(We
apologize in advance for this being a long Boaters
Blast, we know you are all very busy and we do try to
keep our messages short. Unfortunately
Possessory Interest Tax is a complex
issue)
Background:
Just
to recap, the County has covered Boater's past
Possessory Interest Tax (PI tax) "Escape" tax year
bills.
You should NOT have received tax bill(s) for
these years (you should have received notices of
enrollment from the County of Orange Assessors office,
however these are not bills).
You
should have recently received a PI tax bill from Chriss
W. Street, Orange County Treasurer - Tax Collector, for
2007 (tax year is from 7/1/2007 to 6/30/08). This bill is not
for an "Escape" tax year and the County fully expects
you to pay this bill and stated so in the letter that
you should have received from George Caravalho, former
Harbor Department Director.
Data Collection:
Of
the bills that we have seen so far, we can see that the
bills vary considerably, even for boaters in the same
size slip.
The Assessors office thought that the bills would
be in the $70-$250 range; however we've seen many bills
well above these numbers. We've developed a
tool to allow you to enter your PI tax information. The information
is collected confidentially and, in accordance with our
standard Privacy Policy, it will not be shared.
To
help us help you, please take the time (5 minutes or
less) to enter your tax bill details here: Possessory Tax Data
Collection. In future
communications we will share with you the summarized
results from this data collection so you'll know better
where you stand.
Appeals:
For a
number of reasons, we are recommending that this
assessment should be appealed. The purpose of
this Boaters Blast is to give you the tools and
information that you need to mount the most effective
appeal possible.
To that end, we have secured the services of
DePasquale, Kelly and Company to represent Boaters in
this matter.
The Association cannot legally bind members, or
nonmembers. Instead, each individual who wishes to
appeal their PI tax must independently retain
DePasquale, Kelly and Company, a California Corporation
Property Tax Consultants. Read more about DePasquale,
Kelley & Company here.
The
dollar value of this particular tax falls well below the
amount that would normally be allowed for professional
representation.
So the deal that your Association has negotiated
with DePasquale, Kelly & Company assumes that the
Association will be successful in reaching out to
thousands of boaters. Since the County
has continued to refuse to include our information in
their mailings, or to otherwise provide the information,
we need to reach out to all boaters affected by this
latest action through our own resources. Therefore, we
must continue to rely on you and your word-of-mouth to
get the word out to our fellow boaters. Please let them
know that the Association (www.DanaPointBoaters.org) exists and that resources are available
to deal with the Possessory Interest Tax.
The
fee charged by DePasquale, Kelly & Company for
representation on this matter is a sliding-scale
contingency rate structure, based on the number of
Boaters they represent. At this time, a
finalized rate is unavailable as we continue to compile
applicants in an effort to ascertain the contingency
participation level. That said, the
starting rate is not to exceed 100% of tax savings
and/or refunds for 2007, and will decline based upon the
actual participation level. Please also be assured that
the actual fee will have a price break for members of
the Dana Point Boaters Association and could be as low
as 40% if enough boaters are brought into the combined
action.
It is understood that there is no cost to the
individual boater/slip renter unless DePasquale, Kelley
& Company is successful at recovering property tax
savings and/or refund.
How do you retain DePasquale, Kelley and
Company?
First, please sign the fee letter Fee
Letter.
Second, please sign the appropriate
appointment of agency. If you already
filed your own appeal and want DePasquale, Kelley and
Company to represent you please fill out and sign this form: COB
306, Substitution of
Agent. If you did not
file your own appeal, you must sign COB 305,
Filed with Initial
Application.
Third, the above two forms along with the
front page of your PI tax bill must be returned together
in order for Depasquale, Kelley and Company to proceed
on your behalf.
You may fax or email the information initially,
but the originals must be mailed to us for future
reference.
