County may give refund to fairground
From our weekly issue dated February 17, 2010
The Josephine County Fairgrounds in Grants Pass could soon receive a tax refund of nearly $12,000 from the county itself.
Fairgrounds Manager Jackie McBee said that the ball began rolling approximately five years ago. A building at the fairgrounds was vacant, and a person expressed interest in renting it.
McBee said that she took the rental offer to the fair board, and a series of terms were agreed upon. She then typed a contract and sent it to county legal staff for review.
However, McBee said that county officials would not approve of that draft of the contract. It was rewritten, but not to the satisfaction of the would-be tenant, she said.
Although a formal, long-term lease never was in place, the tenant did end up renting the fairgrounds feed store and locating a motorcycle shop there for some two years.
McBee said that the agreement that existed between the fairgrounds and the tenant was an events lease, which has daily terms, rather than monthly.
John Harelson, county treasurer, said that long-term leases involving county property typically have provisions for property taxes to be paid.
“When government property is leased to a private individual, it becomes taxable for property tax purposes,“ he said. “I“m required to tax it if it“s not used for government purposes.“
Rosemary DeLashmutt, county chief financial officer, said that the tax situation came to officials“ attention after the fairgrounds tenant moved out of the facility.
“The tenants originally paid one or two tax payments,“ she said. “But when they left, we had no contract and no lease with them that required them to do that.“
On June 4, 2009, county officials decided to take approximately $11,757.43 from the fair fund to make up what was owed.
“The county paid the tax bill and charged the fair for it,“ Harelson said.
But a court ruling stemming from a case in Grant County ultimately caught Harelson“s attention. He said that ruling set the precedent that government entities cannot enforce foreclosure actions against other government entities.
“The county is still an exempt person,“ Harelson said. “I cannot, as a tax collector, in accordance with that court case, foreclose on that property. I cannot enforce collections against the land owner, which in this case is the county.“
Harelson said that during the next few days, he plans to seek permission from the county commissioners to refund the nearly $12,000 to the fairgrounds.
“That“s the typical rule here,“ Harelson said. “The rule is, if I have a refund of over $10,000, I have to get the board“s approval to give that money back.“
In a letter dated Jan. 22, Harelson informed McBee of his intentions to seek the refund. Harelson also plans to work with other county officials to craft a new policy for rental property.
“As a tax collector, I have rules to follow,“ he said. “If the rules change, I follow the changed rules. The rule was changed by the court case.“
McBee said that if the money is refunded, it will go toward the care and maintenance of the fairgrounds.
“We don“t get any tax dollars to support this place,“ McBee said. “Everything is generated right on the property from the rental of buildings, the fair and horse races.
“That“s why we feel like we“re a community center for anything anybody wants to do,“ she concluded.
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