An error is assessing Dover Schools’ valuation last year will result in that district’s taxpayers seeing a sharp increase this year.

New Dover Superintendent Jay Wood was alerted of the issue earlier this fall and, after investigating, sent a letter to the district’s patrons alerting them of the issue last week.

“The current county assessor discovered a mistake when totaling the 2021 property valuation,” Wood wrote.

The district was originally assessed at $102 million last year, which was up $19 million from the year before.

Although larger than most, the increase had continued the trend of the last decade.

At one point, Dover’s valuation was $9.3 million, but in seven years it jumped to $76 million in 2019. It was $83 million the next year.

When last year’s valuation came in increasingly larger, it was good news for the district as it was beginning to pay off a series of bonds voters approved in August 2020.

That bond issue, to build a new elementary, was for $16.5 million over 15 years.

However, once the mistake was discovered this year, the taxes are going to make a steep one-year increase as Dover’s valuation for 2022 dipped to about $81 million.

“Because of this, the sinking fund millage levy will go from 11.45 mills to 23.5 mills,” Wood wrote. “This will result in roughly $185,000 total tax increase for the year.”

Wood added the change in millage won’t affect property valuations.

County Assessor Carrie Turner said she discovered the mistake when assessing this year’s valuation for the district.

“I found where an oil and gas company was duplicated in the system,” Turner told the Times & Free Press.

“The company was bought out and the name changed, therefore when they applied for the fiveyear exemption it came in under the new company name, creating the duplicate account.”

Turner was referring to the state’s incentive program that allows certain new businesses or those under new ownership to be exempt from paying ad valorem taxes for the first five years of operation.

The exemption itself was not the issue in the miscalculation. The problem was that the assessed value of the property for the business was added twice into Dover Public School’s total property valuation – once under the old name and again under the new name.

Wood said the error does not put Dover property taxpayers in a worse position than what was presented to voters when the bond issue was approved.

Dover’s valuation was sitting about where it is now when the bond issue was passed overwhelmingly by voters.

When presented to voters, the school board actually conservatively projected a 1% decrease in valuation annually for 12 years.

“Even though you will see an increase in your taxes, the tax rate proposed for the school bond is actually still lower than projected when we ran the bond election,” Wood wrote.

However, the district has another $7 million in property taxes tied up in district court protests by wind and oil and gas companies operating in the district, Wood said.

“When large companies protest their ad valorem taxes, these protests go into litigation…that could take years to resolve,” Wood said.

“These ad valorem taxes affect our bonds as well. Our bond payments are regulated by property valuation. When these companies protest, tax dollars are held in trust until the protest is settled.”

Dover and other districts in the county may never see a large chunk of that protested money.

The state supreme court last month ruled that federal production tax credits are intangible property and not subject to ad valorem taxation.

That ruling upheld a previous ruling in district court in favor of Kingfisher Wind LLC that was being appealed by assessors in Kingfisher and Canadian counties.

It means a difference of more than $283 million in the company’s combined property valuation in the two counties.

While Dover is not one of the school districts who share in that valuation, the supreme court’s ruling likely will influence the outcome in the protests filed by Red Dirt Wind, which operates turbines located within Dover’s district.

Red Dirt’s litigation is among a dozen or so pending state court cases also contesting inclusion of production tax credits in property valuations.

Red Dirt filed its most recent appeal in Kingfisher County District Court this year, but the company also has contested its valuations for the previous four tax years, all of which have been consolidated into a single court case yet to be resolved.

The supreme court left open the possibility that the legislature could act to close the loophole that excludes production tax credits from property tax valuations for wind farms.

But unless and until that happens, the Kingfisher Wind ruling presumably would be binding on all pending and future protests that raise the same issue.