Taxes are the price we pay to be a civilized society. The power to tax is the power to destroy.
The answer to fair and equitable taxation probably is someplace between these two statements.
A group of conservative legislators, executives with the Kansas Chamber of Commerce and concerned taxpayers met Tuesday, July 23, in the Presidential Suite at the Kansas Speedway. One of the major topics at the luncheon was changing the law that authorizes the Court of Tax Appeals.
House Bill 2413 was introduced late in this past Kansas legislative session, but did not go anywhere. The conversation at the Speedway meeting focused on grass roots and the state chamber’s efforts to promote the bill for the 2014 legislative term.
In 2008, the Kansas Legislature changed what was the Board of Tax Appeals to the Court of Tax Appeals. There are three judges in this administrative court; one must be a lawyer and another must be a certified public accountant. There can be no more than two judges of the same political party. The Kansas governor appoints the members of the court; the Kansas Senate must ratify the appointments
These judges hear appeals from taxpayers who have not received satisfaction of their property values at the county level. The proposed legislation would provide that the judges would not have powers to determine who could represent taxpayers. One of the more controversial parts of this legislation would be a provision that if a decision is not handed down within 120 days, there would be a default judgment in favor of the taxpayer.
The proposed legislation would reduce the salaries of the judges to no more than what district judges are paid; this would save the state $130,000 a year, according to those favor the proposed law.
There is a provision in the present law that allows for expedited hearings for single-family residential properties or commercial properties appraised at $2 million or less. Fees for such residential property is set at $35 for cases appealed from the small claims division to the regular division.
Those at the Speedway meeting said they favored a simpler law, as cases before the court are expensive and often require costly legal representation. Two Johnson County lawyers who represent such clients were at the meeting—Greg Musil and Linda Terrill.
A Texas law dealing with property tax appeals was explained as much simpler and much more taxpayer -friendly than the present Kansas law. The Texas law allows for arbitrators to solve local disputes. Cases can be appealed to the district court.
Historically Kansas taxes have come from three sources—property, income and sales. Property tax is the most stable and sales tax is the most fluid. Income tax is somewhere in the middle.
Gov. Sam Brownback and his conservative legislative colleagues are reducing the state income tax in their effort to attract new business. His critics argue that reducing income taxes would cause more dependence on property tax, upsetting the delicate balance among taxing sources.
Changing the state law might help individual Wyandotte County taxpayers wanting property tax relief. It also could help Wyandotte County taxpayers in general who have to pay for Unified Government representation costs in Topeka. But that is only one piece in a much larger puzzle. A very important key to fair and equitable appraisals has to rest primarily with the county appraiser. Taxpayers here complain that they should be able to solve many of their tax disputes at the local level rather than having to go to Topeka.
A few years ago, I did a study on tax cases that were appealed to Topeka from Wyandotte County and another county of comparable size—Shawnee. The results showed that there were more than three times the cases appealed from Wyandotte County compared to Shawnee.
A strong property tax base is important to a community. That is the resource that helps fund schools and municipal government. But excessive property taxes, which we have in Wyandotte County, are a deterrent to development. All of the growth at Village West is most welcome. However, most of the businesses there receive some type of tax abatement—either property or sales, or both.
In 2016, the Unified Government projects that it will receive a windfall of sales tax from the bonds that will be paid off that are financing the infrastructure in Village West. That finally should give the residential and small business owners relief. In the meantime, the appraisal process in Wyandotte County and throughout Kansas needs attention.
Murrel Bland is the former editor of The Wyandotte West and The Piper Press. He is the executive director of Business West.