County might join class action PILT lawsuit
Lincoln County might join a class action lawsuit that seeks to recover additional payments in lieu of taxes (PILT) for fiscal years 2015, 2016 and 2017 — years in which a federal claims court has determined insufficient funds were paid.
The county has until Sept. 14 to join the lawsuit. Participation would cost the county nothing out-of-pocket, but legal fees might be deducted from any proceeds awarded to the county, according to a notice from the U.S. Court of Federal Claims in Washington, D.C.
“If it doesn’t cost us a dime, we might as well throw our hat in the ring, especially being one of the largest PILT recipients,” County Administrator Darren Coldwell told the County Commission on Wednesday during an administrative discussion.
The item will be placed on a future commission agenda for the commissioners to vote on, Coldwell indicated.
Payments in lieu of taxes, authorized in 1976, are payments the federal government makes to local governments to help offset losses in property taxes due to non-taxable Federal lands within their boundaries.
Lincoln County has received $7,063,349 in PILT funds since June 2009, according to figures Lincoln County Treasurer Nancy Higgins provided Thursday. The money can be used for matching grants, emergency needs, unforeseen legal costs and other items, Coldwell previously told The Western News.
The class action lawsuit arose from legal action Kane County, Utah brought against the United States. The U.S. Court of Federal Claims subsequently “allowed, or ‘certified,’ a Class Action Lawsuit against the United States to recover amounts which the Court has determined that the (federal) government was required to pay units of local government … but did not pay in full in fiscal years 2015, 2016 and 2017,” according to the court notice.
The notice states that the federal government denied needing to pay any additional amount for those three fiscal years, but that the court ruled the federal government was “obligated” to pay “the full amounts calculated by a formula set forth” in the law that authorized the payments.
While the court has not yet determined how much the federal government underpaid local governments during those three fiscal years, the notice states that legal counsel for both the plaintiffs and the federal government so far “have agreed on the amount of the underpayment in fiscal years 2015 and 2016.”
The notice does not explain why those three years were underpaid.
According to the court notice, Alan Saltman and the firm of Smith, Currie and Hancock were determined by the court to be “qualified” to represent all class members in the legal proceedings, though any class member would be allowed to hire its own representation at its own direct expense.
No trial date has yet been set, the court notice states. If a trial on damages were to be held, class members would not have to attend. Any court decision would be open to appeal.
By opting into the class action suit, Lincoln County would give up its right to sue the federal government on its own for the same claims made in the lawsuit.
The county need take no action if the commission chooses not to join the lawsuit.