Pa.-based Ad Firm Sues Over Plan to Tax Billboards

April 11, 2006

Luzerne County in Wilkes-Barre, Pa., plans to become the first county in the state to tax billboards as real estate, but the strategy is being challenged in a suit filed by an advertising firm.

The county hopes to raise several hundred thousand dollars or more annually from the billboards, with collections set to start this year.

“These billboards are substantial structures,” said Gene Porterfield of 21st Century, a firm hired by the county to reassess real estate. “Temporary structures are only meant to be up for a few months. How many of these billboards have you seen them tear down in the last few months?”

Lamar Advertising, which is challenging the tax, would be assessed about $300,000 annually for its 350 county billboards, according to records analyzed by the Times Leader of Wilkes-Barre.

Lamar will instead tear down about a third of its billboards if the suit or any ensuing appeal fails, the company said. The trial on the issue is set for June.

“Landowners will be upset about the loss of income,” company spokeswoman Mary Ellen Coleman said.

She argues that it employs 35 people locally, helps businesses promote their products and commits to community service.

County officials say they have a strong case for the real-estate classification.

“These are permanent fixtures along highways,” Commissioner Stephen A. Urban said. “They require a foundation to hold them up to withstand a great deal of wind. Most of them I’ve seen are lit and have power running to them.”

The Times Leader concluded the billboard tax would generate about $86,000 annually for Wilkes-Barre Area schools, $5,400 for the city of Wilkes-Barre and more than $4,000 for Plains Township.

Coleman said the entities should instead look for public land that could host billboards and generate leasing payments, as Wilkes-Barre has done.

“Isn’t that a better way to do it a win-win? The city is getting more money and Lamar is putting up billboards in commercial areas,” Coleman said.

Assessment notices have gone out for the billboards, but a county judge has ruled that Lamar does not have to start paying until it exhausts its court appeals, which could take several years.

About 100 other billboard owners not involved with the lawsuit are expected to start paying this year, or risk losing the property over unpaid taxes.

Plains Township resident Anita Davis supports the billboard tax plan.

“Why should they be allowed to deface the beautiful countryside and not pay some dollar amount in taxes on them?” Davis said.

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