Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: MONDAY, May 23, 1994 TAG: 9405230025
SECTION: VIRGINIA PAGE: C-1 EDITION: METRO
SOURCE: By ERIKA BOLSTAD STAFF WRITER
DATELINE: LENGTH: Medium
Within Roanoke and Botetourt counties and the cities of Roanoke and Salem, there are four personal property tax rates and three ways of assessing them.
Virginia law requires local commissioners of revenue to use a recognized pricing guide to determine the taxable value of cars. Commissioners can choose the National Automobile Dealers Association guidebook, called the Blue Book, or the National Market Guide, called the Red Book.
Among the 241 cities, counties and towns in Virginia, 237 use the Blue Book to determine car values.
"We are the guidebook of predominance, especially for dealers, insurance companies and banks, or anyone else who has anything to do with cars," said Jan Ocean, managing editor for the Blue Book.
The National Automobile Dealers Association keeps track of the prices paid for used cars all over the country and publishes a yearly guide offering a loan value, a retail value, and a trade-in value for almost every make and model of car sold in the United States.
Four localities, including Roanoke, use the National Market Guide. Marsha Fielder, Roanoke's commissioner of revenue, said the city was using the Red Book when she took office in January and probably would continue to use it even though most car dealers, bankers and insurance agencies consider the Blue Book a more accurate reflection of the used car market.
"The problem with changing books is that the public feels [the Red Book] is so much lower," Fielder said.
In fact, the National Market Guide does have lower assessed values for many automobiles. And popular cars such as sports-utility vehicles went down in value this year, according to the National Market Guide. According to the Blue Book, however, some of those cars went up in value.
The disparities among localities get wider, however.
In Roanoke, the tax is $3.45 per $100 of assessed value. The commissioner uses the loan value from the Red Book for cars newer than 1986 models.
Most localities use a Blue Book older-car guide for cars made from 1978 to 1986. When a car is old enough to drop out of the guide books, most localities assess a minimum tax, assuming the car passes its annual inspection.
But Roanoke doesn't use the older-car guide. Instead, until this year it assumed a 10 percent depreciation each year on all cars made before 1986.
Fielder says that wasn't logical. "We had them [valued] at something way less" than what they were worth.
This method of assessing a car's value is "where the general public got the idea that a car's value automatically depreciated each year," Fielder said.
This method goes against the state's requirement to use a recognized pricing guide. It also undervalues cars and loses tax revenue for the city.
Because of that, Fielder made some changes this year. She froze values on older cars if the assessed value was less than the older-car guide said it was worth.
Fielder does not know if the city will start using the older-car guide next year, since it would mean that many taxpayers would be assessed higher taxes than they are used to.
Botetourt County uses the Blue Book's retail value. The tax rate is $1.80 per $100 of assessed value. Cars older than 1975 are assessed at $340.
Roanoke County uses the loan value from the Blue Book. The tax rate is $3.50 per $100. Cars older than 1975 are assessed at $200.
Salem also uses the Blue Book loan value, and has a tax rate of $3.20 per $100. Cars older than 1975 are assessed at a minimum of $100 to $200.
"If that car is drivable, it has at least $100 worth of tires," Salem Commissioner of Revenue Ron Wright said.
by CNB