Managing & Reducing Your Fleet’s Property Tax Liability in 2025

Is reducing your fleet’s property tax cost in 2025 a priority?

If so, here’s a few proven initiatives that can save you 50% or more:

Quantify Abnormal Obsolescence

Abnormal obsolescence – both economic and functional – is depreciation over and above the assessor’s standard schedule.

Abnormal obsolescence can be determined by applying several universally accepted machinery and equipment valuation techniques, including utilization ratio scale factor models, economic life analysis, cost to cure analysis, measuring excess capital cost through comparing replacement versus reproduction cost, determining the net present value of excess operating cost, capitalizing income shortfall, and return on capital analysis.

Our annual State of the Barge Industry Report tracks the operating metrics of the inland marine transportation industry, including, but not limited to, gross revenue per barge, net operating income per barge, shipments per barge, fleet capacity / utilization, grain exports, freight rates, and new builds to calculate industry wide abnormal obsolescence.

Pollution Control Exemptions

The tank barge industry in particular must adhere to strict pollution control mandates, including vapor control and spill protection. Quantifying the incremental cost (functional obsolescence due to excess capital cost) of these federally mandated assets, including the required double hull, yields our clients a direct annual property tax savings on every qualified barge.

Additionally, calculating the functional obsolescence (cost to cure) of complying with emission mandates may produce additional savings.


Take Advantage of Taxable Situs Statutes

The taxable situs statutes for inland and offshore marine vessels differ state to state.

Some states have unique statutes that allow qualifying barge companies to claim a more beneficial taxable situs in a taxing jurisdiction with a lower tax rate.

By helping our clients navigate overlooked taxable situs options they are able to realize significant property tax savings.

Summary

Combining these strategies can deliver extraordinary annual property tax savings exceeding 50% or more.

The keys to successfully reducing your fleet’s property tax liability are:

- an in-depth knowledge of the unique issues affecting the inland marine transportation industry

- technical expertise in machinery & equipment valuation, including quantifying abnormal obsolescence

- a thorough understanding of the applicable state and local property tax codes

- most importantly, a long-term professional working relationship with the tax assessing authorities.

For a detailed, no obligation, review of you 2025 property tax savings potential contact john@woolard-group.com or call / text @ 210-710-9065. We’ll provide a comprehensive analysis that quantifies your projected savings. In exchange, all we ask is, if you agree with our findings, you are open minded to continuing our conversation.