May 12, 1995 in Nation/World

Assessor Under Fire For Lost-Tax Fiasco Schools, City, Other Taxing Districts Stand To Lose $1.4 Million Due To Inaccurate Property Appraisals

Kristina Johnson And Bruce Krasnow S Staff writer
 

Spokane County Assessor Charlene Cooney is under siege as officials, employees and property owners say they’ve lost confidence in her ability to do the job.

Confusion, misinformation and turmoil blanket the office charged with setting the value on property for taxes that pay for everything from schools to police to street sweeping.

As a result, county taxing districts stand to lose nearly $1.4 million - money they had planned on getting from taxes but that now has vanished.

Property owners also face a bigger bite from the state next year as it tries to make up for this year’s losses.

“This is just an awful shock to us,” said Walt Rulffes, Spokane School District 81’s associate superintendent, when told Thursday his district has lost nearly $500,000. “You’ve just ruined my lunch.”

“It’s unbelievable,” said Spokane Mayor Jack Geraghty when told $400,000 the city had counted on has evaporated.

The lost tax money is the result of inaccurate appraisals that forced Cooney to slash more than $90 million from valuations.

Owners of more than 300 properties still are challenging Cooney’s appraisals, meaning tax losses could escalate.

County commissioners met in a closed-door session Wednesday morning to discuss Cooney’s performance.

“These events are of grave concern to all of us,” said Commissioner Skip Chilberg, who refused to say what actions commissioners had discussed.

People inside and outside the assessor’s office refused to allow their names to be used for fear of retribution or political fallout. More than a dozen repeated the same theme - Cooney’s lack of leadership and poor management skills are largely to blame for the problems.

“Employees are extremely worried about the present situation,” said one man who works closely with the office. “Things are falling apart at the seams.”

Another expert familiar with Cooney’s office said the only way to solve the problem is for Cooney to step down.

Last-minute changes in commercial property values triggered the growing concerns.

In the final two days before the May 1 deadline for paying property taxes, Cooney dropped the values of five large commercial properties by more than $41 million.

Officials now have learned the troubles didn’t end there. The assessor’s office revealed this week that even before the last-minute changes, nearly $50 million in assessed valuations already had disappeared. That’s a total of $91 million in lost values.

Schools and cities set their levy rates based on the value of property. Once levies are certified by county commissioners - as they were in February - taxing districts can’t change their rates. So when values drop, taxing districts can’t recoup their unexpected cash losses.

Several of the largest value changes came on property appraised by Dick Weber. Other appraisers had expressed concerns to Cooney in November that Weber’s property values were inflated.

Cooney claims the concerns were not ignored but that she was assured by Weber the values were correct.

“We support our appraiser until we’re advised otherwise,” Cooney said. “If we find we have an overestimated valuation, we correct it as soon as possible.”

Weber and Cooney blame property owners for not providing them with the necessary information to make accurate appraisals. Both, however, admit the office didn’t even ask for the financial information on a major downtown hotel until Sept. 15, far past the office’s internal deadline.

In December, Sharon Stern, Cooney’s staff assistant, sent a letter to city budget manager Ken Stone that established a 1995 tax rate.

She said assessed values “could change, up or down, but should not affect the revenues drastically.”

Still, City Council members delayed setting the city’s property tax rate because they had heard there were problems with the appraisals.

In January, they received a revised valuation from Cooney’s office knocking $61 million from the original number. Cooney also assured them that future changes would be minimal.

Council members passed a levy rate in January, one month later than the state requires. This week, they learned another $91 million in valuation has disappeared.

Problems in the assessor’s office don’t stop with inflated values and lost tax money.

Confusion over utility assessments in unincorporated areas has left some residents being charged for improvements to property they don’t own.

“People just aren’t being served,” said Chilberg.

Cooney admitted her office is at least two years behind in creating new tax parcels from subdivided land, a process known as segregations.

She blames a lack of staff and rapid growth. “I’m the eternal optimist,” Cooney said. “We’re going to get there.”

The state, which receives 25 percent of all property taxes levied here, will increase its tax rate in 1996 to compensate for this year’s errors. While most of the mistakes were made on commercial parcels, all property owners will see a jump next year to make up the difference.

