HomeMy WebLinkAbout2012-109 Council Resolution•
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CITY OF LINO LAKES
RESOLUTION NO. 12 -109
RESOLUTION APPROVING A JOINT POWERS AGREEMENT WITH
ANOKA COUNTY FOR ASSESSMENT OF PROPERTY
WHEREAS, pursuant to Minn. Stat. §273.072, subd. 1, any county and city, lying
wholly or partially within the county and constituting a separate assessment district, may, by
agreement entered into under Minn. Stat. §471.59, provide for the assessment of property in the
City by the County Assessor; and
WHEREAS, pursuant to Minn. Stat. §273.03, subd. 2, the agreement may provide for the
abolition of the office of the City Assessor when the assessment of the property within the city is
made under an agreement with the County Assessor; and
WHEREAS, the City of Lino Lakes wishes to cooperate with the County to provide for a
fair and equitable assessment of the property within the City; and
WHEREAS, said work will be carried out in accordance with the provisions of Minn.
Stat. §471.59.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Lino
Lakes, Minnesota that the Joint Powers Agreement with Anoka County for assessment services
be approved for the term beginning January 16, 2013, through the year 2018, unless earlier
terminated as provided by the Joint Powers Agreement.
Adopted by the City Council of the City of Lino Lakes this 26th day of November, 2012.
The motion for the adoption of the foregoing resolution was introduced by Council Member
ROPSPr and was duly seconded by Council Member Stoesz and upon vote
being taken thereon, the following voted in favor thereof:
Roeser, Stoesz, Rafferty, O'Donnell, Reinert
The following voted against same:
none
ATTEST:
J lianne Bartell, C y Clerk
Jeff Reinert,
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CITY COUNCIL
AGENDA ITEM 3B
STAFF ORIGINATOR: Jeff Karlson
MEETING DATE: November 26, 2012
TOPIC: Joint Powers Agreement with Anoka Co. for Assessment Services
VOTE REQUIRED: 3/5
INTRODUCTION
At the last City Council meeting, the Council was asked to consider approving a Joint Powers
Agreement (JPA) with Anoka County for assessment services for years 2013 through 2018.
The parcel rate for each type of property would remain unchanged for the duration of the
contract period. At the request of Councilmember Stoesz, this item was postponed until the
November 26 meeting for further discussion.
BACKGROUND
Cities use one of the following three methods for property assessments: (1) hire its own in-
house assessor; (2) contract with county assessor; or (3) contract with a private appraiser.
In Anoka County, there are currently three cities that employ a city assessor: Anoka, Coon
Rapids, and Fridley. There are ten other cities in the metropolitan area that employ its own
assessor —all of them located in Hennepin County with a population of at least 50,000, with
one exception (Brooklyn Center at 30,000). Based on the Minnesota Local Government Salary
& Benefits Survey, the average salary for a city assessor is $101,000. In Anoka County, the
average salary is $90,000. When you include benefits and gas or mileage expense, a
conservative annual cost estimate for an in -house assessor would be around $120,000.
Most cities in Anoka use the County Assessor. The charges Lino Lakes has paid the county for
the past three years are as follows: 2010 -- $101,273; 2011- $97,478; and 2012 -- $97,577. I know
of four Anoka Co. cities that contract with a private appraiser: Spring Lake Park, Centerville,
Columbus, and East Bethel. One of the downsides of hiring a private contractor is we cannot
be sure of getting quality assessments. For example, attached is a newspaper article about
private assessors incorrectly assessing properties in St. Louis County.
RECOMMENDATION
It is still staff's recommendation to adopt Resolution No. 12 -109, approving a joint powers
agreement with Anoka County for assessment of property.
ATTACHMENTS
1. Joint Powers Agreement between the City of Lino Lakes and County of Anoka for
Assessment of Property
2. Duluth News Tribune article
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Anoka County Contract No.
