BENTON COUNTY — More than $1 million in undis
tributed taxes have been dis
covered in five bank
accounts, according to
Benton County Tax Collector
Gloria Peterson.
The taxes were for 2006
and 2007 - meaning the
money was collected in 2007
and 2008 - but never sent to
the taxing entities, according
to information from Peterson.
Peterson will file a petition
with the County Court of
Benton County to approve the
distribution of $1,417,645.30.
By law, that
money was to
be distributed
to the appro
priate entities
one month
after collec
tion. Instead, it
has remained
in five different bank
accounts, untouched and
undistributed for more than
two years.
"This problem existed
before I took office (in
January) and we've worked
with state auditors to responsi
bly identify the proper distri
bution of funds," Peterson said.
"When this was discovered
and we saw the balance in five
different accounts, still sitting
there, we knew immediately
that money should not be
there." Based on information the
Benton County Tax Collector's
Office has compiled,
$1,261,704.32 for taxes levied in
2006, while the remaining
$155,940.98 was levied 2007.
The appropriate division of
the tax receipts in these
accounts could not be fully
identified, Peterson said.
Peterson proposes to distribute the money based on the prorated share each taxing entity received in those years.
On Friday, Benton County attorney George Spence provided spreadsheets that detail the amount each taxing entity - including cities, school districts, fire departments and parking districts - would receive if the court approves Peterson's plan. The Bentonville School District, for example, stands to receive $412,526.16, while the Rogers School District would get $401,699.09. According to the documents, the city of Rogersstands to receive $49,959.91.
On the other end of the spectrum, Springtown would receive $18.73 and the Pleasure Heights Volunteer Fire Department would receive $6.01.
Of every tax dollar that passes through the Benton County Tax Collector's Office, 80 cents goes school districts, 10 cents to city governments, 8 cents to county government and 2 cents to county/city roads. Peterson said she's already spoken with several of the financial officers and leaders of these entities about the situation.
The tax dollars in these accounts were collected under former tax collector Greg Hoggatt's watch. This discovery of undistributed funds is not Hoggatt's first. In November 2005, $1.6 millionwas mistakenly placed in an interest-bearing account and was not distributed in 2006, as was required. An auditor noticed the error the following February.
"It was our mistake," Hoggatt said when that discovery was made. "It was during a busy period, and the mistake has not been repeated."
According to Peterson, there is no indication that excess taxes were collected or that any taxes received, as part of this most recent discovery, are missing. The more than $1.4 million has remained in the bank accounts of the BentonCounty Tax Collector's office since they were receipted for 2006 and 2007, according to a release issued Friday by the tax collector's office.
"There's definitely an issue of public trust," Spence said.
"This involves elected officials, but there has been absolutely no evidence to suggest any wrong doing here. It appears to be more a matter of poor bookkeeping. If anything different had surfaced during the audit, this would be a very different story."
Peterson said all tax receipts are now being properly accounted for and distributed as the law requires. The implementation of a new software package has ensured the ability of the tax collector's office to properly reconcile all taxes receipts to bank statements and prepare a proof of cash, both of which are now being performed monthly.
"I said during my campaign, we have to create a position for a collector's financial administrator," Peterson said. "That
person is in place now and has
been extremely helpful
through all of this. Monthly
balancing wasn't taking place
before. There have been differ
ent balancing procedures put
into place and we have new
software capable of handling
what we need it to."
Community, Pages 3 on 08/19/2009