must be applied to specific,
albeit governmental, services,” rather than being deposited
into Prince George’s County’s general fund, “unlike other
taxes/fees/assessments.” CBCA Nos. 5269, 5659, Dkt. 68,
at 1–2 (May 31, 2019) (GSA Post-Hearing Statement). As
to the second basis, GSA argued that the Lease “carves out
any ‘future’ taxes from the tax adjustment clause.” GSA
Pre-Hearing Statement at 10.
The Board issued a decision on October 31, 2019, ruling
partly for and partly against NOAA Maryland. J.A. 1–9;
see also NOAA Maryland, LLC v. Gen. Servs. Admin.,
CBCA 5269, 19-1 BCA ¶ 37458 (Oct. 31, 2019). The Board
first quoted the Lease provision, namely, § 3.3(A), and de-
scribed the four taxes at issue. J.A. 2–4. The Board then
discussed a variety of factors that courts have used to iden-
tify a “real estate tax,” including whether the tax is an ad
valorem real estate tax assessed in the same manner as
other real estate taxes in the jurisdiction, whether the tax
is a fixed amount, whether the tax is to be assessed every
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8 NOAA MARYLAND, LLC v. GSA
year for an “‘indefinite duration,’” whether the tax’s pro-
ceeds benefit the “‘general public’” rather than specific
property owners, and whether the tax is “‘used to augment
the level of traditional governmental services.’” J.A. 5
(quoting City Crescent Ltd. P’ship v. United States, 71 Fed.
Cl. 797, 804 (2006)). 1
The Board went on to address the parties’ arguments,
dividing its discussion into two sections, one addressing the
transportation and stormwater taxes, the other addressing
the clean water and education taxes. In the first of those
sections, the Board rejected GSA’s argument, which GSA
had made as to all four taxes, that § 3.3(A) “limits real es-
tate taxes to those going into the county’s general fund.”
J.A. 6. The Lease, the Board found, “does not contain this
limitation but instead states that real estate taxes are
those used for ‘general Government services.’” J.A. 6. The
Board then discussed the distinction between “real estate
taxes” and “special assessments”—terms that appear, re-
spectively, in the first and second sentences of the Lease
provision at issue—and quoted the Supreme Court’s expla-
nation in Illinois Central Railroad Co. v. City of Decatur,
147 U.S. 190 (1893), that general taxes provide “‘no return
of special benefit’” to any specific property but, rather, “‘se-
cure[] to the citizen that general benefit which results from
protection to his person and property,’” whereas special as-
sessments “‘proceed upon the theory that, when a local im-
provement enhances the value of neighboring property,
that property should pay for the improvement.’” J.A. 6
(quoting Illinois Central, 147 U.S. at 197–98).
The Board applied the distinction and found the trans-
portation and stormwater taxes to be “real estate taxes”
1 In City Crescent, unlike in the present case, the
lease left “real estate taxes” undefined, necessitating an in-
quiry into whether a charge constituted a real estate tax or
a special assessment. See City Crescent, 71 Fed. Cl. at 799.
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NOAA MARYLAND, LLC v. GSA 9
under the Lease provision. It noted that GSA “d[id] not
dispute that public transportation and stormwater man-
agement are within the scope of general government ser-
vices provided by the county,” once GSA’s argument about
deposit in a general fund was put aside. J.A. 6. Both taxes,
the Board found, are designated “property” taxes, are “as-
sessed every year, and imposed for an indefinite duration,”
are imposed on an ad valorem basis, and are included on
Prince George’s County real estate tax bill. J.A. 5–6. The
Board added that the stormwater and transportation taxes
“predate the [L]ease” and thus neither tax constitutes a
“‘future tax[,]’ which is excluded from those taxes for which
GSA is obligated to pay.” J.A. 6. For those reasons, the
Board ruled that GSA must include the stormwater and
transportation taxes in the calculation of the amounts (to
be paid by GSA) by which “real estate taxes” increased over
the base year amount. J.A. 7; see also J.A. 45 (§ 3.3(E)).