JOINT POWERS AGREEMENT
BETWEEN THE CITY OF LINO LAKES AND
COUNTY OF ANOKA FOR ASSESSMENT OF PROPERTY
THIS AGREEMENT is made and entered into this day of
20_, by and between the City of Lino Lakes, 600 Town Center Parkway, Lino Lakes, Minnesota
55014, hereinafter referred to as the "Municipality," and the County of Anoka, a political subdivision
of the State of Minnesota, 2100 Third Avenue, Anoka, Minnesota 55303, hereinafter referred to as
the "County."
WITNESSETH:
WHEREAS, pursuant to Minn. Stat. § 273.072, subd. 1, any county and city, lying wholly or
partially within the county and constituting a separate assessment district, may, by agreement
entered into under Minn. Stat. § 471.59, provide for the assessment of property in the city by the
county assessor; and
WHEREAS, pursuant to Minn. Stat. § 273.072, subd. 2, the agreement may provide for the
abolition of the office of the city assessor when the assessment of the property within the city is to
be made under an agreement by the county assessor; and
WHEREAS, it is the wish of the County to cooperate with the Municipality to provide for
a fair and equitable assessment of the property within the Municipality; and
WHEREAS, said work will be carried out in accordance with the provisions of Minn. Stat.
§ 471.59.
NOW, THEREFORE, in consideration of the mutual covenants herein contained, it is agreed
as follows:
That said Municipality constitutes a separate assessment district which lies wholly
within the County and that all property in the geographical boundaries of this district shall be
assessed by the County Assessor of the County beginning with the assessment year 2014,
provided this Agreement is approved by the Commissioner of Revenue.
II. Pursuant to Minn. Stat. § 273.072, subd. 2, the office of the city assessor in the
Municipality shall cease to exist on January 16, 2013, but not before the end of the term of the
current city assessor, if serving for a fixed term, or when an earlier vacancy occurs; provided,
however, that upon the termination of this Agreement, the office of city assessor shall be
automatically reestablished and shall be filled as provided by applicable law or charter in
accordance with Minn. Stat. § 273.072.
III. The term of this Agreement shall be from January 16, 2013, through assessment
services performed in the year 2018, unless earlier terminated as provided herein.
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IV. In consideration of said assessment services, the Municipality shall pay to the
County an annual payment as follows:
2014 Assessment services payable on or before January 15, 2013
2015 Assessment services payable on or before January 15, 2014
2016 Assessment services payable on or before January 15, 2015
2017 Assessment services payable on or before January 15, 2016
2018 Assessment services payable on or before January 15, 2017
V. For year 2014 assessment services, the Municipality shall pay the County as follows:
A. Twelve Dollars and 50/100s ($12.50) for each improved parcel of residential,
seasonal recreational residential and agricultural type property;
B. Four Dollars and 50/100s ($4.50) for each unimproved parcel of residential,
seasonal recreational residential and agricultural type property;
C. Eighty Dollars and 00 /100s ($80.00) for each improved and unimproved
parcel of commercial, industrial and public utility type of property; and
D. Eighty Dollars and 00 /100s ($80.00) for each improved and unimproved
parcel of apartment and mobile home park type property.
The same procedure shall be used, as described above, in the computation of the
assessment payments due in 2015 through 2018, provided, however, that the cost for each type of
parcel shall be increased according to the County Assessor's increase in operating costs, cost of
living and merit adjustments established by the Anoka County Board of Commissioners for
January 1 to December 31 in the year prior to the date of the assessment.
VI. Notwithstanding Section III. above, the County and /or Municipality shall have the
right to terminate this Agreement by providing, at a minimum, two years written notice by certified
mail, which notice shall be sent prior to January 2 of any year to terminate assessment services to
be performed two years from such date (i.e. to terminate this Agreement for assessment services in
the year 2015, the party must provide written notice of termination by not later than January 2,
2013).
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IN WITNESS WHEREOF, the parties have hereunder set their hands on the dates written
below.
