Published: September 07, 2008 08:39 am            

Clark County school corporations forced to pay on bonds until county gives out funds

$2,438,857.

That’s the amount of money Greater Clark County Schools has lost in interest payments since 2003.

$530,953.79 is how much West Clark Community Schools Corp. lost in the past three years.

Since 2001, Clarksville Community Schools Corp. has paid out $519,671 in interest.

That adds up to almost 70 new teachers, when considering a first-year teacher’s benefits and pay add up to about $50,000, according to Superintendent Steve Fisher, of CCSC.

Though Clark County isn’t alone in being late in handing out tax bills, it is one of less than half who have yet to do that this year, according to Mary Jane Michalak, director of communications for the Indiana Department of Local Government Finance.

Clark isn’t just a little behind either. Michalak said the county’s latest ratio study was submitted in June, nearly one year late.

School corporations across the state are forced to take out bonds when the county does not collect taxes on time,

causing schools to receive their tax money later. Greater Clark borrowed $27 million in one year.

Interest on those type of loans adds up for school systems which already are feeling the squeeze of a tight economy.

“I think the real shame of this is that the taxpayers should know that we are spending a lot of money on interest,” Fisher said. “To me, that’s dollars coming out of the taxpayers’ pockets.”

In addition to the interest paid, Fisher said the corporation could have been earning interest if they received the money on time and it got to sit in the bank.

“That money could have been spent on the students, on the textbooks, professional development for the teachers, possibly hiring additional teachers,” Fisher said of the money paid and lost in interest.

To get that money, the county needs to collect the taxes. To do that, the auditor needs to send out the tax bills.

Keith Groth, Clark County auditor, said the problem lies in when the county gets those bills out.

“The most recent tax bills, which are for 2006-07, didn’t go out until January 2008,” he said. “You can see where the problem is. We’re hoping to get things back on the proper schedule beginning next year, 2009, but we’re still playing catch up for the 2007-08 tax bill to go out.”

He said those are behind because of delays in the reassessment process.

The reason for the delay is changes in how the county assesses properties, according to Vicky Kent Haire, Clark County assessor. She said the state used to use a property guideline manual to come up with the assessed values. However, in 2006, she said the state required a new model, based on sales of homes and value trending.

That’s when she was first elected.

She said the county hired a group to do that sales ratio study, but the group didn’t do a good job. She said the company’s results couldn’t get approved by the state, so the county hired another group to come in and do the study.

Kent Haire said she feels confident that if the change in companies had not been made, the county would have been required to reassess, which would cost millions of dollars.

Kent Haire said the office also recently switched over its software system. She said before, employees could only work on one year at a time and could not process the current year until the previous one was completed.

“Once you got behind, it was virtually impossible to get caught back up,” she said.

Kent Haire said she hopes to have the next ratio study completed by November. She said if that gets approved by the state and the legislature doesn’t make any more big changes to the system, then things should slowly get back to normal.

“This didn’t happen overnight, so it will take longer to get it caught back up and on track,” she said. “If [the legislature] will just let the smoke settle and let the cities get caught up, then we’ll be fine next year.”

She said she does agree with how properties are assessed now, adding that it is more fair, especially for older homes that have had renovations.

Meanwhile, the schools are left paying for something they aren’t getting on time.

“I don’t know who to blame. I don’t know where the blame lies,” Fisher said. “All I know is that we do not have a 2008 budget and here it is September. The county does not have certified assessed values. We’re stuck in the same pattern we’ve been stuck in for the past few years.

“It’s just the same thing over and over again. I don’t have an answer. I wish I did.”

“I feel the county is doing what it can,” said R. Mac Dyer, assistant superintendent of business for West Clark. “I don’t want to throw any blame around. I think they do the best that they can do.”

Come January, changes with the property tax system will take effect, causing the state to take over parts of the school corporations’ budgets. Dyer is hopeful that will help.

“I think as things go on ... things will probably get better,” he said.



Glossary

• Ratio study: The ratio study is basically a comparison between sales and assessed values in the county, to ensure that market values are being used to determine assessed values.



How the property tax system works

STEP 1:

• The first step in the process is the completion of trending and assessments, which culminate with the submission of a ratio study.

WHERE CLARK COUNTY STANDS

Typically, these should be submitted to the state and approved in the May/June time frame of the year prior to billing. So, for 2008 bills, the ratio study should have been submitted to the DLGF in May or June 2007. Clark County submitted its ratio study to the DLGF on June 24, 2008 — nearly one year late. The ratio study was approved by the DLGF on July 8, 2008.



STEP 2:

• Once the DLGF approves the ratio study, the county assessor sends the county’s gross assessed values to the auditor. Statutorily, this should be done by July 1, allowing the county auditor to apply exemptions, deductions or abatements to determine the net assessed values — the values upon which tax rates are based.

WHERE CLARK COUNTY STANDS

That information is statutorily due to the DLGF by Aug. 1 of the year prior to billing. Again, for tax bills issued in 2008, it would be a due date of Aug. 1, 2007. Clark County has not yet submitted their certified assessed values to the Department, and as such, the budget approval process is pending.



STEP 3:

• Once the certified net assessed value information is received, the DLGF can begin processing the county’s budget and calculating preliminary rates, which are then sent to the county taxing units. There is a two-week window during which the units can comment on these rates and make corrections to information used to calculate these rates. After that two-week window has expired, the DLGF will hold a local, public budget hearing, during which anyone can comment on or object to the preliminary rates. This would typically happen in the October time frame.



STEP 4:

• Once the public hearing has taken place, the budget order and tax rates can be issued.



STEP 5:

• Once the budget has been approved, the DLGF will make a property tax calculator available using the certified tax rates. This tool allows taxpayers to enter their property’s assessed value, taxing district and possible deductions to see tax bill estimates for bills due in 2008. Taxpayers can access the tool from the department’s Web site at www.in.gov/dlgf.

• Information courtesy of Mary Jane Michalak, director of communications for the Indiana Department of Local Government Finance

        

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