Treasurer says clerical tax error will require $532,523 refund; board to pursue legal review and audit

The village treasurer told the Board of Trustees that a clerical error in exemptions led to an overstated advertised tax rate and that the village has located prior-year fund balances sufficient to reimburse taxpayers for the difference.

"The total taxpayer refund amount is $532,523.25," the treasurer said, proposing that refunds be paid from undesignated fund balance and that the treasurer's office calculate individual checks on a schedule tied to payment dates. He told the board taxpayers who paid by July 31 would begin receiving checks in early August; those who paid later but before Oct. 31 would be scheduled for a November issuance.

The treasurer also recommended separating village funds into distinct bank accounts at Orange Bank and Trust to improve transparency and traceability. He said some funds in the general ledger are dormant and that clearer account separation would make it easier for the board and auditors to see balances for water, sewer, grants and undesignated reserves.

Mayor Michael R. Henry (as recorded in the transcript) responded that fixing the clerical error and issuing refunds is "the responsible and transparent way to address this matter." Trustees, several residents and staff urged the board to obtain legal guidance and input from the state comptroller's office to confirm the timing and authority to issue refunds before action is taken.

The treasurer also raised two operational items tied to the funds: repairing three fire hydrants currently bagged out of service and funding a financial audit. He reported that three accounting firms were contacted and that RBT returned a quote in the neighborhood of $25,000 to perform an audit; the treasurer said the village had budgeted roughly $9,000 for auditing but had available undesignated funds to augment that amount if the board authorized it.

On motions and next steps, trustees moved to add the refund and hydrant-repair resolutions to the next meeting agenda for legal review and to compel the treasurer and department heads to deliver a consolidated financial report to the board for review by the end of the week. The motions were made and seconded during the meeting; the transcript records the board agreeing to place the items on the Tuesday agenda and to request the detailed reports, and trustees discussed scheduling and the July 31 timeline for refunds. No final vote on the refund or any binding contract with an auditor was shown in the meeting record; the actions were advanced for formal consideration once legal review and the treasurer's detailed reports are available.

What this means for residents: if the board adopts the resolution after legal review and the treasurer's calculations are finalized, individuals who paid village taxes by July 31 would receive checks beginning in August; other payers who meet the specified payment windows would be scheduled later in the calendar the treasurer described. Trustees emphasized they want the village attorney and the state comptroller's guidance before authorizing disbursements or signing audit contracts.

The board also discussed, without final action, using undesignated fund balance to pay for the short-term hydrant repairs and for the audit; trustees asked for more documentation showing where the discovered monies are held and the precise account balances before approving expenditures.