COUNTY OF ANOKA CITY OF LINO LAKES
By: By:
Rhonda S ivarajah, Chair
Anoka County Board of Commissioners
Jeff Reinert
Mayor
Dated: Dated:
By: By:
Jerry Soma
County Administrator Title:
Dated: Dated:
APPROVED AS TO FORM
By: By:
Dan Klint
Assistant County Attorney Title:
Dated: Dated:
The above Agreement is hereby approved by the Commissioner of Revenue this day of
By:
Minnesota Commissioner of Revenue
I: \atty \CIV\DK\ CONTRACT \20121Assessment - JPA \01 -JPA- assess form.doc
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St. Louis County properties not added to tax rolls cost others money - TwinCities.com Page 1 of 6
St. Louis County properties not added to tax rolls cost others money
By Brandon Stahl Duluth News Tribune TwinCities.com- Pioneer Press
Posted: TwinCities.com
A $240,700 building on resort property near the Boundary Waters Canoe Area and Voyageurs
National Park. A $559,800 four - season lake cabin that rents for $5,250 a week in Cook, surrounded
by state forest and with stunning views of Lake Vermilion. A $439,000 addition to the Ziegler
Caterpillar Dealership in Buhl.
What do those three buildings have in common?
They, like hundreds of others in St. Louis County - homes, garages, barns, cabins, campers and
businesses - went for years either off the tax rolls or significantly undervalued, a News Tribune
investigation has found.
Because of that, the rest of the county's property owners paid more in taxes than they should have,
possibly by hundreds to thousands of dollars.
A News Tribune analysis of St. Louis County property records and audits found that building projects
worth at least $16 million either weren't taxed for nine years or were appraised for much less than
their actual worth.
But the actual number is far higher. Records the county provided to the newspaper include hundreds
of other properties that were undervalued or weren't taxed at all.
The News Tribune also has learned that the State Department of Revenue is investigating whether an
assessor in St. Louis County did not include 51 other parcels worth an estimated $4.2 million on the
tax rolls.
"There is no excuse for this," said Mark Monacelli, the St. Louis County public records and property
evaluation director, who oversees the assessment process in the county. "It's disturbing."
For years, Monacelli and the county assessor's department have been aware of the problems with the
allegedly missed assessments, the county recorder said. After several attempts to solve the problem,
the county formed a blue - ribbon panel to address it.
But though the county is responsible for how assessments are done, officials have little oversight over
the independent assessors hired by small cities and townships.
Among the News Tribune's findings:
Appraisals and inspections allegedly were conducted of properties that didn't exist.
Following reviews beginning in 2010, the State Department of Revenue ordered the county to
reassess five townships and hundreds of properties because their values were too low - meaning other
taxpayers were paying too much.
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An attempt by a former county official to have the problems investigated eight years ago went largely
ignored by the St. Louis County Board and the State Department of Revenue, allowing the assessment
errors to continue.
The overwhelming majority of incorrectly assessed properties in the county were done by assessors
hired by small municipalities as independent contractors. The local assessors aren't required to have
the training of a county assessor.
Each year, the county is required by law to audit each independent assessor's work. But if the county
finds mistakes, the assessors don't have to fix them. The county's only recourse is to have its staff do
the work and bill the city or township.
Only the State Department of Revenue can discipline assessors, but only twice since 2005 has the
department taken that action - and both times were when assessors failed to pay child support.
The county also can't tell towns and townships whom they should hire to assess properties, so the
townships often go with the lowest bidder, even if county audits show that assessor has incorrectly
assessed other properties for years.
Such is the case with the assessor the county's records show is responsible for inadequately assessing
more properties than any other assessor since 2003 - Rick Vidmar. At one point, Vidmar was
responsible for appraising more parcels than any other St. Louis County appraiser or local assessor.
Reached for comment, Vidmar, who is now retired, said the records provided to the News Tribune
from the county are inaccurate. He said the assessments were done but the county didn't allow him to
enter the records into its electronic database.
"I was locked out of the computer," he said.
He also threatened to sue the News Tribune.
"If you want to dig this up, you better have one hell of an attorney," he said.
VIDMAR INVESTIGATED
Many of Vidmar's assessment issues were first reported by former county assessor Mary Durward,
who in 2004 compiled a 100 - plus -page report recounting dozens of properties that she said Vidmar
under- assessed, didn't put on the rolls or said he examined but didn't.
