COUNTY OF SAN MATEO

Inter-Departmental Correspondence

County Counsel

 

DATE:

October 14, 2003

BOARD MEETING DATE:

November 4, 2003

 

TO:

Honorable Board of Supervisors

FROM:

Thomas F. Casey III, County Counsel

SUBJECT:

Correction of Property Tax Roll, Account Number 024996-02-N (Visa Resources)

 

Recommendation

Approve a change to the 1992, 1993 and 1996 tax rolls, and corresponding tax refunds to Visa Resources ("Visa"), to reflect corrections resulting from a mandatory audit conducted by the Assessor's staff.

 

Background

During the time period in question, Visa held leaseholds and owned taxable personal property that were located in San Mateo County. As the result of an audit, the Assessor's staff determined that during each of the 1992, 1993 and 1996 tax years, Visa incorrectly reported computers that it used in the County as office furniture. (This error resulting in erroneously high assessments because computer equipment can be depreciated much more rapidly than office furniture.) Further, the audit revealed that, prior to the 1992 lien date, certain leasehold improvements that were included in Visa's assessment had been assigned to a Visa affiliate, Visa International. However, the value of these leasehold improvements was erroneously included in Visa's assessments for the 1992, 1993, and 1996 tax years.

 

Discussion

Pursuant to sections 4831.5 of the California Revenue and Taxation Code, the tax roll may be corrected to adjust for errors caused by "a defect of description or clerical error of the assessee in his property statement or in other information or records furnished to the assessor . . . ." Similarly, section 5096 provides for the refund of property taxes where they have been erroneously collected.

 

As a result of the corrections described above, the tax roll should be decreased by (a) $8,716,657 for the 1992-1993 tax year (with a corresponding refund of $89,139.55); (b) $7,281,750 for the 1993-1994 tax year (with a corresponding refund of $73,938.89); and (c) $5,871,472 for the 1996-1997 tax year (with a corresponding refund of $60,476.16). Because the tax refund for each of these years exceeds $50,000, the approval of this Board is required.

 

Vision Alignment

The implementation of this proposal will further commitments and assist in achieving goals set forth in the County's Shared Vision 2010 report. Specifically, this proposal implements the commitments of "providing "responsive, effective and collaborative government."

 

Fiscal Impact

The fiscal impact of this proposal is estimated to be a $89,139.55 decrease in the 1992-1993 roll, a $73,938.89 decrease in the 1993-1994 roll, and a $60,476.16 decrease in the 1996-1997 roll (with a corresponding property tax refund in these same amounts for each of these tax years). The County's General Fund share of the refund is 14% of the decreases (i.e., approximately $12,479,54; $10,351.44; and $8,466.66 for the 1992, 1993, and 1996 tax years, respectively).