Board of Supervisors - Special Meeting

Before we get started, uh I just want to set some ground rules. I'd like to please ask you to set your phones on vibrate or uh shut them off uh out of courtesy, please. And secondly, uh, if you come up on on call to the public, you have three minute three minutes to to speak and please, uh, state your name and address for the record. Um, with that said, I I'll go ahead and wait till, uh, 1:00 and we'll get started. Good afternoon. Welcome to our Wednesday, February 11th, 2026 board of supervisors meet, Santa Cruz County Board of Supervisors meeting. And with that said, I'd like to call this meeting to order. And uh Miss Donnie uh you want to lead us in the

pledgece of America and to the stands one for all. Let's move on to item B, adoption of the agenda. Uh, Mr. Manager, good mo good afternoon, sir. Mr. Chair, members of the board, good afternoon. There is no changes to the agenda. Okay. At this time, I'd like to entertain a motion to uh approve agenda. I move. Second.

I have a motion and a second. Any discussion? Hearing none. All in favor? I. All oppose? Motion carries. Um, our next item is called to the public. I'll go ahead and uh I have several slips here and first one is Richard. Is it Offstrap?

I apologize, sir. Good afternoon everyone. My name is Richard Anstead. I live at 68 Sakulo, Montana and I'm in school district 28. I've got three things I'd like to comment on today. uh first is the tax rates and then secondly the budget approval process and lastly uh communications relative to school district meetings. So to start off with uh school district 28 tax rates, the cover sheet of the revised budget dated 129 shows on one line on line one a budgeted revenue of $2,561,000. That's rounded to the nearest thousand. Uh 15 or 1,560,000 of that would come from government sources. the balance of $1 million from taxes. And if we were to make up that million, it would require a a rate of $822 to achieve. Likewise, on line four of the cover sheet of the budget, uh $2,10,000 in expenses are defined and would be offset by that same 1,560,000 from the government. and the balance of 450,000 rounded to the nearest 1,000 would require a $349 tax rate to achieve.

Meanwhile, the current revised property tax notice has a school district 28 tax rate of $726, which yields 937,000 versus a need of $450,000 to balance that $2,10,000 in expenses as defined on line four. If the overage of $487 $487,000 is really needed. Why isn't it defined in the budget? Okay. Secondly, the budget approval process. The original school district 28 budget was approved July 8th and here we are a half year later looking at our second property tax notice because of a re of a revision and apparently with another reivised tax notice in the works. This suggests to me that somehow for someone needs to closely look at the approval process because unless some external event is impacting things it is not working correctly. Lastly, the communication mechanism for school school district meetings is not working effectively because at least half the property owners live outside the county and although the meeting notices in Nawas International follow the letter of the law, they don't follow the spirit of the law. State law defines both public notices and letters to property owners as acceptable ways to communicate. And I strongly feel that the letters would be more in the spirit of the law. Thank you very much for your time.

Thank you, sir. Thank you. Next, I have Carrie Pottinger.

Good afternoon. My name is Carrie Pottinger and I'm at 15 Duke Road, Ngalas and I am a school board member for SC28. Okay. Um I dear chair and members of the board of supervisors, the governing board of Santa Cruz Elementary District 28 writes to request clarification and alignment regarding recent public statements issued by Santa Cruz County offices related to the 2025 property tax billing errors affecting our community. At the outset, we want to be clear. District 28 acknowledges and accepts responsibility for approving a small school's adjustment that resulted in an increase to the district's tax rate following all required state and county procedures. that responsibility is not in dispute. However, recent county communications, including the February 4 press release, do not clearly clear clearly distinguish between district approval of a lawful tax rate and county responsibility for tax calculation, application of statutory limits, and billing administration. This lack of distinction has contributed to community confusion and misplaced frustration directed towards the district. While district 28 lawfully approved the small schools adjustment through the required state processes, the calculation, application of statutory limits, including the 1% primary property tax cap and administration of individual individual property taxes are county functions. While district 28 is also concerned that the February 4 press release was not shared directly with the district, despite referencing district 28 and its tax rate, the district learned of the release through the local newspaper. This limited our ability to respond promptly and accurately to community questions regarding an issue that directly affects taxpayers and our schools. As a result of repeated billing errors and unclear public messaging, taxpayers are understandably frustrated and District 20 has received criticism for matters outside of its administrative control. Our shared priority is ensuring that taxpayers receive clear, accurate information and are treated fairly by all levels of local government.

requested actions in um in that spirit, we respectfully request the board of supervisors support in number one encouraging county offices to clearly distinguish between district tax rate approval and county tax calculation administration in future public communications. Number two, supporting a clarifying public statement explaining that the billing errors occurred during county's administration of approved tax rates. Number three, ensuring district 28 is included in future communications or press releases that directly reference the district. And number four, reviewing county processes to prevent further billing errors and help restore public confidence. Our intent in writing this letter and is signed by all the board members, and I'll leave it with you, is not to assign fault, but to support accurate public understanding, restore trust, and ensure that future processes serve our community well. um signed the governing board. It's SC28. Thank you.

