The Tax Collection Mess: Escapes And Delinquents

Property taxes collected by the County are the primary funding source for schools, special districts and the County. The majority of the County’s share of property taxes goes to law enforcement. When a core function like tax collection isn’t attended to, all those entities suffer.

In September of 2023 when the Supervisors met on the Coast, Coast realtor Dierdre Lamb had a rather lengthy exchange with the Board. Lamb tried to tell the uncomprehending Board that the Supervisors should increase the Tax Collector staff. “I sell luxury homes,” said Lamb, adding that her clients “want to pay their taxes” but many of them have not even been billed. Ms. Lamb said she advised her clients to set aside money for the day when a big bill for accumulated back taxes came in the mail.

Instead of pursuing this low-hanging revenue windfall, the board abruptly switched gears, citing the budget bump they gave the Assessor’s office the prior year, which of course did nothing to address the understaffed Tax Collector’s office.

Remember: the Tax Collector’s office had suffered a major staffing setback in March of 2022 when long-time Tax Collector Schari Schapmire and her long-time senior assistant Julie Forrester retired prematurely when the Board rashly consolidated the Tax Collector’s office with the Auditor’s office against the considered advice of Schapmire and Auditor Chamise Cubbison (and many others). (They are now in the process of belatedly “deconsolidating” those offices.) The office suffered a further blow the following month when the Board vindictively suspended the Treasurer-Tax Collector/Auditor-Controller on what turned out — 17 months later — to be bogus misappropriation charges filed by the DA.

The Tax Collector’s office thus had no one left with significant tax collection expertise. At the time the state had paused some property tax collections during the covid interlude which was the beginning of a burgeoning backlog of uncollected taxes. And here was Mendo suddenly without any experienced tax collection staff. Mendo has not conducted a tax lien sale since 2019 and when asked in 2022 for the list of properties to be sold for back taxes, the County said they had no list.

On top of the covid pause, there are a variety of ways property taxes can go uncollected. They fall into two basic categories: “Escapes” and “Delinquencies.”

Escapes occur when properties (commercial and residential) go unassessed, are under-assessed, and, according to the state tax collector, “escape bills” are issued when the County somehow discovers unreported assessed value changes like new construction, change of ownership, or assessment errors, covering taxes due for prior years. These bills for back taxes are triggered by events like adding a room, unreported ownership transfers, business audits, or market conditions, resulting in a new, higher valuation. Escape collections are essentially corrections of past errors and oversights. They are not classified as an unpaid tax bill. And they are not quantified because the County only knows about them if or when they are “discovered.”

Delinquencies are unpaid tax bills. Unpaid taxes are easier to quantify because they are the difference between what a property owner is billed and what they pay.

Each year the County calculates the amount of unpaid tax bills in a given fiscal year and calculates a percentage and puts it into the Annual Comprehensive Financial Report. The property tax base assessed value has increased over the last ten years due to inflation and upward assessments. But the collection rate has gone down leaving millions of accumulated dollars uncollected. In the last ACFR (for 2024) the County reported that in that fiscal year there was $9 million in unpaid (delinquent) tax bills, up from $7 million the year before. But what about the late payments, the payment plans, the penalties and interest that came in late? How much was that worth? In a footnote to the ACFR delinquency chart the County’s outside auditor says, “No data available. Collections in Subsequent Years are not available from the County’s current property tax system.”

In the recent $800k state Audit report, the State Auditor said:

“We asked the county whether it has taken longer than four years to complete assessments [after four years most uncollected taxes have to be written off], but the county was unable to provide an answer based on data from its property tax system. The county provided us with workload reports showing that its staff had more than 7,300 assessments to perform. However, after meeting with the county’s staff and comparing information in these reports to other information in the county’s property tax system, we determined that the workload reports could not tell us or the county how long these assessments had been pending completion. In other words, the reports the county can produce from its property tax system cannot help the county manage its workload in a strategic way.

