Legal action looms over tax rate OK’d by MFPD directors


The Missouri Attorney General’s Office has notified the Mehlville Fire Protection District it intends to take legal action to prohibit the district from collecting the fiscal 2010 tax rate approved by the Board of Directors.

The Board of Directors voted Aug. 27 to set the fire district’s tax rate at 59.3 cents per $100 of assessed valuation, an amount it contends is the legal maximum it can levy as a result of the passage earlier this year of two propositions reducing Mehlville’s tax-rate ceiling by 40 cents.

The fiscal 2010 tax rate is 3 cents more than the previous year’s tax rate of 56.3 cents, and board members voted to roll up the tax rate to collect the same amount of revenue as the previous year under the provisions of the Hancock Amendment.

However, Missouri Auditor Susan Montee’s Office contends that because the Board of Directors voted in August 2008 to levy a tax rate less than the district’s tax-rate ceiling of $1.052, Mehlville’s ceiling was reduced to 56.3 cents under the provisions of Senate Bill 711. As a result, the tax-rate-ceiling reduction of 40 cents approved by voters sets the district’s new tax-rate ceiling at 16.3 cents.

“They are above the taxing rate that’s allowed,” Allison Bruns, public affairs coordinator for the Missouri Auditor’s Office, told the Call.

Citing SB 711, she said, “It changed what your ceiling could be and because they took a voluntary reduction and then the voters passed an additional reduction, what that would create is the (tax) rate last year is now the ceiling under Senate Bill 711.”

Because the board voted to levy 59.3 cents for fiscal 2010, Montee’s office deemed the fire district’s tax rate to be non-compliant with state law and has referred the issue to Attorney General Chris Koster’s Office, Bruns said.

In an Oct. 27 letter to Administrative Chief Fire Officer Tim White, Ronald Holliger, general counsel for the Attorney General’s Office, wrote, “… It appears that the levy you seek to impose is in violation of the certified rate provided by law. You have previously been given an opportunity to correct or explain this discrepancy by the auditor.

“It is our intention to file a petition for an injunction barring your attempt to levy a higher-than-authorized rate within 15 days of this letter. If you voluntarily come into compliance, we will not seek the assessment of costs against the district.”

But Mathew Hoffman, legal counsel for the fire district, told the Call the county collector of revenue will levy the tax rate approved by the Board of Directors. Furthermore, Hoffman contended the ballot language for the two tax-rate-ceiling-reduction measures — Proposition 1 and Proposition 2 — specifically stated they are not subject to any tax-rate-reduction rollback.

Proposition 1 asked whether the district’s general-fund tax-rate ceiling should be permanently reduced by 36 cents per $100 of assessed valuation while Proposition 2 asked whether the district’s pension-fund tax-rate ceiling would be permanently reduced by 4 cents per $100. Both measures were overwhelmingly approved by voters in April.

In an Oct. 21 letter to Montee’s office, Hoffman wrote, “… It is the position of the district that the tax-rate ceiling available is higher than the tax-rate ceiling determined by your office. Further, both Proposition 1 and Proposition 2, which were approved by the voters of the district, state the following: ‘This proposition is based upon the 2008 assessed valuation of the district. The foregoing shall not be subject to any tax-rate-reduction rollback’ …

“As such, the Mehlville Fire Protection District does not accept the tax-rate ceiling certified by the office of the Missouri state auditor …,” Hoffman wrote.

His letter also included a copy of the district’s tax-rate resolution and the ballot language for Proposition 1 and Proposition 2.

In an Oct. 26 letter to Koster’s office, Montee wrote, “… If a taxing authority rejects a rate change certified by the SAO (State Auditor’s Office) and the SAO does not receive supporting information which justifies the taxing authority’s original or any subsequent tax rate, the SAO shall refer the perceived violation to the attorney general …”

Besides citing the ballot language for Proposition 1 and Proposition 2, Hoffman noted the Mehlville Fire Protection District is the first taxing entity in the state in which voters have approved a tax-rate-ceiling reduction. Therefore, it’s his understanding the auditor’s office has never dealt with such a situation, he said.

“The language included in both Proposition 1 and Proposition 2 states that they are not subject to any tax-rate-reduction rollback,” Hoffman told the Call.” The auditor’s office did not address the roll-back language. It is my understanding that they have never dealt with a tax-rate-ceiling decrease prior to the legislation passed by Mehlville Fire Protection District voters in April 2009.

“At this point, we are in the process of discussing this issue in further detail with the office of the attorney general.”

Board of Directors Chairman Aaron Hilmer told the Call he believes the ballot language of the two propositions is clear.

“… What the auditor’s office is saying is you have to take the 40 cents from Prop 1 and 2 out of the 56 cents …,” he said. “Why would we put something on there that would take away from what we already took away? None of this makes any sense and what’s really frustrating is that’s why we drafted that last sentence the way we did. Because we realized the situation and that’s why we put it in there. Everything that residents received, giving them information on this, made it clear that this was coming off the ceiling and not last year’s tax rate.”

Proposition 1 and Proposition 2 were put before district voters after withstanding a legal challenge from Concord resident Dennis Skelton, who filed a lawsuit seeking to remove the measures from the April 7 ballot. But St. Louis County Circuit Court Judge Sandra Hemphill ruled the fire district had the legal authority to place the measures on the ballot, citing provisions enacted as part of SB 711.

The judge also denied a motion for a new trial by Skelton’s attorney, John Goffstein, who had contended, “The ballot measure is unconstitutionally vague because it states it is not a rollback measure, when in fact, that is the effect of the proposition.”

But Hemphill disagreed, writing, “The critical test for the sufficiency of a ballot measure is ‘whether the language fairly and impartially summarizes the purposes of the measure so the voters will not be deceived or misled’ … None of the provisions of 321.244.1, RSMo. mandate specific language for the type of ballot measures at issue here. The court has reviewed the language of the propositions and finds them to be in substantial compliance with the ballot form set out in section 321.244.1, RSMo.”

Hilmer said he looked forward to meeting with representatives of the Attorney General’s Office and was optimistic the situation would be resolved in the district’s favor.

“I expect that to be the end of the story,” he said. “Certainly the ballot language is very clear. Our intent was clear. What voters voted on was clear and here’s what I think is really interesting: The ballot language was verified by a judge as to how clear it was. I am shocked that it got this far, but the auditor’s office was not … not that they weren’t even helpful, but they wouldn’t listen to us.”