The Bourbon County Real Estate Tax Statements are starting to arrive and most people are going to see an increase in property taxes this year because of several mill levy increases. The County Commissioners have noted that if all the taxes due were paid, it is likely that the county wouldn’t have needed to raise the mill levy.

But property taxes aren’t the only form of income from the local government. Here is a list from the Kansas Department of Revenue of warrants for some of the other types of unpaid taxes.

Just in Bourbon County, there are over $600,000 in unpaid taxes. Now not all of this money would go to local governments. For example, the bulk of sales tax goes to the state. However, Kansas sales tax has gone up in recent years to deal with revenue shortfall just like the local government bodies have had to raise property taxes.

One of the biggest concerns from this list is that most of these taxes are either sales taxes or witholding taxes. That means they were actually collected from people–most likely Bourbon County citizens–and not remitted to the government. When the government didn’t get the taxes it needed, it had to raise taxes. So in effect, many locals have had to pay taxes twice. Once when it was collected as sales tax for a local purchase and again when the property taxes and sales taxes went up.

Certain types of taxes being unpaid can lead to prison terms for tax fraud which means that the local citizens may end up paying a third time by taxes that are going to cover keeping someone in prison. The best figures I could find for Kansas seem to estimate that it costs about $24,000 per year to keep someone in prison.

Government works when people follow the rules. Unfortunately when some people don’t follow the rules, the costs are distributed to those who do and it is often very expensive.

There was no County Commission meeting today as the Commissioners and many other county employees and officials attended annual Kansas Association of Counties meeting in Topeka.  The theme for the event is The New Normal — Balancing Resources & Expectations.

Most homeowner’s insurance in Kansas doesn’t cover an earthquake unless you specifically add it to your policy. Since the risk is very low, most homes in the Bourbon County area can be insured against earthquake damage for a few additional dollars per month. Be aware that the way deductibles are handled for earthquakes can be different than the way it is handled for other types of damage.

Even if you want coverage, you may not be able to get it right now. At least one local insurance company is unable to write earthquake insurance today. Its underwriters refuse to issue policies in this area due to the recent tremors.  Other companies will let you add coverage with a simple phone call.

If you are unsure of your coverage, your insurance agent can let you know what your policy covers and what options you have.

There was a bank foreclosure sale for a single piece of property scheduled this morning at 10 am on the county court house steps, but 10 am came and went with no sale. The court house was not open because of Veterans Day and it appears that the sale was rescheduled for December 9th.

Apparently when a bank wishes to foreclose on an owner who is not paying their mortgage, they can’t simply take the property back. The bank’s position against the home must be auctioned off with the bid starting at the amount the bank is owed. If there are no buyers the property goes back to the bank and then the bank can then sell it through a realtor or through their own auction.

The county is getting ready to send out tax statements to property owners. Joanne Long said that the county sends out over 15,000 tax statements. Some properties have two statements–one that goes to the mortgage holder and one to the property owner. Property owners should see the statements sometime in the next week or so.

The taxes can also be viewed online by following this link. Type in your last name, push “find now” and then click on the “current taxes” link.

There was some discussion of the getting a crane to help move crusher equipment at the rock quarry. Commissioner Coleman said that when he was working with cranes they always tried to oversize the crane by 5x of whatever they are trying to lift. The commissioners were going to check to see just how much the equipment that needs to be moved weighs.

There will be no commission meeting on Friday due to the holiday. There will be no commission meeting on Monday due to the Kansas Association of Counties annual conference.

A citizen came in to talk to the commissioners about a large rock that bent up the A-arm and stabilizer from bottom of his car last Tuesday when he hit it and it drug him over into the ditch. The commissioners and county clerk gave him a form to fill out for the county insurance company.

Sewer District

Two citizens, John Scott & Curt Shankel, were updating the advisory committee for the new sewer district. The sewer system should be operational by the end of the month. They are asking that the committee be kept in the loop particularly in matters related to the price increases. They discussed how to keep things fair if people want to connect to the district in the future. The commissioners based a motion to recognize the advisory committee in an advisory capacity.

Vacation & Holiday

The commissioners passed a motion to close the landfill on Saturday when there is a holiday that falls on a Monday or Friday.

