Kokomo — To determine if the personal property assessed value reported by companies is accurate, Howard County has hired a company to conduct extensive audits.
Auditor Jamie Shepherd said the county signed a two-year contract with Tax Management Associates to conduct the audits to make sure the assessed values companies file for tax purposes accurately reflect the equipment being used.
Shepherd said the company is only paid if the county collects more in the form of tax revenues.
The hiring comes just months after both Chrysler Group and General Motors Components Holdings filed amended personal property assessed values that showed a marked decline.
The county reached an agreement with Chrysler, and GMCH has filed an appeal with the state to lower the assessed value of personal property.
Chrysler proposed reducing the personal property assessed value from $804 million to $92 million. GMCH wants to lower the assessed value of property it purchased from Delphi Electronics and Safety from $253.8 million to $7.5 million.
The Howard County and Center Township assessor’s offices will determine what personal property assessed value returns are audited. Shepherd said it will probably be companies that have a personal property assessed value higher than $50,000.
Shepherd said Tax Management Associates will determine if companies and businesses have misrepresented or failed to include equipment in their personal property assessed value.
“They will do a walk-through of a facility with representatives from the county offices taking part,” she said. “We want to make sure all equipment is reported accurately.”
Shepherd said companies will be billed if the personal property assessed value is changed.
The review includes farms, and commercial and industrial businesses.
Shepherd said if a company files an appeal, Tax Management Associates will cover the appeal for the county.
“The reason we felt the time was right was because of the large industrial base and the self-reporting by businesses,” she said.
Extensive audits need to be conducted on a regular basis, according to Shepherd.
“We want equality of the assessment and tax base,” she said. “The goal is to make sure everyone is paying their fair share. The assessed value could go up or down based on the audit review.”
Shepherd said the decision was made to hire Tax Management Associates because of the county’s financial constraints and a review done in-house would require hiring additional staff.
She said another extensive audit will be done in the future.
The current review covers 2007 taxes payable in 2008 through 2009 tax payable in 2010.
“We want to start as soon as possible,” Shepherd said of the audits. “This company has been used in other counties and is recognized and respected in the assessor community.”