CLEARLAKE, Calif. – The Clearlake City Council concluded at the end of a special Wednesday meeting that it would call on local and state agencies to take action and begin an investigation of the Lake County Treasurer-Tax Collector’s Office regarding what the city alleges are failings to uphold legal duties, including holding tax sales.
During the hour-long meeting on Wednesday afternoon, the full council – including Vice Mayor Dirk Slooten, who was on video conference from Strasbourg, France – voted to approve letters proposed by City Manager Alan Flora to the Board of Supervisors, the Lake County Civil Grand Jury, the California State Controller, California State Treasurer, California Board of Equalization, the California Attorney General’s Office and possibly others to request an investigation of Lake County Treasurer-Tax Collector Barbara Ringen.
The letters allege Ringen has been negligent in her duties, has “willfully failed” to perform her official functions as well as those required by law, and breached fiduciary duties to the electorate by failing to take action on the thousands of tax delinquent properties “that could otherwise be tax producing properties on the tax roll.”
The letter to the supervisors specifically asks for the county to provide Ringen with resources to facilitate an additional tax sale in the second half of next year, to pursue any and all options to facilitate regular tax sales – including supporting the efforts to have her retire or resign – and demands a formal written response from Ringen.
The city also is asking for the auditor-controller to provide a report on the Teeter Fund, which is how the county allocates tax revenues on tax defaulted property.
The Board of Supervisors last year discussed issues with Ringen’s office – including tax sales – on several separate occasions, and earlier this year formed an ad hoc committee to work with her.
However, so far, indications are that solid improvements haven’t occurred, and Ringen has said in meetings with the board that staffing remains a key challenge.
Targeting concerns
Flora said the city has been concerned for some time about the number and continual increase of properties in tax default and the inability to have them placed for sale by the Treasurer-Tax Collector’s Office.
He said they believed it’s necessary for the council to ask the supervisors to take additional action. While the treasurer-tax collector also is an elected office, the supervisors have oversight of her budget.
Flora presented statistics in the letters that, he noted, differ from those he gave to the Board of Supervisors at a September meeting because they have since been updated.
Key points in the letters include:
– 3,652 out of 14,191 parcels in the city have delinquent taxes. Of those, 2,204 have been in tax default for five years or more, automatically qualifying them for tax sale and further triggering a legal obligation on the tax collector to bring them to auction. Some parcels have been in default since 1981.
– 15 percent of all Lake County parcels, or 12,500 properties, are in tax default.
– The total defaulted amount of property tax currently due countywide is $18.3 million; of that, $8.3 million is currently eligible for sale.
– The city sent a list of 166 properties to Ringen’s office, requesting that they be included in the March 2020 tax defaulted property auction. Clearlake city staff has heard indirectly that 27 of them will be included in the tax sale.
“It's really causing a significant blight in our community,” Flora said of the building of tax defaulted properties, noting it’s impacting development, draining resources and causing a threat to public safety and welfare.
“The letter seems to be very appropriate,” said Councilwoman Joyce Overton, adding, “I think we got our point across.”
Supervisor Bruno Sabatier, who before joining the board in January had served a term on the city council, said he’s been trying to deal with problems associated with the Treasurer-Tax Collector’s Office since taking office. He said he believes the tax defaulted properties lead to code enforcement issues.
Referring to the statistics cited in the letter, Sabatier said he’s not sure of how to get the properties up for tax sale. He said jurisdictions should be able to say which properties go up for tax sale, but now it’s in the treasurer-tax collector’s hands.
Sabatier said he and Supervisor Moke Simon have been part of an ad hoc committee meant to push Ringen into action. He said a tax sale scheduled for June didn’t happen.
The ad hoc committee asked Ringen to resign due to her inability to do the job, Sabatier said.
In June, Ringen – whose term ends Jan. 1, 2023 – submitted an email to the ad hoc committee announcing her intention to resign and giving a Jan. 10 date, which she has since withdrawn, as Lake County News has reported. Sabatier said he’s acting as if the resignation date is still in force.
In the last 11 years Lake County has had seven tax auctions, Sabatier said, citing the letters. Two of those have taken place in the last five years, which is during Ringen’s time in office.