Thank you, Carrie. Thank you. Thank you, Alejandro Castier.

Good afternoon. Good afternoon, sir. Uh, I respectfully request a little more time. I have two and a half pages. I will try to say it within the three minutes, but I think the serious seriousness of the matter warrants a little more time. As long as it's not 10 minutes long. No, no, no. It's just two and a half pages long. That's all. I will allow it. Yes, I appreciate that. Absolutely. Thank you for asking.

Yes. Um, my name is Alejandra Castanada. I live on 70 circle in Montana, Ngalas, Arizona. um inside Lake Patagonia Ranch Estates. Chair, members of the board, Mr. Valdez, treasure, and my neighbors, thank you for holding this special meeting. We appreciate it. I want to say right up front, we're here in good faith. We're not here to score points or lecture anyone. We're here because we believe Santa Cruz County can do the right thing openly, directly, and with respect for people who fund the system. And let me be clear about the spirit we're bringing. We are here to listen. We want a real back and forth if possible. We want to understand what happened, how it happened, and what will change. But I also need to be honest about where we are. For months now, many of us have reached out by email, in person, at meetings asking for transparency and straight answers about how to how this tax situation happened and how you will prevent it from happening again. And too often these opportunities, I believe, were squandered. We got careful wording, soft edges, and explanations that felt designed to deflect rather than clarify. Not always and not from everyone, but enough that the public has been left feeling like we're being managed instead of respected. That's a hard thing to say, but it's true from where we sit. And the reason it matters is simple. This is an abstract policy debate. This is money out of people's pockets. It's mortgage payments, retirees on fixed incomes. People can tolerate bad news. What they can't tolerate is confusion, shifting explanations, and a sense that the truth has to be pried out one meeting at a time. So today is not just another meeting. I believe this is a crossroads. This is your chance to be upfront and honest with taxpayers without spin, without hedging, without rare circumstance language that sounds like an excuse when this type 03 framework exists elsewhere at least 30 other times that I was able to find

throughout Arizona and should be understood by the professionals responsible for it. Maybe it was rare for this county office to encounter, but rare cannot be the last word when taxpayers when what taxpayers need is a clear explanation and a system that can be relied on. I want to be clear about something else. We did not begin with confrontation. We began with cooperation. We showed up. We asked. We tried to work through proper channels. We've been patient. But patience is not weakness. It is civic responsibility. Patience also has a limit when taxpayers are left holding the bag while government asks for the benefit of the doubt. That's why we are here and it's why I'm going to say this plainly. If you want to earn our trust back, this is the moment to do it because the public is watching. The public is ready to listen. And if if you're ready to speak plainly, here's what I'm asking for. First, tell the truth in plain English. what failed, how it failed, how it was discovered, and why it wasn't caught sooner. Give us a timeline. Second, show the work, the calculations, the process, the internal checks that were supposed to catch this and exactly where those checks broke down. If the public can't see it, the public can't trust it. Third, give us a written corrective action, not promises or assurances, but an actual plan with name responsibility, verification steps, and a schedule. and then report back publicly until it's complete. Fourth, if you want to restore credibility, invite outside review where appropriate, whether that state level confirmation, independent auditing, or whatever oversight is necessary to prove the system is now reliable. Trust isn't restored by asking people to believe. It's restored by giving people reasons to believe. Fifth, this one has to do with constitutional governance. The 1% cap is a constitutional guard rail and it protects an individual homeowner. When even when it protects an individual

homeowner, the cost doesn't vanish. When local decisions trigger state backfill, the homeowner may be protected, but the public is not. The cost is shifted statewide to the state taxpayer. That is a constitutional compliance and governance issue more than it is a math problem. So, did the situation shift cost of the state and if so, how much and why? Now, let me add why these five points matter. Because right now, the burden has been shifting quietly but steadily away from the people who are paid and empowered to get this right and onto the taxpayers who simply want lawful government. We have people in our community who since this all started last year have been collecting documents, cross-checking rates, reading statutes, comparing notices, making timelines, and doing all the things a healthy system would not require its taxpayers to do. And please hear this part. Taxpayers should not to become investigators or part-time auditors to keep government within constitutional and statutory compliance. That's not community engagement. That is government offloading its duty onto taxpayers. And it's also a warning sign because when taxpayers have to do that, it means either the controls are failing or accountability is missing. When the public sees careful statements that minimize error, the public doesn't think, "Oh, good. They have it under control." The public thinks they're protecting themselves. Whether that was the intent or not, that was the effect. And effects matter because confidence is built on what people can verify, not what people are asked to assume. So the question is not just how do we correct the numbers. The question is how do we correct the relationship between the taxpayer and the government that serves them? Because in a free state, government should not be a mystery. Government is supposed to be accountable, comprehensible, and honest. If a mistake happens, the answer is not to polish the words. The answer is to own it, explain it, fix it. and prove it and prove it. That brings me to the tone we need today. I'm asking for a real conversation. If there are constraints you're working under, procedures that failed, if assumptions were made that

