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Home My WebLink AboutE&R 2000-05-01 I I I 213'" MINUTES OF BOARD OF EQUALIZATION AND REVIEW, MAY 1, 2000 ASSEMBLY The New Hanover County Board of Equalization and Review met on Monday, May 1, 2000, at 9:00 a.m. in the Assembly Room of the New Hanover County Courthouse, 24 North Third Street, Wilmington, North Carolina. The purpose of the meeting was to recognize and record individuals who have submitted an appeal of their property values and to schedule the dates for the hearing of the appeals. Members present were: Commissioners Buzz Birzenieks, Ted Davis, Jr., Charles R. Howell; Vice-Chairman Robert G. Greer; Chairman William A. Caster; Tax Administrator Robert Glasgow; Tax Appraisal Supervisor Larry Bolick; Assistant County Attorney Holt Moore; and Deputy Clerk to the Board, Teresa P. Elmore. Chairman Caster called the meeting to order and welcomed everyone present. DESIGNATION OF WILLIAM A. CASTER AS CHAIRMAN OF THE 2000 BOARD OF EQUALIZA TION AND REVIEW Tax Administrator Glasgow stated that since the Board of Commissioners acts in lieu of a separate Board of Equalization and Review, the Board may want to appoint William A. Caster as Chairman of the 2000 Board of Equalization and Review. Consensus: William A. Caster was appointed to serve as Chairman of the 2000 Board of Equalization and Review. RECOGNITION OF KNOWN APPELLANTS Tax Administrator Robert Glasgow reported that the Deputy Clerk to the Board has been provided with a list of property owners who have submitted written appeals. The following list of appellants was presented for entry into the record: Appellants Tax Map Number King, Helen M. RO 1100-009-006-000 5120 College Road North Dombroski, A. T. Jr. Ann ROI805-001-009-002 107 Tom Avenue Buck, Carolyn Hill RO 1900-00 1-0 10-046 2806 Castle Hayne Road Vandergrift, A. Wayne R02500-002-009-000 3400 Castle Hayne Road R02500-002-020-000 3400 Castle Hayne Road ~ 2J4 MINUTES OF BOARD OF EQUALIZATION AND REVIEW, MAY 1, 2000 Faison, Ernest F. Eta\. R02900-00 1-042-000 8853 Stephens Church Road Valade, Joseph A. Saundra K. R02900-002-025-000 321 Creekwood Road McDonald, John B. III R02900-003-005-000 534 Creekwood Road Mullins, James F. Gail R029 11-00 1-004-000 9103 Salem Court DiMartino, Michael Rose B. R02920-003-020-000 8905 Saint Ives PI. Harden, Joe A. Patricia M. R030 17 -001-005-000 1717 Futch Creek Road Rogers, Charles 1. III Barbara M. R03500-005-375-000 2400 Sunburst Court Battistelli, Leo 1. Margaret A. R03 508-005-0 10-000 1604 Basset Court Possehl, John Cheryl R03600-003-042-007 117 Bump Along Road Mercer, Johnny L. Pamela L. R03600-005-031-000 7718 Market Street Bugbee, Thomas N. Wendy S. R03706-003-003-000 708 Squire Lane Williams, Paul M. Virginia R03710-001-0 12-000 301 Edgewater Club Road McDonough, Sean Janet R03714-006-006-000 512 Captain Dexter Wynd Jones, Calvin K. Nancy M. R037 16-002-015-000 8140 Bald Eagle Lane Dwarziany, Alexander Linda N. R03717-003-004-000 130 Point Drive Johnston, Henry W. R03719-003-002-000 8009 Bald Eagle Lane Bozik, E. Gail R03805-003-007-000 8633 Bald Eagle Lane I I I 215-'" MINUTES OF BOARD OF EQUALIZATION AND REVIEW, MAY 1,2000 Kahn Properties, LLC R038 11-003-003-000 515 Beach Road N. Dreyfors, Peggy Powell EtaI. R04000-00 1-00 1-000 310 Sampson Street Godwin Oil Co., Inc. R04000-002-003-00A H\ry421 N. Applied Analytical Ind., Inc. R04119-002-00 1-000 1206 23rd Street N Shepherd Harry Lee Brenda M. R04400-003-083-000 7114 Haven Way Ratliff, David R. Shirley J. R0441 0-004-011-000 224 Middle Sound Loop Road R0441O-004-0 12-000 224 Middle Sound Loop Road Capps, Michael W. Robbin S. R04414-005-005-000 6606 Lyonia Court Devane, Daniel Etux. R04305-004-002-000 132 Hargrove Drive Thomas, Edward 1. Elizabeth A. R04400-003-052-000 7201 Oyster Lane Ballard, Joseph T. Leanne P. R04414-008-033-000 6301 Wolfbead Court Green, Harry W. Gunnfinna T. R04414-0 10-009-000 6606 Red Cedar Road Davis, Russell Jr. Regina Floyd R04419-00 1-043-000 3202 Graylyn Terrace Wachovia Bank Trust Co. For Leslie M. Merrill R04500-007 -002-000 2220 Middle Sound Loop Road Kramer, Elizabeth M. Robert P. R04506-003-020-000 744 Aljean Drive Broadfoot Limited Partnership R0451O-004-009-000 1835 Buena Vista Circle Allen, Elms L. Harriet C. Eta\. R04520-002-009-000 90 Beach Road S. ~ 216 MINUTES OF BOARD OF EQUALIZATION AND REVIEW, MAY 1, 2000 Kahn Properties, LLC R03811-003-003-000 515 Beach Road N. Dreyfors, Peggy Powell EtaI. R04000-00 1-00 1-000 310 Sampson Street Godwin Oil Co., Inc. R04000-002-003-00A H\ry 421 N. Applied Analytical Ind., Inc. R04119-002-00 1-000 1206 23rd Street N Shepherd Harry Lee Brenda M. R04400-003-083 -000 7114 Haven Way Ratliff, David R. Shirley J. R0441 0-004-011-000 224 Middle Sound Loop Road R0441O-004-012-000 224 Middle Sound Loop Road Capps, Michael W. Robbin S. R04414-005-005-000 6606 Lyonia Court Devane, Daniel Etux. R04305-004-002-000 132 Hargrove Drive Thomas, Edward 1. Elizabeth A. R04400-00 3 -052 -000 7201 Oyster Lane Ballard, Joseph T. Leanne