County backs assessor on ECDC tax issue

Uinta County Commissioners Eric South and Craig Welling listen to local attorney Sharon Rose during the Sept. 15 commission meeting in Evanston. The two were at odds on whether the Evanston Child Development Center should be classified as a school or a daycare. Commissioner Mark Anderson agreed with South, upholding the county assessor’s belief that ECDC is a daycare and should be responsible to pay property taxes. (HERALD PHOTO/Kayne Pyatt)

EVANSTON — A controversial decision was upheld last week at the Uinta County Commission meeting that could result in the long-exempt Evanston Child Development Center (ECDC) having to pay up to $13,000 in property taxes. The decision, which came during a non-unanimous vote — which is as rare as hen’s teeth for the governing body — classifies ECDC as a daycare, rather than a school. Those concerned about the entity’s status filled the commission chambers on Tuesday, Sept. 15.

Local attorney Sharon Rose served as examiner during an Aug. 25 Uinta County Board of Equalization hearing after ECDC questioned Uinta County Assessor Lori Perkins’ decision to repeal ECDC’s tax-exempt status. She attended last week’s meeting via telephone because she said she wasn’t made aware that she was on the agenda for the meeting.

The question brought before the equalization board was whether ECDC fit the definition of a traditional educational institution, which would qualify it to be exempt from paying taxes on the property it occupies. The board had to decide if it would support Perkins’ decision to tax ECDC.

Rose said she had arrived at two schools of thought on the matter. One is that the program ECDC provides could qualify as traditional education and there was some evidence to support that, including certification by the local school district for ECDC teachers. ECDC met viable criteria set by the school district, she said.   

The other school of thought is that education is ordinarily provided by the government at taxpayers’ expense. Wyoming school districts are not required by law to provide preschool, she said, and on that basis, it is not provided for by taxpayers.

“However, studies show that children who have not had preschool before entering traditional education have a higher risk of teen pregnancy, drug use and criminal behavior later in life,” Rose said. “Those children who attend preschool and kindergarten are better prepared for the traditional classroom.”

Commissioner Craig Welling asked Rose, “What was your determination in your communication with us?”

Rose said it was her understanding that two out of three board members decided that since the school district is under no obligation to provide preschool education, they agreed to support Perkins in her determination to tax ECDC.

She said the one board member who disagreed had thought the statistics of the importance of preschool would be enough to give ECDC an exemption. She said that ECDC has the right to file an appeal to a higher board.

Welling addressed ECDC Director Kendra West and the large number of teachers and parents who were in attendance at the commission meeting.

“I was the dissenter,” Weling said. “I asked myself (during the Aug. 25 hearing), ‘Is ECDC a school?’ Superintendent Ryan Thomas gave a convincing argument. By the very nature that Thomas evaluates potential teachers at ECDC and those teachers earn college credits for teaching from that institution — that gives us a lot of evidence that ECDC is indeed a school. We deliberated this evidence extensively. The other debate was that this institution provided to the taxpayer a service that wasn’t ordinarily provided by the government. I felt there was a great benefit to the public directly through the efforts of ECDC. Their curriculum aligns with UCSD No. 1, as well as the things being taught.”

Welling said there are other consistencies between local public schools and ECDC.

“As I understood it, the children receiving this curriculum are evaluated to see if they are on track to enter the traditional school, and if they are not, there is remediation in place to provide corrections in order for the child to enter a school of education,” Welling continued. “By doing so, a portion of public expense that would normally be expended would be eliminated. Also, the other side effects of no preschool Rose mentioned in the statistics would be remediated. Being in preschool would carry them forth into the tradition of public school, so I just think we owe an explanation of why our opinions differed. Fortunately, we have a democratic society and the other two men voted differently.”

Commissioner Mark Anderson followed with his explanation.

“Mr. Welling has described clearly how this decision came to be,” Anderson said. “For me, my hang up was the description in the Department of Revenue rules regarding an educational institution ordinarily being provided for by taxpayers. As important as a preschool is and the great things ECDC offers young children, my feeling was that a preschool is not ordinarily provided by the government at taxpayers’ expense, and that is why I voted to support the assessor’s decision.” 

Commissioner South echoed Anderson’s statement as to why he supported the assessor. South said he thinks the solution should be remanded to the state, and the people who make these rules should look at the issue.

Rose said the county equalization board cannot make recommendations to the state board but ECDC can appeal to that board and the issue can be considered there.

Commissioner South asked if they needed to take action on anything today.

Rose said they could go ahead and vote if they were comfortable with the conclusion of law. They could still follow up with reading the findings of fact and make minor changes if needed. She said if there is a monumental change needed, they would have to call a special meeting.

Since the next regular commission meeting is after Oct. 1, and they needed a vote before then, a motion was made by Anderson and seconded by South to support the assessor’s decision that ECDC is not tax exempt.

ECDC officials have indeed said they will appeal the decision, all the way to the Wyoming Supreme Court if that’s what it takes.

Legal precedent

On Feb. 19, the Wyoming Supreme Court ruled in favor of the Laramie County assessor and treasurer in support of their decision to deny tax exempt status to a daycare operated by the Town of Pine Bluffs. Earlier, the Laramie County Board of Equalization and the Wyoming Board of Equalization had ruled in favor of supporting the assessor’s decision and against the town of Pine Bluffs. Following that decision, the Town of Pine Bluffs took the case to district court, which ruled in favor of the Town of Pine Bluffs.

The Feb. 19 ruling reversed the district court’s decision and reinstated the order of the Laramie County Board of Equalization.