should never have been made, if steps were skipped, please tell us. And if there were individual officers responsible, the responsibility needs to be stated not to humiliate anyone, but to restore the most basic principle of public service, accountability. Because accountability isn't a favor you grant to the public when it's convenient. Accountability is a price of holding authority in the first place. I'll close with this. Former US president said that said a former US president used to remind people that government's first job is to serve, not to manage perceptions. And service begins with honesty. Elected officials have to earn trust every day. Not once, not with one press release, not with one meeting. So we are here and we are reaching out ready to listen and expecting the truth. We want this county to succeed. We want to respect the officers that serve us and that's a true statement. But respect is a two-way street and trust is not a gift. It is earned. Thank you for your time and your public service.

Thank you. Thank you. Thank you, Alejandro. David Cotch, is it or coach?

Coke. Okay. I apologize for My name is David Ko. Uh I reside at 19 Escaloney Court, Ngalas. I am a property owner and homeowner in Lake Patagonia. And quite honestly, Alex has just made my job a lot easier. I just want to reiterate every point that he has made. Uh, I have seen my neighbors spend countless hours researching, producing documentation um, finances that really cannot continue to justify District 28's existence financially. Spreadsheets have been sent analyzing the cost of student at Little Red versus other districts. the numbers are not there. Um, and I think that's it. I would like to reiterate what uh Alec said. It shouldn't be our jobs to be the accountants or the overseers for you gentlemen or for district 28. Miss Pos pottinger is it? I u share your frustrations. I need to say we have had the same frustrations communicating with district 28. Um, enough said. Thank you.

Thank you, sir. Thank you. Thank you, sir. Vanessa Register.

Good afternoon and thank you. My name is Vanessa Register, 105 Loma, uh, Lake Also, um I'd like to say one that um I've been reading a lot and I attended the school board meeting district 28 last night and I watched the presentation so I understand what put the school in their um high-risisk school for not being able to uh be a sustainable school financially. So I have three questions. one um Samber uh the school board says it's the treasurer's job to do the math and the treasurer says he just receives the numbers. So could someone tells me who does the math and I would like to know who audits the bills before passing them on to us the property owners. I don't understand how much the school tax can increase before it goes to the voters. The financial impact on my family is a $300 a month increase. And yet I'm told I have a credit coming, but I don't get that money. But yet, I still have to keep paying an extra 300 every month. So, it's impacting me negatively a lot. My money's gone and I need my money to help pay. If it's gone, I can't use it. And I want to know, will the county let my mortgage company know that they're adjusting it so that they can adjust it and I don't have to keep paying the extra money for the fraudulent tax bill or will they give me a letter that I can send to my mortgage company? And the next thing is how long can we support a high-risisk school, the school that is taking general budget capital improvement money and putting it into operating expenses. Last year, the school did that with 54.72% of its total budget. Doesn't have an operating budget. It can't make it. It's got to take it from the capital. And you

can't keep doing that. The school had this problem. In the last four years, they had a 76.87% decrease. Their budget right now, they have $19,000. According to the state auditor's presentation, schools been declining students since 23 by 32.22%. It's not coming back up. We're paying too much and they don't have the money to do it. And we're paying for a high school because they don't have one. There are other schools. If these 122 students, 122 students could be put into another school. They're already being bust. We would do better with the money we have and we could do better for the students. Off offer better programs. Thank you for your time. Thank you.

Thank you. Thank you,

Susan Lang. Hello. Thank you for this opportunity. My name is Susan Lang and I live at Patagonia Lake. And I'm just bring I'm just wanting to bring a larger focus to property taxes in general. We're speaking specifically about SD28, but in the research I've been doing and here are my here's my curiosity. There is a rampant issue with property taxes across the nation. In fact, in Texas, there is a big push to speak to or work with Ken Paxton um to investigate a thousand cities across Texas for property tax. I'm going to call it fraud or misdemeanor. And one of the big questions is a request to check the checking account. Where do these property taxes go? And the biggest issue that they're having in Texas and apparently nationally, according to the research I'm doing, is through schools and school bonds. And I think you would know Carrie Pottinger. So there there aren't bonds with the Little Red School. Is that right? No, there aren't any bonds there. But if we become part of Patagonia High School, then there are bonds there. So my question is the bigger question of who is auditing and watching where do

these property taxes really go? And that's my question. Please, if we if we don't resolve it, then I will want to watch the checking account of the local Santa Cruz County. Thank you. Thank you. Thank you.

