Disregarding a judge’s admonition, Eminence Independent Schools last week requested that its 2013/2014 tax bills be issued and sent to the district’s residents.
During a Thursday morning hearing in La Grange, Circuit Court Judge Karen Conrad urged the district to hold off on issuing tax bills until she could rule on the merits of a lawsuit filed against the district.
Should Conrad rule against the district, the district would have to issue refunds, representing an additional cost on top of the reissued tax bills to the district, and its taxpayers.
Henry County Clerk Juanita Lashley confirmed Tuesday morning that Eminence Superintendent Buddy Berry contacted her office Thursday afternoon, the same day as the hearing, and requested the tax bills be sent out.
Lashley said the bills are in the process of being printed, though one piece of information regarding payment dates is still outstanding, and could be mailed as early as the end of this week.
Because it is a second billing, the school district would be responsible for payment for the printing, though Lashley was unsure exactly how much that would cost. Postage for the 1,529 tax bills that will have to go out will run just over $700 at first-class postage rates.
Eminence resident Justin Atchison filed suit against the district regarding the tax rates, in essence claiming the district failed to give proper notice.
Atchison’s attorney, Perry Arnold, claimed in the hearing that the district included false information in its legal notice advertising the tax rates, constituting inadequate notice to taxpayers.
Referring to a Kentucky Department of Education document, Arnold said the district overstated its 2012/2013 revenue by about $70,000.
But EIS attorney Grant Chenoweth and superintendent Buddy Berry said the KDE document is provided for guidance only, and is not required to use the information for their public notice of tax hearing ads.
Chay Ritter, a branch manager with KDE said the advisory document was based on an unaudited financial report submitted by EIS to KDE on July 12 and was unaware of any revisions until about a month later.
But Berry and EIS financial officer Darlene Bates said that report was later revised when the district discovered that a check of about $69,000 had been coded incorrectly.
Bates testified specifically that the correction was made on July 18, and that Ritter told her to wait to submit the revised financial report until after the district’s audit. She also testified that the reason for the revised revenue figure was given at the public hearing on Aug. 14.
“We certainly advise them to make changes if need be,” Ritter said.
Chenoweth argued against Arnold’s motion for an injunction in part because Perry’s client, Atchison, could not and had not proven immediate and irreparable harm.
“Assuming he owns $500,000 in taxable property, that’s less than $300 in excess taxes,” Chenoweth said. “In exchange for that, they’re suggesting that the school district ought to not have any cash flow through tax levies while this matter is proceeding through this court and appeal by virtue of an injunction. That’s a substantial burden on the school district on even being able to keep its doors open with cash flow that cuts off, because that one plaintiff stands to potentially pay $300 in excess taxes if he owns $500,000 in taxable property.”
Chenoweth argued that Arnold and Atchison had not yet shown any immediate or irreparable harm if the injunction were not ordered.
He also argued that Atchison had one of two choices after EIS levied its tax rates on Aug. 14: challenge the action taken that night by suit, or begin the petition process to get the rate on the ballot.
“By trying to get it put on the ballot, he is admitting it was properly done,” Chenoweth argued.”
If immediate and irreparable harm had been done, Chenoweth argued, Atchison should have filed suit on Aug. 15, the day after the tax levy hearing.
Conrad took Chenoweth to task in part for suggesting that Atchison did not have a right to question the tax rates.
“The information that was available was different… and (Atchison) is entitled to explore that, so I don’t think we need to be critical of somebody for being critical of this issue,” she said.
Chenoweth also argued that had Atchison been at the tax rate hearing on Aug. 14, he would have received the information about the change in revenue. He continued to argue that the district did not release the KDE courtesy report.
“It’s not unreasonable, as you are implying, for them to question this,” Conrad said. “I think it’s reasonable that they would want to question this because there was a change in the numbers.”
At the end of the three-hour hearing, Conrad requested briefs and responses from both attorneys to be filed this week. Another hearing date has not yet been set.