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Cass County Board: Tax payments on garbage incorrectly collected

Brainerd Dispatch file photo

WALKER—When the state of Minnesota recently audited Cass County for its payment of garbage taxes, it found the county had both underpaid and overpaid the tax.

Cass has two satellite garbage transfer stations — one just north of Hackensack and one at the May Township site where there also is a county highway garage. The county accepts garbage at those from individuals self-hauling their garbage to the satellite.

So, the county had been charging the self-hauler rate of 9 percent on amounts individuals paid and which the satellites then had a refuse hauling company take to the county's main garbage and recycling center north of Pine River.

The state determined the county is a commercial operation. It did not matter how the county got the garbage. It did matter that the county paid a refuse hauler to take it to Pine River, so the county should have been paying the 17 percent commercial rate.

The audit covered from Aug. 31, 2015 to Dec. 3, 2018.

The state determined Cass owed the 8-cent difference or a total of $4,513, plus $156 interest. The state waived a penalty.

The state also found the county failed to provide the two haulers who transport garbage from Hackensack and May Township to Pine River a form, which states the county has already paid the tax, so the hauler doesn't have to collect and pay it.

So, both haulers were charging the county the 17 cent tax rate and paying it to the state. Basically, the state got paid twice — once by the county and again by the haulers.

The state calculated the haulers collected from the county and paid $18,596 more than they should have.

Both haulers now will have to apply for a refund from the state, so they can refund it to the county.

Once the county pays its underpayment and receives its refund from the haulers, the county will have a net gain from the audit of $13,928.

Cass County Solid Waste Committee of the Board: Commissioners Neal Gaalswyk and Bob Kangas recently met with Chief Financial Officer Sandra Norikane, Administrator Joshua Stevenson and Environmental Services Director John Ringle to review the first year of the county's current contract with KDR to operate the garbage and recycling main transfer station north of Pine River.

County employees have found some revenue specified in the contract has not been remitted to the county. Some services being paid for in the contract with KDR also are being billed by local contractors.

The committee discussed providing notice to KDR on non-compliant contact terms, but did not recommend any county board action until after KDR responds to that notice.