August 2009

A. William Peterson Retires   A. William Peterson, who has been with the firm since April 1, 1961, has retired effective July 1, 2009.  We are grateful for Bill’s long service and will miss his professional competence and dedication to our clients and the firm.  We are happy for him and wish for him a successful retirement.             Severance Tax Exemption for Haynesville Shale Royalty
Louisiana law (Revised Statute 47:633) allows an exemption from severance taxes for horizontal wells such as those usual to the Haynesville Shale.  These taxes are material at 30.8 cents per 1,000 cubic feet or, at current prices, about 10 percent of the value of the production.  This exemption from severance taxes is for the shorter period of two years or until payout of well costs. To qualify for the exemption, operators are required to file documentation  with  the  state.  The exemption  inures to		the benefit of the royalty owner.  If you receive Haynesville Shale royalty, you should review your monthly run statements on a well-by-well basis to ensure that the operator is not inappropriately deducting severance taxes.  If so, you will want to contact the royalty/landowner relations department of your payor.  You can find more information on the Severance Tax Relief Program at the Louisiana Office of Conservation’s website, www.dnr.louisiana.gov.
____________________________________________________________   Property Taxes Too High? Now is the Time to Act
August and early September is the best time to correct an  over-assessment  of real property  and business movable property.   Once the property tax bills are mailed (usually in November), it is almost impossible to change an assessment.  In mid to late August, each parish assessor will (as required by law) open the 2009 assessment rolls for public review and inspection for a minimum of 15 days.  During this 15-day period, property owners can challenge the validity of the tax assessment.  Unfortunately,  the  review  period  is  very  short, and there apparently is no recourse if a timely protest is not made.         You can check the assessed value of your real property (as well as that of nearby property for comparison) in Caddo and Bossier Parishes by using the assessors’ websites.  For Caddo Parish, the web address is www.caddoassessor.org.  For Bossier Parish, the web address is www.bossierparishassessor.org.          Because property taxes are based on a percentage of the fair market value of your property, one way to determine if your taxes are an appropriate amount is to compare the assessor's determination of the fair market value of your property with what you believe it to be.  The assessed value of a property is a percentage of the assessor's estimate of its fair market value.  Accordingly, you can compute the fair market value that the tax assessor has placed on your property from the notices of assessed values mailed to you by the assessor or by visiting the assessors’ websites.                The assessed amounts can be divided by .10 (10%) for residential improvements and all land (residential and business) and by .15 (15%) for commercial improvements and business personal property (furniture, equipment, and inventory) to determine the fair market value placed on the property by the assessor.  For example, if the property tax assessment for a commercial building shows that the land is assessed at $5,000 and the improvements are assessed at $30,000,  the assessor		has determined the fair market value of the entire property to be $250,000 ($5,000/.10, or $50,000, plus $30,000/.15, or $200,000, for a total of $250,000).   As you might recall, all Louisiana real property was reappraised in 2008 in accordance with the Louisiana Constitution.  Since 2009 is not a reappraisal year, the 2009 assessed values of real estate should generally be about the same as 2008’s assessed values.  Business personal property (furniture, fixtures, equipment, and inventory) are, of course, reappraised each year by the parish assessor.         If your property is in Caddo Parish, the 15-day review and protest period will start on August 26 and will close on September 9.  In mid-August the assessor will mail notices showing the amount of the assessments on all property.  By using the assessor’s website, you no longer have to go to the Caddo Assessor’s Office to check your real estate assessment.  You can check it now without waiting until August 26.  The assessor also encourages you to check your assessment and to come in to discuss it at any time, not just during the public review period.         If your property is in Bossier Parish, the rolls will open for review and protest on August 17 and will close on September 1.  By using the assessor’s website, you no longer have to go to the Bossier Parish Assessor’s office to check the assessment on your real property.  If you want to discuss your assessment with the assessor, however, you should go by the Bossier Parish Assessor’s office in Benton.         If you do find that the determination of the value of your property is excessive and if you are unable to reach an agreement with the assessor as to the value, you should file a written protest before the end of the public review period to preserve your rights to have your assessment reconsidered by the Board of Review.  Form 3101 can be obtained from the assessor for use in making a written protest.