July 7, 1981

Mr. R. William Tschetter 
Deputy State's Attorney 
Pennington County 
Rapid City, South Dakota 57701

Official Opinion No. 81-22

Correction of Tax Lists on Abatement of Taxes

Dear Mr. Tschetter:

You have requested an official opinion from this office in regard to the following factual situation:

FACTS: 

'A' had 6.78 acres taxed for the years 1975, 1976, 1977 and 1978.  For the years 1979 and 1980, the assessed acres dropped to 5.60 acres.  All of the acreages were in error and the correct should have been .21 acres.  As an example of the discrepancy in taxes collected, the tax paid in 1975 was $93.50 for the acreage assessed, when, in fact, it should have been $3.04 for the .21 acres which was the true acreage. 

The Auditor appeared before the Board of County Commissioners and asked to have the assessment corrected in March of 1981.  At that time, the 1979 and 1980 taxes were not paid. 

The County Auditor sought to have the 1975, 1976, 1977 and 1978 taxes refunded except for the portions due on the .21 acres.  The County Auditor further sought to have these taxes abated, because, a refund having been made, the abatement was necessary in order to clear the books. 

The 1979 and 1980 taxes have not been paid, so it was asked that they just be abated.

Based on the above facts you have asked the following questions:

QUESTIONS: 

1.  Is it necessary that the taxes be abated and refund made to clear Auditor's and Treasurer's books for the years 1975, 1976, 1977 and 1978? 

2.  If the abatement is not made for the years 1975, 1976, 1977, 1978, 1979 and 1980 and the amounts deducted from the uncollected balance of the tax list account, how does the Auditor keep the tax list account in balance? 

3.  Would the failure to abate these taxes result in the Treasurer's books showing 1975, 1976, 1977 and 1978 taxes open?

The abatement and refund process is contained in SDCL 10-18.  It involves the executive power of the county commissioners acting in their role of superintending the fiscal affairs of the county.  That chapter provides a means whereby an assessment may be reduced or decreased or a tax may be refunded, if paid, under conditions wherein the commissioners determine the same is invalid for any one of the reasons stated in §  10-18-1.  The term abatement may apply to either the assessment levied against the property or the assessment plus the tax derived from such assessment.  It is only applicable before the tax has been paid; thereafter, action must be taken to refund invalid taxes.  SDCL 10-18-9 describes the procedure to be taken by the county auditor when the application for abatement of the assessment or tax is granted.  It reads in part as follows: 

. . . [T]he county auditor shall correct both the original and duplicate tax lists in accordance with the order and the applicant shall be relieved of  further liability for the tax abated.

SDCL 10-18-10 relates to the procedure to be followed when a refund is granted.  In this instance the application for refund having been filed by the county auditor and approved by the commissioners results in the issuance by the county auditor and the delivery to the applicant of a refund order on the county treasurer in the amount ordered refunded stating what sum shall be refunded. After receiving the same and making the refund the county treasurer shall write opposite such texes in his tax duplicate the word 'refunded' and the date and number of the order.  Since the county auditor issues this order that would serve as the justification to reduce the balance of the auditor's set of books thereby bringing the original and duplicate tax lists into balance once the rreasurer has issued the refund based on that order.

I have reviewed the instructions of the Auditor General in the Uniform Accounting Manual and do not find any particular discrepancy from these procedures except that I might note in Duties of the Auditor Relating to Taxation, Part H, Abatement and Refund of Taxes, it is stated: 

When refunds are granted the county auditor shall issue a refund order to the county treasurer in the amount ordered refunded, and the treasurer shall refund same (SDCL 10-18-10).

This might well have added to it the rest of the statement found in that section which goes on to state: 

And the county treasurer shall write opposite such taxes on his tax duplicate, the word 'refunded' and the date and number of the order.

This then would round out the instructions to both officials and clarify any matters in dispute.

IN RE QUESTION NO. 1:

It is my opinion, therefore, that if the county commissioners have approved the application for a refund and the auditor has issued a refund order, that order entered on both the auditor's and treasurer's tax books as provided in § 10-18-10 is sufficient to correct the joint liability of those officials.

IN RE QUESTION NO. 2:

In answer to Question 2, the years 1975, 1976, 1977 and 1978 are answered by Question 1.  The years 1979 and 1980 may be handled by abatement since the tax has not been paid.  The process for completing this action is in § 10-18-9 where the auditor is directed to correct both the original and duplicate tax lists, thereby keeping the tax list account in balance.

IN RE QUESTION NO. 3:

If the order has been issued by the auditor and entered on the books by the treasurer for the years 1975, 1976, 1977 and 1978 the books should not show those years as being open since in lieu of payment notation they would reflect a refund statement together with the number of the auditor's order directing such refund.

Respectfully submitted,

Mark V. Meierhenry
Attorney General