Vidmar began working as a St. Louis County employee in 1990 and retired from his position as a real
estate appraiser in 2003.
Around 2003, the County Board raised the fees the county charged cities and townships for
assessment services, said Mel Hintz, who was county assessor from 2004 to 2008.
When he retired, Vidmar started his own assessment business, Vidmar Appraisals, and offered his
services to cities and townships throughout St. Louis County.
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"Everything was prepped for Rick to go out and do these assessments," Hintz said. "Here comes an
assessor that still has the county brand on him. He has the credentials, and was willing to do it for
less."
By 2004, Vidmar was responsible for appraising more than 10,000 parcels throughout the county. The
reason he got so much business, said County Commissioner Mike Forsman, was simple: He charged
less than the county.
"(Townships) said, 'Rick gives a really good deal, much cheaper than the county would give us,' "
Forsman said.
But with St. Louis County encompassing more land than any other county east of the Mississippi
River, Hintz wondered whether Vidmar took on more properties than he could handle.
"I'm not sure if it was humanly possible for the best assessor in the world to handle that workload," he
said.
Durward's report, which was provided to the News Tribune, alleged that Vidmar also missed more
assessments than any other assessor in the county. She wrote that she and two other county
employees, Clayton Breimon and Hintz, confronted Vidmar about the problems in early 2004 and told
him he was "severely deficient" in several of his jurisdictions.
(Disclosure: Mary Durward worked as a temporary news assistant at the News Tribune following her
employment with the county but did not disclose to or discuss the report with News Tribune
employees.)
"You indicated that you were aware of the deficiencies, and we expected you to comply," Durward
wrote to Vidmar.
But a month later, Durward wrote that Vidmar still had not made "significant progress" on evaluating
hundreds of properties.
Durward's report documented millions of dollars in property allegedly missed by Vidmar: A car wash
and bank in Cook, several new construction projects in Floodwood, cabins in Crane Lake, and
numerous homes and cabins in Beatty Township.
"One of our staff (members) in Virginia and I spent a day in Beatty Township," Hintz said, "and
found over a million dollars in new construction that had been built under building permits, so it was
right out there in the public arena but had not been added to the assessment."
County or municipal officials would add properties after reviewing building permits or doing
something as simple as driving past the parcels.
In other instances, the report accused Vidmar of not reassessing properties that were assessed at too
high a value or classified as a non - homestead when the home could be taxed at the lower homestead
rate. The report also claimed that Vidmar didn't verify hundreds of property sales - a crucial measure
in keeping assessments accurate.
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Durward sent her report to the Minnesota Department of Revenue, which ultimately oversees
disciplinary actions against assessors, saying that in addition to missing properties, "he just doesn't
know how to do the work."
"He has no experience in assessment of commercial and resort properties," she wrote. "Regardless of
the reasons, the assessment service is not getting done at an acceptable level, and in many cases, not
getting done at all."
She asked the state to "initiate action" against Vidmar for failing to comply with his duties and state
law.
That didn't happen.
John Hagen, director of the Department of Revenue's Property Tax division, which received
Durward's 2004 report, was asked why no action was taken against Vidmar.
"I can't recall," Hagen said. "I honestly cannot recall exactly how that was resolved."
Some staff members from the Department of Revenue did come to St. Louis County and met with
county assessors and some township board members, Hintz said, but they never met with Vidmar.
"What they said when they left was they wanted to meet with Rick, and they wanted to schedule some
audit meetings with them, and they wanted to sit in on those audits," Hintz said. "I did get those
scheduled, but then Revenue said they couldn't make it, so they never followed through on it. So it
basically ended there."
Monacelli, who has been county recorder since the late 1980s, said that when he took over as head of
the assessment department in August 2010, he asked the state why no action was taken against
Vidmar.
"They said it was a violation of county policy, not state statute," said Monacelli. "I don't see how not
doing the work or not getting the work done is a violation of county policy."
