ORANGE COUNTY PERSPECTIVE : Tax Foul-Up: Once Is Enough

Orange County must reform the way it handles appeals of property assessments if it is to avoid another costly loss of money and public confidence in government.

The office of County Assessor Bradley L. Jacobs tells property owners how much it thinks their land and buildings are worth and how much tax they owe--usually just over 1% of assessed valuation. When taxpayers disagree, as they have done frequently in recent years as property values plunged during the recession, they can appeal. If the county does not review an appeal within two years, the property owner’s valuation prevails.

Last month county officials said an inordinate number of appeals had slipped past the deadline without action by either the assessor’s office or the Board of Supervisors’ clerk’s office, which schedules appeals hearings. One eye-opener was a Bank of America parcel, which the bank valued at less than $24 million and the county pegged at nearly $120 million, a staggering difference. The appeals deadline passed, and the bank won.

A hearing might have pegged the agreed-upon valuation somewhere between the two figures. Had the county prevailed, it could have gained an extra $1 million for schools, cities and the county itself. Instead, the county now must refund about $1 million per year for two or three years, depending on when it received the appeal and when it next will reassess the property.

The Bank of America disclosure got everyone’s notice, and when the county administrative office looked into the assessments it found that more than 200 additional cases might be lost by default. The supervisors’ clerk, who also is clerk of the appeals boards, said the appeals had “fallen through the cracks.”

An especially unseemly part of the problem has been the finger-pointing and blame-ducking. Jacobs said it was the clerk’s fault; the clerk blamed Jacobs. The county supervisors understandably want to know who is to blame and how to prevent it from happening again. If they can’t get satisfaction from the administrative office’s inquiries, they should ask the Orange County Grand Jury to investigate. If it feels it needs outside help, the grand jury can hire an accountant or systems expert.

Last year the supervisors authorized more help for Jacobs after the backlog of appeals grew too large. That was a blemish on a record that until then had been good. Jacobs is an elected official, over whom the supervisors have little control aside from the budget. He and the appeals board clerk owe an explanation to the supervisors and to Orange County residents of what went wrong and how they plan to make it a one-time aberration. If the supervisors don’t get convincing answers, they should rescind the raises they approved for Jacobs and the clerk before this fiasco came to light.