P. R04414-008-033-000 6301 Wolfbead Court Green, Harry W. Gunnfinna T. R044 14-0 1 0-009-000 6606 Red Cedar Road Davis, Russell Jr. Regina Floyd R04419-00 1-043 -000 3202 Graylyn Terrace Wachovia Bank Trust Co. For Leslie M. Merrill R04500-007-002-000 2220 Middle Sound Loop Road Kramer, Elizabeth M. Robert P. R04506-003-020-000 744 Aljean Drive Broadfoot Limited Partnership R0451O-004-009-000 1835 Buena Vista Circle Allen, Elms L. Harriet C. Eta\. R04520-002-009-000 90 Beach Road S. 217 ,., I MINUTES OF BOARD OF EQUALIZATION AND REVIEW, MAY 1, 2000 Gold, D. McEntire R04520-003-008-000 3 Saltmeadow Road Macris, Spiro 1. R04 712-004-001-000 1019 3rd Street N Carver, Charles 1. R04 716-001-002-001 501 Nutt Street Cooperative Bank/Savings Inc. R04 720-009-016-000 127 Market Street Fragos, John E. R04 720-012-005-000 116 Market Street Burney, Lizzie Mae Life Estate R04806-002-003 -000 1312 Corbett Street North Metro Properties, LLC. R04809-042-0 13 -000 705 Bladen Street Crossland, Thomas C. R04813-00 1-0 16-000 I 829 4th Street N. Audubon Enterprises, LLC R04813-030-005-000 511 3rd Street N Benedict Arnold Assoc. R04817-029-008-000 519 Market Street Wells, H. W. III Calvin F. R04817-032-008-000 Partnership 3 3rd Street S Yarborough, William H. Etux. R04818-006-009-000 1315 Chestnut Street McFee, Evelyn 1. Eta\. R04818-0 14-004-000 112 12th Street N Foster, Evelyn M. Hrs. R04819-O 17 -001-000 2024 Market Street Mills, Ashley C. Evelyn H. R04819-026-009-000 2006 Wolcott Avenue R05407-029-0 12-000 514 17th Street S. I Greentree Apartments LTD. R04 907 -001-001-000 4615 Greentree Road ~ 2'1 8 MINUTES OF BOARD OF EQUALIZATION AND REVIEW, MAY 1, 2000 New Centre Drive Com Park Inc. R04911-001-011-000 5042 Market Street Deviprya R049I3-009-001-001 3903 Market Street Harvin, Charlie R04913-0 17 -017 -000 10 31'1 Street N JHT Realty, LLC R04914-00S-026-000 107 Cinema Drive Atlantic Facilities LLC R04915-009-002-000 104 Jacksonville Avenue New Hanover Associates R04916-00 1-029-000 5201 Sigman Road TPI Properties, Inc. R04916-003-005-000 149 College Road S Marlow Properties, LLC R04 917 -00 3 -040-000 30 Covil Avenue Stanley, Sandra Yancey R05000-006-00 1-000 409 Sundial Court Inman, Sylvia Yvonne R05007 -005-005-000 5606 Athens Lane Andrea, Anne K. R05007 -009-004-000 213 Spartan Road Kwaasnicki, Olive M. Eta\. R050 10-009-004-000 5916 Chester Street Smeltzer, Lee K. Jacquelyn S. R050 10-0 10-00 1-000 6000 Chester Street Cobo, Louis Eleanor R050 10-0 11-00 1-000 6032 Chester Street Erickson, John K. Kathy I. R05011-00 1-0 14-000 208 Love Grass Court Wood, William O. Lois F. R05011-014-012-000 318 Oakland Drive Wilson, James G. Angela F. R050 15-009-00 1-000 238 Tanbridge Road I I I 219 -.., MINUTES OF BOARD OF EQUALIZATION AND REVIEW, MAY 1, 2000 Meeker, Timothy F. Lynn E. R051 06-012-002-000 2005 Montrose Lane Saleeby, Elias W. Philomene A. R05112-007-009-000 2102 Graywalsh Drive Haar, Margaret C. R05112-O 10-002-000 2140 Bay Colony Lane Trainor, Gary 1. Jayme R05115-003-017-000 2105 Forest Lagoon Drive Simons, C. Ernest Jr. Anne M. R05115-003-023-000 2129 Forest Lagoon Drive Harding, Bridget M. R05116-00 1-0 13-000 2248 Deepwood Drive Sherwood, Richard L. Jr. Sandra RO 5116-004-011-000 1038 Ocean Ridge Drive Saklad, Daniel A. Trust Eta\. R05119-00 1-00 1-000 1413 Quadrant Circle Jacobsen, Wang Ling R05119-003-003-000 2035 Spanish Wells Drive Bonin, Mary Louise EtaI. R05200-001-003-000 2422 Middle Sound Loop Road Divine, Morrison W. III Trustee R05308-0 13-006-000 416 Front Street S Carroll Carolina Oil, Inc. R05316-00 1-00 1-000 801 Surry Street Durham, Norman E. Donna D. R05405-004-016-000 106 5th Street S Sullivan, Edith T. R05405-020-0 13-000 310 4th Street S Erickson, Douglas T. Margaret R05405-032-O 15-000 412 3rd Street S Purdie, Flossie V. R05406-034-002-000 513 13th Street S Smith, P. R. Jr. Lillian 1. R05408-008-0 12-000 615 Forest Hills Drive E ~ 220 MINUTES OF BOARD OF EQUALIZATION AND REVIEW, MAY 1, 2000 Johnson, James T. ROS409-O 14-00 1-000 302 Castle Street McNair, Joseph Curtis R05410-013-007-000 140S Wooster Street Ward, Tony ROS413-030-002-000 120S 4th Street S Grainger, Willie Jr. ROS414-023-00S-000 710 Kidder Street Carmon, Dan W. Hrs. ROS41O-02S-007-000 81713thStreetS Mintz, Mable Loraine Skinner ROS413-0 13-0 10-000 30S Meares Street McDaniel, Frank Mr. Jr. ROS414-0 17 -006-000 1217 ISth Street S Devita, Peter M. ROS418-002-001-000 81S Greenfield Street Blackmon & Stephenson Ltd. ROS418-004-004-000 9100 Greenfield Street Warner, Alice Johnson ROS420-007-023-000 1729 Country Club Road Pickelsimer, John D. Etux. ROS508-002-004-000 4713 College Acres Drive Tysinger, Junius A. Sr. Violet R05513-007-003-000 3401 Wrightsville Avenue Best, Arthur Andrew R05518-020-004-000 4111 Peachtree Avenue Williams, Joseph N. Margie P. ROSS 18-026-0 12-000 4106 Peachtree Avenue Ellis, Stephen Gregory Eta\. R05607-001-0 11-000 125 Formosa Drive Lindsey, William C. Jr. EtaI. R05608-002-006-000 110 Mount Vernon Drive Newton, Carolyn Elizabeth ROS611-004-0 13 -028 6211 Wrightsville Avenue 2?1 -.., I MINUTES OF BOARD OF EQUALIZATION AND REVIEW, MAY 1, 2000 Medac Group, LLC R05612-002-011-000 1442 Military Cutoff Road Harris, William Dempsey Jr. R05612-008-044-000 1507 Military Cutoff Road Hammond, Billy A. F. R05615-003-028-000 1604 Softwind Way R05615-003-029-000 1600 Softwind Way Lecompte, Rowan Peggy R05615-006-008-000 6204 Bradley Overlook Stubblefield, Steven Mary R05615-006-009-000 6208 Bradley Overlook Walden, Elmer P. Brenda 1. R05616-008-027-000 6303 Bradley Overlook Swayne, Henry M.. Maude A. R05700-003-019-000 102 Bradley Creek Point Road I Hunter, Jack A. R05700-006-O 15-000 601 Airlie Road McPheters, Robert F. Deborah R. R05705-002-055-000 1804 Verrazzano Drive Pace, Lisa P. R05706-0 10-005-000 1911 Prestwick Lane Morris, Sandra Ann Kirby R0571O-002-041-003 245 Beech Street Cunningham, Donald J. Carol S. B. R05710-006-039-000 1716 Landfall Drive Shantz, Elsie R05711-003-004-000 1523 Landfall Drive Norton, Patrick 1. Jr. R05714-013-006-000 7204 Airlie Road Island Petroleum Dev. R05716-001-015-000 100 Salisbury Street W I Woodson, James H. Nancy R05716-004-01O-000 6 Palmetto Drive ~ 2/~) MINUTES OF BOARD OF EQUALIZATION AND REVIEW, MAY 1, 2000 Register, Carolyn F. R05718-003-009-000 213 Seacrest Drive Stafford, W. R Jr. R05719-003-021-044 322 Causeway Drive Yunaska, Robert L. Linda A. R05719-003-021-122 102 Seapath Estates Drive Hurley, Robert 1. Jr. Eta!. R05720-021-004-000 24 Henderson Street W Machine & Welding Supply Co. R06005-009-006-000 246 South Carolina Avenue Tucker, Anne D. R06007 -004-011-007 2219 Jumpin Run Drive Harriss, George Brenda W. R06106-005-031-000 4008 Oleander Drive Unitarian Universalist Fellowship of Wilm NC R06106-006-008-000 4306 Spirea Drive - S & R Partnership R061 14-001-006-000 41'1 Street Ext Hilburn, Michael Harvey EtaI. R06205-009-009-000 5127 Oleander Drive Buck, N. D. R06307-00 1-005-000 14 Island Drive R06307 -001-008-000 14 Island Drive Griffin, Steven G. R06308-0 17-00 1-002 20 B Channel Avenue Morine, William C. Pamela S. R06309-00 1-0 12-000 10 1 Windlass Drive R06309-00 1-0 16-000 10 1 Windlass Drive Scott, Farrel W. R06309-002-008-000 Skystasail Drive Fasul, James S. Samatha T. R06311-00 1-003-000 312 Waynick Blvd. 2?3 -.., I MINUTES OF BOARD OF EQUALIZATION AND REVIEW, MAY 1, 2000 Bradshaw, William T. R06312-005-002-000 204 Lumina Avenue S Heatcraft, Inc. R06500-007 -010-000 602 Sunnyvale Drive Cottle, Jeffrey P. Life Est. R06511-00 1-0 12-000 3527 Carolina Beach Road Erdem, Murat R06512-002-006-000 322 Donald E. Gore Drive George, Casey J. Lorene M. R06512-002-021-000 2323 Robert Hoke Drive Trask, G. W. Jr. Eta!. R06600-00 1-005-000 3710 College Road S Pine Valley Comm Ctr #1 LLC R06600-00 1-005-008 3600 College Road S Burns, David A. Bonny A. R06609-004-00 1-000 I 805 Robert E. Lee Drive Allman, Steven L. Jean W. R06609-009-O 14-000 384 John S. Mosby Drive Coleman, Stephen T. C. Michele R06612-014-003-000 3316 Aster Court Strickland, Anna B. EtaI. R06615-006-021-011 331 Pine Cliff Drive Jaross, Richard 1. Elka M. R06710-006-004-000 6609 Cove Point Drive Trask, Harold E. Jr. Eta!. R06806-003 -002-000 905 Lumina Avenue S Hewett, William P. Janet B. R07007 -002-007 -001 3935 Appleton Way Hatchell, Gerald Dwayne Cynthia R07119-0 13-0 14-000 5501 Bernhardt Court S & P Commercial Prop LLC R07 600-004-0 54-001 I 5901 Carolina Beach Road Tregembo, Geo R. June M. R07600-004-066-000 5815 Carolina Beach Road ~ ??4 MINUTES OF BOARD OF EQUALIZATION AND REVIEW, MAY 1, 2000 Hargrove, James T. R07705-00 1-00 1-000 5510 Captains Lane Myers, Patricia Faye Hobbs R07908-003-0 12-000 279 Shannon Drive Broome, Miriam A. R07908-003-0 15-000 303 Shannon Drive Different Strokes Golf Ctr. Inc. Various parcels 601 Rivage Promenade Fazzari, Sheila F. Rev. Trust R08215-002-007 -000 246 Chimney Lane Brown, James F. Jr. Grace 1. R084 13-007 -009-000 402 Bobby Jones Drive Marnie, William R. Wendy T. R08416-00 1-002-000 8915 Shipwatch Drive Cypress Green, Inc. Various Parcels 9208 Gimme Court ~, Tax Administrator Glasgow advised that most of the cases may be resolved by staff and the appellant or withdrawn from the appeal process prior to the Board of Equalization and Review holding the hearings; however, the Board will need to approve and accept those recommendations. Furthermore, he gave notice that the Tax Department would accept written appeals until 5 :00 this afternoon. MEETING CONVENED FROM THE 2000 BOARD OF EQUALIZATION AND REVIEW TO HOLD A MEETING OF THE 1999 BOARD OF EQUALIZATION AND REVIEW Chairman Caster convened from the 2000 Board of Equalization and Review at 9: 15 a.m. to hold a meeting of the 1999 Board of Equalization and Review to consider the appeal by General Electric. 