It has become obvious in recent months that the property tax collection efforts as applied in Weber County have some serious flaws. It has come to our attention that there is possibly millions of dollars of uncollected and delinquent property taxes listed on the Weber County Web site.
The immediate response from the County Commission was that the Utah State Tax code prevents them from more aggressive collection of property taxes. That is simply not true. Section 59-2-1358 clearly provides the county with ample latitude to collect these delinquent taxes up to the final act of foreclosure.
In fact, the County did pass a minor change in 2008 regarding subdivisions that provides better leverage to collect delinquent accounts. This could be expanded beyond subdivisions to include all delinquent taxes from any developer. Weber County has many options that could be explored with some innovative thinking and application.
Our subsequent e-mail to Jan Zogmaister included some possible options for the County to consider for collection prior to foreclosure.
It is our unhappy duty to report that according to Jan Zogmaister today, the Commission is already involved in many issues regarding the county and state and she did not mention any plans to investigate or rectify this tax issue.
All the information below on taxes is available at the Weber County Web Site; it is part of the public record.
We took a sample of just 6 property owners in Ogden Valley where we live, and found that those six owe $334,000 in delinquent property taxes just for the tax year of 2007. We also found that most of them owe more for other years including the tax year of 2008.
If this sample in Ogden Valley is indicative of the entire Weber County tax base, there could be millions of uncollected and delinquent property taxes due in our County.
What makes this unacceptable is that the rest of the property owners that pay their property taxes on time, bear the burden of carrying these delinquent accounts until they are paid. In some cases this may take up to 5 years since many delinquent tax payers wait for the sale of their property before paying.
The most insidious hidden part of this process is when the land or home is sold and the delinquent taxes are finally paid, the selling property owners increase the price of the property to cover the delinquent taxes plus the penalty and interest that they pay for being delinquent. This additional cost for the property works it’s way into the tax evaluation system and results in higher property taxes for everyone in the area.
If anyone is under the impression that this is a insignificant amount of money, we suggest you visit the Weber County Web Site and review the delinquent lists starting in 2008, and back several years.
In addition, we would suggest your read the article by Lee Davidson in the Deseret News today regarding delinquent taxes.
This is a major misuse of taxpayer money, in effect almost a “Ponzi” scheme with taxpayer money. If you are unhappy about “carrying” these delinquent tax payers to the tune of millions of dollars, let your county commissioners and the Utah Governor know about it. The e-mail addresses for all Utah officials can be found at the VCRD web site http://vcrdutah.org/county.html.
Larry and Sharon Zini
19 comments:
While I am not sure which 6 Ogden Valley properties you looked at, it is very interesting to look at the "L's" and the "M's." Many developers appear - to spell it out more clearly look at Lakeview, Lewis and more. Upon closer inspection, look at "Catanzero" and Wolf Creek. And don't forget "Western America Holdings, owner of Powder Mountain. And Liberty Real estate. The list is interesting indeed. I keep finding more!
It is not so much who is responsible for the unpaid taxes, it is the fact that such a large amount goes uncollected when much of it maybe recovered with some effort by our County leadership.
From the 2006 list, the Red Moose Lodge owes more than $20,000 and Lewis homes had a long list of delinquent properties.
Do you suppose the Bison Creek Ranch subdivision in Huntsville was on shaky, wet ground since John Lewis had his hand in all three?
I believe the Red Moose lodge changed hands, so why was the $20K not collected?
The best, most effective action any of us could do is to write e-mails or call our County Commissioners to demand that they formulate a plan to start collecting this delinquent tax money before hammering us with additional taxes. The numbers and e-mail addresses for all State and County officials are on the VCRD Web site www.vcrdutah.org.
After reading the Deseret Article yesterday, it would seem that our county and state leaders could craft a change in the tax code or collection procedures that would not punish truly hurting delinquent tax payers, and go after the large developers that intentionally use the current system to avoid paying until they sell their land. They are being carried by the other taxpayers!
In reading the article in the Deseret News, there is about $86.7 million in delinquent property taxes outstanding in just Salt Lake, Utah and Davis Counties alone. Just think what the State and those Counties could do with just 25% of that money if collected. Maybe we would not have to reduce our police departments, reduce higher education spending or all of the rest.
