Town Selectmen See Legal Bills
Assessors in West Tisbury Unveil Bills from Graham Tax Case with $275,000 Price Tag; November Meeting Set
By IAN FEIN
West Tisbury selectmen this week saw their first glimpse of the legal bills related to the tax case against town assessors. The total estimated price tag tops $275,000.
Selectmen requested the breakdown of the bills as they prepare for a Nov. 16 special town meeting, where voters will be asked to refill the town\'s depleted legal budget. Assessors provided the breakdown to selectmen on Tuesday night, and the board discussed the numbers at its regular meeting on Wednesday.
Selectmen singled out for comment the bills from the private appraiser hired by assessors as an expert witness in the tax hearing. The bills submitted by appraiser Kenneth J. Croft 3rd off Coleman & Sons Appraisal Group of Waltham totaled more than $70,000.
\"That seems pretty excessive to me,\" said selectman Glenn Hearn.
\"I would like to find out what our contractual requirement is with Coleman [& Sons], if there is a contract,\" said selectman John Early. \"I would also like to see the duration of his testimony to figure out how much a word he got.\"
According to a contract and itemized bills provided to the Gazette by principal assessor Jo-Ann Resendes yesterday, Mr. Croft charged the town $12,000 for his appraisal report and $250 per hour of testimony and trial preparation. Mr. Croft\'s testimony during the hearing dragged on for more than two weeks, in part because the Massachusetts Appellate Tax Board chairman who is presiding over the case asked for numerous revisions and additions to his report.
Assessors hired Mr. Croft to appraise the seven properties owned by West Tisbury resident William W. Graham, who is challenging his assessments from fiscal years 2003 and 2004 when he paid the town more than a half million dollars in property taxes. Assessors valued Mr. Graham\'s 235 acres at Mohu off Lambert\'s Cove Road at roughly $50 million during the years in question. Mr. Croft appraised the same properties at $64.5 million.
There are questions about why the assessors did not present some invoices - which date back as early as May - to the selectmen and town accountant until this week. It is also unclear why the assessors\' attorney Ellen Hutchinson waited until two weeks ago to bill the town for her extensive work on the case since May - which also resulted in a bill of more than $70,000.
Ms. Resendes said yesterday that the bills were not submitted to the town accountant or selectmen because the assessors knew the town did not have the money to pay them. Discussion of the bills, and the decision not to release them until this week, does not appear in the assessors\' minutes.
Legal bills related to the case have long been a concern for the town.
In fact, news of the Graham appeal first surfaced at a selectmen\'s meeting last winter, when executive secretary Jennifer Rand told the board that a complicated legal case had emptied the town\'s legal budget less than halfway through the fiscal year.
The enormously complex case, which alleges that the system town assessors use to determine land values and property taxes is fundamentally flawed, has since become longest property tax appeal in the history of the commonwealth.
Beyond the legal bills, the case poses an enormous financial impact to the town of West Tisbury - where the town budget has increased at a rate of more than 10 per cent each year, and landowners already pay one of the highest average property tax bills on the Cape and Islands.
Mr. Graham approached town selectmen at their regular meeting two weeks ago, asking them to intervene and help negotiate a settlement with assessors before either side incurred more legal bills. Mr. Graham yesterday refused to say how much money he has spent on the case.
Assessors estimate that another $50,000 will be needed to cover the town\'s unbilled legal expenses. Ms. Rand reminded selectmen that the estimate - and corresponding $275,000 price tag - could rise.
At the Wednesday meeting Mr. Graham appeared again for an executive session with the selectmen. Mr. Graham and selectmen yesterday declined to discuss the closed-door meeting, though it is understood that another executive session has been scheduled.
Meanwhile, the appellate tax board chairman traveled to the Island with attorneys and both parties this week to view the properties in question. Assessors are expected to conduct a second view with the tax board chairman in the weeks ahead.
Once final transcripts from the views are completed, the clock starts ticking for attorneys to file closing briefs. A decision by the tax board is not expected until at least next spring.
Also included in the breakdown this week were previously unreleased bills from the assessors\' consultant company Vision Appraisal Technology Inc. of Northboro, which assists the town in revaluations. The Vision Appraisal system came under scrutiny during the hearing.
Vision submitted six bills between May and August, totaling $29,400 - a sum that represents the company\'s $700-a-day contractual rate with the town for providing expert witnesses at tax board hearings. According the breakdown compiled by assessors, Vision also offered the town a $10,500 discount.
The $275,000 estimated price tag also includes $17,500 for the court reporter, though it does not include the $12,000 in travel expenses incurred by Ms. Resendes and board of assessors chairman Michael Colaneri during the hearing.
Ms. Rand told the selectmen this week that the town has already paid for all of the travel expenses and $62,000 of the legal bills. She said the town will need roughly $214,000 to cover the remaining legal expenses related to the case, and the assessors will need more money for their expense account, which has been depleted.
Ms. Rand recommended the selectmen author a warrant article for the Nov. 16 special town meeting asking for $240,000 to be transferred into this year\'s town legal budget, originally set at $38,000.
\"I think I feel comfortable with $240,000 carrying us through to the end of [fiscal year] 2006,\" Ms. Rand said. \"That being said, I will never guarantee it.\"
Mr. Hearn asked Ms. Rand whether the $240,000 figure included the cost of an upcoming property tax appeal filed against the assessors by West Tisbury residents Dr. Timothy and Ellen Guiney, who own a waterfront property next to Mr. Graham.
Ms. Rand said it did not.
\"I\'d recommend you get an estimate from the assessors and their attorney,\" Mr. Hearn said.
Selectmen acknowledged on Wednesday that funding sources for the unpaid bills remain unclear. Board chairman and finance committee member Jeffrey (Skipper) Manter said the committee and the town financial management team will meet in the weeks ahead to recommend an option. He said they will likely ask for a combination of different sources. Ms. Rand said a Proposition 2 1/2 override does not appear feasible.
She said the warrant will include a second article to cover unpaid legal bills for work incurred during fiscal year 2005, prior to July 1. The second warrant article will require nine-tenths approval on town meeting floor.
Ms. Rand did not have an estimate for the second article, but according to the itemized legal bills provided to the Gazette, the sum requiring nine-tenths approval appears to be roughly $75,000. Ms. Rand said the second warrant article would be in addition to the request for $240,000.
It is not known what will happen if town voters deny either of the legal bills.
In the wake of the mounting legal bills this summer, selectmen asked for advice from town counsel Ronald H. Rappaport, who recommended that the town adopt a policy where different town boards and departments must ask selectmen for permission to engage an attorney.
Selectmen this week scheduled a meting for Monday, Oct. 31, to meet with all the town departments to discuss a draft of the new legal policy.