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— 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

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