Kroger tax appeal impacting school district
Published 8:25 am Friday, November 24, 2017
Danville Board of Education members learned that the ongoing lawsuit involving Kroger and the Boyle County PVA is going to have an impact on the district’s budget during Monday’s meeting.
“Kroger has decided to appeal their assessment for the 2016 tax bill that they were sent,” said Paul Dean, finance director for the Danville Independent Schools, explaining the background to the board.
The building’s assessment was about $5.5 million dollars, which they want to reduce to $2.8 million. That would cost the district about $26,000 in tax revenue, he said. According to an article in The Advocate-Messenger, Kroger pays a total of $37,000 in property tax money.
Email newsletter signup
“(Kroger) has appealed this to the PVA. The PVA in turn reviewed this and turned it down. So they took the next step and appealed to the state board, which reviewed all of the information and they also turned this down,” Dean said.
Kroger also filed an appeal of the 2017 rate with the Boyle County Circuit Court on June 19, according to archives of The Advocate-Messenger.
The Boyle County Fiscal Court has contracted the case with attorney Stephen Dexter, to represent the county and the Boyle County PVA.
Dean said he understood after speaking with Property Valuation Administrator Eddie Tamme, because if the county didn’t support the PVA on the appeal process, it could open up a “whole can of worms” as far as other assessments.
“That’s where we are right now,” Dean said, before turning the floor over to Superintendent Keith Look for further explanation.
“We are essential bystanders in this process. We don’t set the original value, we are not the PVA,” Look said.
He explained to the board that Boyle County Judge-Executive Harold McKinney has contacted him to ask the district to help foot some of the attorney and court fees.
“Although this type of dispute is not new, it’s the first time we’ve been asked to contribute to an attorney. Judge McKinney believes that since we get, in his mind, 66 percent of the benefit, that we should absorb or cover 66 percent of the cost of the attorney that they hire,” Look said.
Danville Board of Education Attorney Vince Pennington, who works in the same office as Dexter, said there was some research to be done before the board committed to anything.
Pennington said there was a hearing officer, who prepared the information to be submitted to the Boyle County Board of Assessment Appeals, and ruled in favor of Kroger.
“The recommendation to the board of assessments was to rule with Kroger and that did not happen. The board of tax assessments upheld Eddie Tamme’s assessment,” he said.
Pennington said it was good to have the discussion, but that it was “probably premature to get too far down the road.”
The briefing will be set in December, he said, and it could be two years before anything is decided. McKinney, he said, is looking as the district is a beneficiary of the tax assessment, which is the reason for asking the district to pitch in.
“We don’t have a final ruling right now and it may be a while,” Pennington said.
He said there is nothing in the statute requiring the other taxing districts, such as soil conservation, to pitch in, since typically these cases are handled by the county attorney, although it does allow fiscal courts to appoint special counsel.
“If, ultimately, the school board decided to do so, it would be an exception based on the fairness argument,” Pennington said. “If we get to that point … When we have a final decision on the tax assessment, you have to make a final decision whether you’re going to chip in or not.”
Pennington said he thinks some research needs to be done before committing any money.
“We need to look at the Kentucky Constitution. There are limits on what school districts can spend the district’s money on,” he said.
Even if board members feel it’s the right thing to do, Pennington said, they may be legally restricted from doing so.
“There will have to be a bit of research.”
Dean said he had understood they had incurred about $10,000 so far and wanted the district to pay about two-thirds of that.
Look pointed out that once the contribution has been made, that opens the door to similar situations in the future.