Inventory - HCAD

Harris County Appraisal District Business & Industrial Property Value Calculation Guidelines

Tax Year 2019

Asset Category A. Inventory B. Supplies C. Raw Materials D. Work in Process E. Furniture & Fixtures F. Machinery & Equipment

Schedule 100% Original Cost 100% Original Cost 100% Original Cost 100% Original Cost 8-Year Age/Life Original Cost x Index Factor x %GD Schedule Original Cost x Index Factor x %GD Schedule

1. General Office Equipment...........................6..-.Y..e..ar Age/Life

2. Specific Equipment......................................S..p..e..c. ific Equipment Age/Life Includes: Mobile Radio Equipment Telephone Systems

Cellular Telephones Fax Machines

3. All other Machinery & Equipment................A..g..e...L..i.f.e. Schedule Based on the Type of M&E: (Refer to SIC Code List)

G. Computer Equipment

Note:

ATV, ATM, MRI, Ultrasound, CT Scanners, Hemodialysis machine and X-ray imaging equipment may have a 6-Year Life. Original Cost x %GD Schedule

1. PC Computer Equipment/Servers .................P..C....S..c..h..e..d...ule

Note:

Includes input/output devices or peripherals.

Examples:

CPU

HP printers

Keyboard

Servers

Mouse display

2. Mainframe ......................................... Mainframe Schedule Examples: IBM zSeries Z13s System z9

System z10 High speed production printers Point of Sale (POS) registers

H. Telecommunication Equipment

I. Solar Energy Device J. Leasehold Improvements K. Transportation Items

Original Cost x %GD Schedule

(Industrial Only)

Note:

The depreciation age/life is dependent upon the type of electronic

equipment/component.

10-Year Age/Life Original Cost x Index Factor x %GD Schedule

6-Year Age/Life Original Cost x Index Factor x %GD Schedule

The new age mix (NAM) schedule does not apply to transportation items.

1.

Vehicles....................................

InfoNation, Inc. (in partnership with Penton Media, Inc.) 6-Year Age/Life Original Cost x %GD Schedule

Note:

Vehicles are carried on a unique account. Mounted equipment is carried on the asset account.

2.

Aircraft...............................

Aircraft Blue Book - Winter Edition

3.

Vessels...........................

L. Miscellaneous Assets

20-Year Age/Life Original Cost x Index Factor x %GD Schedule Original Cost x Index Factor x %GD Schedule Age/Life Schedule Based on the Type of asset: (Refer to SIC Code List)

The equipment cost index national average is obtained from Marshall Valution Services as published in their October issue each year. The reported cost is indexed to arrive at the replacement cost new multiplied by the percent good factor (%GD). The Present Value Factors (PVF) includes the cost indexed which is used to calculate the Book Value to Market Value Conversion method.

Note: These value calculation guidelines normally apply to items appraised by the Personal Property Section. Appraisers may apply an obsolescence factor to newer assets if the overall asset age mix is out of balance. These schedules may also be used for the appraisal of industrial personal property by the industrial section. However, industrial properties may be subject to different maintenance regimens and may have longer useful lives. A combination of longer schedules and factors representing condition may be used for such property. In any event, these schedules are guidelines and may be overridden based on the documentation presented and the judgment of the appraiser.

Page 1

YEAR OF ACQUISITION

The percent good factor (%GD) schedules for the YEAR OF ACQUISITION METHOD are to be used when original cost is known by year of acquisition. Refer to the property category, such as Furniture & Fixtures, to determine the appropriate useful life %GD schedule. The original cost is multiplied by the Index Factor, which equals the replacement cost; then multiply by the %GD for the acquisition year to arrive at a calculated rendered value for that category.

BOOK VALUE TO MARKET VALUE CONVERSION

If the original cost by year of acquisition is not known, but the original cost and depreciation are known by category, the tables for BOOK VALUE / MARKET VALUE CONVERSION are to be used. First, divide the accumulated depreciation by the original cost to determine the percentage of book depreciation. The percentage of book depreciation is used to determine which present value factor (PVF) to apply. The original cost is multiplied by the PVF factor to arrive at a calculated rendered value for that category.

NET BOOK VALUE

Original cost less accumulated depreciation equals NET BOOK VALUE. The net book value is calculated and compared to the BOOK VALUE / MARKET VALUE CONVERSION METHOD of valuation. If the net book value is greater than the book value / market value method, then the net book value is used to arrive at a calculated rendered value for that category. The NET BOOK VALUE is not used to override the YEAR OF ACQUISITION METHOD of valuation.

