Money For Thee, But Not For Me

– Chris the Producer writes:

At twelve o’clock today we broke a story about Lake Union Drydock Company. The company sits on just under eight acres of water front property just down the street from our studios. Pretty nice piece of property. You can take a look across the lake, see sea planes land, and enjoy the natural surroundings of the lake. How much do you think this piece of property would assess for? $10 million or $20 million? How about $2,000 dollars. That’s all that the property is being taxed on right now.

I’m sure you are wondering just why in the hell the city government is allowing a company to sit on some prime real estate and only pay property taxes on the $2,000 assessed value. Well there is a whole story behind this.

Starting in 1999 the King County Assessors office received an appeal from Lake Union Drydock Company stating that their property isn’t worth the original assessed value. In fact it is only worth $2,000 dollars. Sending in documentation that the Federal Government has designated the area as a super fund site and that the EPA would estimate the cost of the clean up at $8 million dollars the property isn’t worth anywhere near the assessed value.

The appeal prevailed and the King County Assessor re-evaluated the property back down to the value set right now at $2,000. Now having talked with King County Assessor Scott Noble he states that the appropriate market value is in the neighborhood of $12.3 million dollars. This is of course not taking into consideration that the site needs to be cleaned up.

Now lets do some simple math. $12.3 million for the assessed value of the property in pristine condition minus $8 million for the clean up cost equals $4.3 million dollars of equity in the property after the cleanup. Now I don’t know about you but that seems to be a lot of money that isn’t being taxed.

We also had a chance to talk with Jim Frances the Vice President for Lake Union Drydock Company. Jim on the Dori Monson Show stated that he felt the property was assessed correctly and that the companies property as it is now and at market value is truly only worth $2,000. If that were true, and Dori even offered, I would be there in ten minutes with $2,000 dollars in my hand to buy the property from him. Unfortunately he declined and there went my lake front property that I had been hoping for.

Jim also stated that the cleanup cost would be way over the $8 million dollars that was quoted to him. When asked how much he did not quote a hard number. Dori also stated that it seemed to him that the company was really taking advantage of the system. Continuing to send in appeals when the property was assessed for more than the $2,000 dollars and making sure that the property never goes up in value. There was a long silence after this question. Almost like a child when they are caught doing something bad. Jim then stated that they are not doing any such thing.

There is also no mandate by the federal government to clean up the site. So as far as I know Lake Union Drydock Company can operate in perpetuity without cleaning up the site. This would then cause the property to be constantly under valued. The site’s property value hasn’t even gone up by any inflationary numbers, and I’m sure that you know the same $2,000 in 2000 bought you a lot more than $2,000 today.

After hearing both sides of the conversation I have come to a conclusion that we, as tax payers, are being taken for all we are worth. Lake Union Drydock Company found a nice little loophole in the tax structure to avoid paying for the true amount of the property. By having a nice little piece of paper from the federal government that states the land they are using is a contaminated site and needs to be cleaned up they are able to drop their property value to a insane amount and then only have to pay taxes on that amount.

The federal and county government has given no incentive to clean up the area. As a matter of fact they have done quite the opposite and have given every incentive to keep the site contaminated. Now for you or I we really can’t start dumping oil all over our yards and bringing in toxic contaminates to have the land that your house lives on be declared a contaminated site. The most that you could do is bring in 10 or 12 old beat up, non-running cars and park them on your lawn. You will have to deal with your neighbors though, and eventually you will be forced to move those vehicles. Forced by the very government that is making you make up the tax burden that is not being filled by companies like Lake Union Drydock.

Now I don’t want to beat up on Lake Union Drydock. They are taking advantage of a system that the government has set up. There are many companies out there that take advantage of this. Many companies come into communities or already exist in the community and find ways to skirt the tax burdens that were originally intended for them. The tax burden then falls on you and I. We then get to make it up in higher residential property taxes or other taxes that are passed on to the consumer.

In order to stop this we need to contact our state, county and city officials and tell them to stop giving so many loopholes and corporate welfare out to larger companies. Then ask them to start closing up the loopholes that are already existing. These same benefits aren’t being given to the small business owner. I’m sure that most of the small business owners don’t even have the time to research how to get out of paying their taxes. They are to busy trying to put out the best product possible. Imagine that! We need to force corporations out of the business of finding ways to drop their tax burden and into the business of creating the best product possible. Lets get some really competition in the market place.