08/16/2023 VAB - Laserfiche WebLink

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(2) The highest and best use --Highest and best use is the most probable and legal use of a property (including machinery and equipment) that is physically possible, appropriately supported, financially feasible, and that results in the highest value.2 The value of the Subject's equipment is based on Fair Market Value — Installed; which assumes the utilization of a unit of production with an anticipated useful life, not as inventory for resale. According to IAAO's Assessment of Personal Property, in order to value equipment at Fair Market Value — Installed, the equipment must meet the following requirements: • Equipment is installed • The highest and best use is as installed for the purpose of producing income . The equipment is employed or part of the business enterprise used to produce income • The equipment is economically feasible By valuing each Subject property according to its highest and best use in the immediate future and present use, the PAO properly considers F.S.193.011(2). (3) The location of said property-- The Subject property was valued as installed at its present location In addition to original costs, the self-reported return requires costs for shipping, installation, debugging and other make-ready costs to replicate the current utility in the current location. By using such costs or directly estimating costs from the best available information when no return is provided, the PAO property considers F.S. 193.011(3). (4) The quantity or size of said property --The property appraiser considers quantity and size by reviewing self-reported returns from similar business enterprises to develop business models. The business models are used to identify taxpayers that may have omitted property and, as such, require on - sight inspections. By valuing the Subject property according to the quantity or size as reported on the Tangible Personal Property Tax Return, the PAO properly considers F.S. 193.011(4). (5) The cost of said property and the present replacement value of any improvements thereon --The property appraiser uses information provided on self-reported returns filed by taxpayers with similar assets to formulate opinions of cost of property. The returns include the original costs, invoice prices when trade-ins occur, the ages of equipment in use and the ages of used equipment when purchased. Installation, freight, taxes, and fees are included to replicate the current utility of the assets. The costs of property are adjusted to replacement cost new by the use of equipment index factors that include adjustments to base year prices and reflect the direction of cost movements. These equipment index factors reflect the national average for industrial, commercial and manufacturing business costs. The replacement cost new is adjusted for depreciation and obsolescence in accordance with industry standards that are calibrated to the local market. The property appraiser actively seeks information regarding industry standards and trends by: attending workshops and conferences, researching taxpayers' websites and catalogues, reviewing industry press releases and periodicals, and analyzing market supplied information as provided by taxpayer to test the reasonableness of his/her opinions. By applying reasonable trend/index factors to the original costs as reported on the Tangible Personal Property Tax Return, the PAO properly considers F.S. 193.011(5), (6) The condition of said property --The property appraiser uses information on the self-reported return to estimate the condition of assets. In those instances where the taxpayer did not indicate the condition of the property, the subject property was assumed to be in average condition for its age. This is a reasonable assumption given that improperly maintained equipment would degrade the company's ability to compete in the highly competitive markets of today. Under a mass appraisal system, assets are assessed as average in condition, unless the owner indicates otherwise. When feasible (i.e. permitted by -104-