Business & Tech
Caterpillar Tax Bill Half Of What It Would Be Without Abatement Oconee County Gave As Enticement To Locate Plant Here
Complex arrangement taxes lease rather than property, but the lease is assessed based on bond sales, since there is no real lease.
About this time last year, the Oconee County Property Appraisal Department made its estimate of the value of that portion of the land and building inside the county that Caterpillar occupies for its manufacturing facility.
It also made an assessment of the value of the lease for the equipment inside that plant.
Caterpillar doesn’t own the land or plant. That is owned by the Oconee County Industrial Development Authority, which does not pay taxes.
Technically, Caterpillar also doesn’t own the equipment inside that plant.
By agreement with Caterpillar, the county assesses real property taxes on Caterpiller based on estimated value of the lease of the equipment.
If Caterpillar owned the land and building, it would have been billed $91,113 in real property taxes last year.
Instead, it paid $42,185 in real property taxes on the “lease” for its facility and manufacturing equipment. That is a savings of $48,928, or 53.7 percent.
That reduction is significant as the county budgets for making its first payment early next year of $450,000 on the debt the county assumed to bring Caterpillar to the area.
For more details on how the Caterpillar taxes are calculated, go to Oconee County Observations.