Camden [County] seeks $3M in taxes from Xe security firm

Published on HamptonRoads.com | PilotOnline.com (http://hamptonroads.com)

Camden seeks $3M in taxes from Xe security firm

MOYOCK, N.C.

Xe Services is Camden County's biggest taxpayer. But the county says the private security company owes even more, nearly $3 million in back taxes for aircraft based there but used in Iraq, Afghanistan and Africa, according to the county.

FAA records and satellite maps show about 50 aircraft worth approximately $80 million were based off and on over the past six years at the complex that was once part of Blackwater Worldwide, now known as Xe Services. The tax bill including penalties and interest is $2.9 million and growing.

"I was always noticing tons of helicopters and airplanes," said Camden County manager Randell Woodruff, who took many tours of the complex known as U.S. Training Center. "I was always wondering: 'Is any of this equipment registered with the county? Why isn't this part of the Camden County tax base?' "

Camden hired an appraiser from Charlotte to research the aircraft beginning in June.

Xe Services agrees it owes more taxes but says most of the aircraft were flying in Afghanistan, Iraq and Africa and rarely in Camden County, according to C.B. "Bart" McLean Jr., a Raleigh attorney representing Xe Services.

Camden tax records showed Presidential Airways, a subsidiary of Aviation Worldwide Services and Blackwater, claimed one small aircraft at the local site.

"The company concedes they made an error," McLean told Camden commissioners in a hearing March 21. "The figure of $3 million is grossly inflated, however. This is based on the assumption that all the aircraft were based in Camden every day."

McLean presented a sheet of 46 aircraft, showing some were in Camden part of the time. Based on McLean's report, the tax bill would fall to about $1 million, Woodruff said.

McLean asked for three more months to do research but was denied by commissioners.

"If someone owes these taxes, they need to be paid," Woodruff said.

Xe Services has given notice it plans to appeal to the North Carolina Department of Revenue, but both sides hope for a compromise, said county attorney John Morrison. If not, the case could end up in court.

Case law supports Camden County, Morrison said. In one landmark case, a shipping company based in Kentucky was forced to pay taxes on ships it owned based on East Coast ports, he said. Other similar cases also support Camden in a principle of law known as situs that says the company should pay taxes where it is based.

"The law is clear," Morrison said.

McLean could not be reached.

Last April, AAR Corp. announced plans to buy Aviation Worldwide Services and its subsidiaries for $200 million from Xe Services. Most of the assets have been moved to Florida, said AAR Corp. spokesman Chris Mason. At the time of the sale, AWS operated a fleet of 58 airplanes and helicopters, according to an AAR Corp. release.

Mason was not aware of Camden's claim for back taxes.

Jeff Hampton, (252) 338-0159, jeff.hampton@pilotonline.com

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Source URL (retrieved on 04/04/2011 - 16:07): http://hamptonroads.com/2011/04/camden-seeks-3m-taxes-xe-security-firm

 

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