San Francisco Tax Preparation / CPA: CA – Petition for reassessment partly granted

Filed in CCH NEWS FEED by on February 24, 2020

For California property tax purposes, the State Board of Equalization granted in part the telecommunications company’s petition for reassessment reducing the 2019 Board-adopted unitary value. The company argued that the Board made an excess capital adjustment for joint-owned poles in the rural footprint, using a pole removal-to-value ratio that is inconsistent with data in Board staff’s appraisal workpapers. It also contended that the square footage it would require to replace its buildings is significantly less than its existing square footage and that an inutility adjustment should be made. Based on additional information provided by the company, the State-Assessed Properties Division (Division) determined that the trend factor for buildings specific to the purchase price allocation (PPA) year should be adjusted and therefore applied the adjusted trend factor for the buildings to the appropriate Replacement Cost New (RCN) value indicator, to derive a revised Replacement Cost New Less Depreciation (ReplCLD) value indicator. The Division applied the adjusted trend factor for the buildings to the appropriate RCN value indicator, resulting in a net reduction to the company’s unitary value. However, the company failed to present additional evidence or arguments to show error or illegality in this adjustment. Additionally, the company did not present any evidence to show that the fiber account reclassification adjustment, excess capital adjustment for the rural footprint, economic obsolescence adjustment were inappropriate. Consequently, the 2019 Board-adopted unitary value was reduced. Frontier California, Inc., California State Board of Equalization, No. 1063284, December 17, 2019, released February 2020

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