2013 advanced personal property seminar september 24, 2013 sheraton four seasons hotel greensboro,...

2013 Advanced Personal Property SeminarSeptember 24, 2013

Sheraton Four Seasons HotelGreensboro, NC

Presented by Dave DutyProperty Valuation Specialist II

North Carolina Department of Revenue

The Instructions Manual

Why do we need to follow the instructions manual?

The 2013 Billboard StructuresValuation Guide

If we are not using the NCDOR Billboard Manual, we are valuing these assets using vintage methodology---

Utilizing the Billboard Manual or any manual optimizes our successful completion of any important project--------

There are efficiencies built in to the manual to help county employees be better mass appraisers-------

What does the manual have in it?

Contents Page

It gives the reader a snapshot of topics

contained within the manual itself

Open up to great information!!!

Introduction & historical overviewDiagrams of sign styles & configurationsBase Cost TablesValuation Worksheet for special/unique signsExamples of how to value signsDefinitionsThe I-1 Form & InstructionsDepreciation Schedules

Dos and Don’ts-Warnings!!!

What is my skill level?

Be able to use simple math processes; adding, subtracting, multiplication, & division

Comprehension is importantRead various graphed informationTransfer information from the I-1 worksheet

into your office valuation systemAsk questions when in doubtAsk your neighboring county to assist you

What tools are needed?

What does the billboard manual have in it? Tools!

An overview of billboard valuation over the years---An introduction to billboard construction techniques

and types of structures---The valuation methodology used in the manual---Illustrations of billboard sign configurations---A specialized valuation worksheet for unique signs---Real world examples to follow along with---Access to the Billboard Manual online 24/7Access to a live conversation with Dave 24/7 for a

fee!

Installation Instructions

Billboard Manual has-----The base costs of the specific sign related to

its classificationDefinitions of terms used in the manualA Depreciation Schedule to apply loss in

valueExamples to follow of all the various types of

signs

Customer Delivery

Billboard Manual DeliversIt provides a copy of the I-1 form along with

instructions for filling it out---

The billboard manual delivers all the necessary data and information for the county appraiser to determine values on billboard signs---

The county appraiser is able to deliver the proper forms to the taxpayer along with instructional information---

Care and Maintenance

Trouble Shooting-----

Need Help?

Our office valuation specialists are available to assist you concerning questions about the billboard manual

The manual also provides examples on how to take data from the taxpayer and utilize the processes in the manual to assess and value billboard signs

SummaryUsing the billboard manual properly values

billboard signs---The manual process is uniform, equitable, and it

arrives at fair market value---Achieving fair market value provides tax revenues

that ultimately provide more services to county citizens, possible additional clerks in the tax office, & leads the county into a more complete compliance program---

The courts have already given their blessing to manuals that NCDOR develops to help businesses become more compliant---

The NC Outdoor Advertising Association helped the NCDOR develop the manual & the I-1 form---

Transition ChallengesSometimes, it is difficult to get information

from the taxpayer---County must be pro-active in helping the

taxpayer utilize the I-1 form and understand the benefits going forward---

County staffing is minimal with increasing responsibility and fewer resources---

A general lack of knowledge is overcome by attending classes, seminars, & using internet sources---

First have a funeral, then have a party!!!

Have a proper and respectful disposal of the old way of assessing and valuing billboard signs---

Have a party and celebrate a whole new way of thinking!!!

Become environmentally friendly & kind to the earth!

Interstate Outdoor, Inc. vs. Johnston County

Thursday May 16, 2013Taxpayer’s Evidence:Owner has not appealed in other counties where his

property is also located---Claims his cost invoices confirmed the cost to build

various signs within the county---Improvements have been made to the signs and

taxpayer approves of the depreciation schedule in manual---

Taxpayer says there are additional costs to build a sign in coastal communities due to soil conditions---

Owner claims neighboring county accepted their invoices and did a reasonable assessment---

Thursday May 16, 2013County Evidence per County Attorney:

Johnston County did use the NCDOR Billboard Manual in order to be uniform & equitable---

Showed that owner’s invoices were “Proposals” only and that there were inconsistencies between invoices; invoices provided did not include all costs---

County relied on NCDOR Billboard Manual because it supports and reflects cost changes from year-to-year related to the actual building of a sign structure---

Thursday May 16, 2013County Evidence per County Attorney (Continued):

County was willing to adjust values for construction techniques based on costs in other regions, however, the sign owner was unable to show all costs related to the construction of these signs---

Replacement costs provided by the taxpayer’s construction vendor could not be authenticated & appeared to be from a biased source---

The PTC Members Vote

Vote was 2 to 1 in favor of Johnston County

The Final DecisionStatement of Case

Analysis & Issues

Findings of Fact

Conclusions of Law

Findings Of FactJohnston County used the 2012 Billboard

Structures Valuation Guide to value all billboard signs in their county

Interstate Outdoor testified to certain direct costs to construct said billboard signs, but claims county has overvalued the assets

There was no testimony regarding the fact that all costs to construct the signs were included

Findings Of FactThe construction vendor testified that invoices

included a turn-key package cost & varied only if a physical site inspection was made

The NCDOR Manual prescribes a proper methodology for using the cost approach to value and says that the reproduction costs new less depreciation is the best way to arrive at Fair Market Value

The NCDOR Manual uses all costs and the costs vary from year-to-year based on the Producer Price Index

Conclusions Of LawThe County Ad Valorem tax assessment is

presumptively correct & the taxpayer must rebut the presumption by presenting competent, material, and substantial evidence

The NCDOR has the power to prescribe forms, books, & records to use to develop standards and rules to be followed by Assessors

All costs must be included in the taxpayer’s presentation of construction invoices

A Definitive Hearing Statement

“Providing some costs does not generate a Fair Market Value…”

Your “Take Away” for today…………………

Appeal??? What can your county do to present a rock

solid case???Walk the PTC members through the cost approach

used so often in valuing business personal propertyUse the NCDOR Billboard Structures Valuation

Guide or all counties run the risk of having this guide declared invalid because all 100 counties do not use it

Be familiar with how the manual works, what it strives to produce, and how its application produces a fair, equitable and uniform approach to valuing signs for all business owners

SummaryPLEASE USE THE NCDOR BILLBOARD

STRUCTURES VALUATION GUIDE!!!

Take advantage of the tools & resources, technical support & court cases to confidently appraise the property

Get out there and make the tax world a bright and wonderful place to be!!!