Ellison's estate cost more than $200 million after multiple delays and construction change orders. Chronicle photo, 2006, by Christina Koci Hernandez
Posted on 03/27/2008 9:23:03 AM PDT by BurbankKarl
Larry Ellison, ranked 12th on the Forbes 500 list with a net worth of $25 billion, has bagged a $3 million tax break after arguing that his flamboyant Japanese-style estate in Woodside is functionally obsolete.
The chief executive officer of software giant Oracle Corp. will be paid from San Mateo County property taxes collected this year, which otherwise would have gone to schools, the county general fund and cities, among other things, Deputy Controller Kanchan Charan said. The hit to schools alone will be nearly $1.4 million.
Ellison's Octopus Holdings LP acquired the 23-acre site in May 1995 for $12 million and spent nine years constructing the lavish property, modeled on a Japanese emperor's 16th century country residence, according to the San Mateo assessment appeals board.
It consists of a nearly 8,000-square-foot main house with two wings, a guest home, three cottages and a gymnasium as well as a 5-acre man-made lake, two waterfalls and two bridges. Hundreds of mature cherry, maple and other trees were planted among nearly 1,000 redwoods, pines and oaks.
The assessor's office based its January 2005 valuation on so-called reproduction costs, the $166.3 million it should have cost to build, said Terry Flinn, deputy assessor-county clerk-recorder. Ultimately, after multiple delays and construction change orders, it ran more than $200 million.
Octopus Holdings, represented by San Francisco attorney William Bennett, asserted that it was worth only $64.7 million at that time, and in the two tax years since.
Why? How did Larry Ellison's palatial estate decline by more than 60 percent in value in a market where luxury homes are actually appreciating and single-family homes values in the county only decreased 6.3 percent in the last year, according to DataQuick Information Systems?
(Excerpt) Read more at sfgate.com ...
Ellison's estate cost more than $200 million after multiple delays and construction change orders. Chronicle photo, 2006, by Christina Koci Hernandez
Which room is Mr Miyagi’s?
I have no opinion on the tax break, since we don’t really know the facts of the case, but maybe this article is just a little slanted...
“The chief executive officer of software giant Oracle Corp. will be paid from San Mateo County property taxes collected this year, which otherwise would have gone to schools, the county general fund and cities, among other things, Deputy Controller Kanchan Charan said. The hit to schools alone will be nearly $1.4 million.”
It’s for the children!
I wonder what would happen if I tried that ploy with my county's tax assessor? I think I would end up broke and living in a tent somewhere in the woods.
I agree with his reasoning, it’d be a tough place to sell. It’s not the same market value as a standard house. In any case the didn’t bribe anyone, just made an appeal that was successful.
As far as the tax bucks are concerned, I wonder how much revenue Ellison brings in personally and corporately to the county.
What really strikes me is that their argument was that the home was “functionally obsolete”.
Yet it claims the property was bought in 1995 and construction took 9 years? Meaning it was finished in 2004?
How on earth is a 4 year old house “functionally obsolete”?
The best thing that can happen to San Mateo County is LESS TAXES.. LESS government.. LESS government employees..
Saying that the cost of something went up due to change orders can be deceiving. If something is built and the owner or architect decide they want it torn out and built differently it will result in a change order; however, that DOES NOT necessarily mean that the VALUE of the final product is any different than it would have been originally.
For example, let’s say your wife has a room recarpetted and the installed price of the tile is $40/yard, you need 100 yards installed for a final price of $4000. But once it’s in, she decides she doesn’t like it and wants it torn out and she picks a different carpet which also costs $40/yard and on top of that, you are being charged $2 per yard to have the old stuff ripped out and hauled away. In the end you will have spent $8200; however, you will only have $4000 worth of carpet.
Because the housing market in 1995, when he planned the place, differs greatly from the market of 2008 when he got the break? Presumably, dot-com billionaires just aren’t buying wasteful ego mansions like they used to, hence the place is now obsolete. If he had built the place as a paean to eco-greenery or some other such tripe, it would not be obsolete now.
I'd heard a story where some Japanese VPs visited his office and one of them dropped his laptop on Larry's 16th century antique Japanese desk. Larry flipped out and started screaming about getting a scratch on his multi-million dollar 500 year old desk so much that the Japanese execs wanted to kill themselves and were practically kneeling on the floor begging forgiveness.
is he still dating secretaries?
Sometimes laws are just WRONG.
Amusing.
Avoiding taxes is as American as Mom’s apple pie so more power to Larry.
The govt, especially the evil govt schools, would only squander the money to no good prpose anyhow.
yes-- and whose fault is it that his house is functionally obsolete? was he forced to build this very, very, personal house? this part of his argument is shameful... in my opinion...
So ordinary crap-on people don’t ever get to see any kind of break like this. It’s only for the rich and powerful.
Larry Ellison is the same guy who, after September 11th, offered to give the government free software in order to institute a National ID card. Eff him.
Ellison just forced the county to follow the law and assess his property at market value. In other words, treat him like any other property owner and not ding him with some conspicuous consumption tax or billionaire tax.
This is typical reporting by the Comical: hate the rich, hate business. All this crap about a tax break, taking money from schools and hospitals is just commie propaganda.
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