The Board then ruled against NOAA Maryland on the
clean water and education taxes, solely on the ground that
they were “future” taxes. It explained:
The Board finds that the clean water tax, imposed
in 2013, and the education tax, imposed in 2015,
fall within the category of a ‘future tax’ under the
[L]ease. While ‘future tax’ is not defined within the
[L]ease, this Board finds that the plain language of
the [L]ease supports the understanding that it
means a tax not contemplated at the time the par-
ties entered into the lease.
J.A. 7. The Board rested its conclusion on only that ground,
having already rejected GSA’s sole other argument for why
these (and the other two) taxes fail to meet the Lease pro-
vision’s criteria for being a real estate tax. The Board con-
strued the second sentence of the provision—real estate
taxes shall not include, without limitation, “‘general and/or
special assessments, business improvement district assess-
ments, or any other present or future taxes or
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10 NOAA MARYLAND, LLC v. GSA
governmental charges’ . . . assessed against the property or
the land it sits on”—to mean that “at the time that the
[L]ease was effectuated, no other taxes currently existing
or assessed, other than real estate taxes, would be paid by
GSA under the [L]ease; nor would any future taxes created
and imposed after effectuation of the lease.” J.A. 8. Be-
cause the clean water and education taxes were imposed
after the Lease was effective and after the tax base was
adjusted, the Board ruled, they were “future taxes” and
GSA did not have to reimburse NOAA Maryland for them.
J.A. 8.
NOAA Maryland timely appealed. We have jurisdic-
tion under 28 U.S.C. § 1295(a)(10).
II
The Board’s decision “on a question of law is not final
or conclusive.” 41 U.S.C. § 7107(b)(1). Contract interpre-
tation is one such question of law, and while we carefully
consider the Board’s decision, we review de novo the ruling
on contract interpretation where, as here, there are no fac-
tual disputes that affect the interpretation. DG21, LLC v.
Mabus, 819 F.3d 1358, 1361 (Fed. Cir. 2016); Rockies Ex-
press Pipeline LLC v. Salazar, 730 F.3d 1330, 1335–36
(Fed. Cir. 2013).
The question presented on appeal is whether the sec-
ond sentence of § 3.3(A) of the Lease excludes a tax from
being a “real estate tax,” even if the tax meets the three
criteria stated in the first sentence, whenever the tax is a
“future” tax, i.e., was first imposed after the parties entered
into the Lease (or its extension). The Board held that the
second sentence has just that effect of derogating from the
coverage that is defined by the first sentence. We reject
that interpretation, concluding that the second sentence is
properly understood as consistent with the first sentence
and not excluding all “future” taxes. The Lease, in short,
requires GSA to reimburse NOAA Maryland for all taxes
(in excess of the agreed-on base amount) that meet the
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NOAA MARYLAND, LLC v. GSA 11
three-part definition of a real estate tax, whenever im-
posed.
GSA presents no argument that even if the Lease re-
quires it to pay future real estate taxes, the clean water
and education taxes are not real estate taxes under the
three-part definition in § 3.3(A). Accordingly, there is no
issue for us to remand to the Board.
A
“Contract interpretation begins with the language of
the written agreement.” NVT Techs., Inc. v. United States,
370 F.3d 1153, 1159 (Fed. Cir. 2004). “‘In contract inter-
pretation, the plain and unambiguous meaning of a written
agreement controls.’” Hercules Inc. v. United States, 292
F.3d 1378, 1380–81 (Fed. Cir. 2002) (quoting Craft Mach.
Works, Inc. v. United States, 926 F.2d 1110, 1113 (Fed. Cir.
1991)). We must interpret a contract “‘in a manner that
gives meaning to all of its provisions and makes sense,’”
Langkamp v. United States, 943 F.3d 1346, 1353 (Fed. Cir.