If you appealed your property taxes for 2007, and as most know the appeals were in record numbers, the Board of Equalization worked well into 2008. In our own case into April before they got to ours. We were not alone.
The adjustments were finally approved by the adjustment board in May 2008.
Meantime, the "computer assisted re-evaluations and assessments" were already being done effective beginning 1 January 2008.
That means we and everyone else who appealed the outrageous 2007 assessments continued to be assessed at the higher 2007 valuation. The Assessor reports to the Treasurer the old numbers.
The new valuation with the reduced and approved appeal valuation goes to the mortgage holder in Nov. 2008 and since the Assessor does not report the adjusted tax bill, we received an incorrect tax notice. It was much lower than the original assessed valuation. A refund check had been issued for overpayment of our 2007 property taxes.
And to make the fouled up situation even more FUBAR, we received a tax delinquent notice in January 2009!!!
Rather than fight the system, we just wrote them a check for the same amount as the Equilization Board had approved during the adjustment.
Now I know for a fact that happened to us. And I also know that the Lewis', and probably most of the others, appealed their property assessments BIG TIME. And I highly suspect that the numbers involved were much much more than our measly $226.
Point is Larry and Sharon, and everyone out there who are getting worked up. The Property Assessment process is so screwed up and complex that virtually no one understands it and can administer it correctly. And it is the current Property Tax system which is at the root cause of all the problems.
The well meaning "bandaids" are not enough to solve the problems with our current "Truth in Taxation" Property Tax system.
Machster, good input. All we can do is try to sort this mess out in the public arena since the County will never admit it has any problem regarding their handling of property taxes.
Our thoughts are that if the Counties and State could just get 25% of the delinquent money owed in Utah, Salt Lake, Davis, and Weber Counties, it would certainly impact the financial crisis and possibly delay future property tax increases. It could amount to around 25 million dollars for those four counties alone.
Larry & Sharon
Did you look at 6 random properties or 6 you selected because of some suspicions? The implications of how big this is could vary widely.
I also think the local governments, in concert with the state legislature that makes the rules, know full well what they are doing and look at this as a savings plan that pays better interest than any where else they can put the money. It of course also helps their buddies in the real estate and development game with below market commercial rates.
The interest they collect is pegged to the prime rate and always is quite a bit more than what the county can get with the normal "safe" places they park collected taxes that haven't been spent yet. Last year it was around 10% and this year it will be around 6.5%. In addition, the law allows them to do a tax auction after five years which prevents the total tax owed from becoming more than the underlying property is worth. So in the end the county always gets the money in this no risk high interest game they are playing and there is never any money left on the table that the on time payers lose.
Ozboy, in fact we were looking for ways to lower or delay the constant property tax increases in Ogden Valley when we came across several parcel lots and they all had the flashing delinquent sign on them.
Sharon's research was in fact the source in the fall of 2007 for the information provided to Craig Dearden and later to Jan Zogmaister that that led to the delinquent tax ordinance change regarding delinquent taxes and subdivions.
At any rate, recently, we went to the County website and just looked at Ogden Valley. We found that 6 property owners owed over $334,000 in taxes for the year 2007. We also checked other years for these same owners and found various examples that they were also delinquent in other years according to the site.
We know the argument about how this is good for the County. We feel it is a false premise since the rest of the taxpayers in effect provide the credit line for these delinquent accounts until they are
paid off.
It is possible this would be less egregious in good times, but it is unacceptable in these serious financial times the resulting tax burden will be carried by the taxpayers. In addition, any new increases to make up for the sales tax revenue could be delayed if some of this money was collected.
If you read the Deseret Article yesterday, the amount delinquent in Utah, Salt Lake, and Davis counties ($86.7 million) and estimate what it may be in weber county, you are over $100 million dollars of uncollected taxes. If the counties and state could just get 25% of that amount collected, it would be a significant boost to all of us.
Larry, Sharon, Oz and others...
I think we are all on the same page and are verging on "preaching to the choir".
Surely the Zini's, and all who agree there are perhaps hundreds of millions in delinguent property taxes out there. We agree the laws very much need to be changed to close this delinquent tax loophole. A very large loophole, which has been perpetrated by and enjoyed by the Realtor/Developer crowd, which by the way dominates the GOP legislature.
