Statewide Web Site Notes Valley Hi Surplus

Statewide web site picks up on the incredible surplus in McHenry County's Valley Hi Nursing Home account.

Statewide web site picks up on the incredible surplus in McHenry County’s Valley Hi Nursing Home account.

I’m not quite sure what “Reboot Illinois” is, but reporter Nancy Mathieson has picked up on the humongous amount of money that the McHenry County Board is hoarding in its Valley Hi Nursing Home account.

But she mis-characterizes the state of the controversy.

She says, this “local controversy was quietly settled” when the levy for next spring’s tax bills was set at zero.

Mathieson asks the right question:

“How did Valley Hi Nursing Home in only nine years accumulate $43 million, or over half the size of the county’s entire annual property tax revenues?”

Mike Walkup is quoted in the article, as if District 4 County Board member Chuck Wheeler.

Walkup points out that a 2002 referendum was passed by about 5,000 votes with about 75,000 cast.

It seems to me that what to do to get rid of the surplus should be the top County Board issue.

Two alternatives have surfaced:

  1. Invest the $40+ million and use the interest to cover any operating deficits (no recent ones have been much since the nursing home is pretty much self-sufficient).
  2. Got to court and ask permission to rebate the money.


Statewide Web Site Notes Valley Hi Surplus — 18 Comments

  1. Based upon Illinois case law that I have cited as recently as today on this blog (See J. Gottenmoller’s alleged conflict of interest blog) the first option of Valley Hi keeping the money and investing it would be illegal.

    The only legal course of action is for MCBOT to sue itself and Valley Hi on behalf of taxpayers for Declaratory Relief pointing out the illegal levying at Valley Hi these many years, seek imposition of constructive trust and court appointment of receiver to take control of the funds for purposes of returning them to the taxpayers who were wrongfully assessed under McHenry County’s compulsory tax system.

    For those taxpayers who cannot be found, set up an account like they do at State level for unclaimed property. You cannot take illegally taxed monies and find a new home for it no matter how tempting . . . Statements from candidates calling such action “overburdensome” or “costly” holds no legal weight This is the price we pay for incompetence and in McHenry County, this price is apparently very high.

    Illnois law says taxing entities may not accumulate more than 2X (maximum) reserves for operating expenses. I am of the belief, that any MCBOT member who approved a levy for Valley Hi after 2x reserves on hand for operating expenses should resign as incompetent stewards of taxpayers’ money. If they do not, taxpayers of McHenry County should insist on resignations. This includes the two lawyers running for MCBOT Chairman.

    Didn’t anyone on MCBOT before approving annual levy at VAlley Hi ask how much money does Valley Hi currently have on hand? Why hasn’t Valley Hi’s feet been put to the fire for not disclosing to MCBOT this excessive taxpayer booty it had on hand since it is obvious no one on MCBOT cared to read or knew how to read Valley Hi financial statements.

    Walkup’s explanation begs the question that Illinois case law deems MCBOT levyig at Valley Hi illegal once 2x amount of operating expenses were on hand. What is most troubling is Walkup and Gottenmoller are attorneys who should have known better but either failed to do necessary research or knew and didn’t care all the while taking the salary and full-time benefits paid for by these same taxpayers.

    It is time “tax watch dogs” we elected stop panting from the sidelines and jump into the fray by motioning MCBOT to take immediate legal action against itself and Valley Hi on behalf of victim-taxpayers. Where is tea party activist Joe Walsh and his Walsh walkers on this issue? Time for them put down the mallets and stop “stumping” for candidates for a while and begin “humping” for the taxpayers who they say they protect and who put in elected office.

    Nick, Chuck and Andrew, what sayeth you on this issue?

  2. David is right.

    How stupid is our government in that they think they can just steal from us and then say it will all be better if they just get rid of the evidence?

    None of these people know what legal or illegal means.

    They just go their merry way making it up as they go along.

  3. Now that I reread David’s piece above, I am getting more an more irritated.

    “They” should be held accounatable for what they have done lo these many years robbing from the poor taxpayers.