2019) (quoting McAbee Constr., Inc. v. United States, 97
F.3d 1431, 1435 (Fed. Cir. 1996)), and we seek to “‘avoid[]
conflict or surplusage of [the contract’s] provisions,’”
United Int’l Investigative Servs. v. United States, 109 F.3d
734, 737 (Fed. Cir. 1997) (quoting Granite Constr. Co. v.
United States, 962 F.2d 998, 1003 (Fed. Cir. 1992)). See
also NVT Techs., 370 F.3d at 1159 (explaining that inter-
pretations should “harmonize and give reasonable mean-
ing” to all parts of the contract, rather than “leave[] a
portion of the contract useless, inexplicable, void, or super-
fluous”). Contract provisions should not “be construed as
being in conflict with [one] another unless no other reason-
able interpretation is possible.” Hol-Gar Mfg. Corp. v.
United States, 351 F.2d 972, 979 (Ct. Cl. 1965).
Here, the first sentence in § 3.3(A) of the Lease gives
an express definition of “real estate taxes.” It states: “Real
estate taxes, as referred to this paragraph, are only those
taxes, which are [1] assessed against the building and/or
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12 NOAA MARYLAND, LLC v. GSA
land upon which the building is located, [2] without regard
to benefit to the property, [3] for the purpose of funding
general Government services.” J.A. 45 (§ 3.3(A)). Notably,
that sentence contains no temporal limitation. It does not
restrict “real estate taxes” to present taxes that satisfy the
three conditions or identify existing real estate taxes by ci-
tation; it sets forth a definition that covers any tax that
meets all three generically stated criteria, without regard
to when the tax comes into existence. Nor does it refer to
the second sentence at all, much less signal that its defini-
tion is subject to or limited by that sentence. Cf. Antonin
Scalia & Bryan A. Garner, Reading Law: The Interpreta-
tion of Legal Texts § 13, at 126 (2012) (discussing subordi-
nating language like “subject to”).
The second sentence in § 3.3(A) of the Lease says: “Real
estate taxes shall not include, without limitation, [a] gen-
eral and/or special assessments, [b] business improvement
district assessments, or [c] 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.” J.A. 45 (§ 3.3(A)). Sig-
nificantly, the second sentence contains no “notwithstand-
ing the foregoing,” “provided, however, that,” or similar
language indicating that it is making an exception to, op-
erating in even partial derogation of, or narrowing the cov-
erage expressly specified in the immediately preceding
sentence. Cf. Merit Mgmt. Grp., LP v. FTI Consulting, Inc.,
138 S. Ct. 883, 893 (2018) (“The very first clause [of 11
U.S.C. § 546(e)]—‘Notwithstanding sections 544, 545, 547,
548(a)(1)(B), and 548(b) of this title’—. . . indicates that
§ 546(e) operates as an exception to the avoiding powers
afforded to the trustee under the substantive avoidance
provisions.”); see also Scalia & Garner, Reading Law § 13,
at 126 (discussing superordinating language, stating: “A
dependent phrase that begins with notwithstanding indi-
cates that the main clause that it introduces or follows der-
ogates from the provision to which it refers.”); Smith v.
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NOAA MARYLAND, LLC v. GSA 13
Davis Surgical Ctr., LLC, 472 F. Supp. 2d 1316, 1318 (D.
Utah 2006) (stating that the “natural” meaning of a con-
tract was to treat the words “provided, however, that” as
creating “a cap” on the purchase price, which was set at
“fair market value”); In re Williams, 29 F. Cas. 1320, 1320
(C.C.D. Mass. 1842) (No. 17,701) (Story, J.) (treating “pro-
vided, however, that” as creating an “exception” from an
otherwise-applicable general provision).