And we agree also, the hundreds of millions of property taxes owed and delinquent are significant. Yet they pale by comparison when the eight hundred pound gorilla in the room (Greenbelt fraud and abuse) is considered.
Bottom line...OUR CURRENT PROPERTY TAX LAWS ARE GROSSLY BEING TAKEN ADVANTAGE OF BY THE "FROERER, NEIDERHAUSER, GREG BELL, BRAMBLE, KILLPACK, STEPHENSON, VALENTINE, New Senate Leader...WADDOUPS--BYU REAL ESTATE MANAGEMENT GRAD, AND REALTOR WHY OF COURSE!, AAGARD, BARRUS, BUXTON, DAVE CLARK, DRAXLER, HARPER, HERROD, HUGHES, CHRIS JOHNSON,MORLEY,NEUENSCHWANDER, RAY, SNOW, URQUHART, and all those (approx. 60% of the Utah legislature) these elected people control and influence. They all have serious conflicts of interests which would, in virtually any other State, disqualify them from public office.
And these "vermin" will continue, along with GOP Party hacks at every level...county and local..., just as Chris Kyler, CEO,CFO and President and Chief Lobbyist for the Utah Realtor Association, brags about openly.
They will continue to pretend to be working for you and me, while sticking it to us in favor of their special interests, defined as those like the URA who give them big bucks under the table calling it "Campaign Finance Donations", and "gifts" etc.
Read just this morning in the Std Ex. that Neiderhauser and Bramble ate a $174 meal in Washington DC., paid for by a lobbyist. Hell, you and I are splitting a $4.75 Polish w Kraut and a mocha lattee at Costco. Yet these "gentlemen" are doing nothing illegal...unethical?, immoral? disgusting? Yes, according to 75% of Utahans polled. Yet they just keep right on...
And they will continue too "keep on keeping on" too, unless somehow we can get enough people to understand what is happening to us at the hands of these schemers and less than ethical/moral legislators.
Our Representative, Hansen, is having an acquisition value, or "purchase price" bill drafted. He has at least consented to have our coalition for property tax fairness members "take a look at it" when it is drafted.
May I suggest that all the good and well reasoned thoughts raised by Oz, the Zini's, and many of you be folded into a comprehensive Property Tax Bill which Hansen says he will sponsor?
After no doubt a lengthy political battle, and numerous delays by these legislative scofflaws (Froerer included), hopefully some day people will finally figure out the truth and demand enmass property tax reform. And the County Commissioners, Assessors, Treasurers, and the "low life fat cats (Realtor/Developer types)" will be handed a Property Tax reform bill which will finally correct the inequities promulgated upon us heavily over taxed residential property owners.
Pleasure horses...(to qualify for Greenbelt) indeed?! Let's put all these legislative clown's AND their delinquent tax loophole and low interest rate schemers in prison on a horsemeat diet!
There was a time when the people could simply tar and feather folks like this and then ride them out of town on a rail. Ohhh, for the good ole days!
Today, we have to educate ourselves and our neighbors and relatives and friends such that no one gets "re-elected" at any level it seems.
Machman
I certainly agree with most of what you say and I do not condone the much abused delinquent tax situation as some on the WCF seem to think. I am merely explaining why the political powers that be condone it and ignore people like Larry and Sharon who try to make changes.
Do you believe in greenbelt as it applies to actual farm land? Where do you draw the line? Should people with agriculture land pay the same per acre rate as home owners and people with an acre or so with horses?
It seems to me that if there were no greenbelt of some sort that it would very quickly drive farmers out of their land.
By the way, I have 9 acres in Farmington that fully qualifies for greenbelt but I have never signed up for it as I feel it would be a perversion of the intent of the law to do so. This little quirk costs me about five grand a year as I have to pay "commercial" tax rates on most of it. On the other hand it is grossly unfair that I should pay tax rates on this land as if it were on the market for development.
It would be great to have some meaningful property tax reform but I ainta gonna count on it as long as we have the same old republican/realtor controlled state legislature.
We appreciate the points made by ozboy and Machster, they are well intentioned and cannot be disputed.
Any fix to those issues would require a change in attitude and new laws.
We are hoping to get some action on money that is already owed and delinquent without the delay of new legislation. That could come later.