1999 REAL PROPERTY APPEAL BY GENERAL ELECTRIC COMPANY Chairman Caster called the 1999 Board of Equalization and Review to order. The following members were present: Commissioners Buzz Birzenieks, Ted Davis, Jr., Charles R. Howell; Vice- Chairman Robert G. Greer; Chairman William A. Caster; Tax Administrator Robert Glasgow; Tax Appraisal Supervisor Larry Bolick; Assistant County Attorney Holt Moore, and Deputy Clerk to the Board Teresa P. Elmore. Tax Administrator Glasgow reported that in 1999, General Electric appealed the assessed value of $44,469,201 for the Cape Fear Plant consisting of 1,759 acres. In 1991, the County had I I I 225 -.., MINUTES OF BOARD OF EQUALIZATION AND REVIEW, MAY 1, 2000 identified 106.6 acres as the actual acreage for the primary site. After the Property Tax Commission hearing on June 24-25, 1999, the County assumed the acreage of385 as testified by General Electric representatives in their appeal. At the last meeting of the Board of Equalization and Review on October 18, 1999, staff was directed to work with General Electric to resolve the differences in the acreage amounts. After review of an aerial map and an on-site guided tour by General Electric officials, staff determined that the plant site consisted on 0 5 acres of actual developed land, 56 acres of roadways, and the remaining acreage consisting of residual and undeveloped land. However, General Electric does not agree with the County on the breakdown of the acreage. An adjustment was made to the acreage, which reduced the total assessment from $44,469,201 to $43,119,521. He stated that the Property Tax Commission had agreed with the County's assessment being an accurate reflection of the plant site. Mr. Charles H. Mercer, Jr., attorney from Raleigh, NC representing General Electric, spoke on there being a fundamental disagreement between the County and General Electric in the differences in the land division. He stated that the County increased the acreage of the primary plant site after misinterpreting testimony by Mr. John Connelly, General Electric's appraiser at the Property Tax Commission. Although Mr. Connelly never used the term "primary site" in his presentation, the County misinterpreted his analysis and changed their records for the plant site to 385 acres. The 1996 property record cards showed the land value at $4,612,620, while Mr. Connelly placed the value at $4,656,000, which is $44,000 more than the County's value. The 1999 revaluation, as of June 2, 1999, placed the land value at $6,148,300. After the hearing on June 24-25, 1999, the County increased the value of the land by increasing the number of acres for the plant site. Tax Administrator Glasgow interjected that the June 2, 1999 value was based on using 167 acres for the plant site and not the recently identified 305 acres. No new facilities or areas of operations have been added to the record cards since the 1991 valuation. Mr. Mercer stated that Mr. Curtis West, an appraiser for General Electric, had provided an analysis of industrial properties in North Carolina to determine a land to building ratio as to what would be considered a comparable market for this type of industrial operation. N.C.G.S. 105-283 states that the market is an indicator of value based on a willing buyer and willing seller. Based on Mr. West's analysis of properties listed for sale or lease as reported by the Department of Commerce, the land value of the plant site should be $5,867,500. The County had increased the value from $4,612,620 to $10,134,300, an increase of 119.7%. The facilities' replacement cost new increased by 7%, depreciation increased by 5.8%, making the increase in the replacement cost new, less the depreciation, to 7.7%. The Property Tax Commission had rejected Deputy County Attorney Burpeau's attempt to increase the land value at the hearing, but since then the County has increased the value to $10,335,074. Mr. West appraised the land value at $5.8 million, which is close to the County's June 2, 1999 value of $6.1 million. Mr. Mercer explained that the total assessed value of the plant in 1992 was $50 million, but it was reduced to $32 million through the appeal process. In 1996, additional buildings increased the ~ 2?6 MINUTES OF BOARD OF EQUALIZATION AND REVIEW, MA Y 1, 2000 value to $34 million. Mr. Connelly had testified that no comparable properties of the plant were found in New Hanover County. Since the plant is a very unique industrial facility, sales of comparable properties should come from national and international markets. The real estate market was depressed in 1992, and has seen improvements in all areas except for industrial facilities. Industrial markets have worsened because of competition between multinational corporations for employees, technological improvements in foreign markets, and better inventory control measures, and less demand for large facilities. Mr. Connelly had testified that the property in 1996 was worth $19.5 million to $21 million and that the value should remain the same in today's market. Mr. West established a market value for industrial facilities in North Carolina and estimated the value of the General Electric plant to be $31,910,601. Mr. Mercer stated that the County assessed the land value at $6,148,300 based on the following acreage: 163.6 acres at $20,000 per acre 1,425.4 acres at $2,000 per acre 170 acres at $150 per acre Total land value $3,272,000 2,850,800 25,500 $6,148,300 He explained that the County increased the value by adding more developed land for the new facilities on the site and because of misinterpreting Mr. Connelly's testimony. Mr. Connelly had appraised the land at $4,656,000. Commissioner Howell commented that staff and General Electric were to resolve their differences in the evaluations and report back to the Board. He asked if the two groups were able to agree on the developed land areas. Mr. Joe Taylor, attorney representing General Electric, explained that the difference in value was not due to the revaluation. None of the appeals since 1990 had included a dispute of the land values. The County assessed the land at $6.1 million for the June 1999 revaluation and General Electric appraised the value at $5.8 million. After the Property Tax Commission hearing, the land value was increased to $10.4 million with no changes in value for the plant facilities. General Electric is in disagreement with the County because of including the land area around two large storage buildings at an assessed value of $300,000. When General Electric spoke of having 385 acres of developed area, it did not have the same meaning as the County's primary site area of 106 acres. Both the County and General Electric had agreed with the 1996 value of the land being around $4.6 million although different figures were used to determine the value. Later, the County changed the property record cards from 106 acres to 350 acres to 305 acres. The County had applied the value of $20,000 per acre instead of$2,000 per acre for residual land. General Electric considers that the plant site consists of 163 acres, which is close to the amount used by the County in June 1999. Mr. West's analysis of comparable plant sites estimated I I I 227 -.., MINUTES OF BOARD OF EQUALIZATION AND REVIEW, MAY 1, 2000 that the Cape Fear Plant should consist of 148 acres. But some of the land, as in front of the fuel manufacturing building, drops off six to eight feet for several thousand feet along the fence line. These areas have never been included in the primary plant site because they are unusable. He requested a reduction of 140 to 160 acres from the primary site. Vice Chairman Greer asked for an explanation of why the County increased the plant site to 385 acres and then reduced the acreage to 305. Mr. Mercer responded that the County's June 1999 property record cards listed 167 acres as the primary site. An aerial photograph of the property shows a huge land mass within the boundary of the roads, but some of the land is unusable. General Electric has argued that the developed area consists of 148 acres instead of305 acres that the County has stated. Tax Administrator Glasgow noted that an additional 56 acres has been identified as roadways on the property. Mr. Taylor stated that the argument between the County and General Electric is the areas that should be included in the primary plant site. It is agreed that the rate of$20,000 per acre should be applied to the primary plant site, and $2,000 per acre for the other acreage. Commissioner Davis asked what the difference was in using the language of a development area or primary site. Mr. Taylor explained that the County has historically used the language of primary site to include the land that the building sits on and the areas that are needed for the operation. General Electric agreed with the County that the primary site was approximately 160 to 167 acres, but they do not agree with 305 acres. Vice Chairman Greer commented that the issue seems to be based on where the lines are drawn on the land. At one point the County drew the lines around the buildings, but now the site has been expanded to include everything within the roadway. He asked why the County changed the primary site to include the other areas. Tax Administrator Glasgow responded that by using the GIS mapping system and an aerial photograph, a more accurate reading of 305 acres has been identified. Break: Chairman Caster called a break from 10:00 a.m. to 10:20 a.m. Tax Administrator Glasgow continued in response to why the County changed the property records from 106 to 385 to 305 acres. Although General Electric and the County have agreed on the number of acres in the past, a General Electric representative used 385 acres in his presentation at the Property Tax Commission hearing. The Tax Department changed its records based on the ~ 2/8 MINUTES OF BOARD OF EQUALIZATION AND REVIEW, MA Y 1, 2000 ~" testimony. At the Board of Equalization and Review meeting on October 18, 1999, staffwas directed to work with the General Electric officials to resolve the differences in the acreage of the primary site. County staff used the GIS maps and aerial maps while touring the site with representatives from General Electric on December 10, 1999. The land records supervisor marked areas on the maps to determine how much of the site was actually used in the operation of