Anyone else wishing to come up on call to the public? Okay, we'll go ahead and move on to item D. Before I we go to item D, I I want to thank uh staff and uh our treasurer, Mr. Bos, for hosting this meeting. because I think it's really important that we are transparent and I thank all of you that came today. Thank you for your questions. Those are very legitimate questions. Thank you for your concerns and uh uh hopefully we can answer these questions today and if not we will at one point in time. Uh and and it's really important that we do communicate uh and that's one reason why we're having this meeting to make sure we have that continuous communication with our school districts, with our superintendent of schools, all of us together. It's really critical and and thank you for being here. Um we'll go ahead and move on to item D. Uh, one Santa Cruz Elementary School District number 28 tax rate presented by Alejandro Pas, Santa Cruz County treasurer and Maya Donley, Santa Cruz County Superintendent of Schools.

Thank you both.

Mr. Chair, uh, before we start, so the reason we're having this discussion, Mr. Castella, Castanetta, sorry, president of the POA. Um, he requested he sent an email out to to the board of supervisors requesting the following uh timeline and accountability. That's the first uh request. Scope of impact uh refund mechanics and taxpayer guidance. Number four, prevention control. Number five, uh public records transparency. And number six, prior year prior tax year uh information. So, with this presentation, we hope to address some of those questions. If we don't get to all of them, we'll reather that information and send it out and including having another meeting. But those are the things that we want to address today. Thank you.

Thank you, sir. Mr. Bosque, good afternoon, sir.

Good afternoon, Mr. Chair, members of the board, members of the county, and everybody uh from the public who joined us today. Thank you for coming. Um, like they stated, hopefully this presentation will hit all of the questions sent in by Mr. Castana. Um, and if not, we can definitely engage in more conversations and make sure you get the information. Um, before I do begin the presentation though, it will be a mixture between myself and Maya going back and forth on the presentation as we're going to explain the process of what it takes to create a tax bill from the beginning to end uh, and to where the error or the mistake occurred. So, we'll definitely highlight that in the presentation. Um, and I also wanted to add some clarity to my comments at the board of supervisors meeting on February 4th. Um, I did misspeak in stating that the uh property tax oversight committee had provided incorrect information to our office. Through my investigations and research, I was able to uncover that that was not the case. They did provide the information in a timely manner. And so, we'll be able to highlight that throughout the presentation. We've established a great partnership and relationship with the property tax oversight committee and the department Arizona department of revenue that we wish to continue. They were also invited to join us today. I'm not sure if they had the chance to do so. Um but we definitely have uh implemented new changes uh due to the situation. So we'll go ahead and get started. And uh on March 15, 2025, uh fiscal year truth fiscal year 26, truth and taxation rates for equalization assistance were sent to board of supervisors, county school superintendent, and the treasur's office. The truth and taxation rates for equalization assistance to schools district is made up of the qualifying tax rate used in K2 to throw funding formula. And I'll have Mr. uh Young go ahead and elaborate a little bit on this one. Uh just briefly, the this document just like the name implies, it wants to

make sure that taxpayers understand that what's happening with their tax rates. And so if the taxing entity, whether it's a school district, the county, um if they are going to ask for a larger levy than the previous year, then they need to go through the truth and taxation process where you inform the public of the increase in levy.

Thank you, Chris. Um And specifically for district 28, I don't have that information, but they provided that in their November 18th board of supervisors meeting or board uh member meeting um of the steps that they followed. Um the next slide is where we start with the property tax oversight committee on June 25th, 2025. Staff from the property I'm going to start referencing this P talk just because it's shorter. Um the staff from PTO and the Arizona Department of Revenue sent the county school superintendent the 2026 PTO school district track rate and levy template. Miss Donnelly then forwarded to each school district that same day for completion. This Excel document has five tabs to be completed. The treasur's office does not receive this blank or completed. Um June 25th, 2025, Mr. Lang, who is another um chief deputy uh school superintendent, I believe, sent out to all counties the new 2025 2026 PT talk school district tax rate and levy template which the county school superintendent, Miss Donnelly, sent out to all districts on June 27th and I'll go ahead and let her speak to that.

Right.

