Which engineering, survey, feasibility, design, and permitting services for marina development were taxable?

Note -- partially obsolete historical guidance. DRS marks this ruling "not current" and states that it was obsoleted in part by Announcement (AN) 94(3).

Plain-English summary

An engineering firm worked on evaluation, feasibility, environmental analysis, and design for waterfront marina developments. DRS divided the services by their character.

Bathymetric and hydrographic surveys were taxable as land surveying. Preliminary layouts, site plans, sealed designs, drawings, permit work, and regulatory coordination were taxable only to the extent they involved building engineering or building planning/design.

DRS listed these services as nontaxable:

• environmental surveys, evaluations, and reports;
• borings;
• core sampling and laboratory testing of bottom sediments;
• site visits, evaluations, and investigations;
• parking plans;
• market and financial feasibility studies; and
• meetings with regulatory agencies governing design parameters.

What this means for you

The historical ruling required separating an engagement into taxable enumerated work and nontaxable study, testing, or coordination work. AN 94(3) later obsoleted the guidance in part.

Common questions

Were feasibility studies taxable? Not by themselves, unless they involved an enumerated service such as land surveying or architectural, building-engineering, or building-design work.

Were bathymetric and hydrographic surveys taxable? Yes, as land surveying.

Were sealed engineering designs always taxable? No. Only the portion involving building engineering or building planning/design was taxable.

What about permit applications and agency-review coordination? They were taxable only to the extent building engineering or building planning/design was involved.

Citations and references

• Announcement (AN) 94(3) -- identified by DRS as partially obsoleting this ruling.
• The published ruling cites no specific statute or regulation.

Source

• Landing page: Connecticut DRS Rulings
• Ruling: Ruling 89-242

Original ruling text

Ruling 89-242, Engineering

This information is not current and is being provided for reference purposes only

This Ruling has been obsoleted in part by AN 94(3)

Your firm is involved in the evaluation, feasibility studies, environmental analysis and designs for the development of waterfront properties in relation to specific marina complexes or projects.

Feasibility studies and analyses necessary to determine the approach for such designs are not subject to the sales and use tax unless an enumerated service such as "land surveying" or "architectural, building engineering and building planning or design" is involved. Thus, bathymetric or hydrographic surveys are taxable as land surveying services. The portion of preliminary layout design and site plans attributable to building engineering and building planning or design is subject to tax.

The following services would not be subject to tax:

environmental surveys, evaluations and reports;

borings;

core sampling and laboratory testing of bottom sediments;

site visits, evaluations and investigations;

parking plans;

market studies;

financial feasibility studies; and

meetings with regulatory agencies governing the design parameters.

Your sealed engineering designs and drawings are taxable only to the extent that they involve building engineering and building planning or design.

The preparation of permit applications, the preparation of non-sealed permit application plans and drawings that are not construction drawings, the coordinating of the permit application review processes, and meetings with various regulatory agencies are subject to tax only to the extent that building engineering and building planning or design are involved.

LEGAL DIVISION

November 27, 1989