Error could change local budgets

An annual state audit revealed a $1.5 million miscalculation in Bourbon County's assessed property valuation for 2012, affecting projected budgets for five taxing entities, including the county's.

The clerical error amounted to a higher property valuation for the county, which led to an expected increase in revenue for the coming fiscal year. The city of Fort Scott, United School District 234, Fort Scott Community College, the Southwind Extension District and the county are all impacted and now must re-work their budgets. The county notified the entities of the error by fax around 4:52 p.m. Friday.

"I know that mistakes happen. I think everybody understands that," Assistant City Manager Susan Brown said during Monday's Bourbon County Commission meeting. "My biggest concern is in the future how do we keep this from happening so late in the game?"

Fort Scott City Commissioners approved the city's budget on July 25, setting the mill levy flat at 48.8 mills.

Brown said commissioners are now faced with cutting the budget by $75,000 or raising the mill levy 1.6 mills.

A special meeting of the city commission is scheduled for 4 p.m. Wednesday, Aug. 15, at City Hall. The purpose of the meeting is to approve the re-publication of the budget.

"Luckily, we still have enough time (that) we can republish," Brown said. "But is there an audit process internally that we can do with the appraiser's office to make sure mistakes don't happen again -- at least not as severe as this one was?"

By law, the county is required to submit its assessed valuation totals to the state in July and November. County Clerk Joanne Long said she sent the county's information to the state around July 15.

"I sent my stuff off to the state, as I do, and they called back on a couple of things," Long said.

The state audit showed that of the $4 million in personal property machinery and equipment for the county, $1.5 million was in assessed value. When people and businesses in the community were sent rendition forms to assess personal property by the county appraiser's office in January, local business Valu Merchandisers incorrectly entered information for a trailer causing the county's personal property to be nearly $4 million higher than this time last year, Long said.

The increase didn't initially raise any red flags, Long said.

"I have nothing to say about what the county appraiser's office gave me," she said.

County Appraiser Judy Wallis was unavailable for comment. An employee with the appraiser's office said Wallis would return on Friday.

"Everybody fell down on the job on that one," Long said.

Accountant Terry Sercer, of Diehl, Banwart, and Bolton CPAs, said when he was working the county's budget it was obvious the personal property had increased, but that was not unusual.

"It wasn't in real estate ... If it was up in real estate, you'd go wait a minute," Sercer said. "But personal property could be a big business doing something different this year. That's why I wasn't as concerned seeing it in the personal property area."

County Commissioner Allen Warren said from the county's standpoint, the miscalculation is "not good." Warren said commissioners were initially hopeful when they saw the valuation increase.

The county's latest revised budget included a decrease in last year's local mill levy of about .600 mills.

Now if the county keeps the budget the same as it was a week ago, the projected budget shows the exact opposite -- about a half mill increase.

"I'm personally concerned about the impact on the county, but also how the city and schools are affected," Warren said. "I don't know what else to say, other than we apologize."

Fort Scott Community College officials recently recommended the college's Board of Trustees raise the mill levy for the second year in a row. The suggestion was a .637 mill levy increase. Working on the county's miscalculation at a Monday night budget hearing, FSCC officials still recommended raising the mill levy, but by a smaller amount than previously suggested.

"I think it's unfortunate we have to come back in here and re-do this when we worked to get the dollars down," trustee Jim Fewins said.

After listening to comments from residents and board members, the panel voted to abstain from approving the budget to reconsider it at a special meeting set for 5:30 p.m. Wednesday, Aug. 15, in the Heritage Room of the Administration Building.

Both the city and USD 234 originally planned to keep their mill levies flat.

"One thing we stressed was we were wanting to keep everything the same," district Business Manager Tiffany Forester said.

During the district's budget hearing Monday night, USD 234 officials recommended a .479 mill levy increase.

"The new property valuation assessment strains the school's budget by about $40,200," Forester said. "If we don't increase mill levy and keep everything the same ... the students are going to be the ones affected."

Forester said school board members decided to table the budget until it can be revisited during a special meeting set for noon Thursday, Aug. 23.

All local taxing entities must submit their approved budgets to the county clerk by Aug. 25. Considering the county's miscalculation, Long said the end of the month deadline will be flexible for both the schools and the city.

"I think Susan (Brown) and I both sort of questioned it, but who are we to question the information that was sent to us," Forester said Monday morning. "... Because it did kind of send up a warning to us, but for us it was good news."