Good afternoon everybody. My name is Maya Donnelly. I'm the Santa Cruz County School Superintendent. Uh, so I'll try to to chime in here when um the process involves um our office, okay? And our and our timeline and our procedures and processes and the way that we work with both the treasur's office and the business managers from the school districts. All right, there we go. Okay, so um like Alejandro mentioned in June, we received this um this tax rate and levy template from the from PTO. Um the the template does change from year to year quite often. I mean you can see that we received a template one day and the next day we received um a a revised one, but the template is all formulaic and and um you know pretty straightforward to fill in using a school's budget. So I sent out those templates to all the school districts. Um the county school superintendent's office completes a template template for each district as well. So the districts are working on their end. I work on our end to fill this out. Then we come together um to to compare, to modify, to finalize. We go back and forth to make sure that both templates match. And when they do, a final worksheet is signed by the district business manager, submitted to my office, and the deadline is July 25th. Um I also confirm with the districts the percentages that they want to designate for their M and their capital. By July 25th I submit all district worksheets. So this is six districts. It's uh Cenoida, it's Patagonia Elementary, Patagonia High School, Santa Cruz number 28, Ngalas Unified number one, and Santa Cruz Valley number 35. And I submit all of those to PTO. Um then I complete a district tax rate chart which includes

all the school districts with their primary and their secondary tax rates and then final and I submit that to county management to Mauricio Chavez, Jesus Valdez and the treasurer and then um those numbers are put before the board of supervisors to certify. Okay, next slide. All right. Uh so just a little bit of clarification about a type three school district and this is an additional tax rate. This is not part of the primary tax rate nor part of the secondary. This is additional. Um so by February 15th uh oh we already went over this. The joint legislative budget committee computes the QTR. Okay. Um then we receive I'm I'm on the lookout for this letter uh from AD uh which determines um Santa Cruz number 28 as a type three district. This is the only type three district in Santa Cruz County. Um an additional tax rate is levied in this common school district that does not have a high school district. Um there is a statuto there is a statute as as referenced there um that that will I guess monitor the tax rate for the type 3 district so that it does not exceed the minimum QTR or uh better known as 1.5606 for the fiscal year of 2026. And these monies that are collected are administered to as state aid to the high schools who provide tuition um to these identified students in the type three district. So if you can see that letter, it's kind of hard to see, but there are 125 students in Santa Cruz Elementary District who are in high school. And then the also the amount of money per student, can't really see, but it's 6,956 I do believe per student uh per school year.

Thank you.

And again, up just a reminder to this point, everything is going as it should be. Everything is being submitted on time. Everything's being going through the correct process. I'll go ahead and point out exactly again where the mistake occurred. Um the Arizona Department of Revenue on July 23rd um sent to the clerk of board of the board and copied the treasures office and the county school superintendent office of the 2025 ASAE um guidelines and worksheets. And in the next slide, it has a few of what those look as well as in the packets that you um received. Again, this has a timeline going back and forth between board of supervisors and the department of revenue. Everything was met on time and submitted accordingly with appropriate responses from both entities. This is um the state aid to education that is completed by the school superintendent and submitted to PTO. Do you want to speak to it just a little bit? Um

this form is actually completed by by Maisio by the finance director, but I do you want to speak to that Maisio? Mr. Chairman, members of the board, members of the public, this is uh a state and a um Excel worksheet that's provided by Arizona Department of Revenue and PTO and it provides um it's based on different u amounts of assessed value amounts that are from taken from the tax rule abstracts from the state of Arizona. So it's a document that we have to review and we have to plug in those numbers and it's it's formula based from the state and it provides the additional the state aid to education. Once that's completed, I forward that that uh document over to the school superintendent's office in recommendation that they forward it to the appropriate to all the school districts so they can review make sure that the numbers are accurate that we didn't miss anything on that and uh and you know they can sign off on that document.

Thank you sir. Just keep in reference that this document is the same document used last year to create tax bills and and I'll refer back to it in later in the presentation. On July 25th, county school superintendent Miss Donnelly submitted to the 2026 Peak School District tax rate and tax levy template for Peach. Um, this is just the from the Excel spreadsheets that are to be completed that was signed off by the appropriate district. Again, everything was submitted correctly and on time. On July 30th, Superintendent Donnie provided the Santa Cruz counties the school district tax rates for the fiscal year 2026. On August 8th, myself, I recommended the school superintendent review all district budgets and tax rates for accuracy. Um and then PTOAC uh additional state aid reduction rates to education at had not been received at this point. So up to this point we had still not received any additional state aid reduction that should be applied to any uh taxpayers. On August 11th, 2025, county management sent the tax rates for fiscal year 2526 to the property tax oversight committee which goes into the next slide as well. They also submitted um the TNT primary and secondary published and affidavit and the school district tax rates for their review as well. On August 22nd, 2025, deputy county manager uh submitted the completed ASA worksheet to the Arizona Department of Revenue. So, we saw the blank one. Here's the completed version. Um uh Arizona Department of Revenue responded that they confirmed that they received it. They would review it. uh same day they confirmed that the worksheet was reviewed and no issues were found. They would then continue on and work the 1%

