Welcome to the third annual One-Size-Fits-All Columbia Candidate Survey, where city council and school board candidates answer questions about issues that affect not just one, but BOTH organizations. In this part, we ask candidates:
Are Developer Property Tax Breaks Breaking Boone County?
The following stories illustrate a property tax break for land developers:
http://columbiaheartbeat.blogspot.com/2009/03/are-developer-property-tax-breaks.html
http://columbiaheartbeat.blogspot.com/2008/11/developer-tax-breaks-city-to-question.html
If you wish, you may also read the following property tax cases (but if you do, read them CAREFULLY AND COMPLETELY.)
http://oa.mo.gov/stc/2004/Northtown%20Village%20v.%20Davis.htm
http://oa.mo.gov/stc/2003/Park%20370%20Development%20v.%20Muehlheausler.htm
(note "stipulated fact #2)
http://columbiaheartbeat.blogspot.com/2008/10/broadway-bluff-more-property-tax-poker.html
ADDITIONAL BACKGROUND:
http://www.showmeboone.com/assessor/feature.asp#article-00
http://columbiaheartbeat.blogspot.com/2008/07/assessor-shocker-millionaire-tax-breaks.html
CANDIDATE QUESTIONS
Q1. Do we have a problem here or not? If so, why? If not, why not?
JASON THORNHILL, 2ND WARD CITY COUNCIL
As our schools suffer directly from undervalued tax assessments, I believe based on the information provided that we certainly could have a problem.
Tax assessments should be consistent, with very little room for exception. Banking development land for the specific purpose of waiting for the right time to begin work is a tricky subject. What happens if the development never takes place? Could the county still argue that the land is worth more?
With that in mind, I believe the county should make attempts to find a middle ground, if nothing else, for these properties that are clearly undervalued. It may not be as simple as using the bill of sale approach, but there has to be some common sense used when a parcel of land can sell for millions and be assessed as if it is only worth thousands.
On the premise that the only way to produce enough funding to undertake projects is to add tax to those who already pay it,
one could argue that the folks who own homes and commercial property that is valued correctly wind up paying a disproportionate amount of tax, by virtue of their own tax bills and subsequent bond issues, etc.
As in criminal law, there is a consequence for intent. As I see it, the holding of land and assignment of a definitive value to it (IE. the purchase price) can create intent. A parcel of land with all necessary utilities to the site and a recorded document that indicates the likelihood that at some point development could occur, essentially proves that the land has a premium value, regardless of its actual zoning and assessed value.
ALLAN SHARROCK, 2ND WARD CITY COUNCIL
I think we need to examine this within the context of the law and what is reasonable. As stated in the reading, by law there are three sub-classifications of real property defined in Missouri: agricultural, residential and commercial.
In regards to the “active farming” argument, I do not think it is reasonable to make a developer farm the property. While some may find it silly, all a developer would have to do to meet this requirement would be to put up an electric fence and turn loose a few goats. If they are in the city limits, they could plant some fescue and claim they are growing hay. Legally they would be farming.
Is a farmer “actively farming” if he is enrolled in a CRP (Conservation Reserve Program)? Or is a farmer “actively farming” if his land is nothing but trees and he never logs it?
CHRISTINE KING, SCHOOL BOARD
The issues raised and the information presented in the articles are something the new Council and Board of Education will need to discuss in great detail.
First, everyone will need to be schooled and educated on how land should be assessed. If the laws are being followed, then what is the problem -- is it the assessment or the law? If the laws on assessment are not being followed and applied fairly, then we need to address that issue appropriately. We must be diligent and also treat each situation on its merits.
MICHELLE PRUITT, SCHOOL BOARD
On the one hand, County Assessor Schauwecker tried to raise assessed value on 3M and other commercial properties in Columbia several years ago and lost the cases when property owners challenged the valuations. During the time the taxes were disputed, ALL of the taxes (not just the additional taxes due to the higher valuation) were held in escrow and were not available to the school district. And eventually the lower valuation was upheld and the district saw no additional revenues.
On the other hand, it looks like some property valuations could potentially be raised by the assessor by changing their categorization from agricultural to residential/commercial. But if those values were challenged by the landowners, that might end up going either way. The cases cited didn't seem to unambiguously apply to local situations mentioned in the question.
Q2. If we do have a problem, what will you do to correct it if elected?
ALLAN SHARROCK
I know it upsets people to hear about rich people not paying high taxes. But if we are to attract businesses, we must have shovel ready sites that are low cost.
We all want businesses to move to Columbia so we can employ our residents. According to REDI, “the number one reason for the lack of success in the attraction of new manufacturing projects and other desired primary employers to Columbia/ Boone County has been the absence of a community-based, non-profit development group continuously working to secure industrial land and create industrial sites with infrastructure that are available at a low-cost or competitive price.”
Now any development group -- non-profit or otherwise -- cannot afford to make sites shovel ready if they will be expected to pay the residential or commercial property tax rate. They will not be willing to take the risk, especially in this economy. Businesses do not want to relocate to towns where they will have to wait for the land to have the infrastructure put it place before they can start building.
The assessor is an elected position. If he is not following the rule of law then when the next election cycle comes around, I am sure his opponent will inform us.
JASON THORNHILL
I still think it will be tricky to tax someone entirely upon the possibility of what they could do. I also know that there are many, many undervalued parcels of land that are effectively costing our schools and public safety entities money due to their gross underpayment of tax.
It seems that many of the problems we have are created by state mandated methodology and statutes that hog tie the assessor's office. I'd be very interested in determining what can be done at the city level to remedy this. If it is as simple as assigning a zoning designation based upon price and owner intent, then maybe that is the answer.
SAM PHILLIPS, SCHOOL BOARD
[No response to Question 1]. The School Board has a responsibility to help the district provide the resources necessary for our teachers to teach our children. To do that, we have to re-earn the community’s confidence. Trust can be earned by welcoming teacher suggestions and acknowledging their expertise, listening to the community, and assuring that the administration does the same. Of course, we must also prudently manage the community’s funds in the best interests of our students. Finally, the Board and the Administration should meet regularly with city, state and county officials to assure that the district is getting its share of the permissible tax base.
MICHELLE PRUITT, SCHOOL BOARD
If there is a systematic bias in assessed values that undervalues certain types of property, it would be in the interest of the school district to investigate.
CHRISTINE KING, SCHOOL BOARD
Currently the City Council and CPS Board of Education are involved in more meaningful discussions and both are working to create healthy dialogue to make sure our community and schools are working more aligned with one another. This process needs to continue, and I would fully support more opportunities for both groups to come together to meet the needs of Columbia and Columbia Public Schools.
NO OTHER school board or city council candidates responded to the survey.
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