Sabatier called the amount of outstanding unpaid property tax of $18 million “insane.”
He added, “I’m here to help.”
Mayor Russ Cremer asked, “Are you on an island?” Sabatier responded that there is support in the county.
A growing problem
Sabatier said new parcels are added to the list of tax defaulted properties at the rate of about 150 a year. They usually don’t get on that list until they’ve been in tax default for five years.
He said after next year, he anticipates seeing the impacts of people not paying property tax following the fires that began in 2015.
Councilman Russell Perdock asked about Ringen's staffing. Sabatier said she’s at 80 percent overall. However, there are only two positions devoted to tax sales and one is filled. During this summer’s budget hearings, Sabatier unsuccessfully fought against a proposal to cut staffing in Ringen’s office.
Perdock said the issue impact quality of life and special districts, such as fire, roads and other services.
Flora said the list of tax defaulted properties is “staggering” and grows significantly each year.
“This is long overdue,” said Slooten, adding that if they don’t pay attention to the matter, it will only get worse.
He said he understands the need to keep a working relationship with the county, but said the issue with tax default properties is costing both the county and the city money.
Councilman Phil Harris asked Clearlake Police Chief Andrew White about whether the delinquent properties contribute significantly to the problems in the city.
White said he’s informed by Code Enforcement staff that yes, they do. He said that the city often has to abate properties or hire a contractor to do so.
Harris said the properties are not only not contributing to the city’s problems but also are a continuous drain on city resources. He said he found it alarming that the county itself and the Treasurer-Tax Collector’s Office haven’t already seen this as an enormous issue and taken action.
“This is such a multifaceted problem, and it contributes to every negative aspect of our community,” Harris said.
Flora said it’s a countywide problem, noting that in Hidden Valley Lake, 15 percent of the properties are in tax default.
Exploring solutions
Overton said she was looking for a solution and wanted to know if some of the work could be outsourced. Sabatier said there is a three-step process involving doing a research portfolio on each property, issuing a public notice and then doing the auction. The county already outsources the auction but he’s been told that nobody does the first two steps.
Overton raised the issue of whether there is enough staff to put together the portfolio, which Sabatier said he believes is a “lousy excuse.”
When Overton again asked if it could be contracted out, Flora said it’s a possibility, and that he had offered to the board in September that they could talk about ways to facilitate the sales.
However, Flora added, “This is the county's responsibility.”
He said nobody is losing more money because of the failure to hold tax sales than the county, noting that the county has to front unpaid property tax to other taxing entities through its Teeter fund.
“As important as it is to us, the county should find it more important than we do,” Flora said.
Overton asked how much money is in the Teeter fund. Flora said the county won’t make it public, which is why the letter specifically asks the auditor-controller to provide the information.
Noting that there are many responsibilities that the treasurer-tax collector has solely, Flora said, “The ultimate plea at this time is the county and the tax collector need to do their job as required by the law. it's not our responsibility to do it.”
At the current rate tax sales are taking place, Flora said it averages out to 70 properties being sold each year. “It's ridiculous to think it's addressing the problem in any way.”
Sabatier said he will suggest inviting a city representative to take part in an upcoming ad hoc committee meeting.
Cremer said he doesn’t see the city being involved with the actual process of handling tax defaulted properties. “It's not within our purview, quite frankly,” he said, adding he loves the idea of going to an outside company to do some of the work.
Cremer added that he expects Sabatier will go to the county about the matter and let them know the city is serious. “This needs to be solved. It cannot go on any longer.”
Overton moved to approve submitting the letters to state and local agencies seeking an investigation, with Harris seconding and the entire council voting to approve.
“You have your direction,” Cremer said to Flora after the vote.
Cremer added of the letters, “Hopefully they're going to do the trick.”
Email Elizabeth Larson at This email address is being protected from spambots. You need JavaScript enabled to view it.. Follow her on Twitter, @ERLarson, or Lake County News, @LakeCoNews.
BOS Tax Collector Letter 11-20-19 by LakeCoNews on Scribd
State Controller Tax Collector Letter 11-20-19 by LakeCoNews on Scribd