Agenda 09-17-19 Item 6-a - Refund Request from John C. and Judith K. Guibert, Lake Orange Property

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2 • Property ownership in North Carolina is deed document based, and taxing jurisdictions do not have the authority to change the property lines or the size of a property without a legal document being recorded that indicates the change in acreage or property lines. Tax records are based on the recorded document, and cannot be changed without a new recorded document. • Pursuant to NC Statute 105-381, a refund may be made for the prior five years if it is based on a clerical error made by the County, or due to an illegal tax. Because the issue in this situation is created by the surveys and deeds that do not clearly define ownership, it is not a clerical error on the part of the County. In addition, because the ownership is not clearly defined, the County cannot determine if this is an issue of double taxation (which would be an illegal tax). • Overlappage Issue — Both the Guibert prior survey and the surveys of Lake Orange Inc. make claim to the same area of property (the area between the 615' and the 620' contour lines). This is creates an overlappage issue. As in every overlappage situation, the issue must be resolved between the owners involved, in this case the Guiberts and Lake Orange, Inc. The issue may be settled between the parties through a newly recorded survey, deed, or a judgement from a court. Mr. Guibert has recorded a new survey, and the issue has been settled for future tax years. • Other landowners at Lake Orange in this same situation should use the same method to solve their overlappage issue by obtaining a new survey. After a new survey has been recorded for the properties, then adjustments to size and property lines will be made by Orange County Tax staff in accordance with the updated survey, and any resulting reduction in value will be effective for January 1 of the year following the recording of the survey. • In order to be equitable, the County must require that all Lake Orange land owners are treated the same, and follow the statutes regarding land ownership as all other Orange County property owners. Standard procedure by Tax Office staff when contacted for assistance is to advise the taxpayer to seek legal guidance and ultimately to record a new survey. It is expressed that the County must tax property owners according to recorded documents, and is not able to change what a property owner's tax is based on on without a new survey. • It is important to recognize that approximately half of the current Lake Orange Land owners have already taken the appropriate steps to establish the correct ownership of the Lake Orange property. • It is significant to realize that overlappage issues are not restricted to just the Lake Orange area. Other land owners in the County have had situations that required a new deed or survey to establish ownership and update tax records. During the June 4'" Board meeting, County Attorney John Roberts pointed out that if the issue with the Guibert property is one of double taxation, then the Guiberts should be eligible for a refund. If the issue were not determined as double taxation, the Board would be at risk of personal liability to anyone in the County who challenged it.