Another Cell Tower Question

[Gobears81]

If the tower lease was bought out, then there would need to be an easement agreement allowing the tower operator access to the tower. What does the terms of the easement agreement state in regard to real estate tax issues associated with the tower? if silent, then hence the issue.

While under the lease agreement, the tower was likely considered improvements owned by the tenant. Depending on the jurisdiction, some assessors will recognize the lease and assess accordingly (i.e. real property for the site and tangible property for the tower). Other jurisdictions will treat the entire property as real property improvements and allow the parties to allocate payments among themselves.


"The attorney" - What attorney? for the Taxing authority or for the taxpayer?
I imagine that your reference noted above ""if there was an agreement" means that you do not have information about a formal agreement. Has anyone searched public records to see if there is in fact a recorded agreement?


How does this jurisdiction handle property assessments? Only as real property? or Do they have Tangible property assessments as well?

To respond to your questions-no it does not mention the RE taxes in the easement agreement, which was recorded in public record.
The attorney was for the taxpayer, so yes I can see where their interpretation would be favorable to said taxpayer, hence my wanting to verify the correct position from secondary sources, rather than placing really any emphasis on what they say.
To respond to the third question, I have since spoken with another appraiser in IL who says that cell towers are assessed differently than land/ building improvements and that an appropriate route would be to use an HC that there is no cell tower on the site for this type of valuation. I am in the process of trying to identify the source of where it lists the difference in the method which it is assessed.
EDIT-spoke with an assessor today (not for this municipality) who indicated that they are valuing cell towers as real property and part of the whole parcel for commercial properties...getting some conflicting answers

 

[hastalavista]

Cell tower arrangements (in my state) have evolved over the last 20 years; both in the contractual relationship with the lessor/lessee and how many of the taxing jurisdictions apply the tax.

Like most appraisers, I've been involved in cases where my subject is the primary property and the cell tower is located on the site.
Contractually, the leases typically require the lessee to pay any real property taxes and personal property taxes attributable to the cell tower and the easement.
Many assessment jurisdictions identify the cell tower with its own taxing ID# and send the tax bill directly to the lessee.

In your case, the lessee has bought-out the lease; I assume that means they paid off the lease but still have the easement access and rights to operate the tower for whatever time remains on the lease. But, it doesn't sound like that buyout transferred any real property (site area) to the lessee; it only closed out the lease in terms of monthly/annual payment.
Therefore, I would assume (and I would, like you, double-check your taxing authority's particulars) that the primary land owner, excepting if the jurisdiction is taxing the lessee separately, is responsible for the taxes due on the site area covered by the easement. I would assume that they are not responsible for any taxes due to the cell tower or its infrastructure.

I hope you post the answer when you ferret it out.

 

[Gobears81]

In your case, the lessee has bought-out the lease; I assume that means they paid off the lease but still have the easement access and rights to operate the tower for whatever time remains on the lease. But, it doesn't sound like that buyout transferred any real property (site area) to the lessee; it only closed out the lease in terms of monthly/annual payment.
Therefore, I would assume (and I would, like you, double-check your taxing authority's particulars) that the primary land owner, excepting if the jurisdiction is taxing the lessee separately, is responsible for the taxes due on the site area covered by the easement. I would assume that they are not responsible for any taxes due to the cell tower or its infrastructure.

I hope you post the answer when you ferret it out.

I edited post #11 almost exactly at the time that this was posted and it looks like you might just be right. In the aforementioned conversation, I was told that someone comes in each year to find out exactly what % of the tax bill is related to the cell tower vs the remainder of the property. For farmland, cell towers are reportedly carved out as separate parcels, but in this small portion of the state, it sounds like that is not the case for commercial. I'm going to let this one sit for a bit longer just in case I receive calls back from a couple others or find out evidence to the contrary, but might just include the cell tower value and indicate on the letter of transmittal exactly what contributory value said cell tower has.