Independent Sch. Dist. No. 54 v. Independent Sch. Dist. No. 67

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Within the 2006 through 2010 tax years, the Oklahoma Tax Commission and the Oklahoma State Board of Equalization issued certified assessments of certain public property physically located within the boundaries of the Stroud school district. Ad valorem taxes associated with these properties were distributed by the Lincoln County Treasurer to the Cushing and Wellston districts, instead of to Stroud. The error was discovered and subsequently corrected by the Lincoln County Board of Tax Roll Corrections during the 2010-2011 fiscal year. There was no disagreement among the three school districts that they were not responsible for the errors made in the distribution of the ad valorem taxes. To recover the funds that should have been Stroud's, Stroud sued Cushing and Wellston school districts. Stroud filed its petition on April 22, 2013. The defendant school districts filed a motion for summary judgment in December of 2014. In the same month, the plaintiff responded with its own motion for summary judgment. Stroud received the taxes from the property identified as within its district; Cushing received the taxes from the property identified as within its district; and Wellston received the taxes from the property identified as within its district. The Oklahoma Supreme Court found Stroud received the same amount for its general funds that it would have received had the ad valorem taxes been properly allocated. Nevertheless, it demanded additional funds from Cushing and Wellston that it would have received if the real property had been correctly identified. The Court determined if that amount was paid to Stroud, then Cushing and Wellston would have deficits in those districts that they would not have if the real property had been correctly identified. Stroud did not believe the other two school districts are entitled to a setoff if they paid Stroud the misallocated ad valorem taxes. The Court found all three school districts were victims of this error, but no district failed to receive the funds needed for their respective districts. The Court reversed judgments against the Cushing and Wellston districts and that in favor of Stroud: "county and state officials will make mistakes in the taxing of property and the distribution of taxes." View "Independent Sch. Dist. No. 54 v. Independent Sch. Dist. No. 67" on Justia Law