Clark County officials reflect on ups, downs of property tax collection

Who owes the most – and the least? Who doesn’t pay?

By Jake Thomas, Columbian staff writer

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On the second floor of the county’s Public Service Center, workers are preparing to receive the first installment $604 million on May 1, along with a deluge of complaints, questions and excuses.

This year, the Clark County Treasurer’s Office expects to receive $604,588,913 in property tax payments. While property taxes are probably the largest check most residents of Clark County write all year, there are property owners on the hook for significantly more, as well as less. Each year, some property owners (for various reasons) won’t write checks for taxes and will create more work for the treasurer’s staff.

Clark County Treasurer Doug Lasher said that there is a story behind every property tax bill. Here are a few of the more unusual.

The biggest bill

The biggest property tax payment Clark County is due to receive in 2017 will come from one of the most polarizing companies in the country.

Georgia-Pacific, an Atlanta-based company that makes paper products and is a subsidiary of Koch Industries, owns Fort James Camas LLC, an 8-million-square-foot paper mill that has a $1.77 million property tax bill due for 2017, according to the Clark County Treasurer’s Office. The factory’s total taxable value is $133 million. It employs about 430 people, according to a previous report in The Columbian.

The company’s bill is more than 600 times greater than the $2,763 median property tax bill in Clark County.

Georgia-Pacific has owned the mill since 2000 and became a wholly owned subsidiary of Koch Industries in 2005. Koch Industries is a multinational corporation based in Wichita, Kan. In recent years, the company has come under scrutiny as its owners, brothers Charles and David Koch, have funneled their fortunes into advancing their political goals of slashing taxes and regulations.

When contacted for comment, the company responded with a brief statement acknowledging the mill and its employees’ importance in the local economy. When asked for his thoughts on Koch Industries having the biggest property tax bill in the county, Lasher, a Democrat who keeps a picture of himself and former President Bill Clinton on his desk, said the mill contributes greatly to the area’s economy and tax base.

“They’ve been good taxpayers forever,” said Lasher of the various owners of the mill.

“Georgia-Pacific has traditionally been the leader in paying taxes,” he added.

6 cents

The county’s smallest tax bill is a mere 6 cents for an 871-square-foot property along Northeast Fourth Plain Boulevard. It belongs to Royal Oaks Land Association, according to the Clark County Treasurer’s Office.

The mailing address for the association is the same as the Royal Oaks Country Club, a private golf course also located along Northeast Fourth Plain Boulevard. Marcia LaFond, manager of the club, responded to questions with an email stating that she consulted with the company’s attorney and found that the property has undergone many property line transitions over the years. At some point, the small odd-shaped property was created as a remainder parcel after others were developed, according to LaFond.

“A dedicated sleuth could sift through the Clark County Auditor’s recorded documents’ history to map out the answer as to how this tiny piece of land came to have its own Clark County parcel identification number,” she wrote.

Rachel Belveal, senior management analyst in the treasurer’s office, said that the property was granted a property tax exemption because of its use as an open space. With the exemption, the property has a taxable value of $6. With the current levy rate it pencils out to a 6-cent property tax bill.

When asked why the treasurer’s office even bothers sending such a tiny bill, Belveal responded that it would cost even more to override it. She acknowledged that the county loses money sending the bill and processing the check. She said there are 26 other properties in Clark County that have tax bills of less than a dollar.

Lasher said he would like to see the Legislature pass a bill to allow county treasurers to round tax bills up or down to keep them simple.

“People will argue over a penny,” he said.

Who doesn’t pay?

Most people pay their property taxes, or their bank does, but unpaid taxes from prior years exceed $12.1 million, according to the treasurer’s office.

The property owner with the largest unpaid tax is Chinook Land Owners Group, which owes $314,190 in payments, penalties and interest it failed to pay on 37 acres of industrial property in Camas. The second-largest amount is owed by a trust managed by Vernon and Melba Hungerford. It owes $238,639 on several properties totaling about 38 acres in the Battle Ground area. Attempts to reach both the Chinook group and the Hungerfords were unsuccessful.

The third-largest back-tax bill, $99,187, belongs to Wubben Brothers, a defunct construction company. Wubben Brothers has been delinquent since 2010, and Lasher said that it’s unlikely the company will ever pay. “There are no assets to seize,” said Lasher. The taxes were owed on assets other than land, and “there are no dump trucks, there are no graders or backhoes in their business, or computers.”

“There is a point in time where we can’t spend any more taxpayer dollars trying to track it down,” said Lasher. “You can only spend so much time chasing ghosts.”

Lasher explained that periodically his office will cut its losses and stop spending time and resources trying to collect on an unpaid property tax bill. To deem a bill as uncollectable, his office refers the case to the prosecuting attorney, who asks a court to have the tax dismissed.

After a tax bill is delinquent for three years, the county can foreclose.

Belveal said that 1 percent in interest is tacked on to a property tax bill for each month it’s late. In June, the county adds a 3 percent penalty and another 8 percent penalty in December, she said.

She said that people end up not paying their taxes for a range of reasons. She said that more than half of taxpayers pay their taxes through escrow rather than directly to the county. But she said sometimes taxpayers don’t realize that they failed to set up an escrow or their lender has the wrong account number.

And then there are the scofflaws.

“We actually have a lot of people who deliberately don’t pay taxes and use their money elsewhere and pay it later,” said Belveal. “They must have a lot of money invested somewhere really, really great. I’m not going to argue with them.”

Former County Councilor Tom Mielke was one. In 2010, when he was a county commissioner, Mielke let his taxes go unpaid. He said he was using his money to remodel his Battle Ground home and chose to pay his taxes late, according to Columbian files.

Tax rates going down

In 2011, Clark County had the distinction of having the highest average tax levy rate of any county in the state at $13.17 per $1,000 of assessed property value.

Taxes are calculated by dividing the budget of a taxing jurisdiction (i.e. a city, fire or school district) by the total assessed value of all property in its bounds. This produces the “millage” or “levy” rate. To calculate a tax bill, a property’s assessed value is divided by 1,000 and then multiplied by the levy rate.

In Clark County, the levy rate reached its peak average at $14.51 per $1,000 of assessed value in 2013 and then declined to $12.27 in 2016, according to numbers from the Washington State Department of Revenue. In 2016, Clark County had the 11th highest average tax levy, with Pierce County at the top at $14.73. However, Clark County has consistently stayed above the statewide average since 2009.

An analysis of data from the assessor’s office found that the average levy rate for property owners in Clark County for 2017 has dropped even further, to $10.63.

Belveal said that assessed values have increased significantly in recent years, much of it coming from new construction. When the total assessed property value in a county goes up, the levy rate decreases.

And, your tax bill may have increased or decreased depending on how fast the value of your property increased relative to the neighbors.

There’s no “average” tax bill in Clark County. Depending on where a property is, it’s subject to differing combinations of taxing jurisdictions, all with different levy rates. There are 342 tax areas in Clark County, each of which represent the various combinations of taxing districts.

The tax area with the highest levy rate is $13.36 per $1,000 of assessed value and encompasses a part of unincorporated Clark County near Camas. The tax area with the lowest levy is $7.12 per $1,000 of assessed value and encompasses an area near Amboy.