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Walworth County taxpayers to absorb charge backs

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Catherine W. Idzerda
December 26, 2013

DELAVAN—Taxpayers across the Delavan-Darien School District will absorb an additional $250,000 hit next year.

The first thing those taxpayers will want to know is that the amount won't be due to new spending. Rather it's part of a “charge back” from the town of Delavan.

The second thing they might want to know is that if that amount had added to this year's taxes, it would have meant an additional $15.29 for each $100,000 of equalized value.

However, as other taxing jurisdictions such as Gateway Technical College and Walworth County get their charge-back notices from the Wisconsin Department of Revenue, they, too, will add to the tax bills. 

The story begins with a lawsuit filed by a group of homeowners in the town of Delavan in April 2012.

According on online court documents, 65 people representing an estimated 46 addresses on or around Delavan Lake filed suit, asserting the town assessed too much for their homes and that they were paying too much property tax. The suit included property taxes paid in 2011 for 2010 and taxes paid in 2012 for 2011.

Of those 65 people, only 13 list Delavan as their primary address. The remainder are from out of state, with the majority coming from the Chicago area, according to online court documents.

Usually, homeowners challenge assessments through the open book process. In this process, a municipality holds a meeting where homeowners meet with officials and/or assessors and challenge the stated value of their homes. However, homeowners also can do this through the court system.

If an assessment changes and the taxes are already paid, the homeowner gets a refund. 

In this case, the town of Delavan collected property taxes from all its residents. Then it distributed a portion of that money to all the taxing jurisdictions including the school district, Walworth County and Gateway Technical College.

But because the court said the town had collected too much in taxes, the school district, the county and the technical college now must pay that money back.

Walworth County Treasurer Valerie Etzel said her office was still calculating what it would owe the town of Delavan.

At a meeting last week, Delavan-Darien Business Manager Carey Bradley told the board the district frequently sees charge-backs, but the amount is typically less than $10,000. For example, this year the town of Richmond and the village of Darien had charge-backs in the amounts of $1,059 and $2,032, respectively.

Charge-back amounts are not included in the revenue cap, the state formula that determines how much a school district or municipality can spend in tax dollars, she said.



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