Redfield Alleged Stalker

The Mayor of Redfield, Gary Judd, came to talk to the commissioners about an alleged stalker / peeping tom. He said that citizens have started arming themselves and walking the streets at night. The other evening two citizens were out with a baseball bat and shotgun. He was concerned that some of the people arming themselves “shouldn’t even have a gun.” He said the sheriff’s department is doing the best they can do, but he was still concerned that someone was going to get hurt.

Allegedly someone broke into an individual’s home, watched her sleep, and kidnapped her from a convenience store. The review of the tapes from the convenience store doesn’t seem to support that.

He said there was a city council meeting tonight where the issue is going to be discussed.

The Commissioners suggested that he talk with the sherrif.  The Mayor said he had tried, but no one called him back. He felt like the person at the front desk was interrogating him. He said that if there was anything Redfield could do to work with the sheriff’s department, they would be very willing.

The Mayor came back after talking with the sheriff and said he and the sheriff were both questioning the validity of the allegations, but that the sheriff’s department was helping the town with the issue.

Quarry Meeting

The commissioners are meeting with the road and bridge crew at 7 am, November 9th at the county barn to discuss the move to a new quarry.

Here is a screenshot of the 2005 property taxes for a local business. Half of this amount should have been due on December 20th 2005 and the other half on May 10th 2006. Since the taxes weren’t paid, they should have been published in October 2006 which would have started the redemption period. For non-homestead property that would have been 24 months.

So the property should have been at any Sheriff’s sale that occurred after October of 2008. However, the taxes were not paid until March of 2010. Was there no tax sale from October 2008 until some point after March of 2010? The Bourbon County website lists a 2009 tax sale list, but this property was not included. According to the Commission minutes, there was a tax sale held January 27th, 2010.

When I asked Treasurer wasn’t sure why this property wasn’t on the sale and she didn’t recall any reason why it was held off. It is important to note that there are many stages that property goes through before being listed on a sale and it is entirely possible that it was submitted as property for sale, from the Treasurer’s office but held out based on other criteria.

If there was a reason why the property was held off the tax sale, was the interest calculated correctly? The interest rate for 2005 taxes was 7%. The total amount owed would incurred interest from May 20th 2006 until March 22nd, 2010 or 46 months and two days.  Half of the amount would have incurred interest from December 10th, 2005 until May 20th, 2006 or 5 months 10 days. If we round the time to just months the total comes to $7,116.29 in interest. There should have been another $15 or so in fees as well.

According to Susan Porter, who used to work in the Treasurer’s office, the system we are looking at here, has a safe guard against accepting incorrect interest.  It requires that you manually over-ride the interest.

When this is entered to actually pay the tax on the tax payment screen the only way for the interest or penalty to be changed or removed is a manual override or to back date the payment calendar date. Until this is done the correct amount of interest and penalties are calculated correctly. ~ Susan Porter source

If this is correct, then someone would have needed to intentionally marked the amount as complete even though the system was showing there was still around $900 owed. I asked the Treasurer the discrepancy could be due to the way that the amortization schedule works. In other words if part of the taxes owed were paid early on, those taxes would no longer be accuring interest. So it is possible the taxes were calculated correctly, but since the date of each payment doesn’t show up on the public website, it is hard to tell.

Interestingly this particular company does have a payment plan that was setup in 2010. They own just under $30,000. The payment plan states that they will pay $2,000 per month from April 20, 2011 until May 20, 2012. This only comes to $28,000 which is about $2,000 less than what they owe without factoring in the interest.

According to Mr. Sercer, he was told that the payment plans were based on an amortization schedule produced by the old computer system and that sometimes it came up with “crazy” interest rates. The Treasurer confirmed that this was likely what had happened in this situation. It seems very odd that it would generate a completely even number that doesn’t even add up to the full amount much less include interest.

The problem isn’t so much that the property wasn’t sold. Obviously it is better if the taxes are paid. However, if a property doesn’t have the threat of being sold, it is possible for other payments to become the priority.

Is it possible that simply following the timelines specified for selling delinquent property would have encouraged enough payments to have made the past mill levy increase unnecessary?