Goodrich Corp., the Charlotte, N.C.-based company that makes carbon aircraft brakes at a plant on the West Plains, has won an appeal that could keep it from being hit with a big increase in property taxes here based on the assessed value of the plants equipment.


The Spokane County Board of Equalization late last month agreed unanimously with the companys contention that the plants equipment should be valued for tax purposes at $18 millionless than half the $36.8 million value placed on it for 2007 by the Spokane County Assessors Office.


Based on a levy rate of $11.40 cents per $1,000 of valuation in the tax code area where the plant is located, that $18 million valuation translates into a 2007 personal-property tax bill on the equipment for the plant of about $205,000. At the assessed-value figure that the assessors office sought to impose, that bill would have been more than $419,000.


Joel Casebier, director of operations for the Goodrich plant, couldnt be reached for comment, and a Seattle accountant who also testified before the Board of Equalization on Goodrichs behalf at an appeal hearing declined to discuss the matter.


Assessors Office Appraisal Supervisor Byron Hodgson, who testified before the board in defense of the countys assessed value for the Goodrich equipment, says, Weve had some big personal-property cases, but not very many, and this is among the larger ones.


The assessors office plans to appeal the Board of Equalizations ruling to the Washington State Board of Tax Appeals, as often occurs in personal-property assessment appeals, he says.


Such cases sometimes go directly to the state board, bypassing the local board, Hodgson says. Thats mainly because the schedules used for valuing personal property are developed by the Washington state Department of Revenue (DOR), to ensure statewide uniformity, he says.


The local six-member Board of Equalization is responsible for assuring that all real and personal property in the county is assessed at fair value. It hears assessed-value appeals filed both by individual home and property owners and by businesses.


Most personal property owned by individuals is exempt from property taxes, but businesses and farmers pay personal-property taxes on movable items such as machinery, equipment, furniture, and supplies.


Those items are taxed at the same levy rate as real property, which includes structures, land, improvements to land, and certain affixed equipment.


Goodrich representatives argued at the Board of Equalization hearing that the value figure reached by the assessors office didnt accurately reflect the depreciation of the unique equipment the company uses, nor how quickly it becomes obsolete in that fast-evolving industry.


The assessors office countered that, in arriving at its figure, it simply applied DOR schedules and incorporated additional information it gleaned from a 2006 DOR audit of Goodrichs operation here.


I think its pretty difficult for us to depart from the state schedules because theyre the ones directing us to use them, Hodgson says, echoing his earlier testimony before the board. At the state appeal hearing, he says, It will come down to the Department of Revenue supporting the schedules that we used. The assessors office does have a certain amount of judgment in applying the schedules, but for the most part they are straightforward and we are just administering the program.


Businesses provide the assessors office with lists of their assets, he says, and we apply the schedule to those asset listings, and that produces the value.


The Goodrich case doesnt have implications for other manufacturers that pay substantial personal-property taxes, though, Hodgson says, because, This is a one-of-a-kind facility, and the scope of its product is very limited.


Thus, the schedule used to determine a taxable value for the plants manufacturing equipment also is narrow in scope, he says.


The Goodrich plant here had personal-property assessments of $18.8 million and $18.4 million for the 2006 and 2005 tax years.


Hodgson says it wouldnt be appropriate to compare those figures directly with the $36.8 million assessment figure the county arrived at for this years taxes. Thats because manufacturers regularly acquire new equipment, and depreciation schedules vary year to year, both of which complicate the assessment-calculation process, he says. He says, though, that for the latest valuation, there was a change in the schedule (applied to Goodrich) to mirror the state audit. We had been using a different schedule on some of the equipment, which contributed to the higher value figure set by the county.


Goodrich claims to be the worlds largest producer of carbon composites for aircraft braking applications. It opened the $66 million, 150,000-square-foot plant at 11135 W. Westbow Lane, on the West Plains, in September 1999. The company employed 146 people here as of last spring, according to information it supplied to the Journal for a list of leading Spokane manufacturers.


Contact Kim Crompton at (509) 344-1263 or via e-mail at [email protected].