GSA reads the second sentence as derogating from, i.e.,
as creating an exception to, the stated coverage of the first
sentence. In GSA’s view, the second sentence excludes any
“future” tax from coverage as a real estate tax even if meets
the first sentence’s definition of “real estate taxes.” But
there is no language in the second sentence indicating such
a withdrawal of just-stated coverage; nor is there language
in the first sentence making it subject to an overriding cov-
erage limit in the second sentence. In the absence of such
language, the principle of construction that disfavors read-
ing provisions as inconsistent with one another counsels
against adopting GSA’s reading. See Hol-Gar, 351 F.2d at
979–80; see also SUFI Network Servs., Inc. v. United
States, 755 F.3d 1305, 1322 (Fed. Cir. 2014) (rejecting the
Board’s interpretation of a contract that caused sections of
the contract to be “in substantial tension” with one an-
other); LAI Servs., Inc. v. Gates, 573 F.3d 1306, 1314–15
(Fed. Cir. 2009) (refusing to find ambiguity in a contract
where “nothing in the plain language” of the contract im-
posed a “limitation” on an otherwise general provision).
The language of the second sentence does not, by its
own words, contradict the full scope of the first sentence.
In fact, the two sentences in the Lease fit together harmo-
niously in a familiar way. The first sentence states a defi-
nition of “real estate taxes.” The second sentence then
reinforces the three-part definition by clarifying, in a way
consistent with the first sentence, what is not sufficient to
meet that definition. This understanding of the two sen-
tences “renders them compatible, not contradictory,” and is
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14 NOAA MARYLAND, LLC v. GSA
favored for that reason. See Scalia & Garner, Reading Law
§ 27, at 180, 182 (“[T]here can be no justification for need-
lessly rendering provisions in conflict if they can be inter-
preted harmoniously. . . . The harmonious-reading canon
is just as applicable to contracts as it is to statutes.”).
Clause [a] refers to “general and/or special assess-
ments.” 2 GSA has not broken out the “general” aspect in
the phrase for discussion; it has not identified a separate
meaning for “general . . . assessment” or suggested how it
withdraws any coverage established by the first sentence.
See GSA Response Br. at 14 (referring in passing to the en-
tire phrase, as a unit, as one of the “specific varieties of
taxes” excluded from coverage, without further elabora-
tion). The “special assessments” portion of clause [a] refers
to impositions that fail to satisfy at least either condition
[2] (“without regard to benefit to the property”) or condition
[3] (“for the purpose of funding general Government ser-
vices”) of the first sentence, as the Board made clear and
the parties accept. See J.A. 6 (discussing Illinois Central);
see also GSA Response Br. at 13 n.4 (similar). As far as the
parties here have indicated, the “business improvement
district assessments” of clause [b] are a species of “special
assessments” and for that reason flunk some of the three
first-sentence requirements. 3 Finally, clause [c]—“any
2 Other cases have involved the same phrase or one
nearly identical. See, e.g., ASP Denver, LLC v. General
Servs. Admin., CBCA 2618, 15-1 BCA ¶ 35850 (Dec. 11,
2014); see also McDonald’s Corp. v. C.B. Mgmt. Co., 13 F.
Supp. 2d 705, 707 (N.D. Ill. 1998); MDJ Aviation, LLC v.
Uniflight, LLC, No. 4:19-cv-00321, 2020 WL 1939614, at *1
(N.D. Tex. Apr. 22, 2020); Alexander v. Holden Bus. Forms,
Inc., No. 4:08-CV-614, 2009 WL 3818149, at *4 (N.D. Tex.
Nov. 16, 2009).
3 See, e.g., Fed. Rsrv. Bank of St. Louis v. Metrocentre
Improvement Dist. #1, City of Little Rock, Ark., 657 F.2d
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NOAA MARYLAND, LLC v. GSA 15
other present or future taxes or governmental charges that
are imposed upon the Lessor or assessed against the build-
ing and/or the land upon which the building is located,”
J.A. 45 (§ 3.3(A)) (emphasis added)—generalizes the point:
A tax or government charge (present or future) is not a
“real estate tax” if it is imposed on the lessor (and hence
flunks the first sentence’s condition [1] (“assessed against
the building and/or the land upon which the building is lo-
cated”) or merely because it is assessed against the prop-
erty (without meeting condition [2] and [3]).
