The Sussex County Council this week was given a presentation by Chris Keeler, the County’s director of assessment, at the request of outgoing Councilman Vance Phillips, in response to a petition by a number of poultry growers who said they were concerned about the cost of their County property taxes.
Keeler told the council that poultry houses ¬constructed since 1974 — the year of the County’s most recent property reassessment — are assessed at $1.75 per square foot. Comparatively, Kent County assesses at $2.95 per square foot and New Castle County assesses at $5 per square foot.
Keeler said Sussex County determines total assessed value for taxes by first multiplying the square footage by $1.75 and then only uses 98 percent of the calculated value to determine appraised value, rounding down to the nearest whole number. He said the total assessed value for determining taxes is half of the appraised value.
He noted that Kent County in its tax calculation uses 60 percent of the calculated value to determine assessed value.
He added that a recent building permit taken out for three poultry houses on Seashore Highway near Bridgeville had an estimated value of $324,000, with a County assessment of just $69,450.
“It appears if you’re a chicken, you’re better off in Sussex County,” said Councilman George Cole following the presentation.
Phillips asked Keeler what happens to the value of a poultry house once it is no longer in use. Keeler said an assessor would go to the property to determine if a reduction would be warranted, depending on the condition of the building.
Councilwoman Joan Deaver said she felt there was a “little elephant” in the room.
“I want to make sure it benefits local folks. We have a lot of foreign folks coming in buying up chicken plants, and so on and so forth,” she said. “Is there any way to be sure that it is local people that are getting the benefit of that, and not North Korea?” (The Harim Group, which owns poultry company Allen Harim, is based in South Korea.)
“I don’t think we have a separate tax for people who are foreign-owned companies,” said Council President Michael Vincent.
“Any assessments have to be consistent across-the-board,” added County Solicitor J. Everett Moore. “We have to adhere to those established guidelines set in ’74.”
Laurel farmer Charlie Hudson, who owns three poultry houses, said his grievance was with the formula used.
“We have people in the area that have other businesses that are taxed by their profit, not by what they have as far as buildings,” he said. “You can have a poultry house and actually go broke, so you’re not making money on it but you’re still paying taxes on it… Just because you have a poultry house doesn’t guarantee you’re going to make money.”
Cole asked Hudson what specifically was upsetting with regard to the County’s formula.
“What other business do you know that if you don’t make money you still have to pay taxes?” Hudson responded.
“Ever had rental property?” Cole quipped. He clarified that the County does not assess taxes based on profits or lack of profits, but solely on the assessed value of the real estate held, and he suggested that perhaps their concerns should be taken to the State.
Also on Dec. 16, the council discussed the County’s employee healthcare plans. In the next few months, the County will be working with an independent agency to review its healthcare options for the May 1 effective date for all plans.
“This is a very costly expense, and I think it’s very important that we look into other options for us for the health insurance,” said County Finance Director Gina Jennings.
Currently, the County has a self-insurance plan, administered by third-party health management company Integra. Insurance Buyers’ Council Inc. will be undertaking a comprehensive review of the health insurance plan, and Jennings said the County will be looking for both fully-funded and self-insured options.
“The objectives of the process are to conduct a comprehensive review of the County’s benefit program, including cost, benefit levels, level of services, funding method and provider discounts,” said Jennings, adding that the County also wishes to maintain a high level of employee satisfaction.
The study will take approximately three months to complete, with the County soliciting bids for health insurance in January 2015, for possible selection in March.