By AMANDA KIMBLE
TheFlashToday.com
STEPHENVILLE (December 7, 2016) – A more than $20 million bookkeeping error led Stephenville City Council to approve an amendment to the city’s tax roll on Tuesday.
Mayor Kenny Weldon said the issue was spurred by a technical error, which was reported to the Erath County Appraisal District after the certification of the 2016 tax roll and after the appeal deadline.
Weldon said the council was not offering tax relief, but accepting the fact a clerical error was made.
The mistake related to values tied to business personal property at FMC Technologies, which was reported to have a value of $128 million when the rendition was submitted. It was later discovered the appraisal district was given the total inventory cost and not the $108 million taxable market value, according to documentation provided by the manufacturing facility.
The issue impacts the city budget and also has an effect on Erath County and Stephenville ISD. Prior to approval of a resolution approving the tax amendment and following questions by council member Alan Nix, City Finance Director Walter Wood said the other entities had already approved the $20 million amendment.
When asked about the impact on city coffers, Wood advised the council to reassess the current fiscal year’s budget a mid-year to determine if adjustments to the city’s budget would need to be made. He agreed with Nix’s assertion that it was simply “too early to tell and too late to rebuild the budget.”
The current fiscal year started on October 1.
Meanwhile, The Flash spoke with Chief Appraiser Jerry Lee who provided his prospective on the issue.
“I was approached by FMC officials following the certification of the tax roll and they asked me if there was anything that could be done,” Lee said. “I told them the rolls had been certified and it was out of my hands. At that point, I told them something could only be done if the jurisdictions were willing to make a change.”
The tax code allows the appraiser and taxpayer to reach an agreement on such issues even after the correction deadline had passed, but Lee opted to put the decision in the hands the jurisdictions.
“I was not willing to agree on an issue involving $20 million in value,” Lee said. “That’s a lot of money.”
Tax Assessor/Collector Jennifer Carey said the issues equates to losses of about $98,000 for the city and $94,000 for the county.
“Anything in that amount, we consider to be significant,” Lee said.
Looking at the district’s current tax rate and property values, about $247,000 is tied to Stephenville ISD, but Superintendent Matt Underwood said, due to school funding formulas, the actual impact will be much less.
“We are on a sliding roll,” Underwood said. “Whatever we lose, we gain from the state.”
Underwood said the local impact to Stephenville ISD will be about $22,000.
“We approved the amendment at our last meeting and presented a resolution to the appraisal district,” Underwood said. “We will obviously be the least impacted, but my take on this issue is that $22,000 is not too much to give back to one of our industry partners.”
Finally, Lee said appraisal district staff reviewed renditions from prior years and could see 2016 totals were not originally submitted as they had been in the past.
“It was apparent a mistake had been made,” he said. “I presented those facts and the request from FMC to the jurisdictions, and it appears they agree.”
Attempts to reach Middle Trinity Groundwater Conversation District for comment at the time of this report were not immediately successful.
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