the plant. Staff identified 305 acres as the primary site, which included access areas abutting the grounds and around the buildings for parking. Fifty-six acres of roadways were identified and have been assessed at a lesser rate of $8,000 per acre. The assessed value was reduced from $10 million to $8.9 million after identifying the areas of the site. He assured the Board that 305 acres was an accurate account of the plant site and its uses. Although Mr. Mercer and Mr. Taylor have stated that the County and General Electric were in close proximity of the assessment before the hearing of the Property Tax Commission, General Electric had appealed the value in December 1998. He questioned why the appeal was made if they thought the values were so close. Tax Administrator Glasgow presented the following changes in the acreage to show the reduction in value. 1999 Revaluation Recommendation 5 parcels 385 acres @ $20,000/acre 1,204 acres @ $ 18,000/acre 170 acres @ $150/acre $ 200,774 7,700,000 2,408,800 25,500 5 parcels (lot value) 305 acres @ $20,000/acre 1,228.4 acres @ $1,800/acre 56 acres @ $8,000/acre 170 acres @ $150/acre Total = $ 200,774 6,100,000 2,211,120 448,000 25.500 $8,985,394 Total 1,777.4 acres $10,335,074 Vice Chairman Greer asked Mr. Glasgow why the County changed the acreage after the Property Tax Commission hearing. Tax Administrator Glasgow responded that General Electric argued at the hearing saying that the County's figures were incorrect and that their records were accurate. Mr. Taylor responded that the Property Tax Commission accepted that the acreage of the primary site was 106. The County's and General Electric's appraisals proposed the same land value of $4.6 million and the same acreage of 106 acres for the primary site, although different terminologies were used. Since 1996, General Electric has added more buildings and developed areas to the primary site. The County correctly picked up additional acreage from building permits for new construction projects, when they changed the primary site to 167 acres. However, General Electric's records show 148 acres. Chairman Caster asked if other issues were involved besides the size and classifications of the land. Mr. Taylor responded that the notice of appeal was based on the evaluation of the buildings I I I 2?9 ,., MINUTES OF BOARD OF EQUALIZATION AND REVIEW, MAY 1, 2000 and not the land value. The disagreements on the valuation of the buildings were considered by the Property Tax Commission and those particular issues will be decided through the appeal process. The County and General Electric have never been at odds about the land value because of how the property was appraised. General Electric does not need 385 acres to operate the plant site and it is being penalized because of mowing grassy areas around the plant. If mowing these areas increased the value from $2,000 to $20,000 an acre, then General Electric should not be mowing those areas. Mr. Mercer explained that the Tax Department assessed the building improvements at $32 million. Mr. Connelly agreed with the land assessment, but the value of the buildings should be approximately $21 million, based on trending methods in appraisals. He appraised the total site around $26 million. However, Mr. West appraised the building improvements at a maximum value of $26 million, which is $6 million off the County's assessment. Mr. West's appraisal was not a complete appraisal, but it was based on a review of other industrial buildings on the market. Vice Chairman Greer asked how the County was assessing the roadway areas. Tax Administrator Glasgow responded that the roadways were not assessed at the primary site rate of $20,0000 per acre, but at a reduced rate of$8,000 an acre for miscellaneous lands. Mr. Taylor objected to including some of the property as part of the 305 acre site because some of the areas are low and cannot be built upon. Border areas are mowed to enhance the appearance of the plant site and have never been included as part of the plant site or taxed at the higher rate. General Electric has always been in agreement on how the land was assessed and most likely would have accepted the original 1999 valuation of $6 million. But the County changed the assessment because of the Property Tax Commission's decision on the appeal instead of being consistent with the normal process. Chairman Caster asked Assistant Attorney Holt Moore if the Board could vote on two separate motions on the assessment, one on the value of the land and the other on the facilities. Assistant Attorney Moore replied that the land classification is the main issue of today' s appeal hearing and should be resolved before voting on the assessment. Tax Administrator Glasgow explained that the 148 acres mentioned in Mr. West's appraisal is a ratio based on an average plant site and it is not based on actual acreage at the General Electric location. Mr. Mercer responded that the appraisal was based on the sales market of industrial sites in North Carolina. Just as