Larry and Sharon
Oz asked:
1. Do you believe in greenbelt as it applies to actual farm land? Answer: Yes...But there needs to be some serious revisions... Quote from previous post: "The 1963"ish" version of FAA or "Greenbelt" was based upon an originally honorable and well intended farm bill, which has been perverted and bastardized by the legislature into the absurd law it remains today. Our fine "legislators" actually made it legal recently for "pleasure horses" to qualify property for Greenbelt exemptions. Like we EAT Horse meat in this Country."
2. Where do you draw the line? Should people with agriculture land pay the same per acre rate as home owners and people with an acre or so with horses? MM reply: People with unqualifed crop production property should be doing the same as you are doing. Paying based upon actual use, not on any legislative BS using USU agricultural "potential for crop production" criteria, etc. You are the rare exception. And if there were more like you Greenbelt fraud would not be a problem.
3. Oz comments: "It seems to me that if there were no greenbelt of some sort that it would very quickly drive farmers out of their land." Machster reply... If paying more than the current eight (8) to (16) CENTS, or PENNIES, an acre "drives them off their land" then so be it. They are doing nothing more than raising more little tax deductions, which again shifts even more tax burdens onto responsible Utah tax payers. And they are not engaged in any form of productive or efficient crop production. They are simply holding the land (at our expense) for their heirs, just as developers and investors...who are merely speculating or prospecting over the long term (at all our property tax expense).
Repeat of my position from previous post follows:
"How about THIS for Froerer's next tax bill. Set a minimum property tax (lower cap) for "Greenbelt" or FAA agricultural property at $100 per acre instead of the 16 PENNIES an acre these tax scofflaws have made legal for themselves to pay. This would result in a net increase to Weber County coffers of more than $110,954,723 (Millions) dollars. And it would enable a much long overdue "shift" of tax burdens from large land owners and developers, to residents and the majority of Froerer's constituents, for a change.
This, of course, would anger all those who are holding investment (non crop producing) properites and the developer friends of the legislature. But the "Greenbelt" law has been prostituted and tampered with so badly that today it is no longer recognizable as the original, circa 1963, intent to assist farmers, who actually produce foodstuffs/crop production, from subdivision encroachments with much higher property tax assessments.
Folks, an example is property parcel number 12-012-0001. It is a non crop producing 226.53 acre parcel, 2007 valued at $5,663,250 but only $3,171 was taxable (per Greenbelt claims) resulting in only $35.51 in Property Taxes paid. Folks, that is only 15.6 cents an acre.
But take heart tax payers! This year the same property is suddenly only worth $1,310,750, according to the County Assessor, with only $3,398 taxable (after bogus Greenbelt claims), making the grand total of Weber County Property Taxes paid, a MASSIVE (hold it ----wait for it....) $36.51 (or 16 CENTS an acre!!)
If we all knew what I am trying to tell you, and raised enough hell about it, the legislature might well be forced, via public outrage and outcry, to update Greenbelt laws (and rates). And in this one example, a mere $100 an acre minimum property tax would yield $22,600 versus the meager $36. Now consider the hundreds of thousands of acres not being used for any crop production efforts and unmonitored by the single Utah State Tax Commission auditor. Then consider how the average residential single family home owner could receive major tax relief from the constant esculating School District taxes (which comprise between 55 to 80% of our property taxes and 100% of our onerous income taxes).
If you don't like $100 an acre, make it $50, or something reasonable to all concerned. But STOP this MAJOR drain on County Coffers and at our residential property owner expense and subsidy.
This grotesque unfair and outdated Greenbelt law, makes the 500 delinquent property taxes look like mere pennies versus hundreds of millions of dollars. Although of course I am TOTALLY in favor of all efforts to collect back taxes owed.
The 1963"ish" version of FAA or "Greenbelt" was based upon an originally honorable and well intended farm bill, which has been perverted and bastardized by the legislature into the absurd law it remains today. Our fine "legislators" actually made it legal recently for "pleasure horses" to qualify property for Greenbelt exemptions. Like we EAT Horse meat in this Country.
If things continue without civic involvement and some public activism...we may well be dining on horsemeat very soon!"
Oh! And Oz...
I agree that these GOP RINO legislators will continue to sponsor and support more "Utah Family Friendly" (decoded to mean large Mormon family) legislation. Legislation which subtly shifts tax burdens off onto responsible residents who pay and pay and pay for large families who can not pay for their children's support.
