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Confusion among extension board while setting tax rate actually equals lower rate for citizens

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By Mallory Bilger

Confusion apparently worked in favor of Spencer County taxpayers last week.
A misunderstanding among the Spencer County Cooperative Extension District Board members caused a higher tax rate to be published in last week’s Spencer Magnet than what was actually levied.
Extension taxes will actually remain at 2011 levels instead of increasing, as reported. The official rates that were submitted to the state office of property valuation were 3.43 cents per $100 of assessed real property; 17.82 cents per $100 of assessed personal property; and 3.11 cents per $100 of assessed motor vehicle/watercraft property.
The confusion stems from the understanding of the term compensating rate. When a government body seeks the compensating tax rate, that means it is passing a rate that would provide a comparable amount of revenue as compared to the previous year. Sometimes the compensating rate will cause tax rates to increase, while sometimes it will cause the rates to decrease. In the case of the extension board, the compensating rate would have raised the real and personal property rates by at least 14 percent.
Board secretary and keeper of the official record, Allen K. Day, said that according to his notes, board member Davis Lee Downs made a motion to pass the compensating rate and the board members present at the Sept. 4 meeting voted unanimously to pass that motion. The members present included Day, Downs, Glen Goebel, Sandi Deutsch and Shirley Thomas. Day followed up with Spencer Magnet reporters several days after the meeting to ensure it was understood that the compensating rate was passed. However, when the story published in last week’s edition, several board members contested, saying that they did not vote to raise taxes.
“(Day) called me that night and I got confused,” Downs said in an interview last Wednesday. “My ignorance is that I got confused on the rates. I understood the compensating rate to be the rate that we had for 2011.”
However, maintaining the 2011 rates and the compensating rate are not the same. Day said it was apparent there was confusion among board members about what the compensating rate actually meant, but said he understood the correct definition of compensating rate, and his vote was in support of that rate.
“What the intention was, I understand,” Day said. “But Davis Lee said compensating. And that’s what went into my notes.”
Downs said it was not the intention of the board to raise taxes.
“What I failed to do and what I should have done in retrospect was  . . . to state the exact numerical value of (the rate),” Downs said.
Day said the confusion revealed that board members had differing ideas of what the word compensating really meant.
“That tells me we didn’t know what we were voting for,” he said.
But board member Shirley Thomas said she knew what she was voting for, and it was not higher taxes.
“What my concern is, I just want to make sure that the public understands that we are not going to raise the taxes,” Thomas said Thursday.  
Day said the board has the ability to amend the minutes at its next meeting on Sept. 26, 12:30 p.m., at the extension office on Spears Drive.
“I intend to bring it up because I know for a fact that the minutes have to be changed. In my opinion, the minutes have to be changed to reflect the intentions of the board,” he said.
Day apologized to Spencer Magnet reporters for the confusion, but said he stood behind the minutes he recorded Sept. 4.
“I’m still convinced of two things: I’m convinced of what I heard and I’m convinced of what their intention was,” Day said. “If I caused you to be wrong, I’m sorry, but I’m convicted about what I heard and what the motion was.”
Day said it is obvious to him now that the other board members who voted that day heard the motion, but had intentions of maintaining the 2011 tax rate. He said he was considering asking the board to invite a tax specialist to speak with the board next year before voting on the rates.
“Next year, at least a week prior to or even the day of, have someone with tax knowledge come and make sure that everyone (understands) what the terms mean and what the result is going to be and how those percentages are arrived at,” he said.
Downs said he hopes to get confusion among the taxpayers cleared up quickly.
“We’re not going to build this building and then raise taxes on people,” he said.