DePasquale, Kelley and Company
CORPORATE
HEADQUARTERS
151
KALMUS DRIVE, SUITE A-102
COSTA
MESA, CALIFORNIA
92626
TELEPHONE
(714) 662-3656
TELECOPIER
(714) 755-1570
At
this point you probably have a few
questions:
Why is this good
deal?
If the appeals are
successful, this could be the last year that you will
receive a Possessory Tax bill from the County for your
slip. While
officially the appeal process is a request to "adjust"
the assessed value, in this case we will be arguing that
our Possessory Interest in this property is zero. Paying up to one
year of Possessory Interest Tax to DePasquale, Kelly and
Company to make all the future years go away is a good
deal. Also
please be aware that DePasquale, Kelly and Company was
one of the key experts we worked with (at no cost to the
Association) to make the "Escape" tax years go
away. At
total savings for boaters of $850,000!
Can I file the
appeal on my own? Yes. The forms and
the instructions can be found on the Counties web site
(www.ocgov.com/assessor).
However, we believe the value of having
professionals like DePasquale, Kelly and Company handle
the process, argue the finer points of the laws,
guidelines, precedence and valuation is compelling. Normally, home
owners and boaters would have no other financially
viable option but to handle the appeal on their
own. Having
professionals handle the process on your behalf assures
the best outcome, saves your time (perhaps a lot of
time), and is relatively inexpensive.
Why should I pay
the tax at all? Not paying the
tax is certainly an option, but not one that we would
recommend.
In addition to the obvious high penalties for
paying late, we have been advised that the failure to
pay the tax precludes you from being allowed to use the
Appeal Process.
Also, appeals to the Superior Court require that
you've first exhausted the Counties' Appeal
process.
Hence our recommendation is that you file the
appeal and pay the tax. The appeal
process is then used to request a refund of the amounts
paid.
Are there other
actions we should be pursuing? Maybe. Because there is
a September 15, 2007 deadline for us to file our
Possessory Interest Tax Appeals we have made these
appeals the top priority. We will apprise
you of other potential actions that should/could be
taken.
My
tax bill is different from some of my fellow boaters
even though we have the same size slip, how can this
be? The
Assessors office takes two major factors into account to
determine your assessed value.
The first factor is the amount that you
are paying, annually, for your slip. If you (or your
neighbors) are one of the 400 boaters that have been
"right sized" into your slip by the Marina Companies and
the County, then you will be paying more for your slip
than your neighbors.
The second factor, since the County will
not give us Boaters leases with any meaningful duration
(we are month-to-month), the Assessor's office is
allowed by law to form their own opinion on how long you
will keep your boat in the harbor and/or how long the
County will allow you to use their slip. This assumed
length of time has a significant impact on the Assessed
Value.
To help us and our experts prosecute the
appeals, we have created a tool that will allow you to
confidentially enter in your specific Possessory
Interest Tax details. Please take the
time to enter your details here: Possessory Tax Data
Collection.
Recommended Boater Actions at a
Glance:
1)
Pay the PI tax bill
2)
Sign up with DePasquale, Kelly and
Company
3)
File an appeal
4)
Enter your data in the Associations data
collection tool.
Summary
In
closing, while we have acknowledged that the financial
burden of this particular tax may not be overwhelming,
it is unfair and it upsets most of us that this is the
way our County, our land lord, wants to treat us. While we have
had to pay the maximum slip fee increases allowed by the
County Board of Supervisors, the additional expense of
this tax, when it used to be included with our slip
fees, represents a back door method to further increase
the slip fees.
Clearly, if this technique goes
unchallenged, we should not be surprised if we see the
same technique used to pass on other costs that are
currently covered by our slip fees.
*****Any tax advice
included in this written or electronic communication was
not intended or written to be used, is not intended to
constitute tax advice, and you should consult your own
tax advisor for such advice. This is intended to
provided information only, and it cannot be used by the
taxpayer, for the purpose of avoiding any penalties that
may be imposed on the taxpayer by any governmental
taxing authority or agency*****