The word “other” in the last clause supports this under-
standing of the second sentence and of its relation to the
first. The word suggests a commonality of theme among
the three clauses of the second sentence—that clause [c] is
a generalization of the specific examples of clauses [a] and
[b]. See Heien v. North Carolina, 574 U.S. 54, 67–68 (2014)
(explaining that “[t]he use of ‘other’” in a North Carolina
statute referring to both “‘a stop lamp’” and “‘other rear
lamps’” “suggests to the everyday reader of English that a
‘stop lamp’ is a type of ‘rear lamp’”). 4 It also suggests that
183, 185–86 (8th Cir. 1981) (considering the nature of an
assessment made by a “business improvement district”);
Bd. of Dirs. of Red River Levee Dist. No. 1 of Lafayette Cnty.,
Ark. v. Reconstruction Fin. Corp., 170 F.2d 430, 432 (8th
Cir. 1948) (classifying a special tax as a “special improve-
ment assessment”).
4 See also, e.g., United States v. United Verde Copper
Co., 196 U.S. 207, 213–14 (1905) (interpreting “‘building,
agricultural, mining, or other domestic purposes’” to mean
that “domestic” refers to activities “consistent with the in-
tentional use of the word ‘other’”—like agriculture and
mining—rather than activities limited to a household (em-
phasis added)); United States v. Palmer, 16 U.S. (3 Wheat.)
610, 617, 627–28 (1818) (defining piracy and interpreting
“other” in the phrase “‘murder or robbery, or any other
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16 NOAA MARYLAND, LLC v. GSA
what is common is that the subject of all three clauses dif-
fers from (is “other” than) what is defined in the first sen-
tence. See Potomac Elec. Power Co. v. Dir., Off. of Workers’
Comp. Programs, U.S. Dep’t of Labor, 449 U.S. 268, 273–
74 (1980) (holding that a statute that included a “compen-
sation schedule” for “20 different specific injuries,” as well
as an “additional subparagraph” that applied to “‘all other
cases’” could not be read to apply the additional subpara-
graph of “other” cases to the enumerated injuries).
GSA reads clause [c] by breaking apart and recon-
structing “any other present or future taxes or governmen-
tal charges” so that “any other” refers only to “present . . .
taxes” but not to “future taxes or government charges,”
which in GSA’s view should be read as standing unmodified
by “any other.” See GSA Response Br. at 14. That under-
standing is at best strained. The ordinary meaning here is
also the simplest meaning: Both “any” and “other” modify
all that comes after, namely, all the items in the broad
phrase “present or future taxes or government charges” (in
which “present or future” itself broadly modifies “taxes or
governmental charges”), a “concise, integrated clause” that
“‘hangs together as a unified whole.’” Facebook, Inc. v.
Duguid, 141 S. Ct. 1163, 1169 (2021) (quoting Cyan, Inc. v.
Beaver Cnty. Emps. Ret. Fund, 138 S. Ct. 1061, 1077
(2018)).
The meaning GSA urges would ordinarily be embodied
in different language, e.g., “any other present taxes or any
future taxes or governmental charges.” But the phrase as
written in the Lease contains no second “any” or similar
determiner after the initial “any other”; nor does it restate
the object of “present” and “future” so as to distinguish
offence, which if committed within the body of a county,
would by the law of the United States, be punishable with
death’” as a word that “connects murder and robbery with
the following member of the sentence”).
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NOAA MARYLAND, LLC v. GSA 17
them, let alone in a way that would restrict the scope of
“other” to stop short of applying to “future taxes or govern-
ment charges.” The natural understanding of the phrase,
as written, treats “present and future taxes or government
charges” as a unit, with, in particular, no distinction be-
tween “present” and “future” as to the critical modifiers.
And that treatment fits the absence of any temporal limi-
tation in the first sentence, whose three-part definition of
“real estate taxes” makes no distinction, among laws that
meet the three criteria, based on date of enactment. The
wording chosen would be a surprising way of making the
distinction GSA urges.
Once GSA’s argument for breaking up “present or fu-
ture” is rejected, its overall construction must be rejected.
