OK-based firm hired to review oil, gas properties

The St. Mary Parish Council is banking on a Holdenville, Okla.-based company to help it boost sales and use tax revenues.

Last year, the parish collected $37.27 million in sales and use taxes.

The parish council authorized a $348,000 deal at last Wednesday’s meeting with Visual Lease Services to re-evaluate oil and gas drilling properties operating on parish-owned land.

The fee will be paid via an intergovernmental agreement between the parish council, the St. Mary school board, and the parish Assessor’s Office. The parish council will pay the largest share of the cost ($163,908), followed by the school board ($133,980), sheriff’s office ($40,020) and the assessor ($10,092).

Prior to signing the agreement, St. Mary Parish Assessor Sherel Martin said Visual Lease Services found in its work for Terrebonne Parish an additional $3 million in unreported property in two oil fields.

However, Martin said there is no guarantee that the company will discover anything in St. Mary.

Visual Lease Services’ Gary Mask told the parish council that his company has “…consistently discovered omitted and undervalued properties in all the taxing jurisdictions that we have completed projects for in the past.”

Mask said the company is currently in the “discovery process” in Plaquemines Parish, and the initial findings are following the same pattern as in other taxing areas.

He said in one instance, a company reported 30 miles of pipeline. However, Visual Lease has discovered an additional 30 miles of pipeline – with a value in excess of $3 million – as well as two compressors worth over $1.5 million and a processing unit with a market value in excess of $3 million.

“This is just one example of one company,” Mask said. “There are other companies that we are finding with similar types of properties and varying market values.”

Visual Lease Services, founded in 1958 under the name of GEM Surveys, has worked in 35 Oklahoma counties. Mask said the company has discovered $6 billion in omitted or undervalued properties in his home state and in Colorado, where $200 million in omitted or undervalued properties were found.

The St. Mary assessor said oil and gas field property assessments are levied based on self-reporting forms turned in by individual companies. About 85 percent of St. Mary’s 1,200 wells are in water.

“But those forms are never checked against the actual inventory out there,” Martin explained.

In 2007, sales and use tax figures show the St. Mary Parish School Board garnered approximately $14.4 million, the parish council, $17.5 million, the sheriff’s office, $4.3 million and the assessor’s office, just over $1 million.

“I’m not sure they’re going to find (the amounts recovered in Oklahoma and Colorado) in St. Mary Parish, but we can be optimistic,” Martin said.

Mask said the company’s strategy includes locating oil equipment and determining whether it is subject to ad valorem property tax; valuing it, mapping it and then providing the information to the parish assessor’s office.

The first step to seeking out equipment includes setting up a global positioning satellite system for all oil wells and operations in the parish. The findings are then compared to the assessor’s last three years of tax assessments.