The owners of Cookeville Boat Dock, Inc. are delinquent no more in their property tax debt to DeKalb County.
Rather than appeal a recent court order forcing them to pay their back taxes from 2004 to 2013, the marina owners today (Friday) paid off the delinquency to the DeKalb County Chancery Court in the amount of $139,815.33 which includes taxes for the years 2004 to 2013 along with all accrued interest, penalties, court costs and attorneys fees through March 4, 2016. Today (Friday) marked the last day the marina could file an appeal.
Cookeville Boat Dock also paid its 2014 and 2015 property taxes to the DeKalb County Trustee’s Office on Monday, February 29. The marina paid $9,691 including interest and penalty for 2014 and $9,417 for 2015.
The written order, signed by Judge Amy Hollars, was filed Wednesday, February 3 in DeKalb County Chancery Court. The judge gave the same ruling orally on Tuesday, November 24.
The court further ordered that “DeKalb County is entitled to additional penalty of 10% on all delinquent taxes” finding that T.C.A. 67-5-2410 (a)(1)(A) is the controlling statute as to additional penalty.
“It is ordered that DeKalb County is entitled to charge a 10% additional penalty on the base amount of delinquent taxes.”
“It is further ordered that Cookeville Boat Dock, Inc. shall continue to accrue on any unpaid taxes, interest and penalty as set out in T.C.A. 67-5-2410 (a)(1)(A)” the order stated.
In November, Judge Hollars again found as she had earlier in the year that Cookeville Boat Dock must pay delinquent DeKalb County property taxes, but in a new ruling she granted a motion by the marina’s attorney to bar the county from collecting more than 10 years in back taxes with 10 years being a statute of limitations.
Judge Hollars announced her decision via a telephone conference call on November 24 with Vester Parsley, Jr., the county’s tax attorney, and Jon Jones of Cookeville, the lawyer representing Cookeville Boat Dock. Clerk and Master Deborah Malone and County Mayor Tim Stribling were also present.
The boat dock owners had refused to pay their taxes since 1998.
Jones initially argued for the marina that Tennessee law violated the Supremacy Clause of the U.S. Constitution by discriminating against a lessee of the United States in favor of lessees of the State of Tennessee. It was argued since the boat dock pays fees to the U.S. Army Corps of Engineers which are used, in part, to pay DeKalb County a sum of “in lieu of taxes,” that having to pay property tax to the county was, in effect, double taxation.
In April, 2015 Judge Hollers ruled that the boat dock’s challenge to the tax was invalid in part because the Supremacy Clause “does not prevent a state or local government from imposing a tax on an individual or a corporation ‘using government property in connection with a business conducted for its own private gain.”
The attorney for the marina later filed a motion asking the judge to reconsider her ruling. Jones argued that the county cannot collect taxes beyond 10 years; that the judge’s ruling on the “Supremacy Clause” of the U.S. Constitution was incorrect; and that the amount of interest the county wants to charge is above what is allowed by law.
In November, Judge Hollars sustained Jones’ motion on the 10 year bar based on TCA 67-5-1806 but she denied the request to prohibit the county from assessing the current rate of interest and penalty. She also affirmed her earlier ruling on the constitutionality of the tax.
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