The commissioners were asked why they requested $5,335.67 from the Treasurer’s bond through KCAMP and not the additional $1,130 that was mentioned in the audit. They said that since the $1,130 wasn’t directly from the period being audited, they didn’t feel they could pursue it based on the audit.

KCAMP has stated that they intend to pursue reimbursement from Susan Quick (County Treasurer).

The county was not clear if collecting on the bond would change the Treasurer’s ability to run for office. However, it appears that it doesn’t.  People running for public office are not required to be bondable to run, but certain positions must be bonded to serve. The county pays the fee for bonds for elected officials. It appears that pretty much anyone will be bondable but the cost may be much greater depending on the risk. It is unclear if the county would be responsible for the bond at any cost or if there there is a limit to the amount the county will pay.

The county attorney came to see the commissioners to ask what they intended to do with the check the received from KCAMP. Susan Quick (County Treasurer) previously asked the commissioners to send the check back to KCAMP. She suggested that the money could be paid from the Treasurer’s office budget or that the Treasurer’s office could attempt to recover the funds from the companies and individuals the underpaid.

Susan Quick (Treasurer) had told the Terri Johnson (County Attorney) that the commissioners had told her that they were required to go after the bond. Terri Johnson said there was no specific statute requiring them to go after the bond, but an argument could be made that they would not be fulfilling their duty to the county if they didn’t pursue it.

Chairman Coleman brought up the fact that Susan Quick said that these were errors from the computer. The commissioners said they wanted to be careful that they aren’t overstepping their bounds in making the claim and they also want to make sure they aren’t picking on an individual. After some discussion, they decided it was within their responsibilities and voted to go ahead and cash the check.

KCAMP told Terri Johnson that it is very rare that a claim against a bond comes in.

Angie Timi requested a speed limit on East Kansas RD because of the high speed of vehicles on that road. She was concerned about how fast people drive down the road and that there would be an accident. The commissioners voted to put in a speed limit sign on that road.

There was some discussion about properties that were annexed by the city, but feel that they have not been provided the promised city services and would like to be de-annexed. Terri Johnson has requested documents from the city showing how the properties were originally annexed to see what options they may have.

Marty found out that TWORKS would pay for the sign that was part of the request for a sign and flashing light over at Uniontown.

Brian Snyder presented a signed petition to close Willow at 135th street to try to keep people from driving out in his fields to go “off roading.”

On March 15th, the Bourbon County Commissioners received a letter and check for $5,335.67 from KCAMP in payment for lost tax interest revenue from the Treasurer’s office.  According to the letter, KCAMP is now requesting payment from the Treasurer for $5,335.67. A copy of the letter can be seen here.

As discussed previously, the law appears to require that a suit be filed to recover money from bonds. The commissioner’s decision to pursue the matter directly from KCAMP allowed them to recover the fund without the cost of of a lawsuit.

On April 10th, there will be a tax sale in Bourbon County  and up to 29 properties will be sold.  If you want to see a list of the properties that may be sold, the properties that have been redeemed and the properties that have unpaid taxes and will not be sold in the first sale, you can view this pdf from the county website.

To bid on property, you must register for a bidding number with the Bourbon County Treasurer. You can do this as early as April 2nd.

According to the the March 5th Commission Minutes the Commissioners voted to write a letter to KCAMP (the county’s insurance company) and request that the county be reimbursed for $5,335.67 from the Treasurer’s $25,000 bond.  It appears that this amount is the amount that was underpaid by Klein Products (plus additional) interest in Terry Sercer’s report details. We previously discussed this underpayment and pointed out that if it was a computer error, there may be difficulties recovering this from the bond. It isn’t clear (at least to us) whether or not a computer mistake in calculating interest could actually be recovered from the Treasurer’s bond.

If you read  KSA 79-1703 it says:

Except as provided in subsection (b) or as otherwise provided by law, no board of county commissioners or other officer of any county shall have power to release, discharge, remit or commute any portion of the taxes assessed or levied against any person or property within their respective jurisdictions for any reason whatever.

To recover money from the bond the county will need to show that the Treasurer “released, discharged, remitted or commuted” a portion of the taxes levied against the property. What isn’t clear is whether or not an error–particularly if that error can be shown to be caused by a computer–would fall under any of those categories. It is possible that there are other laws that come into play here as well that the county is basing their action on.

However, there was $1,130 that was “forgiven” by the Treasurer on property in order to help a real estate transaction proceed. This definitely falls within the definition of KSA 79-1703, but it doesn’t appear that this amount is being included in the request for a payout from the bond. (It is possible that the requested amount includes a portion of the miscalculated interest from Klein Product as well as the full $1,130 amount, but that seems unlikely.)

