THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Sunday, June 30, 1996 TAG: 9606290079
SECTION: CHESAPEAKE CLIPPER PAGE: 06 EDITION: FINAL
TYPE: Guest Column
SOURCE: BY JOHN P. FLEMMING IV
LENGTH: 108 lines
When I read the article in the May 24 Clipper titled ``City won't collect property taxes on some older cars,'' I was reminded that taxes were due on my 13-year-old Toyota pickup truck. The bill for 1996 was $55.08. This seemed a bit steep for my little red truck. I checked my records and found my 1995 bill. It was for $57.12. Aghast! The personal property taxes on my little red truck had fallen only $2.04.
The article stated, ``The city is no longer collecting personal property taxes from people who owe less than $15 in a calendar year.'' I reached for my two-year-old Texas Instruments TI-81 calculator. Problem: How long would it take for my little red truck to reach an assessment of $15 or less? I first calculated the number of years it would take for my truck to reach the city's $15 minimum tax assessment, based on the last annual decrease of $2.04.
Could my calculator be wrong? Not 20 years from now! That would be in the year 2016, and my little red truck would be 33 years old.
Vehicle assessments normally decrease with time, or so I thought. Factoring in a depreciation rate of 10 percent per annum, I determined that the year 2016 was too optimistic; in reality, my little red truck wouldn't reach the city's minimum tax assessment until some time after the year 2038.
This seemed odd. So I called the city treasurer's office the next day. A polite lady at the other end of the telephone informed me that after a vehicle reaches the age of 20 years, it is reclassified as a ``classic,'' and after 30 years it will reach the ultimate - ``antique.'' When a vehicle reaches either of these stages, she pointed out, the vehicle's value increases, and so does the city's tax assessment. Feeling more and more depressed, I thanked her for explaining all this to me and hung up.
I turned on my trusty TI-81 and did a few more calculations. It was obvious that my little red truck's assessment would never reach the city's minimum tax assessment of $15. Quite the opposite. Now I would have an ``antique'' on my hands - just what I had always wanted.
I read the newspaper article again. It stated that Mrs. (Barbara) Carraway, the city treasurer, estimated that 23,000 cars fell into the less than $15 tax assessment category. Now, I've met Mrs. Carraway and found her to be an intelligent and personable individual. However, could there really be 23,000 cars in Chesapeake with tax assessments of less than $15, resulting in their owners no longer being responsible for paying personal property tax?
The following Friday, after teaching my final statistics class for the semester, I pondered with a colleague of mine about these 23,000 cars. He suggested without hesitation that a survey was in order. So, the following Sunday morning upon arrival at church in Deep Creek, I told my wife to go ahead, that I would join her shortly. The next 20 minutes I surveyed 186 vehicles in the three parking lots nearest to our church. Surprised, yet somewhat dismayed, I came across only one vehicle that appeared older than my little red truck. I looked upward, but got no answer to my question, ``Could this be true?''
The next day I called the Chamber of Commerce and was told that Chesapeake's population numbered 177,990 as of August 1995. I then called the city treasurer's office and asked for a count of registered cars and trucks in Chesapeake. A very nice lady responded that she only had figures for all registered vehicles, which included motorcycles, vans, RVs and trailers as well as cars and trucks. The total number for all vehicles was 127,959.
Resorting to my TI-81, I made a few assumptions (economics professors love to make assumptions) and did a few more calculations. I assumed my survey was unbiased, that a normal distribution prevailed (statisticians love normal distributions), and that a reasonable, but conservative estimate for registered vehicles in the motorcycle, van, RV and trailer category was 20 percent. If I assumed trucks were 30 percent of all the registered vehicles (a conservative estimate, I figured), then cars would account for the remaining 40 percent, or 63,979, of the vehicles registered in Chesapeake.
My TI-81 hummed. I calculated that for there to be 23,000 cars in Chesapeake each with an assessed value of $983 or less (which would equate to a tax assessment of $15 or less, given a tax rate of 4.08 percent), Chesapeake's population should number slightly shy of the cumulative populations for the six states just north of us. Could that be? Something didn't seem quite right.
My last calculation stunned me. At least 36 percent of the cars (23,000 out of a total of 63,979) in Chesapeake should have a tax assessment of $15 or less, according to figures from the city treasurer's office. Had Mrs. Carraway overlooked my 13-year-old little red truck? I sighed.
Questions abounded. Who were these people who owned one or more of these non-taxed 23,000 cars? Where did they live? Were these cars in the Indian River section of Chesapeake? Western Branch? South Norfolk? Maybe Great Bridge? According to my survey, only one-half of 1 percent of the cars in Deep Creek could be considered ``older cars,'' and my little red truck wasn't one of them.
Were I politically oriented, I might ask: What percent of these non-taxed 23,000 ``older cars'' were owned by Democrats and what percent by Republicans? What percent were owned by city employees and what percent by non-city employees? In any case, the questions seemed endless.
Alas, it was Monday afternoon, the academic semester had just ended, and I was ready to go home. Still, I was in torment. Seeing my frustration, the colleague who had earlier cajoled me into conducting the survey, peered at me across the room smiled, then inquired: ``Why do you trouble yourself with these questions? You will be classified an ``antique'' years before your little red truck, and by then you will no longer have need of the truck. Besides, have you considered what traffic will be like in Chesapeake by the year 2016, when Mrs. Carraway reclassifies your little red truck as a classic? Better sell your truck and forget that retirement RV you've been talking about!''
Reverently, I sat back in my chair, looked out the window and pondered my future and that of my little red truck. I decided to go home and not mention any of this to my wife nor of the agony I was experiencing. If I did, she would surely aim that little finger of hers at me and retort: ``I told you not to buy that little red truck 13 years ago, but - oh, no - you wouldn't listen to me!'' MEMO: Dr. Flemming is a professor of statistics, quantitative methods
and economics at St. Leo's College. He and his little red truck reside
on Shell Road in Chesapeake. by CNB