TO: Mayor and Town Council
FROM: W. Calvin Horton, Town Manager
Ralph D. Karpinos, Town Attorney
SUBJECT: Tax Refund Request: Chapel Hill Kehillah
DATE: October 27, 2003
On October 8, 2003, the Town Council referred to the Manager and Attorney for comment a letter dated September 16, 2003, from the Chapel Hill Kehillah to the Orange County Tax Assessor, which was copied to the Mayor of Chapel Hill and subsequently copied and distributed to the Town Council (Attachment 1).
SUMMARY OF REQUEST IN LETTER TO ORANGE COUNTY
The letter seeks an “equitable resolution” with respect to a bill for 2002 property taxes paid by the Kehillah under protest. The tax bill paid is for approximately $25,000 for 2002, including Town of Chapel Hill taxes in the amount of $8,500. The property’s tax exempt status has been established for the current 2003 tax year.
DISCUSSION
Pursuant to an agreement entered into in 1980 by and among Orange County and the Towns of Carrboro, Chapel Hill and Hillsborough, Orange County performs for itself and for each of the Towns all of the tax collection functions prescribed in Subchapter II of Chapter 105 of the North Carolina General Statutes (Attachment 2). Those functions performed by the County include all those with respect to the listing, collection and consideration of refunds for taxes improperly assessed or paid. Thus, under the terms of this agreement, the County is the appropriate party to have been sent the letter from the Kehillah seeking a refund of the taxes paid in 2002 under protest.
We understand that the letter is currently being considered by Orange County officials. We do not believe, based on the applicable State Statutes and the agreement with Orange County, that the Town of Chapel Hill can take any formal action on this letter directed to the County. Therefore, we have not attempted to make an evaluation of the legal merits of the Kehillah request for a property tax refund.
We expect that if the County determines there is a basis in the law that entitles the Kehillah to a refund of the taxes paid, the County will consider providing a refund of County and Town taxes. The Council may wish to send a letter to the County asking them to process this request in an expeditious manner.
RECOMMENDATION
That the Council take such further action as it deems appropriate.
ATTACHMENTS