LAKE COUNTY ? Mediacom”s property tax bill will be reduced after a unanimous, if reluctant, vote by the Lake County Local Board of Equalization on Tuesday.
Sitting as the board of equalization, the Lake County Board of Supervisors voted to reduce the value of the corporation”s land holdings in the county. The reassessment was based on a new tax law and a reduced demand for service, according to Lake County Assessor Doug Wacker.
“What we”re looking at is the value of the possessory interest ? basically the value of the right to access the property,” Wacker said.
The value of Mediacom”s buildings and facilities is taxed separately. Mediacom holds leases with Lake County, the City of Lakeport and the City of Clearlake to use land that houses equipment the company needs to provide service and make a profit. The value of the right to access the land was assessed in 1999, when Mediacom bought Jones Cable, at a percentage of the purchase price, according to Wacker.
Tax law changed the way county tax assessors calculate the value of possessory interests in 2002, according to Wacker. The new process of valuation requires Mediacom to estimate how much revenue it will earn during the term of a 10-year lease agreement. The fee the company pays to use the land is based on the projection. Wacker said the value of the possessory interest goes down as a result, and so does the amount the company pays for tax.
“What they”re purchasing is future income,” Wacker said.
Mediacom appealed the value on the county”s tax roll for its possessory interests in 2006. Wacker said a lack of communication delayed the process, and Mediacom filed another appeal in 2008. Wacker told the board that part of the reason for Mediacom”s appeal was that its customer base was dwindling.
“Lake County fortunately didn”t get any appeals until now,” Wacker said.
Mediacom asked for a total valuation of $1.4 million for all of its Lake County possessory interests. Wacker recommended to the board a $2.2 valuation, down $5.4 million from its 1999 assessed value. Wacker said that would result in an approximately $50,000 annual tax reduction for the company.
“We have to follow state guidelines, it doesn”t mean we can”t question the collective wisdom of our representatives as it relates to state law,” Board Chair Anthony Farrington said.
Contact Tiffany Revelle a trevelle@record-bee.com, or call her directly at 263-5636, ext. 37.
