Posted on

Tax ‘quagmire’ leaves county in hands of DLGF

Property owners in Harrison County are now in the hands of the Indiana Dept. of Local Government Finance when it comes to paying their property taxes, despite efforts by the local taxing bureau, including the county assessor, auditor and treasurer.
The latest in what Harrison County Auditor Pat Wolfe calls the ‘quagmire’ of property tax values and reassessments is a noncompliance issue with the 2006 real estate sales disclosures from the office of county Assessor Rena Stepro.
In a public meeting focused on showing the State of Indiana this county’s effort for compliance ‘from the top down,’ Wolfe and Stepro presented members of Harrison County Commissioners and the community with a plan to remedy the problem with the sales disclosures.
Last month, Stepro and other members of her office received a notice from the office of Cheryl Musgrave, commissioner of the Dept. of Local Government Finance, informing them they were noncompliant due to a lack of information concerning the 2006 sales disclosures and that they must present a public hearing with a plan to remedy the situation by today (Wednesday). The letter stated these disclosures were due to the state in March but had never been sent in.
‘I question why, if we were considered out of compliance as of March 1, 2007, we were not notified by the state until July 2007,’ Wolfe said in a prepared statement.
Wolfe also questions why an issue in the assessor’s office would prevent her office from receiving the tax rate from the state to get the ball rolling on finally sending out tax statements and collecting the property taxes, something that should have started in May.
According to the letter from Musgrave’s office, ‘Indiana law requires that Harrison County submit these data sets … to determine compliance with the annual adjustment rule and to analyze the shift of property tax burden from one class of taxpayer to another.’
Stephanie McFarland, a spokesperson from the DLGF, said the issue of sales disclosures being included in the abstract isn’t a new one and it has been something each county is required to submit for years, but it is something she has seen many counties simply refuse to submit. She also claims the four months in between the state’s knowledge of the noncompliance on March 1 and the letter informing them of their noncompliance is ‘sufficient time,’ especially considering that the inclusion of sales disclosures isn’t a new requirement.
‘They knew in the spring they weren’t compliant,’ she said, when they didn’t include the disclosures in the abstract.
This year, though, the DLGF has a new tool to ensure compliance: the right of the DLGF to withhold property tax replacement credit funds.
Part of the money from property tax bills should be going into the county’s school corporations, as well as libraries and other (non-taxed entities) and now the lack of money is causing some to be worried, including Dr. Phil Partenheimer, superintendent of the North Harrison Community School Corp.
Partenheimer spoke at Monday’s meeting and said his district was only about six weeks from being forced to take out a loan to pay employees’ salaries. Without future funds, he said, they would have to end the year without a balanced budget, which is prohibited in Indiana. He estimated North Harrison schools would need $5 million to operate.
Dr. Neyland Clark, superintendent of South Harrison Community School Corp., echoed a similar sentiment.
‘We could liquidate all our assets and we would not have enough to get through the year,’ he said. ‘We are going to have to have revenues coming from some source. That’s the bottom line.’
Wolfe hopes that the hiring of The Nexus Group, an Indianapolis firm, will bring the county one step closer to state compliance and thus the release of Harrison County’s tax rates.
The commissioners approved the hiring of The Nexus Group during Monday’s meeting, and Stepro was going to take the 1,000 disputed sales disclosures to Bloomington herself yesterday to ensure a speedy delivery. The group, which has worked with other local counties, including Clark and Daviess, will then begin the process of entering the sales disclosures in the proper format using the proper software the state dictates.
Wolfe said because it is an emergency situation, Nexus has assured her that once they receive the disclosures, all the information will be processed within two weeks. Stepro is also looking into purchasing the software so the information could be processed in her office in the future.
In the meantime, Wolfe suggested that citizens could look up last year’s tax bill and pay that amount, so money could start to funnel in and be distributed to schools and other government agencies. Once this year’s tax bills are sent out, a credit for those who have paid will be on the bill and they will then have to pay the difference.