The census figures showing growth in Utah are from the extraordinary internal growth created by a continuation of the highest birthrate, among Utahans, in the World, including third world countries.
We must change this unique situation or leave for greener pastures outside Utah. There-by leaving only large Utah families to pay for their own proclivities.
But as we all know, no one is holding their collective breaths and expecting any "revelations" from anyone, at any level of "government" in Utah.
Machman
It seems to me that property tax ought to be geared to the amount of public services the property and people on it use. In other words people ought to pay for what they get, not what their neighbors are getting.
If you own a large yard and live there with only you and your wife is it fair to pay the same tax as some one with the same size yard but with 10 kids and 5 relatives all of whom use up way more public services than you?
Is it fair if someone owns 9 acres, lives there alone, and has no intentions of selling or developing it pay the same large tax bill as the real estate hustlers down the street with the same size property who are using it for money making purposes or speculation?
What about some sort of tax break for people who keep large tracts of land in the family, don't farm it but keep it as open space which benefits every one. Why should that land be taxed the same as land that is being used for speculation?
Why should my land be taxed at $300 grand an acre just because some hustlers bought land in the same area for that extremely inflated amount last year? It seems to me that this rampant land speculation is forcing people to sell because of the outrageous property taxes that riffle through the system.
Perhaps the acquisition scheme you support will bring some fairness to it all?
Oz, Larry, Skeeter, Squirt, Ra La, Most interesting, and Moose head:
That is seven (7) only...interested enough to have a say. Yet this topic drastically effects all 127,000+ residents of Weber County and all 2.3 Million or so citizens of Utah.
Rep. Hansen's AV Property Tax Reform Bill should (should--a moral issue with no data to support) contain:
1. Home and/or land Purchase price as the basis for actual property market valuations.
2. A base year of 2004 for a rollback, or beginning, or start of assessed valuations (a baseline or beginning point).
3. Transferability of base AV tax valuations plus annual increases (or decreases) within area counties.
4. Transferability within blood first generation relations should property be inherited.
5. Set Caps on maximum increases of no more than 2% per annum.
6. Set tax rates of no more than 1% a year.
7. Centrally assessed property tax valuations based upon the annual profitability of the land as it is used in business. Limited by amount of income taxes the business pays.
8. Residential transfers (sales between friends or relatives) must be limited to "arms length" transactions. Heavy fines for violations (Class A misdemeaner or felony).
9. Residential and centrally assessed (business and corporations) property additions must be addendums to previously existing assessed valuations. And determined by verifiable independent assessment.
10. FAA and "Greenbelt" laws should be included within property tax reform law/bill. A minimum dollar amount, adjusted annually for inflation/deflation or CPI, must be charged per acre. No more sixteen cents an acre. Fifty dollars an acre seems more reasonable.
11. The money saved after the transition (from current to AV) must be used to enforce both delinquency and significantly increased (like by 20%) penalties.
12. State Tax Commission needs to be redirected to represent State Tax Payers instead of State Tax Collection County agencies, ie Assessors and Treasurers.
13. The State Constitution must be amended from "fair market value" to "purchase price valuations". Trying to weasel word around this will prove nothing more than several more years of delaying tactics by opponents favoring the current gravy train of windfall taxes.
14. Additional taxing agencies such as fire districts, school districts, water conservancy districts, EMT, 911, ad infinitum must be completely separated into logical and homogenious services groups. They must be directed via statue such that they must go directly to the public as separate entities with tax and bonding issues.
15. All "bundling onto our property taxes" (by unaccountable "Service" organizations) must be stopped in order to finally have transparency and accountability. Institutionalization breeds incestuous and rampant incompetence, inefficiency, fruad, waste and abuse of the tax payers.
16. All situations where tax monies are being used to fund lobbyst bribery/"contributions to campaign finances" of legislators must be stopped immediately. The League of Utah Cities and Towns and the Council of Utah Counties for example (among others like the Univ. of Utah, etc.) for example.
17. Second residences and primary residences should be taxed at 100% of the taxable value. No differences.
18. Utah must join with virtually every other (46 of 50 with the other 4 considering it) State in becoming a "Full Disclosure" State...meaning no more lying about how much a property cost will be tolerated. Full disclosure means the purchase price of property is up front, truthful and recorded.