and reduction rate. And here's where we start. And in the next couple of slides, I'll add the clarity. Once I have received the approved tax rates from all the districts and state aid worksheets, I complete an Excel spreadsheet seen on the screen um with each district breakdown. This is provided to our consultant at TGI systems for a compilation compilation of te test bills. Um I sent the tax rate to TGI systems on August 25th. Again I we had not yet received any additional communication from anybody in regards to additional state aid. So, um, and I guess here, this is where I was trying to be an overachiever from last year and making sure that our, um, residents received tax bills in a more timely manner, um, and started working ahead of it and didn't realize we were still missing a critical piece. Uh, TGI systems will then provide the treasur's office with test bills for reviews. You'll see the marks, the calculations. Um I mean he does this for every single parcel. We reviewed a substantial amount of them. Um the review this year which is part of the changes going into the procedures we implemented um is that more eyes get on it before we send it to the printer. Uh here we go. And September 9th, 2025, the Arizona Department of Revenue sent the 2025 state aid to education reduction rates and the 1% check sheet used to calculate the state aid reduction rates. This is where the mistake occurred. In the bottom screen, um you'll see that Santa Cruz Elementary School District number 28 has a tax reduction rate of 3.9837 and that was not applied. what was applied was the reduction rate um of the

1.5606 that was received in the first TNT letter as well that was part of the um ASA worksheet that was completed and submitted to them. So this is where the mistake occurred that this notification was sent to us um and was missed and not caught and so we did not plug in the correct state aid reduction. Tax bills are sent to the Arizona Department of Revenue. We sent ours on September 30th, 2025 and also and included samples tax bills from all taxing authorities. Uh meetings on uh Santa Cruz County officials, Santa Cruz Elementary School District 28, superintendent, business manager met with Lake Patagonia Ranch Estates Homeowners Association and residents of District 28 to discuss tax bill concerns in the board of supervisors conference room on November 18th. On that same day at 5:30, Little Red Schoolhouse held a board meeting where super uh attendant Romero, business manager Denise Melendez, Assessor Pablo Ramos, and myself presented. That's the slide that I presented on. Um, and since November 18th, like I believe some of you mentioned to now, we our office has received emails, phone calls, and visits from residents of Santa Cruz District 28. Um, here what I can say, and I'll speak for myself, I think we still It was the conversation was about high tax bills. I think though there was a miscommunication, misunderstanding uh when we were discussing what the error actually was or what was going on with the tax bills. Um and for all those that were present, I'm pretty sure you can attest to the same. Um we weren't yet looking into this 1%. It was not a thought. it was not something that we thought could have potentially been an issue until later on that that was identified. We started then looking into that. So, these were two different um

conversations. On January 30th 30th, myself and Chief Deputy Damon met with Jolene Christopherson, Craig McPai, Kin S Pi, and I hope I'm saying their name right, and Alexander Cusen to discuss the uh bill's concerns. This was really a a discussion what led to the beginning of a great relationship with them. Um where we just discussed and shared text bills, discussed what was applied, um what was received, what wasn't received. Um and so we were able to just engage in really good open dialogue conversation um open, transparent, um and for mutual uh benefits for our residents. Um on February 3rd and 5th the treasures office, county management and PTA connected for review again for discussions, clarifications, and understanding. We went through iterations like the one you see on the right hand side where we plug in we provided tax bills to them again and we started plugging in in formulas to make sure that the additional state aid rate that was provided initially was still the accurate rate. Um and actually I'm not I'm not going to say it now. I'll say it when I get to that slide because then I'm going to confuse you. Um, but we went through several of these uh iterations. They're actually currently working on a few more um because of the different class types. Some have mixed use. So, they're double checking and triple checking on all different types of parcels um that could qualify for the state aid and make sure that it's applied correctly before we do a rebuild. On February 6, uh the treasur's office met again with PT Talk again to review and request a written confirmation of the additional state aid rate to apply. We also provided two additional samples for their requests. If it remains as previously provided at the 3.9837, the adjustment will be an additional 1.6428

to the already applied 1.5606 for a total primary rate reduction of 3.2034. If you add in the 7803 from the type three reduction for a total combined rate reduction of 3.9837 which is what the uh property tax oversight committee and department of revenue have um shared we must apply. The current rate reduction rate applied is a 2.304 and so if you add that uh subtract the 2.304 from the 3.837 37. Again, the additional uh state aid to apply is the 1.6428. We are waiting on their confirmation. They were seeming pretty confident that that was it, but they want to make sure again that they go through more iterations, more examples to make sure that it is solidified before we reprint and send out again.