'A TERRIBLE SITUATION'
Cities and townships continued to hire Vidmar, and he continued to undervalue or miss
improvements, according to county audits and other records.
"The problem never went away," Hintz said. "Along the line, Rick had a couple of health issues...but
the point is that doesn't excuse the assessor from doing the work. That's one of the dangers when all
these jurisdictions hire a local assessor. You put all your eggs into one basket, and if that person has
some health issues, you still have an obligation to make sure the assessment is completed. Whereas,
with the county staff, if someone goes down, the work is still going to get done."
In e -mails he sent to Hintz and other county assessors, Vidmar blamed his health for not meeting for
audits.
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"I have not refused to come in for the audit," Vidmar wrote in one e-mail to Hintz in February 2008.
"After the hell I was put through by you and your self - serving schedule last fall, my blood pressure
goes through the roof when I hear your name or see it written."
Hintz said the St. Louis County Board was told of the problems but nothing changed.
"It was really frustrating," Hintz said. "The county is responsible for this, but you'd ask for help, and
you didn't get it."
Forsman, the St. Louis County Board member who represents a large portion of the area with the
unassessed properties, said he first remembers being told about the problems sometime in 2005.
"I was of the belief that the assessor's office was taking action to correct these things, and taking
action to correct these deficiencies as soon as they were made aware of them," Forsman said.
To make sure properties were eventually put on the tax rolls, the county would send its own staff to
assess parcels. They continued to alert Vidmar to missed properties during audits, but by about 2007,
records show that Vidmar refused to respond to county assessors' e-mails asking why work wasn't
getting done, and he wasn't meeting county assessors for audits.
"And that year there had been very little work done at all," Hintz said. "He is required to meet with us,
but he said, 'I'm just not going to do it.' "
In 2008, letters were sent to all Vidmar's cities and townships, alerting them of the situation and
• saying the county would do the work and bill the municipalities.
"Our only recourse was to let town boards know these infractions were taking place," Monacelli said.
When called to town board meetings, Vidmar would get into debates with County Assessor Dave
Sippila, Monacelli said. Some townships would continue to hire Vidmar, who was still assessing by
mid -2011, records show.
"The finger was pointing in many different directions," said Monacelli. "Our assessor's office was
trying to take action, but nothing was being resolved."
When he took over in August 2010, Monacelli said he met with Vidmar to try to resolve the
problems, even going to his home and fixing his computer.
"But we still did have some issues, and at that point things were winding down," Monacelli said. "If
there was work to be done in a township, we'd just go in and do it."
By the end of 2011, St. Louis County had assessed 17 of Vidmar's cities or townships, charging them
for the work.
Many of the townships appeared to have taken the money they paid the county out of the money they
owed Vidmar. That's the action Cherry Township took against Vidmar, said town Clerk Stephani
Hartzell.
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"We had problems with him from the get -go," she said. "A lot of stuff that he said was getting done
wasn't. We had a lot of complaints from residents."
However, she said the township still paid Vidmar for some of the work he did, rather than fight to get
all of their money back.
"The Board of Supervisors felt we'd just be spending more money on lawyers and court fees,"
Hartzell said.
Only once, in 2008, did a township ask for its money back from Vidmar, when Clinton Township
sued Rick Vidmar for about $5,000 claiming he "did not do the work as contracted."
"He did not do the work, based on our records, and did not provide the township any evidence that he
had done it," Hintz said.
A judge found for the township.
Several owners of property that didn't make it onto the tax rolls said they've never been told what
happened, and that they thought they were paying the appropriate amount.
"It seems like I visited with an assessor every year," said Karen Whisler, who, with her husband, built
a $250,000 home in Beatty Township near Cook in 2006 that wasn't added to the tax rolls until 2009.
The Whislers paid taxes on the property but weren't assessed for the house until 2011, records show.
Monacelli said it's unlikely that property owners who didn't pay enough in taxes would be ordered
now to pay their share, nor would there be a rebate for taxpayers who paid too much.
"There's no way we'd be able to calculate the value," said Monacelli. "It'd be a terrible situation."
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