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ME~ORANDUM <br /> <br />TO: Board Chairmen, Managers, Attorneys and Tax Supervisors <br /> <br />FROM: Robert Hunter, NC County Attorneys Association, McDowell County <br /> and Butch Gunnells, Staff Counsel, NC Association of County <br /> Co~issioners <br /> <br />DATE: December 9, 1981 <br /> <br />SUBJECT: Updat~ on Railroad Lawsuit <br /> <br />AS most of you are already aware, U. S. District Judge Franklin Dupree <br />has rendered a decision in the case of Clinchfield Railroad Company, <br />et al., v. Mark Lynch, Secretary of Revenue, et al., which is the <br />lawsuit brought by the major railroads in the State challenging the <br />level of taxation of their'property in relation to other property. <br />The railroads generally alleged that their property, which is assessed <br />annually by the State, is always assessed at true value, while most <br />other property is taxed at less than true value - particularly locally <br />assessed real property which is revalued only in eight-year cycle's. <br />The railroads sodght to establish the level of disparity on a county- <br />by-county basis, through use of a sales-assessment ratio study which <br />established the ratio of assessment of locally-assessed commercial and <br />industrial real estate to the true market value of such real ostate. <br />As relief, the railroads sought to have the defendant Department of <br />Revenue enjoined from assessing the railroad property in each county <br />at a figure higher than the sales-assessment ratio calculated for that <br />county. <br /> <br />AS further background, the plantiff railroads have proceeded under a <br />federal statute which entitles them to relief on a showing of at least <br />5% disparity, and allows the action to be ~rought in Federal District <br />Court. The statute also establishes the assessment ratio as the method <br />for measuring the disparity or ~iscrimination. The plantiffs sought <br />relief only for the 1980 tax year. <br /> <br />Initially, only state-level defendants were involved (the Secretary <br />of the Department of Revenue and the Director of its Ad Valorem Tax <br />Division). As you know, both Mecklenburg and Madison counties directly <br />intervened, with Hamlin Wade from Charlotte as lead counsel coordinating <br />a defense effort for all interested counties. <br /> <br /> ALBERT CO&TE~ LOCAL GOVERNMENT CENTER <br /> <br /> 215 N, DAWSON ~T, o ~ ~ ~OX I~OB o RALEIGH. NORTH CAROLINA 27602 · TELEPHONE 9)9/032-2693 <br /> <br /> <br />