Economic obsolescence

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Economic obsolescence

• Gregg Martin and Dave Duty
• Property Valuation Specialists
• North Carolina Department of Revenue
• Property Tax Section/Local Government Division
• 2011 Advanced Personal Property Seminar
• Greensboro Sheraton Four Seasons Hotel
• Monday September 12, 2011

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Economic Obsolescence

• Economic obsolescence-wikipedia, the free
  encyclopedia-information about economic
  obsolescence can be found here
• http//en.wikipedia.org

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Economic obsolescence

• External obsolescence is loss in value as a
  result of an impairment in utility and
  desirability caused by factors external to the
  property (outside the propertys boundaries) and
  is generally deemed to be incurable. External
  obsolescence can be caused by a variety of
  factors such as changes in the highest and best
  use of a property due to market shifts or
  governmental actions, restrictions on income,
  zoning, neighborhood decline, lack of property
  demand, and national economic conditions.

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Boundaries Book Store

• Letter to county from Thomson Reuters concerning
  assets in the company
• Closing of other sister stores
• Related business decision to downsize
• Costly development of website for retail sales
  online
• Job openings?
• Airport business is taking off!
• PTD recommendation

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Fuzzy Picture, Inc.

• Letter from Ernst Young to county addressing
  value of assets
• Numerous phone calls from affected counties
• Shotgun approach
• PTD recommendation

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Elite home appliances, inc.

• Phone call to county asking for review of values
  related to manufacturing plant assets
• Tour of plant
• Conference discussion
• County decision
• PTD recommendation

8
Fancy Paper Products Corp.

• Phone call to the county with request for a
  conference
• Guided tour of 2 plants
• County decision
• PTD recommendation

9
DGM Automotive parts, Inc.

• Letter from tax representative to county
  requesting a review of listing forms, etc.
• Tour of plant
• Conferences
• County decision
• PTD recommendation

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StuffHauler Truck Mfg. Co.

• Letter from tax representative to county
  requesting an adjustment for economic
  obsolescence.
• Review of information about company.
• Review of information presented in media.
• County decision.
• PTD recommendation.

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Conglomerated Diesel, Inc.

• Letter to the county requesting value reduction
  due to economic obsolescence
• Conference call with Assessor
• Review of documents
• Determination of percentage amount of economic
  obsolescence to recognize
• PTS recommendation

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Economic Obsolescence

• Summary
• Questions?