Blaine County is investigating whether the Picabo Cemetery District is operating legally, and the investigation is prompting questions about who is responsible for ensuring that special districts are law-abiding.
"There's just an assumption that [the districts] are doing things the right way," said Larry Schoen, Blaine County commissioner and taxpayer in the cemetery district. "People very trustingly pay their districts and hope for the best."
Idaho state code requires taxing districts to have elected boards that pass budgets in a noticed public hearing. In the case of cemetery districts, the board must be made up of three commissioners who are elected for terms of two years.
If the races for the seats are uncontested, elections may be foregone; however, three commissioners must be seated at all times.
The county is currently investigating whether the Picabo Cemetery District meets all state requirements. Schoen said a constituent, Gary Castle, contacted him and claimed the Picabo Cemetery District has not had an elected board since 1992.
Gary Castle said his brother, Raymond Castle, a Picabo resident with family in the cemetery, has run the cemetery district without a duly elected board since two elected commissioners refused to take an oath of office. No replacements were found.
"He's basically run the Picabo Cemetery for a very long time," Schoen said.
The district budget was set at $10,286 for fiscal year 2010, the latest date for which a report was available.
The county approved a levy rate at $13.72 per $100,000 of assessed property value, several percentage points above the levy for the Hailey Cemetery District. Hailey residents pay about $9.28 per $100,000. Much of the funding is slated for lawn mowing and maintenance.
Records indicate that a public hearing on the district's budget was held on Tuesday, July 12, 2010, at Raymond Castle's home, and Picabo property tax assessments state that this year's public hearing was held on July 5.
No other names of board members are listed on county documents. According to county records, Raymond Castle is the only contact for the district, solely responsible for submitting levy rate request forms and noticing public hearings.
"It appears to me that he tried to act responsibly," Schoen said. "But the fact of the matter is that not only was he submitting budgets on his own, he was the contractor for all the work done on the cemetery."
Raymond Castle declined to comment when reached by phone on Thursday, but said the district was run by an elected board and denied any wrongdoing. He declined to reveal the names of other board members.
Regardless of the state of the Picabo Cemetery District board, the investigation has prompted questions over whether the state or the county—or anyone other than the district's own board—has the responsibility to make sure districts are law-abiding.
Gary Houde, senior research analyst for the Idaho State Tax Commission, said the state's role in such issues is limited.
"Generally, unless we hear a complaint from a taxpayer, we assume everyone is doing everything correctly," Houde said.
Even when there is a complaint, Houde said the resident is generally directed to the county clerk's office.
"It's not really our task here at the commission," he said. "Our purpose is more oversight."
Schoen said the general assumption is that the county has jurisdiction over districts, because the commissioners set the levy rate and the treasurer collects tax revenue. However, he said, the process is ambiguous at best.
"It's reasonable for people paying taxes to those districts to assume that there's a system of checks and balances," he said. "[But] basically any officer of a taxing district can come into the county and submit a budget. There's not really a mechanism in Idaho law to have this process verified."
Therefore, Schoen said he's trying to develop a "paper trail" for taxing districts. Districts should be required to submit the minutes of their budget hearing, evidence of public notice and a copy of the budget resolution signed by a majority of the elected board along with the standard levy request form, Schoen said.
"It's a simple way of ensuring everything is being done," he said.
Commissioner Tom Bowman said that he hadn't formed an opinion on Schoen's proposal, but he worried about "Big Brother" implications.
"I am concerned about the county coming off as patronizing other elected officials," Bowman said.
Most of the county taxing districts, including Ketchum Fire, the Hailey Cemetery District, Wood River Fire and Rescue and the Blaine County Recreation District, are conducting business professionally and legally, Bowman said.
"They're all very responsible and all follow statutory requirements," Bowman said.
He added that Schoen's proposal to send a letter to the districts reminding them that they need to hold public budget hearings is unnecessary in most cases.
"Ninety-nine percent of the taxing districts already know that," Bowman said.
As for Picabo, Houde said there is no set penalty for taxing districts that assess levies without elected boards.
"It can be severe or it can be mild," he said. "We deal with each of these on a case-by-case basis. Failing everything, it could result in the district not getting any property tax revenue for that year."
Bowman said he didn't think the board could approve the cemetery district's levy without resolving the issue, but said he would have to consult with the State Tax Commission before making a decision.
Schoen echoed that sentiment, saying that he didn't think the county could set the levy if the commissioners could confirm the district was not in compliance with the law.
"There's a real question mark over the Picabo Cemetery District now," Schoen said.
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