    Totally inexcusable!

    The pitch forks should have ome out over this issue alone.

  4. David: The cases you cite are all pre-PTELL.

    Also, what is “MCBOT”?

    Our Board is just called the “McHenry County Board”.

  5. PTELL or Property Tax Limitation Law was enacted in 1991.

    In 1996, 5 years later, the Illinois Appellate Court in People ex rel Toynton v. Commonwealth Edison Company, 285 Ill.App.3d 357 (1996) held:

    “Based on our review of applicable case law, we do not agree with the argument that a taxpayer cannot meet its burden of showing an excess accumulation unless the accumulation is at least 2.84 times the average annual expenditure . . .

    “We conclude that a tax objector can meet is burden to show excessive accumulation by presenting evidence that the accumulation in the fund exceeds two or three times the annual expenditures for the fund.”

    The post PTELL Toynton Court cites many of the pre 1991 cases that I have put on this blog including the Illinois Supreme Court Rule case of some 60 years, People ex re Harding v. C&N.W Ry Co., 413 Ill. 93 (1952) where Illinois Supreme Court opined:

    “Where a balance is on hand amounting to a little less than 2 years requirements, as established by recent prior experience, a levy is unnecessary.

    “Levies which results in an unnecessary accumulation of funds are invalid”

    (People ex rel. Toman v. Grendada Apartment Hotel Corp., 36 Ill. 41).

    Mr. Walkup, PTELL does not provide a license for government bodies to build-up grotesque amounts of tax reserves off the sweat of the taxpayers’ it rules over.

    In fact, the “L’s” in the PTELL acronym stand for “Limitation Law”.

    Had you shepardized the cases I cited, I do not thinkg we would be having this conversation.

    PTELL has done nothing to change the longstanding common law in the area of levy and municipal taxation, at least to my knowledge.

    If you have a case which states the contrary, please post it on this blog.

    If you cannot find a case to support your legal proposition, it is time you take the lead and demand of the “McHenry County Board” (“MCB”) to do the legal thing and take necessary action to return all of these Valley Hi Ill-gotten tax revenues to their rightful owners, the taxpayers of McHenry County who through compulsory powers of McHenry County government involuntarily paid into this fund, including me.

    Regarding acronym MCBOT it stands for McHenry County Board of Trustees; but you are right “Trust” is not a word included in the the title of this board and based upon past performance, rightfully so.

    Therefore in the future I will be careful not to include the word “Trust or Trustee” in any Acronym used to describe this board.

    Finally, Mr. Walkup, irrespective of PTELL, for year 2016, MCB approved a “0” levy for Valley Hi.

    If PTELL allows MCB to do this then it should have been done 35 Million Dollars ago.

    Your argument falls apart based upon your own and MCB action this year concerning Valley Hi levy.

    But Mr. Walkup I appreciate your willingness to engage on this issue and why I may vote for you just yet.

    Maybe candidate for MCB Chairman J. Gottenmoller would like to chime in as well.

    I am anxious to hear Gottenmoller’s reasoning for allowing 41 Million Dollars in tax reserves to accumulate at Valley Hi.

  6. Give the money back to taxpayers.

    No one can afford to live in McHenry County unless they work for government.

  7. Who are we giving the $$$$ back to?

    Allot of the people who paid so many years are dead or retired somewhere else.

    The newbies deserve the same kick back?

    40m minus 16% for commercial and industrial some of which doesn’t exist anymore, divided by the present population is about $110.00 per person

    Wouldn’t it make more sense to keep it together and pay off some of the county debt the dead and retired help to create so we at least don’t have to pay so much in interest payments in the future.

    Just a thought.

  8. It should be distributed not by population, because population didn’t pay it.

    Taxable property paid it.

    Whoever is abated or exempted from paying property taxes ( tif, ezone) shouldn’t get it, they didn’t pay it.

    There is about $7 billion eav ( equalized assessed value) in the county.

    $40 million /$7 billion is .0057 per each dollar of eav.