“Strategic” meaning giving priority to larger unpaid tax bills that are at risk of becoming uncollectable.

“In the absence of being able to rely on more useful reports from the system, the assistant assessor provided examples of annotated work reports some staff create to triage their work, and the assistant assessor explained that other staff just work their assigned items in batches.”

That was just the Assessor’s office. The State Auditor then switched to the Tax Collector’s office:

“Compounding these problems, the assistant treasurer-tax collector indicated that the issues with the property tax system have distracted efforts to collect past due taxes from property owners. The list of properties in default status as of December 2025 that the county provided to us identifies that taxpayers owed $30.6 million in uncollected property taxes, penalties, interest, and fees pertaining to about 4,200 properties. $17.5 million of this owed amount was attributable to tax years 2023 through 2025. The assistant treasurertax collector explained that she and her staff spend time developing solutions to issues with the property tax system, and that issues related to the property tax system cause delays to billings, payment plans, and other tasks.

“We noted that data published by the State Controller’s Office (SCO) demonstrates that Mendocino has had declining property tax receipts when compared to the total taxes charged over the last few fiscal years. Specifically, the county received 97.7 percent of the tax revenue it charged in fiscal year 2021–22 within that fiscal year, but that percentage declined in the following years, reaching 94.3 percent in fiscal year 2023–24.”

On the plus side, in November of last year Auditor-Controller/Treasurer Tax Collector Chamise Cubbison told the Supervisors that the County had received about $4.1 million more in property taxes than was expected. But nobody knew where that surplus came from. Ms. Cubbison suspected at least some of it came from the above mentioned escapes due to some back taxes being paid late. But the county’s computer tax collection system shortcomings made it difficult to say.

The County doesn’t know how much delinquent taxes have been paid, they don’t have reports on the status of assessments, they don’t know how much is owed or how much is interest and penalties, they can’t generate a list of which delinquent taxpayers they should focus on, they have at least $30.6 million in accumulated unpaid taxes…

Yet the Supervisors say time and again that they have a multi-million dollar structural deficit that requires major staff cuts.

What a mess!

How hard would it be for the Supervisors to at least ask the Tax Collector for a report on tax collection status and offer the tax collector whatever reasonable revenue-generating staff or outside assistance she needs? Apparently that’s beyond this Board’s limited ability because nobody disagreed back at that September 2023 Coastal meeting when lame-duck Supervisor Dan Gjerde replied to Ms. Lamb, “We have dealt with Assessor staff increase and higher wages in her department. We have given more assistance to the Assessor to help them catch up. So we are doing everything we can.”

Neither Gjerde nor his colleagues mentioned offering assistance to the Tax Collector’s office.

Astonishingly, Supervisor Williams finally mused: “Maybe we should have an agenda item on how do we collect the taxes that are due and unbilled?”

(Former) Supervisor McGourty agreed, with one of his classic idiotic pearls of wisdom: “You can’t get anywhere unless you have a plan, correct?,” said McGourty, adding, “At some point we need to take action.”

But, as usual, nobody “took action.” Instead they accepted CEO Antle’s hilariously lame remark: “I have met with the Assessor and we are looking at how to improve the process.”

That was more than two years ago. So they’ve they’ve known about the problem and haven’t done anything to address it. They shouldn’t have needed the State Auditor to tell them that they were delinquent in collecting tens of millions in taxes due.

Since that time, neither CEO Antle nor Auditor-Controller/Treasurer-Tax Collector Chamise Cubbison have reported on the results of whatever Antle was “looking at.” And not one Supervisor has suggested an agenda item on the subject, not even after the State Auditor highlighted the problem.

In our next installment, we will discuss the implications of this tax collection mess on the Teeter Plan, the tricky accounting procedure that requires the County to pay schools and special districts their large property tax allocations based on the tax bills sent out, and which is supposed to let the County recoup those taxes with penalty and interest that the County gets to keep — if they are paid.