Norberto Santana Jr-Writer AP
Posted may 15 2013

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Orange County supervisors voted unanimously Tuesday to file an appeal over a dispute with the State Department of Finance involving more than $73 million in annual property tax revenue.

Supervisors lost their court case against the State last week in Orange County Superior Court with Judge Robert Moss ordering county officials to return the property tax revenue they convinced Auditor Controller David Sundstrom to allocate to the county instead of to local schools and community colleges.

The issue is the result of a massive oversight on the part of county supervisors and county legislative staffers who ignored warnings after they refinanced the 1994 bankruptcy debt in 2005.

At issue was a special legislative authorization granted by Sacramento leaders to Orange County after the bankruptcy that allowed Wall Street investors to be paid directly on bankruptcy bonds. That legislative set-aside was removed when supervisors refinanced the bankruptcy debt and despite warnings was never re-established.

In later years, Sacramento switched counties from receiving vehicle license fees to a larger share of property taxes. For years, Orange County got both property taxes and the VLF.

In 2011, Gov. Jerry Brown’s budget staff discovered the oversight and took back a chunk of property tax revenue.

County supervisors avoided any public discussion of the legislative snafu and instead approached then-Auditor Controller David Sundstrom to change the county’s allocation of property taxes, which he did. Local community colleges protested the move and joined the state in their lawsuit against the county.

Read more: http://www.kitsapsun.com/news/2013/may/15/orange-county-supervisors-vote-to-appeal-loss-on/#ixzz2TToIr4gU
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