The Sun
Sunnyvale's Newspaper

Lockheed settles its property tax appeal

High school district's loss scaled down to $176,000

By Katherine Petersen

The Fremont Union High School District breathed a sigh of relief when Lockheed Martin settled a property tax appeal with the county assessor's office for just $6.3 million. Lockheed had said its property and equipment had been overassessed by more than $4 billion over the past six years, which would have translated into a $47 million refund.

"It's probably the largest single appeal in this county's history," said County Assessor Larry Stone.

The high school district, which relies on property taxes for much of its operating budget, will lose only $176,000 in the settlement. Officials feared the loss would be as high as $1 million.

This $176,000 had already been factored into the district's estimated revenue from property taxes, said Scott Johnson, the Santa Clara County controller/treasurer.

"They won't be taking money back from us that we expected to get," said Mike Raffetto, the district's associate superintendent of business services.

Neither Raffetto nor Stone knows yet the ongoing impact of the changes in Lockheed's property values. The district has relied on property taxes as its main financial source since 1989.

Sunnyvale was hit with a $74,500 loss in the settlement, but had already factored a $100,000 loss into its budget.

More appeals, some of which concern Hewlett-Packard, remain unsettled, Stone said.

Lockheed Martin is comfortable with the settlement and feels the process was handled fairly, said Katherine Strehl, the company' s public affairs manager. The company did not want to take a huge sum of money away from schools, she said.

"Education has always been a major concern for us. We' ve continued to support schools in our region. I think our settlement reflects our commitment to schools," Strehl said.

Lockheed filed appeals between 1990 and 1995 and had contested up to $4.1 billion in assessments for assets primarily located in Sunnyvale, Stone said. They include a Lockheed plant at Moffett Park.

Strehl said the appeals filed did not amount to the nearly $47 million cited by Stone. The action was initiated by the county assessor's office after the merger two years ago, she said.

The assessor's office toured Lockheed's properties and reassessed them over the company's objections, she said.

The assessor's office told Lockheed it would have a tax reduction, Strehl said.

Stone said his office subpoenaed Lockheed's records for the last six years.

The $4.1 billion in evaluation Lockheed contested is significant because it comes from one property owner, Stone said. It represented 2.9 percent of the county's $120 billion dollars in assessments.

A change of ownership, such as the merger between Martin Marietta and Lockheed Missiles & Space, is a natural time to reassess property values, Stone said.

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This article appeared in the Sunnyvale Sun, July 9, 1997.
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