Mr. Chair, can you go back to the Yeah, go ahead. So in the current bill that they received the reduction is at 2.3 correct. Okay. So it's going to hopefully once it gets verified by PTO it'll be adjusted to the 3.98. Okay. Just so for clar thank you sir. Yes.

So we did apply a reduction just not the full amount. uh scope of the scope of the impact because type 3es affect uh primary residents class three there was 500 there are 550 parcels in district 28 that had a direct impact with this the total amount is not determined uh as of yet once the rate is plugged in and rebuilds are generated we have the confirmation from PTO and we do what we need to do we will have a more accurate dollar amount we'd be more than happy to share that as well once we have it um and we are not aware of any penalties We did reach out to Kotality to Loretta. Um, Kotality is the largest mortgage provider for tax parcel payments. Um, we do have emails with them. We also had connections with them. There's no impacts um, as far as what they've told us. The overp payments for their requests were to be applied to the second half installments and to continue providing updated tax rules twice a month as we do every single month. So, they have your adjusted amounts. Once we review revise this tax rule, they're going to continue to get it twice a month throughout the entire year and they'll make the necessary adjustments to your mortgage. I know that is true and accurate simply and solely because my parents, my siblings, and a lot of my friends reside in district 28 who were also impacted by this uh mistake. And with the first reveal, they several of them made comment that their mortgage company had made adjustments. So um that's um what we've uh that's exactly how we handled for those uh payments from the mortgage company. We applied it to the second half and provided updated tax rules to the companies. Refunds refunds will be made via check by mail. Again, our goal is by end of March. However, this all does depend on the refill, the pock review, and the

printer. So we want to make sure that we get it right and this once and for all. So, we are def we are going to take our time with a sense of urgency still to make sure that it's correct and accurate before we send it to the printer. The refunds will include interest pursuant to the statute listed above. The interest rate is based on the Arizona Department of Revenue which is listed at 7% per annually and a zero a 01918% per day which is how your interest will be calculated on your refunds. And the refund is solely on the overp payment amount, not the full uh amount of your tax bill. Uh the treasur's office uh has started a bill, a new tax bill procedure. It is as it says states up there that it's a work in progress and it's a life document that can be updated and changed. If it is updated, once it's approved by the board, it needs to be represented to the board for approval of any revisions or updates made to it. Um, there is a copy of what we currently have. It has not been submitted to the board. We'll submit it in the next one. So, it gets approved, uh, reviewed and approved there, but you currently have one in your packets of what we've added there. Um, it is just the beginnings of it. Um, this is what I could achieve in this time period, but we'll definitely keep working at it. And then um the treasur's office and superintendent's office also as we have been because we have been collaborating extremely well since the beginning of my time here. we um are implementing some changes within the processes to make sure that we can catch um everything and anything possible and avoid the situations from occurring because I can tell you at least for me is we don't want these things to happen and I hope that you can understand that these are not things that we're wanting to do or with ill intent. Um I it's it's it's a

mistake that occurred and then we definitely have learned from it and we'll we'll move on from it. Do you want to speak to this? Yeah, sure.

Um, for about the last year now, I guess the the superintendent's office and the treasur's office have held I mean, we've always held monthly business manager meetings with the school district business managers, but for about the last year or so, maybe a little bit more. Um, Alejandro has uh along with his deputy has attended every one of these business manager meetings, which has just opened up lines of communication, made things more clear. the business managers feel really um uh more at ease being able to have the treasurer right there in the same room, ask every question, hammer out every new process and procedure um so that things can be improved, things can be more efficient. Um so th this has worked out really well. Um in the past, I mean in June and July, you know, traditionally schools uh are closed and so we would hold these these uh tax reviews virtually and through email. that won't be the case this summer. will be holding our business manager meetings in person with Alejandro present so that we can go through so that he understands everything that's going on on those those calculation templates so that he and I can look through the school district tax rate chart so that he understands everything that I have done and there's no room for um confusion or misinterpretation and before we send it off to uh county management and the board of supervisors to certify we're sure that the business managers have signed off. My office has signed off. The treasures has signed off and everything is correct.

So yes, uh and same thing for our processes, they'll be highlighted there in the procedures. Um once we start going into the tax bill creation and once I've received everything, we're going to include county management, the county school superintendent, and each corresponding district to review sample bills from their areas to review exactly what is provided for printing and sending out to our constituents. Um so a lot has changed. Um I don't want to speak for them. They did highlight for me um from pet talk that this has also sparked some change within their office. Um, and so it's it's it's a learning opportunity not only for our county but for a lot of agencies in the state um who deal with these special circumstances. And um they they are from what I've told they are on the call. Um so I'm glad that they were able to join us. And that is it. Any any questions? Any anything to add?

