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Taxing the real value of billboards

Published May 22, 2003

Billboard companies like to play this shell game: When a local government wants to remove a billboard because of road work or visual blight, the company demands that taxpayers shell out $100,000 or more per sign. But when it comes time to pay property taxes on that same billboard, the company says it is worth a small fraction of that amount. The losers, of course, are the rest of us.

Orange County Property Appraiser Bill Donegan has turned the tables on the billboard industry. If billboards are so valuable when it's in the public interest to take them down, Donegan reasoned, then they should be just as valuable when they are taxed. "We took (the companies') assessments and said, "Okay, we believe you,' " Donegan told the Orlando Sentinel.

Donegan asked Clear Channel Communications and the others for details on how they valued their billboards, but the companies refused to tell him. So he came up with his own method. It boils down to this: A billboard "is a piece of iron that sticks in the ground and produces income," Donegan explained. So in addition to the value of the "iron," his staff considered the increased value of property that contains a billboard, and the results were dramatic.

Donegan reappraised the 915 billboards in Orange County. Nine out of 10 billboards that had previously been valued at less than $5,000 for tax purposes are now appraised at $35,000 to $50,000. One Clear Channel billboard on a major highway saw its taxable value rise from less than $600 to $45,000. The result is that Orange County will collect an additional $600,000 in taxes.

Predictably, the industry cried foul and sued Donegan over 15 of the new valuations. You see, billboard companies gladly accept your tax dollars but don't want to pay much in taxes themselves.

Removing billboards is still a better deal for communities. But Clear Channel and the others have used campaign contributions and the threat of legal action to win protective legislation in Tallahassee and favorable settlements from the Pinellas County Commission and other local governments.

If Donegan wins the suit, the state's other property appraisers will have no excuse for not following his example. If we can't get rid of billboards, at least we can make Clear Channel and the others pay their fair share of taxes.

[Last modified May 22, 2003, 01:30:54]


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