By Dave Baumeister, County correspondent
SIOUX FALLS – From the looks of their agenda, it seemed the Minnehaha County Commission meeting on Tuesday, July 9 would be very short, but a confusing property tax issue left commissioners with quite a few questions.
At the meeting, it was recommended that an abatement filed by Brian Etrheim of Garretson for his 2018 property taxes (payable in 2019) in the amount of $995.50 be denied.
Etrheim was seeking to have his property taxes voided for that year, since he said he did not receive notice in a timely fashion, as the law calls for.
The heart of the issue, according to Minnehaha Director of Equalization Chris Lilla, seemed to be when the property was purchased.
On November 1, 2017, the property was a single 2.34-acre lot owned by Marlin Conrad.
As Lilla explained, property is assessed as of Nov. 1 each year, and that assessment is what determines the property taxes for the next year.
Property owners have to be notified of their property tax assessment by March 1 of the applicable tax year; however, the taxes for that year are not billed until February of the following year for payment on the last day of April and October.
So, for a specific timeline in this case, Conrad owned a single lot on Nov. 1, 2017. On Nov. 7, he started the process to split that single lot into three separate parcels and had a spec house built on one of them.
On Dec. 3, 2017, Etrheim purchased the parcel with the spec house, subsequently moved into it, and continued to live there through 2018.
In March 2018, a tax assessment was sent to Conrad for the property as it had been the previous Nov. 1, which was one 2.34-acre piece of land, Lilla said.
At that point, the office of equalization would normally be done with the matter, as the specific tax bills would be figured out by the Minnehaha County Auditor’s office.
Lilla said he sent Etrheim a notice to contact the auditor’s office for a break out of the taxes for his property specifically, even though Etrheim said he didn’t receive anything about it.
But it seems that someone had done something in that regard, as Etrheim said on Feb. 19 of this year, he received a tax bill on his particular property.
He went through the specifics of South Dakota tax law dates that read a person needs to be notified of his property assessment by March 1 of the tax year, and he said he was never notified until he received the tax bill 11 months later.
Even still, Etrheim said he was willing to pay his share of property taxes, but he was asking for the 20-percent owner-occupied reduction.
While commissioners thought the closing agent, if there was one, should have arranged for the property taxes, Etrheim said that did not happen.
He said a title company was involved, but no one asked, and he never said if there was a mortgage (which should have required the correct property taxes being escrowed), or if he paid for the property outright (in which case there would be no escrow account, and he would have been responsible for his own tax bills).
While commissioners had several questions for Etrheim about why he felt like he shouldn’t have to pay property taxes for a year when he lived on the property, they seemed to have no questions when it came to the owner-occupied status.
The way South Dakota law works for the owner-occupied property tax reduction to transfer, either a property must have been receiving the reduction the year before or the new person moving in had been getting the exemption on his previous property.
For almost all of 2017, there was no property in existence to receive a reduction, and Etrheim said he was renting an apartment prior to moving onto the property.
Therefore, when there is no reduction to be transferred, the owner is responsible for the entire tax bill for that first year.
As the law now exists, owner-occupied status cannot be granted until that second year of occupancy, and Lilla said that Etrheim has already completed the necessary paperwork to claim that going forward.
Maggie Gillespie with the state’s attorney, who advises the commission, was asked for her opinion on the matter, and while she said she couldn’t give any legal advice on the floor, she said, “At the end of the day, someone has to pay the taxes.”
She did say that Etrheim could always go back to the title company or the seller, but that for now, the taxes had to be paid.
After hearing everything from Etrheim, Lilla and Gillespie, commissioners voted 5-0 to deny the abatement request.
Noise ordinance needed
During public comment, Jim Reiff, who lives in a housing development in Mapleton Township, asked commissioners to consider a noise ordinance. Currently, any noise ordinances within the county only exist in municipalities, as the county has no noise ordinance of its own.
Reiff spoke of ongoing problems he has with his neighbor, specifically citing fireworks, motorcycles and a miniature howitzer.
Both Commissioners Jeff Barth and Dean Karsky expressed that there may be a need for some type of noise ordinance and encouraged that the commission look into it.
The Minnehaha County Commission has its regular meetings each Tuesday at 9 a.m. on the second floor of the county administration building at 6th and Minnesota in Sioux Falls.
These meetings are open to the public, and public comment is always encouraged.