Will Rice, of the state Department of Revenue, said it’s not unusual for counties to adjust property tax rolls after tax rates have been set. Spokane County’s problem is unusual because of its severe impact on taxing districts.

“I don’t mean to imply - and won’t imply - that there’s no reason for concern. There is,” Rice said.

The errors put a strain on other county departments, such as Public Works and the treasurer’s office.

Treasurer Linda Wolverton devoted one staff person’s time to changing tax bills, costing taxpayers more than $15,000.

“We just don’t do other things for taxpayers that we should be doing,” Wolverton said.

“There’s a general lack of confidence in (Cooney’s) ability to run the office,” said one man who works closely with office employees. Employees are shuffled around, and there’s “no real coordination effort.”

Cooney said she has weekly staff meetings when employees are encouraged to talk about their concerns. “No one has come to me to say they’re dissatisfied,” she said.

She admitted her office has been overwhelmed since she took the job in September 1992. Massive changes in the assessment process, including switching from a four-year reassessment cycle to an annual cycle, have left her employees scrambling to keep up.

A lack of staff, fumbled data entry and a complicated new computer system also are to blame, she said.

“When you don’t have the staff and you have the job of this magnitude - that’s what we all have to understand,” Cooney said. “No one has ever undergone in this county a revaluation of this magnitude.

Deadlines set by Cooney repeatedly have been missed.

“All the schedules have been off since we started this annual revaluation,” Cooney said. “We worked diligently throughout the summer; in fact, we worked overtime to complete the revaluation. It was laborious getting information from the agents or the taxpayers.”

Cooney is more than willing to accept blame for the problems. She said she already has started changes to streamline this year’s appraisals.

“It’s real important to know that this happened on my watch, and I am personally responsible,” Cooney said. “We have taken the necessary measures to make sure this doesn’t happen in the future.”

MEMO: Two sidebars appeared with the story: 1. TAX BITES Changes by Assessor Charlene Cooney to the county’s tax roles will cost local govrnments more than $1.3 million. How it hits services… Total amount lost by each district City of Spokane $404,415 State schools $352,622 Local schools $455,507 Spokane County $147,127 TOTAL $1,360,290* Source: Spokane County assessor’s office * Total includes other taxing districts not listed Staff graphic: Warren Huskey

2. TREADING LIGHTLY Spokane County commissioners always tread lightly around other elected officials, who do not report to them and have their own policies and staffs. But as controllers of the budget and county hiring, commissioners have urged embattled elected officials to cooperate. In 1992, when former Coroner Graham McConnell was having a festering dispute with Spokane’s only forensic pathologist, George Lindholm, commissioners urged the coroner to appoint Sheriff Larry Erickson as a chief deputy charged with resolving the conflict. McConnell then did so. In 1981, a critical state audit pointed to “large negative balances” in tax roll accounts in the county treasurer’s office. That week, commissioners made it clear they wanted to appoint an operations manager for then-Treasurer Don Brown. Dale Lumby was hired from the private sector in February, and Brown decided a few months later not to seek re-election. - Bruce Krasnow

Two sidebars appeared with the story: 1. TAX BITES Changes by Assessor Charlene Cooney to the county’s tax roles will cost local govrnments more than $1.3 million. How it hits services… Total amount lost by each district City of Spokane $404,415 State schools $352,622 Local schools $455,507 Spokane County $147,127 TOTAL $1,360,290* Source: Spokane County assessor’s office * Total includes other taxing districts not listed Staff graphic: Warren Huskey

2. TREADING LIGHTLY Spokane County commissioners always tread lightly around other elected officials, who do not report to them and have their own policies and staffs. But as controllers of the budget and county hiring, commissioners have urged embattled elected officials to cooperate. In 1992, when former Coroner Graham McConnell was having a festering dispute with Spokane’s only forensic pathologist, George Lindholm, commissioners urged the coroner to appoint Sheriff Larry Erickson as a chief deputy charged with resolving the conflict. McConnell then did so. In 1981, a critical state audit pointed to “large negative balances” in tax roll accounts in the county treasurer’s office. That week, commissioners made it clear they wanted to appoint an operations manager for then-Treasurer Don Brown. Dale Lumby was hired from the private sector in February, and Brown decided a few months later not to seek re-election. - Bruce Krasnow


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