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E&R 1992-05-15 73 MINUTES OF THE 1991 BOARD OF EQUALIZATION AND REVIEW MAY 15, 1992 ASSEMBLY The 1992 Board of Equalization and Review met on Friday, May 15, 1992 at 10:00 o'clock A.M. in the Assembly Room of the New Hanover County Administration Building, 320 Chestnut Street, wilmington, North Carolina. Members present were: Commissioner Jonathan Barfield, Sr. Commissioner Fred Retchin Commissioner william H. Sutton Vice Chairman Robert G. Greer Chairman E. L. Mathews, Jr. Chairman Mathews called the meeting to order and welcomed all present. The Chairman explained the procedure that the Board would follow and that the appellants would be informed of the Board's decision within a week. The Chairman further explained that the appellants have the right to appeal the decision by the Board of Equalization and Review with the Property Tax Commission in Raleigh. TAX APPEAL - PILOTS RIDGE HOMEOWNERS ASSOCIATION, PARCEL R07900- 001-042-000, 800 PILOTS RIDGE ROAD Mr. John F. Crossley, President of the Homeowners Association of Pilots Ridge, spoke concerning the property which is a dedicated airport strip. He explained that the owner, George Talman, was unable to sell the runway and gave it to the homeowners association with the agreement that the transfer expense and last year's taxes be paid for by the association. In support of his opinion that the fair market value should be $20,000, he quoted tax laws that stated property must be appraised at "true value in money" and based "on the uses to which the property is adapted and which is capable of being used." He concluded that the airstrip had no commercial value but was only of value to the 20 adjoining property owners. He also quoted tax laws that say when a residential subdivision's assessed value includes a common area, the common area cannot be assessed again. Mr. Crossley considered that each property owner was assessed for the value of the airstrip in the individual tax evaluation. Tax Appraisal Supervisor Jim Bethune responded that tax laws require the value of asphalt to be included in the cost approach to value. He concluded that on the market the runway may not have any value, but as an enhancement to the owners it does have the value of the asphalt. He also recommended another option for the Board to consider is to assess the value of $6,000 per lot for the airstrip. Motion: At the conclusion of the hearings on this date, I I I 7 9 -.., MINUTES OF BOARD OF EQUALIZATION AND REVIEW, MAY 15, 1992 Commissioner Retchin MOVED, SECONDED by Commissioner Barfield, to assess the value of the runway to each of the twenty lots by $3,000 each. Upon vote, the MOTION CARRIED UNANIMOUSLY. TAX APPEAL - JOHN T. AND ANN MARIE JOHNSEN, PARCEL ROS40S-018-001- 000, 113 NUN STREET Mr. and Mrs. Johnsen were not in attendance to present their appeal. Tax Appraisal Supervisor Jim Bethune presented the case explaining that Mr. and Mrs. Johnsen objected to the assessed value of the property saying that it was not equitable to other properties in the historic district. Mr. Bethune reported that in reviewing sales and assessments of similar property in the neighborhood, the appellants' property is assessed at or below the actual market value as other properties and the other properties were not the quality of construction as the Johnsen's property. Motion: At the conclusion of the hearings on this date, Commissioner Retchin MOVED, SECONDED by Vice Chairman Greer, to uphold the appraised value of $261,191 as recommended by the Tax Appraisal Supervisor. Upon vote, the MOTION CARRIED UNANIMOUSLY. TAX APPEAL HEATCRAFT, INC., PARCEL R06500-007-010-000, 602 SUNNYVALE DRIVE Mr. Noel Crume of Lennox International, Dallas, Texas, spoke concerning the industrial facility located on Sunnyvale Drive. This plant was closed on March 31, 1991. He said the marketability of the property is hindered due to contamination of TCE (trichloratethylene) found on the site and functional and exterior obsolescence of the facility. He considered these problems should decrease the assessed value of the property. Mr. Crume stated the contamination was created by Snyder General, but the responsibility for the cleanup, which is estimated at $500,000, will be with Lennox. He said Lennox has already spent $99,000 in order to close the facility in accordance with requirements of State law. CRS will determine if and the extent of contamination of the ground water. The property will be listed for $1.9 million although it has been appraised at $1.6 million. Tax Appraisal Supervisor Jim Bethune spoke saying the company closed the plant for economic reasons. The property was purchased in 1988 for $4,400,000. Although Mr. Crume said the property will be listed for $1.9 million, it is not on the market at the present time. If the property is assessed with an extensive cleanup in future years, the company will be able to come back before the Board and ask for a reduction based on the cost of the