Committee hears competing views on vehicle‑valuation bill that would fix assessments at MSRP with a 12‑year depreciation schedule
Loading...
Summary
Representative Roger Reedy presented HB 3035 to standardize vehicle assessments using MSRP plus a 12‑year depreciation table. Assessors backed predictability and consistency; school administrators warned of local revenue losses and downstream effects on school‑funding formulas.
Representative Roger Reedy told the Special Committee on Tax Reform that House Bill 3035 would create a predictable, statutory framework for valuing motor vehicles by starting from the manufacturer's suggested retail price (MSRP) and applying a 12‑year depreciation schedule. Reedy said the change is intended to prevent sudden market fluctuations — like those assessors encountered during COVID — from producing unexpected tax increases for vehicle owners.
Reedy described the proposal as consistent with how business personal property is depreciated and said the Tax Commission and assessors would select a valuation guide and secure an annual appropriation for its use. "It gives consistency and gives predictability to the taxpayers," he said.
Committee members pressed practical questions: whether assessments should be based on the actual sale price or MSRP when dealers discount new vehicles, how the schedule applies to used cars of varying ages, and how a shorter depreciation term would affect local taxing jurisdictions. Reedy said MSRP plus an aggressive early depreciation (15% in year one, then 10% in year two, per the bill's structure) would blunt the disparity caused by market swings and that using a standard guide avoids inconsistent results across counties.
Kenny Moore, Boone County assessor and legislative chair of the Missouri State Assessor's Association, testified in favor. Moore said a statutory depreciation table tied to MSRP would produce a ‘‘more steady annual decline of motor vehicle values’’ and reduce the awkward public exchanges assessors experienced when market guides rose during COVID: "That's a tough conversation" telling a taxpayer their older vehicle is suddenly worth thousands more. He acknowledged implementation costs to update assessor software and said many assessors currently use a 20‑year minimum to reach a nominal minimum value.
Opposing testimony came from Mike Lodewigan of the Missouri Council of School Administrators, who warned that reducing taxable personal‑property values would lower local revenues in jurisdictions that rely heavily on those taxes for school funding. Lodewigan urged the committee to consider the downstream effect on the school‑funding formula and cautioned that the state's formula rewrite next session will magnify the consequences of any local revenue cuts.
Trent Watson, representing the Missouri Association of Counties, supported the bill as a measured approach to statewide consistency; he said his group would be more comfortable with a 15‑year schedule if MSRP is retained but nonetheless endorsed taking steps toward predictable valuation.
The committee did not vote. Members asked for additional information about fiscal assumptions and implementation costs before any further action.