May 24--The owner of the luxurious Bacara Resort & Spa wants its property tax valuation slashed in half -- by more than $110 million. 

Alvin Dworman's attorneys contend the 360-room beachfront hotel's property value is approximately $105 million, far less than the county's valuation of $217 million. 

While hundreds of businesses pursue tax appeals every year, the Bacara, which opened 21 months ago, is one of the top five property tax payers in Santa Barbara County. Winning its tax appeal could cut its property tax payments in half, from $2 million-plus to the neighborhood of $1 million. 

The Bacara is not the only upscale inn seeking relief. Beanie Baby magnate Ty Warner is appealing the valuation for the past three tax years of his 236-room Four Seasons Biltmore in Montecito, asking the county to reset the hotel's assessed value from $134 million to about $100 million. 

Property tax is a major source of revenue for government -- it represents $90 million of the $530 million brought in by Santa Barbara County last fiscal year. Of the tax money collected countywide, schools get 59 percent, the county and county-dependent districts 27 percent, cities and redevelopment agencies 5 percent each, and special districts 4 percent. 

In tax appeal papers filed this month, the Bacara team says the property was over-assessed for two reasons. First, the assessor valued the resort as though it was fully operational as of September 2000, although it fully opened four months later. Second, the county is including $15 million in project expenses that the Bacara team thinks should not be counted. 

Bacara is the pride of Mr. Dworman, a New York financier who by various accounts spent $220 million to $240 million on the retreat and its lush courtyards, gurgling fountains, heated swimming pools and rooms that go for $300 to $5,000 per night. Guests relax in steam rooms and are pampered with avocado-citrus body scrub. 

The appeal is to be heard in mid-November. The three-member county Assessment Appeals Board will determine whether the county's assessed value is fair or should be lowered. In California, property tax is levied at about 1 percent of the assessed value. Getting that valuation lowered also proportionately reduces the tax. 

Bacara is appealing regular assessments for the tax year 2001-02, as well as supplemental assessments for the year 2000. 

Every property is assessed as of Jan. 1 every year. The owner then receives a tax bill based on that valuation. A supplemental tax assessment was made for the Bacara resort for the last four months of 2000, because the hotel opened that September. 

The Bacara tax appeal contends that the hotel had only received temporary certificates of occupancy covering less than half the property as of September 2000. While part of the hotel opened that month, construction continued into December, when certificates of full occupancy were issued. Mr. Dworman's team thinks the supplemental tax assessment is set too high because construction was not finished. 

The Bacara team also complains that the county included exotic expenses as assessable improvements. These include $1 million to capture and temporarily relocate endangered frogs while creeks were drained during construction; $2 million to redesign the project to avoid Chumash artifacts; $2 million to remove soil that would not support buildings; and $1 million to install a methane containment system. 

There's no disputing that the Bacara boosted bed tax revenue in the Goleta Valley. Those revenues, paid by hotel guests in their bills, soared to their highest levels in four years, in large part due to the Bacara. The hotel also is a huge employer; its workforce is approximately 800 people. 

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(c) 2002, Santa Barbara News-Press, Calif. Distributed by Knight Ridder/Tribune Business News.