If the phrase “present or future” were deleted from clause
[c], the second sentence would make clear that “real estate
taxes” do not include “any other . . . taxes or governmental
charges that are imposed upon the Lessor or assessed
against the building and/or the land upon which the build-
ing is located.” That language, as GSA appeared to agree
at oral argument, would clearly be using “other” to distin-
guish the larger class of taxes and governmental charges
imposed on a lessor or the property from the particular sub-
class defined in the first sentence. Oral Arg. at 17:34–
18:01. The addition of “present or future” merely confirms
that the distinction is unaltered by the timing of the tax or
government charge. It does not change the distinction,
which itself is not temporally based.
For all of those reasons, we conclude that GSA’s inter-
pretation, adopted by the Board, is not the ordinary mean-
ing of the second sentence. That conclusion means that,
under ordinary interpretive principles, a real estate tax
qualifies under the Lease provision whenever it satisfies
the three criteria of the first sentence.
A final principle supports our adoption of that interpre-
tation. Even if the language of the provision is not
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18 NOAA MARYLAND, LLC v. GSA
unambiguous in its support for our interpretation, GSA’s
arguments get GSA at best to the point of indicating ambi-
guity of the provision. But any such ambiguity cannot help
GSA, which drafted the Lease provision. “When a dispute
arises as to the interpretation of a contract and the contrac-
tor’s interpretation of the contract is reasonable, we apply
the rule of contra proferentem, which requires that ambig-
uous or unclear terms that are subject to more than one
reasonable interpretation be construed against the party
who drafted the document.” Turner Constr. Co. v. United
States, 367 F.3d 1319, 1321 (Fed. Cir. 2004). GSA does not
dispute the applicability of that rule if the provision is am-
biguous as to the point in dispute. See GSA Response Br.
at 26–28 (disputing that NOAA Maryland’s reading of the
contract language is reasonable but not disputing that the
contract should be construed against GSA if the meaning
of the language is deemed ambiguous). Here, even if the
provision is thought to be ambiguous, our reading is at
least a reasonable reading, and it therefore must be
adopted.
GSA vigorously insists that reading the contract as
subjecting it to liability for real estate taxes arising after
the contract’s formation is an “implausible” interpretation
because it is not consistent with what the parties originally
intended (namely, to limit GSA’s tax liability in order to be
“consistent with fundamental principles of government
procurement practices to fairly procure goods and services
in ways that safeguard the public fisc”). Id. at 21–24. In
asserting what the parties’ intent was, however, GSA pro-
vides no foundation for the assertion—most importantly,
no textual foundation in the Lease. Here, as we have con-
cluded, the language of the on-point provision, interpreted
according to standard principles of construction, estab-
lishes a contract interpretation contrary to GSA’s position.
See Restatement (Second) of Contracts § 201 (Am. L. Inst.
1981) (“Unless a different intention is shown, language is
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NOAA MARYLAND, LLC v. GSA 19
interpreted in accordance with its generally prevailing
meaning.”).
GSA also points to our decision in S.S. Silberblatt Inc.
v. United States, 888 F.2d 829 (Fed. Cir. 1989). There, we
considered a lease provision that referred to real estate
taxes, with no further definition, let alone one like the ex-
plicit definition contained in the first sentence of the Lease
provision here. Id. at 830. We applied our earlier interpre-
tation of the same lease language as covering taxes adopted
“‘in lieu of general real estate taxes,’” as judged based on
whether a tax was “collected at the same time and in the
same manner as the previous ad valorem real estate taxes”
and “had ‘the same relationship to the lessors’ property as
did the levies they replaced.’” Id. at 832 (quoting Alvin,
Ltd. v. U.S. Postal Serv., 816 F.2d 1562, 1565–67 (Fed. Cir.
1987)). We held that a local imposition did not qualify,
based on findings that it was “billed and collected sepa-
rately from the real property taxes on the property at is-
sue,” was “based on gross receipts from rental of the
property rather than the property’s assessed value” (and so
was “a privilege or income tax as opposed to a real property
tax”), and, in fact, predated the state constitutional limita-
tion on real estate taxes (which the lessor argued it was in
lieu of). Id. That ruling did not exempt all “future” taxes
from coverage of a “real estate tax” provision, much less a
provision with the express definition found in the Lease
here.
