GOVERNMENT: DUTCHTOWN TAX ILLEGAL, MISSOURI AUDITOR SAYS

DUTCHTOWN, Mo. -- The village of Dutchtown is in the crosshairs of state tax regulators after billing residents for 1999 on a county assessment tax that will appear on a ballot for the first time Tuesday.

The Dutchtown real estate and personal property tax -- 32 cents per $100 assessed valuation -- was submitted for inclusion on the 1999 tax bills by a petition signed by about 60 Dutchtown residents, according to H.W. "Bud" Obermann, a member of the Dutchtown board of trustees.

That's not legal, said the state auditor.

"It has to be a vote. A petition would not be sufficient," said state Auditor Claire McCaskill.

"We determined Dutchtown was violating the constitution by charging taxes that had not been voter approved," said McCaskill, who reported the violation to the Missouri attorney general. "I've got to do anything I can to enforce the Hancock Amendment, which says ... you cannot raise taxes on the people of Missouri without a vote by the people."

Cape Girardeau County Tax Collector Diane Diebold said she collected a total of $1,300 from Dutchtown residents through the assessment tax via their 1999 tax bills. Diebold said this tax revenue has been paid to the Dutchtown Board of Trustees.

"It's all been distributed to Dutchtown," said Diebold. "But if voters reject the tax issue they may get ordered to refund it. That order might come through the court system."

I'm not a lawyer'

Cape Girardeau County Clerk Rodney Miller said he advised Obermann and fellow trustees the petition was not legal authorization to place the tax on the 1999 bills.

"They were told at that time that was not legal," said Miller, "but if they submitted it, we would put it on the bills, because it was not our position to make a judgment right or wrong."

Obermann said the trustees pressed on despite the warning.

"There was a possibility it was ... iffy," said Obermann. "But it was just a technicality. There's been enough said about it.

"I'm not a lawyer."

McCaskill said her office discovered the Dutchtown violation when staff members reviewed the standing tax rates of the village, submitted along with the rates of every other county taxing authority in an annual report from the Cape Girardeau County clerk.

McCaskill said her office asked Dutchtown to provide information on the election that legitimized this tax.

"Of course, that wasn't forthcoming from Dutchtown because they hadn't had an election," McCaskill said.

Solving tax problems

The state auditor said her office is now required to refer tax authorities levying improper taxes to the Missouri attorney general by a law that went into effect in August.

It was a revision the state auditor's office campaigned hard for, said McCaskill, because previously the state had been rife with taxes not approved by voters. Two years ago, when she assumed her post, her office was routinely overlooking 60-some such violators across Missouri.

"I said, That's the goofiest thing I've ever heard of'," McCaskill said.

Revenue from the assessment tax, as well as revenue from a one-cent sales tax approved by Dutchtown voters in August, is intended to fund the village's share of the construction costs of a U.S. Army Corps of Engineers levee for the Diversion Channel south of town, said Obermann.