Nez Perce County trying to fix tax overcharge
A $58 million error that resulted in higher 2020 property tax bills has Nez Perce County officials scrambling to find a solution.
Assessor Dan Anderson told county commissioners at a Tuesday meeting that his office accidentally recorded Clearwater Paper’s $58 million tax exemption on its new pulp digester twice.
“By giving a double exemption, it lowered the value over the county and raised the levy,” Anderson explained of the recently discovered mistake.
Anderson calculated that taxpayers were overcharged by $20.40 per $100,000 of taxable assessed value because of the error. He said that once it was discovered, he notified the state tax commission to discuss the easiest way to make the taxpayers whole. The tax exemption is set to run for another two years, so Anderson proposed that half of the $58 million in value be put back on the tax rolls next year, and the other half in 2022.
The addition of that value would lower the levy rate across the county, and therefore lower property tax bills in the process, Anderson said. Officials at Clearwater Paper are on board with that solution, he added, and the Idaho Attorney General’s Office has advised that it is legal.
Other solutions were entertained, but they were deemed too complicated, time-consuming and expensive to undertake. After hearing a summary of the situation at Tuesday’s meeting, county Commissioners Don Beck, Douglas Havens and Douglas Zenner agreed that Anderson’s proposal seemed like the best way forward.
They didn’t address the possibility, however, of what would happen to taxpayers who sell their property at some time over the next two years. They would have already paid the mistakenly higher assessment in 2020, and then would not be able to realize the benefit of a lower tax levy in 2021 and 2022, since they would no longer own the property.
Responding to that question, Nez Perce County Prosecutor Justin Coleman said the county is always open to legal action.
“But the (county commission) has the statutory ability to enter into these agreements for tax exemption,” Coleman said via text to the Lewiston Tribune. “So from a legal perspective we believe we are fine.”
Anderson’s proposed solution would be implemented through an amendment to the county’s tax exemption agreement with Clearwater Paper. Commissioners said they will formally take up the amendment at their next regular meeting.
The county granted the exemption as a way to help lure a $160 million expansion project to Clearwater Paper’s Lewiston paper mill at a time when the company was considering other locations for investment. It took effect in 2017 and is set to run for five years.