Further, the law seems to indicate that the process to recover money from the bond requires a lawsuit:

Any taxes so discharged, released, remitted or commuted may be recovered by civil action from the members of the board of county commissioners or such other officer and the sureties of their official bonds at the suit of the attorney general, the county attorney, or of any citizen of the county or the board of education of any school district a part of the territory of which is in such county, as the case may be, and when collected shall be paid into the county treasury to be properly apportioned and paid to the county, municipalities, school districts and other taxing subdivisions entitled thereto

This suggests that if the county or a citizen were to sue the Treasurer to recover the $1,130 and win then the fund would be able to be recovered from the bonds. However, if such a lawsuit were to succeed, a more likely scenario would be that the Treasurer would simply pay the $1,130. In fact, if a lawsuit were filed, it might make sense to simply pay the $1,130 unless the Treasurer thought it was reasonable to expect the lawsuit to fail. Our understanding of the public bond is not that it offers a type of insurance so the public (in this case the county) can quickly recover their fund through the bond. The bonding company still has the right to recover the fund from the person bonded.

If a bonding company has to pay out for someone once, it stands to reason that it may be very difficult to get another bond on the same individual. If someone can’t be bonded, it appears that this would prohibit them from being able to occupy a public office that required a surety bond.

According the the commission minutes, the county is not suing the Treasurer. They are writing a letter to KCAMP requesting funds from the bond directly. It is possible that there is an agreement in the bond that allows this in order to prevent expensive legal proceedings, but it appears to be a different procedure than outlined in the law quoted above.

According to the report by Terry Sercer, a number of individuals overpaid their taxes–(including the County Treasurer by $346.32 in 2006) because of problems in the way the interest was calculated.  The report said that a number of individuals overpaid by around $800. (It wasn’t clear if this is the sum of all overpayments or an average per person.) These individuals should be receiving a refund in the coming weeks.

Mr. Sercer has provided a summary of his findings from his audit. FortScott.biz has requested the details from Bourbon County, but at first they were not available under Kansas Open Records Act because the Commissioners had yet to request them. Since the Kansas Attorney General hasn’t indicated that their investigation is complete, the Commissioners didn’t originally want to request this information (and thus make it public) in case it would damage the Attorney General’s efforts. After weeks of not hearing anything from the Attorney General’s office, the commissioners decided that the importance of getting the refunds made outweighed any potential benefit to the Attorney General and went ahead and requested the details which we published here.

When it comes to interest that should have been charged, but not paid it turns out that there are provisions in the law for this.

If you look at this opinion by the Attorney General, it talks about payment plans and makes it clear that neither the Commissioners nor any other officer of the county can change the amount of tax due or interest charges.

Thus, except for very limited exceptions, no board of county commissioners or other officer of the county has the authority to release, discharge, remit or commute any portion of taxes that have been levied or assessed against a person or property.

The exceptions have to do with bankruptcy and a situation where there was a very specific program established by law for Wyandotte County.

The law cited is KSA 79-1703 which says:

Except as provided in subsection (b) or as otherwise provided by law, no board of county commissioners or other officer of any county shall have power to release, discharge, remit or commute any portion of the taxes assessed or levied against any person or property within their respective jurisdictions for any reason whatever.

So if you owe taxes, no one can change what you owe other than changing the actual assessment. So what happens if Commissioners or another elected official does “release, discharge, remit or commute” a portion of the taxes?  For example, what happens if they mark the taxes and interest as paid when the proper amount was not collected? There is a provision for that.

Any taxes so discharged, released, remitted or commuted may be recovered by civil action from the members of the board of county commissioners or such other officer and the sureties of their official bonds at the suit of the attorney general, the county attorney, or of any citizen of the county or the board of education of any school district a part of the territory of which is in such county, as the case may be, and when collected shall be paid into the county treasury to be properly apportioned and paid to the county, municipalities, school districts and other taxing subdivisions entitled thereto

So basically if any commissioner or official releases a tax payer from paying taxes, they become liable for them personally and they can be sued by the Kansas Attorney General, County Attorney, any citizen of the county, or the board of education. This provision means that trivial amounts, while they can’t technically be written off, are unlikely to be something that will incur a lawsuit. If someone owes $0.32 on their taxes and a county official decides it isn’t worth pursuing and marks it as paid, someone could sue that person to recover the $0.32, but it would be a whole lot of effort for very little.

Notice that the wording of the law refers to “taxes assessed or levied.” It doesn’t specifically say that interest on unpaid taxes gets the same treatment.  However, the Attorney General’s opinion concludes with:

However, K.S.A. 79-2024 does not authorize the county treasurer to abate or forgive delinquent tax or interest on tax debts, which remains prohibited by K.S.A. 79-1703.