No, I I didn't get a chance to say thank you to the public. Thank you for being here. I know it's been a a long process, a very frustrating process, and for that I apologize. Um, but I I I know we're heading in the right direction at this point. Um, and the collaborative effort that it's going to take to make sure this doesn't happen again is incredibly important. So, thank you. So somebody asked me earlier how did we what did we do for Mr. and Miss Donnie to come as elected officials, right? So b and the answer was basically an invitation because basically like we didn't force anybody. You just got an invitation because you guys want to help and that's the reality. So, I want to thank you guys for coming. Also, all the team because it was a lot of work uh putting this uh sess this special meeting together and the public. I agree with you and the community that this is the job that you guys shouldn't do, but thanks for bringing that. I mean, I know you shouldn't do that, but thanks. And I want to let you guys know that if we have to make another special meeting, we're going to make another special meeting. We're going to do whatever it takes. And you guys can see that things are working and and and they're going to they're going to be different. I just want to ask management and uh county management, the deputy managers that for next year before the the school rates get approved and then we certify them to have a public meeting to the public before certifying out the the rates and that so that that becomes a habit, you know, every single year. So, thank you guys. Thank thanks everybody for for doing this. I really appreciate that because you guys have to know that I know it was like there's little mistakes like that but we want to do things right and if we have to take responsibility for something we will and we're going to

correct it and I hope nothing else happens and if it happens we're going to we're going to work on it. We're going to work on it. Have that confidence.

Thank you Mr. Davis. Uh I I too again want to thank uh Superintendent of Schools Donley and uh our our county treasurer for for this uh study session along with staff. Uh and I think it's really critical that we continue this communication. I agree with my two colleagues uh and and set procedure. I I think Alejandro said it real nicely where I think if we make mistakes, we set procedures so it doesn't happen again. And uh I I think someone asked about audit auditing. We just so you know, we do have the state auditors that come in and audit us and and we also have hired an independent uh agency to come uh audit us as well. So uh um we have made some changes for the positive and and you know we're human. We make mistakes and we apologize. We apologize for the inconvenience and uh we will make it right. We will and thank you thank you all and for for your questions, your concerns. Uh, I know there's still the the lingering big question about do we have enough students? Um, should the school be open? I think that's uh a dialogue uh that needs to happen down the road for sure. Um but uh we do need to continue having these study sessions down the road, especially when our our our property taxes come out in uh in uh July. Uh and I again thank thank you staff uh all for putting this together and I want to thank the community as well for being here.

Um, with that said, um, if you have any other questions or concerns, feel free to email our our treasurer or us or call us and let us know. Mr. Can I have something else? Yes, absolutely. Absolutely. Go ahead, sir. Is there uh, county manager, is there any way that we can share that presentation on online? The the answer is yes. Yeah. Um

it's it's on the agenda. So it's on it's it's already public, but if somebody wants it, you're talking about place it on on our website. Nope. If it's online, it's online. It's available. Have access to it, right? The public has access to it. Yes, sir. Good. Thank you. Can I just make one last comment? Yes, sir. Republic.

I just again want to extend my sincere apologies for the mistake that occurred. I am definitely trying my hardest. I am definitely trying to still learn and grow. I'm sure you can understand or at least know that um the office that I stepped in was is not the best um or in the best conditions. It's not an excuse for the mistakes that are made. Um, and I am a person that was raised extremely well by my parents who I'm very proud of to take accountability for my mistakes, own it, and rectify it as soon as possible. And that's exactly what we're doing here. And what I will continue to do if any mistakes ever occur because I can one thing I can assure you is that I am human. Um, and that I might make more mistakes. And so bear with me. Come engage in conversations with me. I know it's not your job to educate me, but I don't know what I don't know. And if it's you that gets to educate me, I gladly welcome it and I appreciate it. So, I want to thank everybody again for what they've done. I want to apologize as well for any frustrations and or any hardships that might have cost through this incorrect tax bill. So, thank you.

Thank you, Alejandro. Thank you very much. you know, and and I think Alejandro mentioned it earlier. Uh, in this day and age, a lot of times as politicians, it's really easy to to lie and and point fingers, and that's not what we're about here in Santa Cruz County. Thank you, Alejandro, for your humbleness, and uh we really appreciate your hard work. Uh, with that said, uh, I believe all we have is item E, uh, adjournment. At this time, I'd like to entertain a motion to adjurnn. I move second.

I have a motion and a second. All in favor? I. All oppose. We're now adjourned. Thank you.