cleanup. Mr. Bethune reported that because of the contamination and leaking roof, the assessed value was reduced from $4,679,011 to $3,644,835. Motion: At the conclusion of the hearings on this date, Commissioner Retchin MOVED, SECONDED by Commissioner Barfield, to uphold the assessed value of $3,644,835 as recommended by the Tax ~ 80 MINUTES OF BOARD OF EQUALIZATION AND REVIEW, MAY 15, 1992 Appraisal Supervisor. Upon vote, the MOTION CARRIED AS FOLLOWS: voting Aye: Commissioner Barfield Commissioner Retchin Commissioner Sutton Chairman Mathews voting Nay: Vice Chairman Greer Commissioner Sutton requested appellant of the Board's decision, to the decision was based on standards and 1, 1991. TAX APPEAL - THOMAS HENRY BROWN, PARCEL R05407-040-003-000, 2136 WRIGHTSVILLE AVENUE Mr. Thomas Henry Brown explained that he purchased the property in 1972 for $6,000. In 1973, he erected a $20,000 metal building and established his radiator service business. The building now needs a new roof; it has water damage in the insulation; and there is severe rust deterioration inside of the metal building which is caused from the effects of chemicals used in the business. that upon notifying the also inform Mr. Crume that rules adopted as of January Tax Appraisal Supervisor Jim Bethune spoke regarding the sale of similar property that sold for $64,000, which supports the assessed value of $63,588. Mr. Bethune reported that an appraiser did not inspect the interior of the building. Mr. Register stated that in the future, an appraiser will be sent to inspect the interior of any property under appeal. Motion: At the conclusion of the hearings on this date, Commissioner Barfield MOVED, SECONDED by Commissioner Retchin, to reduce the assessed value of the building on the property by $10,000. Upon vote, the MOTION CARRIED UNANIMOUSLY. TAX APPEALS - PARCEL #1: SAND RIDGE ASSOCIATES, LTD. (SAND RIDGE APARTMENTS), PARCEL R06019-001-003-000, 1222 HARBOUR DRIVE AND PARCEL #2: WEST CARY INVESTMENT ASSOCIATES (SAND RIDGE APARTMENTS), PARCEL R06018-004-036-004, HARBOUR DRIVE Mr. Tedd Beck, Real Estate Analyst of Summit Realty Group, spoke concerning his assessment of the property's fair market value of $2,265,084 is based on figures obtained by using the income approach to valuation. He also considered recent sales of Mill Creek Apartments, Creek Apartments and Forest Hills Apartments as comparable property and support for a reduction in the valuation. Mr. Carrol Mason, owner and developer of Sand Ridge Apartments, spoke concerning Phase II of the project. He believed the property should be assessed at the land value of $400,000, since the buildings were partially completed and were producing no income. I I I 81 -.., MINUTES OF BOARD OF EQUALIZATION AND REVIEW, MAY 15, 1992 Tax Appraisal Supervisor Jim Bethune responded that the very attractive apartments of Phase I are well maintained and landscaped, and the cost approach to value is reasonable. He said the appellant's income approach to value was not allowable because the expense ratio was unusually high. If the income was reduced by a normal rate of expense, the income approach valuation would be close to the assessed tax value. Mr. Bethune said the sales of the apartments mentioned by Mr. Beck were not comparable sales because the Mill Creek Apartments were purchased out of foreclosure and both the Creek and Forest Hills Apartments are much older projects. Tax Administrator Roland Register commented that the General Statutes require the assessor to value property under construction at its percentage of completion. The property was reassessed based on completion of the construction for 1992. Motion: At the conclusion of the hearings on this date, Commissioner Sutton MOVED, SECONDED by Chairman Mathews, to uphold the assessed values to both parcels as recommended by the Tax Appraisal Supervisor. Upon vote, the MOTION CARRIED UNANIMOUSLY. TAX APPEAL - w. R. KOBERGER, R06216-004-009-000, 841 SHINN POINT ROAD Mr. W. R. Koberger asked the Board to give consideration of equal assessment to his property located in Shinn Point Subdivision. He compared his property with the property owned by Dr. Creighton and calculated that per square foot his property was assessed at a greater valuation. Mr. and Mrs. Koberger complained of problems with the interior of the house, specifically a leaking roof. Tax Appraisal Supervisor Jim Bethune explained that the calculations on a square foot basis used by Mr. Koberger were on property that is much larger, whereas lots in Shinn Point are sold based on the location, not by square footage. Mr. Koberger' s property was priced the same as his neighbor's lot and building based on our adopted schedule of values. Mr. Bethune recommended the tax assessment of $249,267 to be a reasonable estimate of a very attractive home on a deep water canal. Motion: At the conclusion of the hearings on this date, Commissioner Retchin MOVED to uphold the assessed value pending review by a tax appraiser's evaluation