West Oregon Electric Coop. v. State Tax Commission

2 Or. Tax 244

• Court: Oregon Tax Court
• Decided: November 12, 1965
• Status: Published

Opinion

Edward H. Howell, Judge.

This suit involves the valuation of certain real and personal property owned by plaintiff, a nonprofit electrical cooperative in Vemonia, Oregon.

The primary issue involves the true cash value of plaintiff’s office and warehouse building and the personal property therein.

The defendant tax commission had originally established the true cash value of plaintiff’s real and personal property at $126,720. Upon appeal to the tax commission the total value was reduced to $121,054.

Generally, all of the witnesses followed the replacement cost less depreciation approach to true cash value.

Vernonia has a population of 1500 people. There was substantial evidence introduced that the town was a depressed economic area since the closing of a large sawmill in 1957. The county assessor testified that he allowed a twenty-five percent discount against the depreciated replacement cost of commercial buildings in Yernonia because of the economic conditions. There was also testimony by plaintiff that the office building was overbuilt and that consideration should be given to a reduction in true cash value because of this functional obsolescence. The building was unquestionably well built but this court does not believe there is any functional obsolescence present. On the other hand, if the county assessor is allowing a twenty-five percent discount for economic obsolescence to all commercial buildings in Yernonia, then the plantiff is entitled to the same consideration.

The true cash value of the real and personal property is established as follows:

Replacement cost of building...................... $120,000

Less 12% depreciation.................................. 14,400

Replacement cost less depreciation............ 105,600

Less 25% economic obsolescence................ 26,400

True cash value of building.......................... 79,200

True cash value of land................................ 1,920

Total true cash value of real property...... 81,120

True cash value of terminal personal

property and equipment........................ 8,400

Total true cash value real and

personal property.............................. $ 89,520