19. The entire State Budget process must be revised so that it makes sense. Right now it is a carefully designed scheme which allows commissioners to suggest/dictate to assessors and treasurers just how much they need to come up with for their insane and inefficient country budgets.
20. Truth in Taxation meetings are also a sham and need to be eliminated. Simple and straight forward transparency and an honest accounting of every tax dollar, where it was, and is, being planned, or budgeted to be spent. The data needs to be on-line and subject to semi annual public review meetings with public input.
21. A general election to support the final budget, held in November to avoid the thinly veiled school district and other taxing entities using off season June ballots when only 4 to 6% of the electorate can decide to increase tax for the majority.
22. A "super majority" of at least 50% of eligible voters, with a minimum of 20% voter turnout, should be required to pass any tax increase.
23. Specification that any County (Commission or ordinance, convenent, etc.) which mandates a minimum acreage per primary residence greater than the normal one acre (or whatever is the County standard by ordinace), forfits any additional property taxes from acerage exceeding the acre minimum.
24. Provision for semi annual County Assessor audits done by the State Tax Commission. The burden of proof for radical shifts in tax unit property taxes must be put onto the County Assessors and not on the individual property tax payers.
25. The entire "Appeals Process" is onerous and bureaucratically aligned against the individual property owner. This must be changed and made far more efficient and easier for residents and businesses. The nature of AV type property taxation should help with this considerably.
26. County Assessor's Office Budgets need to be significantly reduced pending a transition to AV since, for example Weber County's 97,000 parcels could be reassessed within 10 seconds by a single Pc (or MAC) desktop computer.
There are more lessons learned from "best practices" of all States which have changed to Acquisition Value or Purchase Price or Prop 13 like property tax valuation systems. But these are just some off the top of my head.
Frankly, the Coalition of Property Tax Fairness, with Jim Bray from Leeds, Ut., near St. George just does not get it. He and Ron M. insist on trying to mix oil and water (current Truth in Taxation using "fair market valuations" AND acquisition value/purchase price based valuations). The two are mutually exclusive. They are trying to do, as Hansen's has already indicated, by suggesting no amendment to the State Constitution might be needed. They are showing a rather naive and near total lack of understanding of either system. Let alone Constitutional law.
So, I have my serious doubts that any of the above considerations will be included in any new Hansen Bill.
So no...I have to say it...the folks involved so far just do not have "what it takes to understand and/or get what is needed" into a comprehensive and effective new Property Tax Reform legislation. Much less be articulate enough to sell it to greedy, self-serving legislators, 60% of whom are corrupted by Realtor/Developer lobby money and campaign finance "donations" which other States correctly classify as graft and corruption.
MM
All of this can be confusing and hard to follow. It is apparent that the real beneficiaries of this almost Ponzi type scheme are the developers and builders in Utah.
How this collection or better yet, non-collection process works for them is as follows:
The do not pay their property taxes and the current County collection procedures provide them over 4 years to do that before the foreclosure process can begin.
They invest the money that should have been paid in taxes in some growth investment that adds to their cache amount. (Now the County will tell you that during this time they pay a 2% penalty and about 6% in interest on the delinquent taxes when they do sell the property) That may be true, but the developer just puts the additional cost of the penalty and interest in to the sale price of the property and therefore recovers everything they spent on penalty and interest at sale.
The bottom line result is they have operated without paying property taxes for this time period (1-4 years) on the "credit" supplied by the County collection procedures (ie: the taxpayers back), they have sold the property and not really paid any penalty for late taxes, and at the same time made money on the investment of what should have been paid in property taxes during that period.
It is obvious that this is a super deal for these developers and builders or they wouldn't consider paying the penalty or interest on these taxes.
The final blow to taxpayers is the land that is sold has increased in price, and that increase works its way into the tax evaluation process and will raise property taxes in the surrounding area.
The other taxpayers that pay on time are getting whacked both ways by this process in Weber County. The County and others will tell you this is good deal for all. Not so, it is good deal for everyone except the on time taxpayers.
This quote fits here.
"The government cannot give to anyone
anything that it does not first take from someone
else."
All the opinions aside, the fact appears to be that there are millions of dollars in delinquent and uncollected funds that are being used by tax scofflaws as front money when the taxpayers should have access to that money to run the counties and State.
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