Goliad, school district could lose tax revenue with company's lower valuation
Goliad County could face a lawsuit and reduced tax money if an agreement is not reached on Coleto Creek Power Co.'s value.
The newest appraised value of the power plant, the largest taxpayer in the county, could mean a loss of about $175,000 for Goliad County and $484,000 for Goliad School District.
In the annual Appraisal District appraisal notices, the plant was originally valued at $355.3 million, said Pat Brennan, Goliad County chief appraiser. The appraisal work is conducted by Pritchard & Abbott Inc., a Fort Worth valuation and consultant company.
But the power plant had its own appraisal conducted. Duff & Phelps, a Chicago-based investment management firm, set the value about $200 million.
After the power company contested the county's valuation, the Appraisal Review Board lowered the value of the plant $26.7 million to $328.6 million on June 20.
Julie Vitek, a company spokeswoman, said they would negotiate with the county to continue to lower the value.
"If we can't reach an agreement, we may have no other choice than to litigate," Vitek said.
Brennan, however, said the county stands by the decision of the review board and the Appraisal District does not have the authority to negotiate after the review board's decision.
The power company has until Aug. 18 to file suit in district court.
If sued, the Appraisal District will need to hire an attorney, funded by the county.
Additionally, if Coleto Creek Power files suit, they will not be required to pay taxes on the property until the matter is resolved, because the value would be under dispute.
The power company makes up about 40 percent of each the county and school district's tax revenue.
Using the $328.6 million valuation and the current tax rates, the school district could earn about $3.7 million from the plant and the county about $2.2 million.
Though the school district is hoping to give staff a 2 percent raise this year, after the previous year's salary freezes, Christy Paulsgrove, superintendent of Goliad school district, said if Coleto Creek contests its value, the school district may be forced to layoff employees or cut programs, instead.
Either way, she hopes they reach a decision sooner, than later.
"We would just like to be able to prepare," Paulsgrove said. "We are waiting to hear something before we make too many final plans, because it will affect both us and the county."
David Bowman, county judge, said a lawsuit would probably cost the county hundreds of thousands of dollars.
"A litigation would be costly and it would certainly have an impact on the community," Brennan said. "Obviously, Goliad County is a small county and we have a very limited tax base. If you have a limited tax base, that equates to limited funding. We are not a wealthy county by any means."
Brennan said he wants to see the county's good relationship with the plant continue.
"They are good neighbors and they contribute significantly to the community in many different ways," he said. "I would be remiss if I did not state the truth, and the truth of the matter is that they have been a very good partner in our community and they contribute significantly to the welfare of this county."