Spokane County Assessor Ralph Baker will have a rematch in June with property owner Bob Webb, who successfully appealed Baker’s decision to correct a 30-year-old assessor’s office mistake at Webb’s expense.
Both men are fighting for principles in a dispute that has little financial effect on anyone.
The question is whether Webb, a retired Spokane police officer, should be booted out of a tax-reduction program for owners of 20 or more acres of timberland. Webb was told in August to enroll in a similar program for owners of fewer than 20 acres or pay $4,100 in back taxes.
Webb can avoid the back taxes by forking out a few hundred dollars for a timber-management plan. Baker can avoid strife by accepting the unanimous judgment of the Spokane County Board of Equalization.
But Baker appealed the county board’s decision to the state Board of Tax Appeals, which he is “very confident” will agree with him.
“The idea is to get this right and fix it, and not just kick it down the road for somebody else to fix,” Baker said.
To him, the issue is black and white: Webb doesn’t have 20 acres, even though a previous assessor said he did.
“What am I to do?” Baker asked. “Should I make an exception for him?”
Webb, who grew up in Philadelphia, remembers the “Philly” rule his father taught him for dealing with bullies: “Even if you can’t win, you’ve got to fight.”
Webb would receive the same tax benefit if he switched to the “open space timber” program for smaller acreages, but would have to spend several hundred dollars on a forest management plan. He objects that he actually has the required 20 acres and has followed all the rules of the “designated forest” program since the assessor’s office enrolled him in it in March 1979.
Baker said his decision to order Webb and others out of the designated forest program last year was motivated by a state audit that was getting under way. He said three such tax-deferral programs were “pretty generally off the rail” and a fourth, for farm and agricultural land, was “completely off the rails.”
“All we’re trying to do is have the programs clean … so we can survive the next audit,” Baker said.
Of four tax-deferral programs, “farm and agriculture” is by far the largest, with 8,858 properties currently on the roll. “Designated forest” is a distant second, with 2,425, while “open space timber” and plain “open space” have 50 and 34, respectively.
Before the programs were overhauled, there were about 9,600 parcels in the farm and agriculture program, said current use specialist Toni Babler. She said about 270 of them transferred into the designated forest program, and about 310 were removed entirely.
Baker said he thinks all of the programs now are in compliance with state regulations.
Webb doesn’t see why he should be burdened by Baker’s desire to fix a 30-year-old assessor’s office mistake that doesn’t affect tax receipts.
Besides, Webb said, “maybe they didn’t make a mistake back in ’79. Maybe they figured it was a gray area and, ‘We’re not going to bug people with something like that.’ ”
The gray area, according to the county Board of Equalization, is whether a 0.45-acre right of way for Tallman Road should be subtracted from Webb’s Mount Spokane-area property for determining eligibility in the designated forest program.
If the road were on an “easement,” the land would count toward the designated forest minimum acreage even though Webb doesn’t pay taxes on it. But the road is on land that was deeded over to Spokane County in 1906, which Baker said leaves Webb no room to claim it for eligibility.
However, the five-member Board of Equalization said in October that the road issue was “too vague and unclear.” The board unanimously granted Webb’s appeal on the basis of arguments presented by the Gonzaga School of Law’s University Legal Services.
First, the board said, Baker’s reason for removing Webb from the designated forest program wasn’t among those listed in state law.
The board also cited legal doctrines of fair play that in lay terms say, “Make up your mind,” and “Speak now or forever hold your peace.” The idea is that government can’t rule one way and then another, to the detriment of citizens who rely on government decisions – especially if that reliance is reinforced by decades of government silence.
Baker plans to present a couple of new arguments at the Board of Tax Appeals hearing, which he’s allowed to do as long as he gives Webb 10 days’ notice.
After Webb’s Board of Equalization hearing, Baker said, the Department of Revenue called his attention to a state Board of Tax Appeals decision that subtracting an acre for homes on tax-deferred land is “reasonable and consistent” with state law.
Baker also plans to argue that Webb doesn’t have enough land regardless of the road right of way or the acre of land for his house.
A survey filed in December 1997, covering the quarter-section in which Webb’s property is located, indicates Webb actually has only 19.34 acres, even with the Tallman Road right of way, said Mike Wentz, the assessor’s digital mapping supervisor.
“We don’t always see them (surveys) until something comes up and we go looking for them.” Wentz said. “I became involved with this parcel and changed the acreages in late August of 2008.”
Webb’s land size for tax purposes was reduced from 19.55 to 18.89 acres. It was not clear, though, what effect loss of the better part of an acre will have on Webb’s assessed value next year.
Baker discounted the possibility Webb might be entitled to a refund, under a three-year statute of limitations, for past taxes on land the assessor now says he didn’t own.
“I’d have to think about that,” Baker said. “I don’t think so, no.”
Webb’s hearing is scheduled for June 16 in Spokane, but Baker said he may ask for a delay to give a new state law time to take effect. The law would allow assessors to remove mistakenly enrolled property from the tax-deferral programs without penalty to the property owner, Baker said.
He said he wants to find out whether the law could benefit Webb if it takes effect before the Board of Tax Appeals rules in Webb’s case. At least, a delay would give Webb more time to switch to the open space timber program.
If the appeals board removes Webb from the designated forest program, he would lose his right to transfer to the other program automatically, according to Baker. Instead, Webb would become a “new applicant,” subject to a three-year waiting period, Baker said.
Adam Teal, a University Legal Services intern who helped represent Webb before the Board of Equalization, said Baker’s new arguments about the size of Webb’s land and the amount to set aside for his home “don’t change the argument we’re making at all.”
“Honestly, it just boils down to common sense,” Teal said. “This is a guy who did what he was supposed to do for 30 years. He complied with the statute to a ‘T’ and now he is getting saddled with the bill because 30 years ago the assessor’s office didn’t dot its ‘I’s’ and cross its ‘T’s.’ ”