CAMANCHE — Disagreeing opinions on a property tax law has led to a frustrating situation for the city of Camanche.
During a council meeting on Tuesday, City Attorney Tom Lonergan informed city leaders that attempts to argue an exempt property tax status for property the city purchased in November 2013 were unsuccessful despite his understanding of the law.
For weeks, Lonergan conducted discussions with County Assessor Roland Ehm regarding the property in question — two parcels located adjacent to the new Camanche City Hall — and its exempt status as of the November 2013 purchas.
The confusion, explained Lonergan, is that Ehm believed the city became exempt from the property taxes in July 2014, not at the closing date of the property. Lonergan did not agree.
“Cities are exempt from real estate taxes,” Lonergan said. “We bought the Litehouse property on Nov. 26, 2013, I believe it’s exempt from taxes at that date, but the county assessor takes the position that we don’t become exempt until the July of the following year, which I think is incorrect.
“At the time that we closed we got a pro-rate from (Bob) Richeson, the prior owner. We then turned around and sold it to Litehouse Realty and it’s my position that the property is exempt from taxes and we shouldn’t have to pay a tax pro-rate even though Richeson owned it for part of that tax year,” Lonergan said.
Lonergan and City Administrator Tom Roth reached out to the League of Municipalities for guidance and to gain access to written law that confirmed their belief, but came up empty when the League explained nothing had actually been written because nothing had ever been litigated.
With little ammunition to combat Ehm and take the case to the Clinton County Board of Supervisors, where the city could ask for the taxes to be forgiven, Lonergan’s recommendation was to use the $2,000 pro-rate from Richeson, to reimburse Litehouse Realty LLC who paid the $1,702 in taxes to the county.
Had Litehouse waited a little longer, said Lonergan, before making the tax payment, the city would have had time to argue its case, but since it could make the reimbursement without any additional cost, that was the most reasonable action to take.
“Litehouse wanted to escrow the money for the real estate taxes but Casey’s insisted that the real estate taxes be paid, so Litehouse paid the real estate taxes,” Lonergan said. “I was already talking to (Ehm) about whether they were owed or not and we continued to disagree and Litehouse paid the taxes.”
Though the council wasn’t happy to make the payment Lonergan felt was legally unnecessary, it took his recommendation and approved the reimbursement unanimously.
It was the easiest, and cheapest, scenario Lonergan believed the city could go with.
“I didn’t want to fight (Ehm) over it; it wasn’t worth spending money over attorney’s fees and angst over trying to convince him that we were right,” Lonergan said. “It’s all kind of convoluted. I think it’s more reasonable since it’s really Richeson’s money from the tax pro rate he gave to us to go ahead and reimburse Litehouse Realty those taxes.”
Clinton Herald Staff Writer Amy Kent can be contacted at firstname.lastname@example.org.