NEW AGE MIX (NAM)

The New Age Mix (NAM) is an obsolescence factor that is applied when most of the assets in a category are newer, therefore compensating for the age mix being out of balance. Each year life, the computer schedules, and the specific equipment schedule have separate NAM factors. Please note the new age mix schedule does not apply to vehicles.

Page 2

HARRIS COUNTY APPRAISAL DISTRICT - 2019 DEPRECIATION SCHEDULES FOR THE YEAR OF ACQUISITION METHOD

See Note 1 Below

See Note 2 Below

YEAR INDEX ACQUIRED FACTOR

3 %GD

4 %GD

5 %GD

6 %GD

8 %GD

10 %GD

12 %GD

15 %GD

20 %GD

25 %GD

2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995 1994 1993 1992 1991 1990 1989 1988 1987 1986 1985 1984 1983 1982 1981 1980 1979 1978 1977 1976

1.000 1.034 1.055 1.046 1.056 1.070 1.079 1.109 1.144 1.136 1.168 1.214 1.281 1.340 1.441 1.491 1.516 1.525 1.538 1.566 1.571 1.584 1.610 1.634 1.693 1.741 1.774 1.796 1.832 1.881 1.982 2.067 2.097 2.117 2.148 2.206 2.246 2.351 2.594 2.854 3.119 3.355 3.532

65

75

85

87

90

92

94

95

97

98

39

56

69

73

79

84

87

90

93

95

26

42

52

57

67

76

80

85

90

93

13

27

34

41

54

67

73

79

86

90

13

23

30

43

58

66

73

82

87

18

23

33

49

58

68

78

84

13

19

26

39

50

62

74

81

13

22

30

43

55

70

78

20

24

36

49

65

75

13

21

29

43

60

71

20

24

37

55

68

13

22

31

50

64

20

26

45

60

13

23

40

56

21

35

52

20

31

48

27

44

24

39

22

34

21

30

21

28

20

26

24

23

22

21

Note 1: Appraisers may apply an obsolescence factor to newer assets if the overall asset age mix is out of balance.

Note 2: Schedules for items with 15 year or greater lives normally apply only to certain types of industrial machinery and equipment. Generally, items of this type are maintained in a manner resulting in low effective ages. Industrial appraisers adjust for lesser degrees of maintenance through application of service factors.

Page 3

30 %GD

98 97 95 93 91 89 86 84 82 79 76 74 71 68 65 61 58 54 51 47 43 40 37 34 31 28 25 23 22 21 21 20

HARRIS COUNTY APPRAISAL DISTRICT - 2019 DEPRECIATION SCHEDULES FOR THE YEAR OF ACQUISITION METHOD See Note Below

YEAR

INDEX

ACQUIRED FACTOR

2018 2017 2016 2015 2014 2013

2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995 1994 1993 1992 1991 1990 1989 1988 1987 1977

1.000 1.034 1.055 1.046 1.056 1.070 1.079 1.109 1.144 1.136 1.168 1.214 1.281 1.340 1.441 1.491 1.516 1.525 1.538 1.566 1.571 1.584 1.610 1.634 1.693 1.741 1.774 1.796 1.832 1.881 1.982 2.067 2.097

YEAR ACQUIRED

2018 2017 2016 2015 2014

2013 2012 2011 2010 2009 2008 2007

INDEX FACTOR

1.000 1.000 1.000 1.000 1.000

1.000 1.000 1.000 1.000 1.000 1.000 1.000

3

3

% GD NAM

65 59.80 39 39 26 26 13 13

4

4

% GD NAM

75 65.25 56 51.52 42 42 27 27 13 13

5

5

% GD NAM

85 70.55 69 60.03 52 47.84 34 34 23 23 18 18 13 13

6

6

% GD NAM

87 72.21 73 63.51 57 52.44 41 41 30 30 23 23 19 19 13 13

8

8

% GD NAM

90 72.00 79 65.57 67 58.29 54 49.68 43 43 33 33 26 26 22 22 20 20 13 13

10 10 % GD NAM

92 80.96 84 74.76 76 68.40 67 60.97 58 53.36 49 49 39 39 30 30 24 24 21 21 20 20 13 13

12 12 % GD NAM

94 81.78 87 76.56 80 71.20 73 65.70 66 60.06 58 53.36 50 50 43 43 36 36 29 29 24 24 22 22 20 20 13 13

Note: If 50% or more of the total cost of an asset category is reported in the eligible NAM years for the category (these NAM years are boxed on this chart), then the NAM schedule is used to calculate the value. If less than 50% of the total cost of an asset category is reported in the eligible NAM years for the category, then the % GD schedule is used to calculate the value.

