State rejects Sprint request for lower tax assessment

Wednesday, March 25, 1998 | 11:29 a.m.

But the board also agreed to order a study to see if other companies such as those that provide cellular services are being valued at a lower rate for tax purposes.

Board Chairman Rodney Larva, after a daylong hearing Tuesday, said there was no question that the taxable value of $459.2 million was proper for Sprint, which purchased Central Telephone Co. in Las Vegas several years ago and changed its name earlier this month.

But Larva agreed with Sprint officials that there was a "potential problem of inequality" when it comes to computing the taxable value of telecommunications companies.

"Air Touch or AT&T (wireless) are no different than Centel. If they are not taxed on a unitary basis, they should be," he said.

The state Taxation Department set the value of Sprint, but the company said it should be $404.6 million, a difference of $54.6 million. The assessed value of those numbers is 35 percent.

Sprint argued since the deregulation of the telephone industry, it has some 60 competitors which are assessed by the county assessor.

Hal Holmquist, a manager for property taxes for Sprint, said the competitors are able to offer lower rates because they pay lower taxes.

The competitors are valued based on replacement cost minus depreciation by the local assessor. But Sprint is considered a "centrally assessed" utility and is valued by the state. That adds intangibles to its value including patents, copyrights, easements and customer lists.