Goliad County to reduce budget to offset possible tax revenue loss

Aug. 24, 2012 at 3:24 a.m.

Goliad County is planning more than $550,000 in budget cuts after a local company filed a lawsuit against the County Appraisal District.

Coleto Creek Power, which generates about 40 percent of the tax revenue for the county and the school district, filed the suit in District Court Aug. 16 to lower their value by about $100 million.

"That is what I'm dealing with in the budget right now, the worst case scenario," said County Judge David Bowman. "I'm trying to reduce our costs and looking at a possible small tax increase, and then using cash reserves."

A spokeswoman for the company said they hope to resolve the dispute in negotiations before going to trial.

Pat Brennan, the county's chief appraiser, said if negotiations fail, a legal battle could take months or even years.

Bowman said his office is budgeting for the worst case scenario - more than $650,000 in lost revenue for the county.

"I have a whole lottery list of proposed cuts," Bowman said. "Pretty much all of the departments in the county are going to have some reductions in varying amounts."

Some proposed cuts include eliminating longevity pay for elected officials, cutting precinct budgets and personnel costs. The sheriff's office could lose $70,000, the roads and bridges fund $157,375 and the clerk's office $43,500.

Bowman also is looking at raising the proposed tax rate by two cents. The previously published rate, 64.84 cents per $100 of assessed valuation, compared to 65.65 cents in 2011.

The county must set the tax rate by Oct. 1.

In addition, the school district could lose up to $1.2 million and must set its tax rate by Sept. 10.

Superintendent Christy Paulsgrove said she hopes they can resolve the issue before it goes to trial.

"We are just hoping that we can negotiate and work out something that ... they would feel is beneficial and one that we can live with," Paulsgrove said.

She said the school is not cutting programs or personnel yet.

In the annual Appraisal District appraisal notices, the plant was originally valued at $355.3 million, Brennan said. The appraisal work was conducted by Pritchard & Abbott Inc., a Fort Worth valuation and consultant company.

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.

The review board appraised value of the power plant meant a loss of about $175,000 for Goliad County and $484,000 for the Goliad school district.

Bowman said he is not sure how much this battle could cost the county in legal fees.

Coleto Creek Power can choose to pay taxes based on its own determined value, while the case is in court.

If Coleto Creek Power pays taxes on the value set by the review board and a judge later rules to lower the taxable value, the county then would have to refund any overpayment plus interest to the power company.



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