Board’s Clerk Blamed in Tax Loss : Finance: Grand jury tells supervisors they were warned about property-appeals backlog a year earlier.

The Orange County Grand Jury on Monday blamed the clerk of the Board of Supervisors for missing a 1994 deadline to hear property-tax appeals that may have cost the county $1.6 million. The jury also said supervisors shouldn’t have been surprised because they had been warned of the problem a year earlier.

The grand jury seemed to support Assessor Bradley L. Jacobs, who has been strongly criticized by the board for not challenging more cases, choosing instead to devote limited resources to other priorities, such as preparing next year’s tax roll.

Jacobs, an elected official, has said it is more important for his office to produce the annual property-tax roll than to defend every appeals case.

Supervisor William G. Steiner, a stern critic of Jacobs, said Monday “the clerk’s office will process the appeals directly.”

Previously, the assessor’s office processed the appeal before passing it to the clerk to schedule a hearing. The clerk will now handle both functions, Steiner said. But the assessor will continue to handle challenges by property owners to their tax assessments.

The latest inquiry began last October after it was revealed the assessor’s office had missed the two-year deadline to challenge numerous property-tax appeals, causing the county to lose the appeal.

Though officials have previously estimated that missing those deadlines cost the county $1.6 million in lost revenue, neither Jacobs nor the grand jury could verify the dollar loss.

But beyond the lost taxes, the grand jury said the slow appeals process has diminished the county’s credibility.

“Delayed processing can be aggravating to the taxpayer in terms of filings, hearing appearances and legal costs,” the grand jury reported. “These negative conditions reflect adversely on the credibility of the county’s management of the assessment-appeals process.”

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Jacobs said Monday he had not read the grand jury’s report. But, like Steiner, he said many of the problems that caused the missed deadline have been addressed.

The grand jury suggested several ways to improve the process, including spending more money on appeals hearings, and cautioned that without additional personnel, more cases would be lost.

“Without increased allocation of resources over the next 20 months,” the panel reported, “it is likely that large numbers of appeals will not be completed within the two-year time limitation.”

The tax-appeals problem was brought on by the adverse real-estate conditions in Orange County, which prompted more property owners than ever to challenge their assessments.

In 1992 fiscal year, for example, there were 13,300 appeals. By fiscal 1994, that number had jumped to more than 41,000.

Appeals during fiscal 1995 dropped to just more than 36,000, but the grand jury reported 67,900 appeals are still pending.

Supervisors were told in September, 1993, about the large backlog of assessment appeals, the grand jury said.

The next month, the supervisors approved $370,000 to improve a computer system used to track appeals, establish a third hearings board and to appoint three more hearing officers.

By April, 1994, the assessor had cut into the backlog. But that fall, it was revealed that more than 150 appeals still had not been scheduled for an appeal within the two-year statute of limitations.

Jacobs blamed the former clerk of the Board of Supervisors, Phyllis A. Henderson, for missing the deadline, which allows the property owner’s valuation to be automatically accepted.

The grand jury agreed.

“The clerk of the board’s clerical resources assigned to assessment appeals are inadequate to meet workload demands,” according to the grand jury. “The recent cases exceeding the two-year limit were a direct result of inadequate file management and lack of supervision.”

Steiner noted that last month, supervisors transferred six positions from the assessor’s office to the clerk to handle appeals.