Valencia County got some unusually good news Tuesday.
The Valley Improvement Association announced that $500,000 in back taxes will be paid to the county by the end of June.
Bob Davey, VIA president, told the commissioners that his staff has been working with county workers for the past few years to trace land ownership, property description and amounts owed on taxes that goes back to the 1980s.
In the 1980s, there was a series of large land transactions, Davey said.
“A group of companies that were related through ownership and management had acquired tens of thousands of parcels of land from Horizon Corporation,” Davey said after the meeting. Horizon Corporation was a past member of VIA.
Land that the VIA now owns had been passed around to various owners making tracking (and billing for taxes) almost impossible, Davey told the commissioners. Only recently, with the help of computers, have the VIA and the county staff been able to trace the land ownership.
“The VIA feels comfortable enough with those corrections to pay taxes due on property,” Davey said. “We cleared up a morass of errors in the records.”
Davey said there was “an effort by companies to take advantage of the county, which was keeping records by hand. There was such a rapid change of ownership, it was impossible. The county worked with us and with the attorney general’s office.”
Thousands of parcels of land were not in the county records, Davey said.
County commissioners seemed stunned to hear about the windfall. There have been budget shortages in the county this year.
“Is this an early Christmas present?” Commission President Al Padilla asked.
Commissioner Alicia Aguilar praised the VIA and the county staff for putting in so much time to solve the problems.
Commissioner Gary Daves acknowledged that this was a complicated matter but asked for more explanation.
Davey said that “six or seven companies related in ownership and management distributed the land to a lot of people in a lot of places.”
“The real concern was that they were passing the land amongst themselves,” Davey said later. “We, with some help from the county and the state, filed a series of lawsuits to put an end to what was happening, and, as a result of those lawsuits, we wound up foreclosing on a lot of that property.”
The county, in turn, was producing tax bills by hand to a lot of people so “there were a lot of errors, ” he added.
County Treasurer Diane Coplen told the commission “we have cleared up everything.”
“This is a positive thing taking place,” said County Manger James Fernández. “This will give us revenue not expected.”
The VIA was happy to clear up the mess, Fernández said later, because there had been cases in bankruptcy court.
“In many cases, absentee owners sold land to companies, sometimes in the Middle East,” he said. “At the end, VIA acquired them.”
Davey said later that clearing up the tax-billing confusion was beneficial for the VIA, even though it is paying out money.
In the past, the VIA was billed for land incorrectly.
“When we were chasing them (previous landowners), the grounds for us was past-owed assessments. The county said they owed past taxes. They issued judgments against these people, which resulted in attorneys in bankruptcy court,” Davey explained later.
“When all is said and done, we were given the right to foreclose on the property by the court, that’s why we finally ended up owning it. The (tax) bills had a lot of errors on them. In trying to correct the records, we spent thousands of dollars on programming assistance, trying to help the county correct the records,” Davey said. “We provided consulting help to clear up some of the errors in the records. Regular bills are coming now. What we’ll wind up doing is paying half a million and then, in the first quarter, another $300,000.
“Ultimately what would have happened, the county said ‘here are the bills. They’re no good, but pay them.’ We would wind up in court and the judge would say ‘fix the records’ anyway, so why not sit down with the county and settle this? You can’t dodge this forever. The whole idea is to try to get things working properly. We get correct bills and help the county.
“We got bills, but they didn’t make any sense. We had 3,000 lots we were not getting billed for. With the system we have with the county now, we can flag this.
“We spent lots of years and thousands of dollars to fix it. We could have thrown up our hands and said ‘there’s nothing we can do about it.’ It was so off the wall, and we simply talked to the county and said, ‘let’s figure out a way to combat this and get it so we can work with it.’
“There are ways to print and deliver tens of thousands of bills electronically. Until the 1990s, they were doing this by hand.”
Davey said that previously, for example, the county would bill one person or company for several parcels on the same bill. If one of the parcels had been sold, it was confusing. Now, one lot is billed on each bill.
“This is not to be critical about either the county or us. We all tried to do our best. Two big things are important in all of this: it’s a great example of how the county and we can work together to solve a problem. And it results in a better system to allow the county to keep track of land we own and maybe other people’s too. It’s the first positive news regarding finances in a long, long time. I can’t emphasize too much how it was a nightmare when we sat down. However, the VIA was still paying taxes every year. But going at it year by year, we found errors, but we have been paying taxes all along. The bottom line: it’s done and the county’s going to get its money.”