of the interior of the home. The motion died without a second. Commissioner Barfield then MOVED, SECONDED by Chairman Mathews, to uphold the assessed value of $249,267 as recommended by the Tax Appraisal Supervisor. Commissioner Barfield explained that Mr. Koberger would surely make any repairs needed to his home; therefore, the value should not change. Upon vote, the MOTION ~ (.) r) 01' MINUTES OF BOARD OF EQUALIZATION AND REVIEW, MAY 15, 1992 CARRIED UNANIMOUSLY. TAX APPEALS - JACK A. SNEEDEN CORPORATION, K-MART STORE NO. 3116, PARCEL R05515-004-003-000, 815 SOUTH COLLEGE ROAD Mr. Terry Hughes of Marvin F. Poer and Company, representing Jack Sneeden Corporation, owner of the property leased by the K- Mart Store, spoke regarding the appeal. He explained that the owner receives income of $240,000 from a long term, land lease with K-Mart. The adjoining building of 2,400 square feet has been vacant for 2 years. Mr. Hughes requested a reduction in the assessed value to $3,087,364, based on the proforma market analysis approach to value less calculation for the rent loss. Tax Appraisal Supervisor Jim Bethune responded that based on the sales analysis presented by Mr. Hughes, the assessment on this lot is much lower than the market value. Mr. Bethune reported that while reviewing the appellant's information, he noted a discrepancy on the measurement of the property. The property was remeasured and found to be 95,840 square feet in size; therefore, the value was adjusted to $4,251,697. Motion: At the conclusion of the hearings on this date, Commissioner Retchin MOVED, SECONDED by Vice Chairman Greer, to uphold the corrected value of $4,241,697 as recommended by the Tax Appraisal Supervisor. Upon vote, the MOTION CARRIED UNANIMOUSLY. TAX APPEAL - JUNIOR ORDER CORPORATION OF WILMINGTON, PARCEL R06207- 014-001-000, 235 PEIFFER AVENUE Mr. James Wolfe, Financial and Recording Secretary for the Junior Order Corporation of Wilmington, spoke regarding the use of building on the property. The fraternity, organized in 1853, supports the American Children's Home in Lexington, NC. The Order purchased the property in December, 1991, from the Bradley Creek Homemakers Extension Club for the purpose of having their two monthly meetings. The Junior Order purchased the property for $39,875 and considered this amount to be the true value. The interior of the building was in bad repair from a previous fire. Motion: At the conclusion of the hearings on this date, Vice Chairman Greer MOVED, SECONDED by Commissioner Barfield, to reduce the assessed value to $40,000 based on the purchase price in December 1991. Commissioner Retchin MOVED to reduce the assessed value on the building by $8,706 due to its poor condition and that the assessed value of the land should be upheld. Commissioner Sutton said as a compromise he would MOVE to assess the value at $45,000. In discussion, the Commissioners agreed that the fair market I I I ~3 ,.., MINUTES OF BOARD OF EQUALIZATION AND REVIEW, MAY 15, 1992 value should be based on the amount of the purchase and should not include any improvements such as the air conditioning. Upon vote on the motion made by Vice Chairman Greer to reduce the assessed value to $40,000.00, the MOTION CARRIED UNANIMOUSLY. It was stated that improvements would be reappraised for 1993. ADJOURNMENT There being no additional appeals, Chairman Mathews thanked Mr. Register and Mr. Bethune for an outstanding job in working with the appellants and for giving the Commissioners the appropriate support documentation needed. Chairman Mathews then adjourned the Board of Equalization and Review meeting at 12:35 p.m. and convened as the Board of Commissioners. RESOLUTION IN SUPPORT OF THE AIR CARGO GLOBAL TRANSPARK TO BE LOCATED IN EASTERN NORTH CAROLINA IN LENOIR COUNTY Motion: Commissioner Sutton MOVED, SECONDED by Commissioner Retchin, to adopt a resolution in support of the Air Cargo Global Transpark to be located in Lenoir County. In discussion the Board considered the proposal by the Town of Kinston to be in the best interest of eastern North Carolina, and especially beneficial to the State Port located in Wilmington. Upon vote, the MOTION CARRIED UNANIMOUSLY. APPROVAL OF LETTER OF RECOMMENDATION IN SUPPORT OF FEDERAL GRANT APPLICATION FOR THE NEW HANOVER COMMUNITY HEALTH CENTER, INC. Chairman Mathews presented a request by Thomas Wright of the New Hanover Community Health Center, Inc. for the Board to write a letter of recommendation to the Federal Public Health Service in support of a grant application for the Center. Motion: Commissioner Sutton MOVED, SECONDED by Vice Chairman Greer, to approve writing a letter of recommendation in support of grant application. Upon vote, the MOTION CARRIED UNANIMOUSLY. ADJOURNMENT Commissioner Retchin MOVED, SECONDED BY Commissioner Barfield, to adjourn. Upon vote, the MOTION CARRIED UNANIMOUSLY. Chairman Mathews adjourned the meeting at 12:40 P.M. Respectfully submitted, J~P~ Teresa P. Elmore Deputy Clerk to the Board ~