property that is rented below market rents is assessed at market rents, and above market rents are assessed at values that are lower than the actual rents, the General Electric assessment should be based on market values. State law does not allow an assessed value to be more than market rents. Mr. West's analysis was based on a specific market, which should be valid ~ 230 MINUTES OF BOARD OF EQUALIZATION AND REVIEW, MAY 1, 2000 ~ evidence of the market value. Tax Administrator Glasgow pointed out that it may be difficult to find a true market value for this particular type of facility because of its uniqueness. However, the Nuclear Division at the Castle Hayne site was recently sold in a joint venture. Mr. Mercer had indicated that he would be able to give the County the selling price of the facility, but he has not provided the information. Mr. Mercer responded that a fair market value would have to be based on a regional, national, or international market, as indicated by Mr. Connelly at the Property Tax Commission. Chairman Caster asked when the sale took place. Mr. Taylor responded that the sale was in this calendar year and would not be applicable to the 1999 valuation. While Mr. West's appraisal was based on a percentage, it is historically in line with the County's appraisal of the General Electric property. Commissioner Howell asked Mr. Taylor if he was able to prove that the primary site consisted of 167 acres by using the available maps and ifMr. Glasgow could show the Board why the acreage should be 305. Tax Administrator Glasgow responded that he and staff members, that included the Appraisal Supervisor, Land Records Supervisor and GIS Supervisor, were given a guided tour of the plant site with the plant manager, Mr. Taylor and Mr. Mercer on December 10, 1999. Theyrode around on all the accessible roads and identified areas that were or were not part of the plant operation. The plant manager was helpful in drawing a diagram of the areas and answering questions about the use of certain areas. A map identifying the areas was provided to Mr. Mercer on January 6, 2000. Commissioner Howell asked if General Electric needed that much land to operate the plant. He did not think General Electric should be penalized for extending the landscaping out to a fenced area that included low-lying areas in order to improve the looks of the facility. Tax Administrator Glasgow replied that the County must be consistent in looking at properties in the County and that staff does not want to penalize anybody. Developed and used areas have been identified on the map and the mowed areas are part of the plant site and the image that General Electric wants to present. Mr. Bolick stated that if General Electric wants 150 acres removed from the designated acreage of the primary site, those areas should be identified on the aerial photograph for removal. Areas used for parking and in operation of the plant cannot be removed. Mr. Taylor pointed out some areas to exclude from the primary site were: open land areas, I I I -.., 231 MINUTES OF BOARD OF EQUALIZATION AND REVIEW, MAY 1, 2000 an old barrow pit, drainage ditches, wetland areas, and some road shoulders. MOTION: Commissioner Davis MOVED, SECONDED by Commissioner Birzenieks , to follow staff's recommendation in reducing the acreage of the primary site from 385 to 305 acres and reducing the assessment on the land value from $10,335,074 to $8,985,394. SUBSTITUTE MOTION: Vice Chairman Greer MOVED, SECONDED by Chairman Caster, to change the acreage by reducing the primary site from 305 acres to 167 acres and increasing the undeveloped land area to 1,366.4 acres. The remaining land areas will stay the same with 56 acres of roadways at $8,000 per acre, 170 acres of wasteland at $150 acres, and the remaining five parcels at $200,774. In discussion, Vice Chairman Greer estimated that the total land value would be reduced to approximately $6.5 million. He explained that removing 138 acres of the primary site to the undeveloped land area was based on the June 1999 revaluation where the plant site increased from 106 to 167 because of additional acreage reported on building permits. The 56 acres of roadways are improvements that are calculated at a lesser rate, but could be included in the primary site. Upon vote, the motion carried by a 3 to 2 vote as follows: Voting Aye: Commissioner Howell Vice Chairman Greer Chairman Caster Voting Nay: Commissioner Birzenieks Commissioner Davis Tax Administrator Glasgow recommended to uphold the assessed value of the improvements at $32,363,778, and the features at $1,770,349, saying that the values were based on the condition of the properties and the replacement cost new, less depreciation and obsolescence. Mr. Mercer stated that Mr. Connelly had placed the value of improvements for the plant site in 1996 at $15 million. Because large industrial plants are getting more difficult to sell, he would say that the value had decreased since 1996. Mr. West's analysis had determined the value to be $26 