LINN — Questions asked by the Unterrified Democrat while researching last week’s sales tax article led to the discovery of an oversight resulting in approximately $300,000 in over-billing on this year’s property tax bills.

As a result, county officials moved fast to correct the problem, as commissioners voted unanimously on Friday to approve the allocation of $20,000 in American Rescue Plan Act (ARPA) funds to reprint the tax bills.

Osage County Treasurer Valerie Prater recommended the commissioners pay for the reprint using part of their remaining ARPA funds, as those funds must be allocated by the end of this year or be returned to the federal government. “You have about $40,000 (unallocated),” Prater said.

UD Reporter Elise Brochu brought the error to county officials. When they learned of the mistake, Interim Osage County Clerk Brooke Dudenhoeffer, Collector Denise Nolte, and commissioners Darryl Griffin, John Trenshaw, and Larry Kliethermes were immediately united in their desire to fix the problem before bills were mailed.

The ballot language for sales tax JR60 (Jail Renovation Fund, passed on Aug. 7, 2007) read, “Shall the County of Osage, Missouri, impose a countywide sales tax for one half of one percent (1/2 of 1%) for a period of 20 years for the benefit of the County, including but not limited to providing funds for general operating purposes and for renovating, improving and maintaining the Osage County Courthouse, and reduce its total property tax levy annually by fifty percent (50%) of the total amount of sales tax revenue collected in the same tax year?”

That ballot language raised the questions of who was responsible for reducing the levy and whether it was being done.

Dudenhoeffer suggested Brochu contact the Missouri State Auditor’s Office with those questions, which she did, copying both Dudenhoeffer and Nolte on the email.

Local Government/Policy Senior Analyst Jill Wilson’s response was, “Computing and ensuring the sales tax reduction is taken is the responsibility of the county, typically the county clerk.”

The state agency also provided the levies from the past 10 years, showing that the reduction was not taken in 2022, was taken in 2023 (including a rollback to compensate for 2022), and was not taken again in 2024. 

Dudenhoeffer and Nolte brought the issue to commissioners at last Thursday’s meeting. The clerk explained that the $0.3251 tax levy rate commissioners had previously approved was incorrect.

“It was questioned at that time as to why the tax rate had (gone) up to $0.3251,” Dudenhoeffer said. “I was unaware of a 50 percent sales tax reduction we had in place. In the meantime, the county’s assessed valuation has (gone) up due to some increases and things from the assessor’s office, So, all in all, we will be collecting a lot more taxes than we should. I have been in contact with the State Tax Commission and the State Auditor’s Office to see how we can fix this.”

“I want you guys to be very aware that I’m extremely happy that Elise looked into (this),” Dudenhoeffer continued. “She had a few questions, and it kind of went down a rabbit hole, so to speak. But if she hadn’t questioned some things, we wouldn’t be sitting here realizing that we should have been doing this. So, I’m really thankful that she has.

“However, according to the new assessed valuation that the assessor and collector both have, and they do match, our tax levy rate should be $0.2006,” she added. “Like I said, I do not know what our options are at this point.”

Dudenhoeffer explained that a similar mistake was made in 2022, resulting in a rollback in 2023 to pay back taxpayers. On Thursday, she was not sure whether the state would allow Osage County to correct its 2024 tax levy or if the county would have to continue with the incorrect rate and issue another rollback in 2025.

“This doesn’t affect the schools in any way or (anything) else, right?” Trenshaw asked. “This is just the county?”

Dudenhoeffer confirmed no other taxing entities were impacted.

“Do you know how much money this is?” Trenshaw asked.   

“I can get you those totals,” Nolte said. “I pulled a couple of (sample bills) just to kind of give you an idea of how it changes.”

Once the magnitude of the error was thoroughly explained, commissioners unanimously agreed the mistake should be corrected before bills were sent to taxpayers.

“If the state will allow it,” Dudenhoeffer said.

“I think we ought to get it fixed, if the state allows,” Griffin said, “because people are gonna have strokes. And I’m not being facetious.” 

“I will gladly authorize whatever overtime it takes,” Trenshaw said.

“Not only are we talking about money, you’re talking about the integrity of all the county offices,” Kliethermes said, adding that he was less concerned about fielding angry phone calls than about citizens losing trust in their elected officials.

“I think that time is of the essence,” Trenshaw said, “Once you get your answer (from the state), I kind of consider this an emergency. Can we have a meeting tomorrow?”

An emergency meeting was scheduled for 8:30 the following morning.

At Friday’s emergency meeting, Dudenhoeffer relayed that the State Auditor’s Office had agreed to allow Osage County to correct its tax levy.

“Jill said, ‘You’re not the only county that we’re doing this for.’ So, the auditor’s office is going to reopen their website for us to re-enter in our pro forma tax levies,” Dudenhoeffer explained. “I have the calculations from yesterday as still being $0.2006 as a tax levy rate, and we just go forward. Saying that, Denise has already printed all tax bills, so she will have to reprint them, as we talked about yesterday.”

The commissioners voted unanimously to change the tax levy rate to $0.2006. Due to that reduction, the county now estimates it will collect $518,761,62 in property/personal property tax revenue, as opposed to the $828,546.62 previously anticipated.

Nolte provided the commissioners with a spreadsheet showing a cost of approximately $16,138.41 to reprint the bills, including $1,286.76 to reprint the 22,000 statements, $826.63 to reprint 7,000 summary sheets, $75 to rush the order, and $13,950 for printed pre-stamped envelopes. That estimate, she said, did not include the software company’s time helping her make the correction or the cost of having an outside vendor come in to shred the existing bills.

“We’ve got a bill of approximately $16,000,” said Trenshaw. “I would like to give a budget of $20,000, in case of stuff we haven’t seen, to take care of solving this problem.”

Trenshaw asked what Nolte planned to do about the approximately $30,000 that had already been collected. Nolte replied that she was working with the software company to get a report of all payments before they updated the tax levy, and she would issue refunds to anyone who overpaid.

Nolte estimated the corrected bills will be mailed the second week of November, still well before the statutory deadline of Dec. 1. “We have a lot of (county) offices saying (when) they have downtime, they’re going to help stuff envelopes,” Nolte said. “So, as a county, we’re all going to pull together and get it done.”

Unless extended by voters, the JR60 sales tax and the associated sales tax reduction will sunset (end) in 2027.