County takes $600k hit to tax revenue

ROCKINGHAM — Richmond County lost approximately $600,000 in tax revenue with the “drop of a hat” following the release of the public service company valuation certifications for the county in September.

County Manager Bryan Land sent an email on the evening of Sept. 15 to all the members of the Richmond County Board of Commissioners, which was obtained by the Daily Journal, informing them that the county had seen a net loss of $61,938,020 in the county’s total assessed value. Duke Energy Progress Inc. alone showed a loss of $63,876,333, or about 12% of their value in 2019.

“In comparison to the amount we had budgeted, we lost $75 million in value at the drop of the hat!” Land wrote in his email to the commissioners. “To put this into perspective, this is the equivalent of losing the value of Weatherstone, Pinelakes, Lakestone, & Stone Henge subdivisions and Midway Road Industrial Park over night!”

The Richmond County Tax Department does not play a role in the values of public utilities, according to Land. The county is currently disputing the state’s valuations, but has yet to hear back.

Fourteen out of a total of 33 Richmond County public utilities showed losses for 2020, and while Duke lost the most in value by far — the next highest loss by a single company was by Piedmont Natural Gas, which lost $1,210,068, or 2.5% of their 2019 value — other companies showed greater losses in proportion to their total. For comparison, Spectrum Advanced Services lost only $265,737 from 2019 to 2020, but this represented 20.6% of their 2019 value.

These valuations are based on assets that public service companies submit to the North Carolina Department of Revenue (NCDOR) each year under state law, according to Schorr Johnson, director of Public Relations for NCDOR. The NCDOR appraises, apportions and allocates the taxable value of public service companies to counties each year, and sends them out to counties each year in September, typically.

“The valuations tell the county or municipality whom and what value to bill,” Johnson said. “These valuations change every year according to many factors specific to the companies and industries.”

It’s unclear exactly how Duke Energy lost so much of its value. A representative for the company did not respond to a request for comment by press time Friday. Johnson said there have been no major state policy or law changes in the last year that would have contributed to this abnormal valuation.

In email, Land called this loss “very disturbing and extremely odd.”

“Since inception of the Smith Energy Complex in 2000 annual values have typically fluctuated (up and down) less than ¾ of 1%, with the exception of 2010 when the facility almost doubled in size and $83 million was added in value,” Land said. “We have asked for an explanation from DOR and are waiting patiently for a response.

He added, “This is a very tough pill to swallow but we will continue as we have always done to tighten up our boot straps and find ways to adjust, overcome and adapt!”

An emailed request for comment on how the county could potentially recover from this loss sent to Tax Administrator Vagas Jackson was not returned by press time Friday.