    So it could be returned pro rata to property taxpayers based upon their TAXABLE (not exempted or abated) eav, at $0.0057 per dollar.

  9. Knob

    When your child steals a candy bar do you instruct the child to give the candy bar to someone in need or back to the merchant the child stole it from.

    This is not about giving newbies a break but about returning stolen property to its rightful owners with interest.

    Your solution may make sense to many, but my solution is legal.

    This mess is the result of electing incompetent people to office.

    Hopefully this will cause voters to focus more on a candidates qualifications rather than what political team he or she hails from.

    Valley Hi represents many years of incompetence and oversight and is indicative of a bigger problem in McHenry county and that is government bloat and overtaxation.

  10. Reboot Illinois has been around for a few years.

    They are an online blog fed up with the government & political status quo.

    They have some original content as well as links to and comments about news stories on other websites.

    They are based in the Chicago area.

  11. David, I’m suggesting a alternative use that makes fiscal sense for us all.

    Of course we should be asked before they would do as I suggested.

    Ya know most will just piss it away, which is their right of course.

    Thx for being the voice on this subject, I’d hope you attend board meetings when this issue is discussed.

    In fact if you plan to attend let us know, I’d like to see their reaction. 🙂

  12. It may make fiscal sense, but it is still illegal.

    The levies at Valley Hi are “void abinitio” meaning at law they never occurred.

    The annual tax levy on residents for Valley Hi was illegal!

    In otherwords, while the 41 Million Dollars is in possession of Valley Hi through compulsory tax powers of the county Board, these monies “are” and always “were” the property of the taxpayers who paid into this fund because the levy(ies) was “illegal” to begin with once reserves reached higher than 1.5X and certainly 2X the dollar amount of Valley Hi annual operating expenses.

    Knob, what you are proposing is “theft”.

    Robin Hood had good motives, but he was still stealing.

    I do not want a Robin Hood style of county government, I want legal county government.

    As long as it is legal, how a taxpayer spends his or her own money is of no concern to county government.

    Hey, additional 35 MIllion in McHenry County residents pockets may spur the local economy.

    I live on the Eastern portion of McHenry County and it takes me almost an hour to get to a meeting but I may show up when Valley Hi is on the agenda.

    I think it is time we the taxpayers demand these meetings be streamed on line or on cable, the cost is minimal.

    Where are all the transparency Board members on this issue?

    Why have J. Gottenmoller, Tax wathdogs and Walsh followers: A. Gasser, N. Provenzano and C. Wheeler refuse to chime in on this blog.

    The largest tax abuse in the county and we hear “mum” from them.

    More importantly why have they neglected to take the lead moving the Board in the direction of returning these Ill-gotten tax revenues to back to the taxpayers?

    Where is my District #1 representative Bob Nowak on this issue, haven’t heard “boo” from him.

    Can somebody please find Bob and notify him duty calls.

  13. There is a second question:

    What (if any) benefit was derived from maintaining the float in an uninsured (above FDIC insured limits) checking account of these many millions of dollars over these many years?

    Was any decision maker instrumental in parking this money benefited in any way (such as obtaining favorable-term loans from the financial institution)?

    That should be an easy question to answer “no”.

    May we have that answer from Peter Austin?

  14. David, illegal?

    I believe I said the public would have to asked, ie a referendum what to do with the $$$$.

    I also live in Dist 1, almost on the Lake co border, no need to worry about the crowded bridges.

    WHO, you still haven’t answered that question?

    Class action suits as to who, I can see it now.

  15. You do not have a referendum to determine what to do with property which does not belong to the county.

    This is not a subject open to popular vote especially by those who were not robbed.

    It is the property of the taxpayers who involuntarily paid into the system not every McHenry county voter who may or may not have paid into the system.

    Any lawsuit would have to be filed in the form of a joiner and not class action.

    You could not get a class certified.

    I have given enough free legal advice going forward I am on the clock need to pay my McHenry county taxes.

  16. Peter Austin does not invest the money; the County Treasurer does.

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