79-1703 doesn’t mention the word interest. The Attorney General appears to assume that the interest on taxes is treated the same way as the taxes themselves and cannot be changed.

It appears that if  a county official released someone from their tax obligation by marking it as paid when they hadn’t paid the proper amount, the county official becomes liable for the amount that wasn’t paid. The law says that the funds may be recovered from them and the sureties of their official bonds by civil action. I called the County Clerks office and asked if Bourbon County Officials are bonded. They are and here is the bonded amount for a few of them.

• $5,000 – County Commissioners
• $10,000 – County Clerk
• $25,000 – County Treasurer

Bonds are basically a type of insurance so that funds can be recovered if an elected official acts inappropriately. The county pays a premium for elected officials to be bonded.  This helps remove some of the risk for the county of an official making off with county money. If that were to happen, the bond company would pay the claim up to the amount of the bond and then it would be up to the bond company to track down and collect from the public official. So basically a bond allows the county to get its money quickly if something goes wrong without depending on whether or not an elected official has the means to pay.

So is a the bond company that insures Bourbon County elected officials on the hook for interest that was not collected? It may depend on the circumstances.

According to Mr. Sercer’s audit report, there was one individual who had their taxes marked paid even though they underpaid by around $5,000 for a two year period. If it could be proven that an official in the county marked the amount as paid even though it was too little, then it appears that the official would be liable to pay back the $5,000 that was not paid.

However, if it could be shown that the computer system incorrectly calculated the interest, it might be a bit more complicated because it might be hard to actually win a civil suit against the county official. The computer company might have some liability, but in Bourbon County, it appears that the system that was producing incorrect numbers was no longer under any type of maintenance plan which would likely remove the company from having any liability since they stopped updating the software when the maintenance plan lapsed. On the other hand, there may possibly be some liability if a county official signs off on something that has obvious error–regardless of what computer system generated them.

While it is not clear how the larger amounts might be treated in court if a civil suit were to be filed, the audit report mentions one instance where $1,130 in interest was not paid. According to Mr. Sercer’s report, it was written off based on a belief that the money probably wouldn’t be recovered in a tax sale. Based on KSA 79-1703 it appears that the official who wrote of the $1,130 could be compelled to pay that money back to the county (in which case their bond would probably be the mechanism that the county would be paid).

Marty Pearson showed the commissioners details on a training program on roads that KCAMP will pay for. The commissioners voted for him to take the classes that will be paid for by the state. The classes are offered through KU and are part of the Kansas Roads Scholar Program.

There still isn’t a date on the tax sale and the county is still waiting for Mr. Meara to put together the press release. There are a few dates in March and April when the Register of Deeds office will be gone to a conference so the the tax sale can’t be scheduled for those dates. The commissioners asked that these dates be communicated to Mr. Meara.

Sheriff Gray presented a request from Uniontown asking about putting a flashing light on  K3 and Maple Road. There have been two fatalities there recently. They have permission from the state, but the state said they didn’t have funds to pay for it. Uniontown is asking for assistance from the county for the approximately $5,000 cost of installing it. The state doesn’t have any money to pay for it, but they were hoping the county could pay for 75% of it. The commissioners acknowledged the request and said they would approve it, but didn’t have the funds to add it at this time.

The county has been asked for a Bourbon County representative for the Kansas 6th Judicial nominating committee.

The commissioners spoke with a company that will help audit the counties phone bills to see if they can recover any overpaid funds. The company will split the refunds with the county. The Commissioners made and passed a motion to use the service to look at their phone bill.

Some time back, FortScott.Biz requested a copy of the details from the audit showing the individual under and overpayment information. The commissioners were concerned that they might not want to request this information (and make it subject to Kansas Open Records Act) until any investigation by the the Attorney General was complete.

This information has now been made available and is being used to send refunds back to tax payers that overpaid. The commissioners said that they still hadn’t heard anything back from the Attorney General, but decided it was in the best interest of the county to request the information in order to issue refunds to those that overpaid.

Keep in mind that underpayment doesn’t indicate any type of problems on the part of the tax payer. They paid what they were told to pay. If there were inaccuracies, in the amount of tax they were told to pay or how the interest was calculated, that wasn’t the fault of the tax payer.

Based on previous conversations, it does not appear there is a way to recover underpaid taxes from the tax payers if their accounts were marked paid in full. This seems reasonable as it would be very disruptive to businesses and individual if the county could go back several years and say “oh we made a mistake, you now owe more money.”

Here is the pdf of the over/underpayments. If your name shows up as having overpaid, you should be receiving a refund in the near future.