COMPUTER, SPECIFIC,TELECOMMUICATION, SOLAR EQUIPMENT

Telecom/Ind Telecom/Ind Telecom/Ind

PC PC SPC SPC MF MF 4YR 4YR 6YR 6YR 8YR 8YR

% GD NAM % GD NAM % GD NAM % GD NAM % GD NAM % GD NAM

68 62.56 78 71.76 75 65.25 75 65.25 87 72.21 90 72.00

44 44

63 63

56 51.52 56 51.52 73 63.51 79 65.57

28 28

50 50

42 42

42 42

57 52.44 67 58.29

10 10

39 39

32 32

27 27

41 41

54 49.68

03 03

25 25

15 15

13 13

30 30

43 43

02 02

10 10

10 10

23 23

33 33

19 19

26 26

13 13

22 22

20 20

13 13

Solar/Ind 10YR 10YR % GD NAM

92 80.96 84 74.76 76 68.40 67 60.97 58 53.36

49 49 39 39 30 30 24 24 21 21 20 20 20 20

Page 4

15 % GD

95 90 85 79 73 68 62 55 49 43 37 31 26 23 21 20

20 % GD

97 93 90 86 82 78 74 70 65 60 55 50 45 40 35 31 27 24 22 21 21 20

25 % GD

98 95 93 90 87 84 81 78 75 71 68 64 60 56 52 48 44 39 34 30 28 26 24 23 22 21

30 % GD

98 97 95 93 91 89 86 84 82 79 76 74 71 68 65 61 58 54 51 47 43 40 37 34 31 28 25 23 22 21 21 20

Harris County Appraisal District 2019 Percent Good Value Factor Tables Specific Equipment and Computer Equipment

Year 2018 2017 2016 2015 2014 Prior

Specific Equipment: Includes Mobile Radio Equipment, Telephone Systems (PBX), Cellular Telephones, and Fax Machines

Percent Good 78 63 50 39 25 10

P.C. Computer Equipment

Percent Good 68 44 28 10 3 2

Year 2018 2017 2016 2015 2014 Prior

Main Frame Computer Equipment

Percent Good 75 56 42 32 15 10

Page 5

Harris County Appraisal District Personal Property Book Value To Market Value Conversion Tables

Tax Year 2019

Book Depreciation

00 - 20% 21 - 40% 41 - 60% 61 - 80% 81 - 99%

100%

PVF

PVF

PVF

PVF

PVF

PVF

PVF

Furniture & Fixtures 90 82 71 56 45 35

Leasehold Improvements

87 75 60 43 32 25

M&E (6 Year Life)

87 75 60 43 32 25

M&E (8 Year Life)

90 82 71 56 45 35

M&E (10 Year Life)

92 87 80 70 61 52

M&E (12 Year Life)

94 90 84 76 70 62

M&E (15 Year Life)

95 93 90 83 77 73

Book Depreciation

00 - 20% 21 - 40% 41 - 60% 61 - 80% 81 - 100%

PVF

Computer Equipment

75 56 42 32 15

PVF

PVF

PVF

Book Depreciation

00 - 50% 51 - 99%

100%

M&E (3 Year Life)

65 40 27

Book Depreciation

00 - 33% 34 - 67% 68 - 99%

100%

M&E (4 Year Life)

75 58 44 28

Book Depreciation

00 - 25% 26 - 50% 51 - 75% 76 - 99%

100%

M&E (5 Year Life)

85 71 55 36 24

Page 6

TABLE OF CONTENTS

General Personal Property Numeric SIC Code Listing Alphabetical SIC Code Listing

General Industrial Property Numeric SIC Code Listing Alphabetical SIC Code Listing

MAN MOD IND

Group Codes Manual Group Model Group (CAPPA) Industrial Group

Pages 8-21 Pages 22-35

Pages 36-45 Pages 46-55

Note: SIC with NEC stands for Not Elsewhere Classified

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