For these reasons, we hold that § 3.3(A) requires GSA
to reimburse NOAA Maryland for amounts paid (above the
agreed-on base amount) for all taxes that satisfy the three
elements of a “real estate tax” as defined in the first sen-
tence, regardless of when those taxes arise.
B
Having decided that the Lease requires GSA to reim-
burse NOAA Maryland for all taxes that meet the three
criteria stated in Lease provision’s first sentence, we must
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20 NOAA MARYLAND, LLC v. GSA
decide whether to remand for the Board to consider
whether the clean water and education taxes meet those
criteria. GSA did not ask for a remand in the event we re-
jected the Board’s “future taxes” interpretation. And we
conclude that a remand is not warranted.
GSA has not “present[ed]” to us “as [an] alternative
bas[i]s for affirmance” any argument that the clean water
and education taxes fail to meet the three criteria. Biafora
v. United States, 773 F.3d 1326, 1334 (Fed. Cir. 2014); Oral
Arg. at 20:50–21:08. Moreover, the Board already rejected
GSA’s argument—made as to all four taxes at issue before
the Board—that the “purpose of funding general Govern-
ment services” criterion requires that the money collected
go into the government’s (here, county’s) general fund. J.A.
6. The Board also concluded, as to the two taxes it found
to come within the Lease provision, that “public transpor-
tation and stormwater management are within the scope
of general government services,” J.A. 6, a conclusion that
readily applies to education and clean water. At oral argu-
ment here, GSA acknowledged that it has not challenged
those conclusions, stating: “At the Board, the GSA argued
that the two taxes that are at issue here were not for pur-
poses of funding general government services. The Board
rejected that position and we, the Department of Justice,
did not seek the Solicitor General’s concurrence to cross-
appeal on that issue, so we are not arguing that here,
Judge.” See Oral Arg. at 21:32–22:01.
In these circumstances, we see no basis for a remand
for consideration of a preserved argument, not already re-
jected by the Board, that the clean water and education
taxes fail to meet one of the three criteria for being a real
estate tax. GSA did not dispute that the two taxes are “as-
sessed against the building and/or the land upon which the
building is located” and that the taxes are imposed
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NOAA MARYLAND, LLC v. GSA 21
“without regard to benefit to the property.” 5 As already
noted, the Board has in substance already rejected GSA’s
arguments about the “purpose of funding general Govern-
ment services.” See J.A. 6. And GSA stressed to the Board
that the facts in the case are “generally uncontested,” that
“discovery ha[d] uncovered little to nothing that should al-
ter the Board’s review of the plain language of the Lease,”
and that “the most apparent issues in [the case] are legal.”
GSA Pre-Hearing Statement at 1; see also GSA Post-Hear-
ing Statement at 1 (“[T]he most apparent issues in these
appeals are legal and have required little factual develop-
ment.”). We see no sufficient basis for a remand.
We therefore conclude that the clean water and educa-
tion taxes are within GSA’s reimbursement obligation un-
der the Lease.
III
For the foregoing reasons, the decision of the Civilian
Board of Contract Appeals is reversed.
REVERSED
5 With respect to the education tax, GSA focused on
the fact that the tax is a “future” tax. See GSA Pre-Hearing
Statement at 10. For the clean water tax, GSA argued that
the revenue raised is explicitly excluded from contributing
to the general county fund. See id. at 4–5; GSA Post-Hear-
ing Statement at 6 n.2. GSA also pointed out that the clean
water tax has certain characteristics that distinguish it
from other real estate taxes, e.g., the tax provides exemp-
tions for property owners suffering financial hardship and
also is imposed based on a property’s impervious area.
GSA Pre-Hearing Statement at 5. GSA has not shown that
those characteristics remove a tax from coverage under the
Lease’s three-part definition.