million based on the sale of industrial properties in North Carolina. By factoring in changes to Mr. Connelly's appraisal, he estimated the value of the property to be no more than $20 million. Mr. Mercer stated that the main difference between the County's and General Electric's appraisals is that General Electric applied more obsolescence than the County. He requested the Board to reduce the assessed value from $32 million to $26 million. MOTION: Commissioner Davis MOVED, SECONDED by Commissioner Birzenieks , to uphold the assessed value of $32,363,778 for the improvements. Upon vote, the MOTION CARRIED ~ 2~~~) MINUTES OF BOARD OF EQUALIZATION AND REVIEW, MA Y 1, 2000 .,.,..;;.;:-. an old barrow pit, drainage ditches, wetland areas, and some road shoulders. MOTION: Commissioner Davis MOVED, SECONDED by Commissioner Birzenieks, to follow staff's recommendation in reducing the acreage of the primary site from 385 to 305 acres and reducing the assessment on the land value from $10,335,074 to $8,985,394. SUBSTITUTE MOTION: Vice Chairman Greer MOVED, SECONDED by Chairman Caster, to change the acreage by reducing the primary site from 305 acres to 167 acres and increasing the undeveloped land area to 1,366.4 acres. The remaining land areas will stay the same with 56 acres of roadways at $8,000 per acre, 170 acres of wasteland at $150 acres, and the remaining five parcels at $200,774. In discussion, Vice Chairman Greer estimated that the total land value would be reduced to approximately $6.5 million. He explained that removing 138 acres of the primary site to the undeveloped land area was based on the June 1999 revaluation where the plant site increased from 106 to 167 because of additional acreage reported on building permits. The 56 acres of roadways are improvements that are calculated at a lesser rate, but could be included in the primary site. Upon vote, the motion carried by a 3 to 2 vote as follows: Voting Aye: Commissioner Howell Vice Chairman Greer Chairman Caster Voting Nay: Commissioner Birzenieks Commissioner Davis Tax Administrator Glasgow recommended to uphold the assessed value of the improvements at $32,363,778, and the features at $1,770,349, saying that the values were based on the condition of the properties and the replacement cost new, less depreciation and obsolescence. Mr. Mercer stated that Mr. Connelly had placed the value of improvements for the plant site in 1996 at $15 million. Because large industrial plants are getting more difficult to sell, he would say that the value had decreased since 1996. Mr. West's analysis had determined the value to be $26 million based on the sale of industrial properties in North Carolina. By factoring in changes to Mr. Connelly's appraisal, he estimated the value of the property to be no more than $20 million. Mr. Mercer stated that the main difference between the County's and General Electric's appraisals is that General Electric applied more obsolescence than the County. He requested the Board to reduce the assessed value from $32 million to $26 million. MOTION: Commissioner Davis MOVED, SECONDED by Commissioner Birzenieks, to uphold the assessed value of $32,363,778 for the improvements. Upon vote, the MOTION CARRIED I I I 233 -.., MINUTES OF BOARD OF EQUALIZATION AND REVIEW, MAY 1, 2000 UNANIMOUSLY. Mr. Taylor requested that the County and General Electric develop agreed upon standards so that appeals will not be necessary. He felt the real issues were the depreciation of the buildings for a nuclear facility and determining the market value for a complex and unique facility. However, the depreciation factor will be determined by the courts. Vice Chairman Greer suggested that staff use the approved breakdown of the acreage as a basis to determine any future valuations. Mr. Mercer stated that he felt the General Electric representatives will be able to work with County staff to resolve the other matters of the appeal except for the issues regarding obsolescence of nuclear plants. He expressed appreciation to the Board for establishing a basis for future assessments. RECONVENE TO THE MEETING OF THE 2000 BOARD OF EQUALIZATION AND REVIEW Chairman Caster reconvened to the meeting of the 2000 Board of Equalization and Review at 11:15 a.m. Tax Administrator Glasgow stated that this is the last day that staff can change any value without coming before the Board for approval. He requested the Board to schedule a meeting of the Board of Equalization and Review to hear the tax appeals in 45 to 60 days. Consensus: After consideration ofthe Commissioners' schedule of meetings, the Board agreed upon the dates of Wednesday, August 2, 2000 at 9:00 a.m. and Wednesday, August 8,2000 at 9:00 a.m. ADJOURNMENT Motion: Commissioner Birzenieks MOVED, SECONDED by Commissioner Davis, to adjourn the meeting until the Board meets to conduct the hearings in August. Upon vote, the MOTION CARRIED UNANIMOUSLY. Chairman Caster adjourned the meeting at 11 :20 a.m. Respectfully submitted, ~jJ~ Teresa P. Elmore Deputy Clerk to the Board ~