All assessors in Wyoming received news of the Wyoming Supreme Court’s decision regarding the Pine Bluffs daycare. Perkins began to research the possibility of the need to remove ECDC (Evanston Child Development Center) from tax exempt status. After making a determination to do just that, she sent them a letter explaining the decision.

“I based my decision on the Wyoming Supreme Court’s ruling,” Perkins said. “This is nothing personal. I’m just trying to do my job to the best of my ability. I think ECDC does a great job; Kendra (West) does a wonderful job there. But if I do not tax ECDC, then other daycares would have the right to appeal to be tax exempt.”

Perkins referred to the Wyoming Department of Revenue rules on property tax exemption standards, which states “… three considerations typically involved in determining whether a property should be exempt: ownership of the property; use of the property; and type of property. Under Section 4: Burden of Proof … Property owned by a governmental entity acting in its proprietary capacity is not exempt, (e.g. where a city enters the field of private competitive business for profit or into activities which may be and frequently are carried on through private enterprises).”

Using the definition of “schools” in Section 12 of the Wyoming Department of Revenue rules for exemption, Perkins determined that since ECDC is not funded by a mill levy at taxpayers’ expense, they should not be tax exempt. 

“I am not saying ECDC is not affiliated with the schools, but I have to follow the Supreme Court’s ruling and the Department of Revenue tax laws,” Perkins said. “The county board of equalization ruled that ECDC has the right to appeal to the state board of equalization, and if they agree with me, then the next step is an appeal to the district court, and if they also agree with me, the final step is an appeal to the Wyoming Supreme Court.”

Perkins said the property owner, in this case the City of Evanston, is responsible for paying the taxes of $5,442.85 for 2020. ECDC is responsible to pay taxes on its personal property, and Perkins said she didn’t receive any response to the form she sent out asking for a list of personal property so she applied an estimated value of $20,000 and assessed value of $1,900, which resulted in the tax of $129.45 for 2020.

Evanston Treasurer Trudy Lym provided the Herald with a copy of the five-year building use agreement between the City of Evanston and ECDC, which was signed on Aug. 17, 2016. It states, “ECDC shall provide day care, educational, recreational and nutritional programs for the children of Evanston and shall structure its fees to enable low-income families to take advantage of the services.” It further states, “ECDC shall pay any taxes that may be assessed against the personal property it locates within or upon the property.”

If the ruling is upheld during the appeal process, the City of Evanston may decide to amend their agreement and ask ECDC to pay the property taxes. The Town of Mountain View, which is home to ECDC’s Children’s Learning Foundation, could do the same, and that would amount to more than $13,000 in taxes ECDC would have to pay.

ECDC Director of Human Resources and Development Melynda Epperson said, “I want to point out that our federal and state funds cannot pay taxes. I would have to use unrestricted funds to pay the tax assessment. Those unrestricted funds of 9% happen to be the smallest line item in our revenue stream. We want our funds to be used for children’s education, not to pay taxes.”

West said they plan to take their appeal all the way to the Supreme Court if necessary. Attorney Caleb Wilkins of Cheyenne is representing ECDC and is currently working on its appeal to the state board of equalization.

West wrote these remarks for the county board hearing: “We are a private nonprofit corporation and we have not been taxed since 1981. … We have never considered ourselves a daycare! We receive 90% of our funds from federal and state government grants which are non-taxable. We have numerous programs sponsored by the state and federal government: EHS, TANF Preschool and 21st Century after school enrichment from the Wyoming Department of Education. They would not fund us if we weren’t meeting the same standards and qualifications as the schools. (Degree teachers; professional development; small class size and ratios and research based curriculum, to name a few).”

West said that Uinta County School District No. 1 Superintendent Ryan Thomas testified for them at the equalization hearing and provided convincing evidence they are a school. Thomas visits ECDC and observes and evaluates their teachers. West also recognized Commissioner Craig Welling for supporting them and for his understanding of ECDC’s role in early childhood education.

ECDC is accredited by the National Association for the Education of the Young Child (NAEYC), promoting high quality early learning for children birth through age eight, West said, adding that every child who attends benefits from their TANF Preschool and if parents were paying the going rate for that education it would amount to upwards of $13,000 per year.

“According to the latest brain research from the Center on the Developing Child at Harvard University, 90% of a child’s brain development happens before kindergarten. Statistics on the Wyoming Department of Education website state, ‘Without a high quality early childhood education, our children are at risk. Twenty-five percent are more likely to drop out of school, 40% become a teen parent, 50% are more likely to be placed in special education, 60% never attend college, and 70% are arrested for violent crime.’ We at ECDC understand the importance of early childhood education. Doesn’t our providing that service reduce the burden on taxpayers and on society?” West wrote.

West said the state recently received a large federal grant to develop an early childhood education/preschool system and the state is using ECDC as one of the quality program models.

At the county commission meeting on Tuesday, Sept. 15, when the board voted to support the county assessor’s decision, there was no opportunity for public comment. West, teachers and other personnel were in attendance and came prepared with letters and comments in support of ECDC.

Early Head Start Director Quentin Rinker said, “We were never given an opportunity to provide comment and were not given formal notice of the meeting’s agenda. Neither was our attorney provided formal notification, and it appeared that the hearing examiner, Sharon Rose, wasn’t notified either. Elected officials should listen to their constituents.”

West said she’s prepared to fight the ruling after commissioners appeared to abandon early education.

“We have to take this all the way through the process of appeals,” she said. “The county commission had the opportunity to tell the public how important early childhood education is and they missed the boat. It appears that the county is gaining on the backs of children.”


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