Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: WEDNESDAY, March 11, 1992 TAG: 9203110077
SECTION: BUSINESS PAGE: B-7 EDITION: METRO
SOURCE: LESLIE TAYLOR STAFF WRITER
DATELINE: LENGTH: Medium
A section of the state code gives localities the right either to tax the equipment at a different rate than cars, trucks and other equipment - or exempt it completely from taxation, said City Manager Randy Smith.
"Some time ago, Mohawk asked if the city would ever consider implementing that section of the state code," Smith said.
Mohawk last year was granted a permit from the state Air Pollution Control Board for additional air emissions as part of its $200 million expansion. The plan is to step up tire production by 150 percent, from 16,500 tires a day to 40,000 tires by the mid-1980s.
Since 1987, some $4 million worth of pollution-control equipment has been installed at the Salem plant. More will be installed as part of the expansion, said Sanat Bhavsar, Mohawk's environmental health and safety director.
Under the ordinance, adopted by council on an emergency basis Monday, Mohawk and 11 other Salem businesses and industries will not have to pay personal property taxes on equipment, provided the equipment meets state certification standards.
The "emergency" was declared because equipment has to be inspected and certified by state agencies, then filed for tax purposes by May 1, Smith said.
Bhavsar could not estimate the tax savings to Mohawk. But industry's gain could be Salem's loss. Finance Director Frank Turk estimated that in the "worst-case scenario," the city will lose about $75,000 a year in tax revenue.
"There's no real return on that type of equipment like there is on manufacturing, yet it's taxed at the same rate - $3.20 per $100 of assessed value," Smith said.
Roanoke has exempted air pollution equipment from taxation since the 1970s, said Roanoke Commissioner of Revenue Jerome Howard. Roanoke County has no such exemption.
by CNB