Error from auditor’s office leads to property tax discrepancies

Jasper County would have collected an estimated $595,000 in overpaid property taxes if an error from the auditor’s office had not been caught and corrected, but the repercussions of that mistake will inevitably result in citizens receiving new tax statements, refunded checks or credit towards other tax payments.

During the Aug. 23 board of supervisors meeting, Jasper County Treasurer Doug Bishop offered clarification and allowed the auditor’s office to explain its mistake.

Jasper County Auditor Dennis Parrott said deputy auditor Teresa Arrowood accidentally used last year’s school levies to calculate the property tax statements. Some of the levies were higher than this year’s school levies, which meant citizens paid more property taxes than they should have.

“She’s the one who found the mistake and started to tell me and everyone else what the situation was,” Parrott said during the meeting. “…That’s the gist of what’s happening. We’re willing to work with Doug to do whatever we can to fix it. It was an honest mistake, and we just want to get it right.”

Arrowood contacted the State of Iowa, Parrott, Bishop and the county’s computer company in order to stop collections on Aug. 19. Bishop confirmed his office had to suspend tax collections and shut down online payment capabilities; between 150 and 300 people use online payments every day during tax season, he said.

For the next four days after collections were suspended, Bishop’s property tax staff tried to address the issue. They found out quickly more than $1 million in property taxes had already been collected before Aug. 19. More than $300,000 of which was paid for the full year rather than the two installments.

Those property tax payments were all reversed and then re-entered as full-year tax payments with a credit being applied to the next year’s taxes, Bishop said.

However, the remaining $700,000 were payments for the first half only. Those payments were also re-entered with the correct first half amount applied. Any additional dollars were applied to the second half total. Some parcels paid $1 or $2 more while others are “significantly higher.”

Jasper County needs to send out new tax statements as soon as possible, Bishop said. Iowa Code states the treasurer’s office needs to give a 30-day notice that taxes are due. So long as the statements are sent before the end of August, the county has until the end of September.

“I feel we’ve given them that notice that taxes are due, and since the amount is actually going to be coming down a little bit for some, I think we should be covered there even if we have to send out another round of tax statements,” Bishop said, noting he has not checked with the county attorney yet.

If the school levies had all increased instead of remaining the same or decreasing, Bishop said he would probably be throwing in the towel.

“There is no quick, easy or painless way to correct this, and kicking the can down the road is not an option,” Bishop said. “We need to fix this right away. (Property tax staff) had to make 405 pages of corrections just yesterday. I’m not sure how many more will need to be made as of yet today.”

Two of the biggest districts affected by the discrepancy are the PCM Community School District and the Colfax-Mingo Community School District. In the Colfax-Mingo district alone there are 502 parcels affected. Farmers with land in either of these school districts may be more impacted.

Bishop said the treasurer’s office had a customer from Prairie City come in with five farm parcels. The customer’s savings for the first half was $128.

“So if he had five parcels that saved him $128 in that district, you can imagine what a large volume would be,” Bishop said.

Another Prairie City constituent sent Bishop an email on Aug. 21 complaining about the high tax assessment. Although he knows it is mostly tied to the increase of property values, he wanted “this insanity” addressed. The constituent said his taxes increased by more than $1,000 since last year, a 32 percent increase.

“What services have we received that merit collecting that kind of money from the citizens of this county? My street still has the same cracks in it as when I moved here 16 years ago … I know there’s an appeal period … Just tell me, Doug, where do we start in order to get someone to pay attention?”

Bishop said his office gets a lot of these comments and questions. He commended supervisors for lowering its levies, but some citizens just don’t know the process nor see other entities like the cities, townships or schools may have raised or maintained their levies.

Although Bishop was able to respond to the man and told him about the savings he would receive because of the error, the comments will likely continue. Bishop tried to think of an analogy to describe this situation, but he could not come up with one. He instead recalled a term use by former President Ronald Reagan.

“Trust, but verify.”

Bishop said, “And it seems like sometimes in our society we spend way too much time trusting and not enough time verifying. My favorite presidential quote is from Harry Truman and it is: ‘The buck stops here.’ And at this point, unfortunately, with the situation that it is, that’s the stand I’m taking.”

It doesn’t matter the mistake that was made or the error that led to this, Bishop said, it just needs to be fixed, and fixed in an open matter.

“No matter how painful that may be,” he said. “I know the auditor’s office has went through some tough couple of days getting that put together, as did our’s. But we’re going to fix this together going forward, along with the board … My co-workers in the tax department have had a rough four days.”

One tax department employee has 44 years of service while the other has 26 years of service. Bishop said both have stated at the end of the day Aug. 22 that it was the worst day they’ve had in their entire working career. People were not very kind on the phone when they called.

Going forward it is going to take time and patience and understanding, Bishop said, as well as a commitment to learn from this experience and not allow it to happen again if at all possible. Bishop said the auditor’s office will be sending postcards to every citizen in Jasper County notifying them of the situation.

At this time, the treasurer’s office has lifted the suspension on property tax collections, and the amounts on the website are now correct. New statements are being processed and are hoped to be mailed out by Aug. 29.

Contact Christopher Braunschweig at 641-792-3121 ext. 560 or cbraunschweig@newtondailynews.com