New School Bond Possibly In Jeopardy:
Emeryille Corporations All Say They're Not Worth Much
Emeryville businesses spend a lot of effort to tell people how valuable they are and about how they contribute to our town especially when they want something from the taxpayers but recently they've begun playing a different tune; now they're busy devaluing their businesses, saying they're not really worth all that much after all. When it comes time to pony up the taxes, suddenly it seems Emeryville's much touted mighty business force is sort of anaemic and sickly.
Seen better days: now they're worth
$90 million less.
The Alameda County Appeals Board has been receiving many requests from Emeryville businesses for significant reductions in the assessed value of their properties according to a report from City Hall. The report is alarming in the depth of the devaluation being claimed. Councilwoman Jennifer West noted with some concern, "Every year there are appeals to the County for reductions, but this year the percentage has definitely gone up". Emeryville, it should be noted must continue to show at least a 4% growth in assessed valuation city-wide or the newly issued Measure J school bonds are in grave danger.
The average appeal rate this year is 25% according to Ms West but some businesses are claiming a much greater loss of value. Hardage Hotels, owners of the Woodfin claims a 41% reduction on property the county says is worth $42 million making approximately a $20 million contested discrepancy. Hilton Hotel claims a 54% reduction in value. Even Disney Pixar with its string of Oscar rated films including tonight's 'Toy Story 3' is claiming a sizable loss in value.
The problem it would seem is that there's no downside for corporations to claim a loss in value; something Ms West noted, "There's no incentive to not appeal these taxes" as she puts it.
Wareham's proposed 'Transit Center': Even with the approval
to build, they claim their value has dropped $124 million.
It remains to be seen how much reduced value Alameda County will grant these businesses but it should be noted that Emeryville will receive significantly less tax on these properties in future years if these appeals succeed. Further, the payback of the $95 million Measure J school bond passed by voters last November would dramatically increase if Emeryville's aggregate assessed valuation dips below 4%. In that case, taxpayers will be on the hook for much more money spread over more time. If the assessed value stays above 4%, the best case scenario, then the payback amount for the $95 million bond would be nearly $400 million over 50 years.
Novartis campus: almost worthless.
Brother, can you spare a dime?
Pixar has requested an assessed valuation reduction of $94 million while the report assumes a $30 million reduction based on their stated 2011-2012 revenue. Novartis requests a $211 million reduction with a $58 million assumption from revenue and Wareham Development requests $124 million with a $41 million assumption from revenue.
The February 15 letter accompanying the report from Emeryville's Chief Financial Officer, Karan Reid noted that as a result of the businesses assessments downward adjustments anticipated, the amount of tax allocation bonds the city could issue has "decreased dramatically".
Emeryville Hilton: chicken feed...
decidedly down market.
The report can be viewed here: