Casper Mayor Ray Pacheco said last month that city leaders will not file a lawsuit over the sales tax error that cost the city $1.7 million in revenue — but one city councilman told the Star-Tribune on Thursday that the entire Council should weigh in on that decision.
“At this point, I don’t know if it was truly an accident or if there was fraudulent conduct. If there was fraudulent conduct, then I want to consider a lawsuit,” said Councilman Dallas Laird.
The city mistakenly received an additional $1.7 million in sales tax distributions after a Sweetwater County vendor incorrectly reported its taxes in Natrona County. The error occurred from October 2013 to December 2015 and was detected during a routine audit, Kim Lovett, the administrator of the Department of Revenue’s Excise Tax Division, said last month.
After the state learned about the mistake, it deducted the money from Casper’s monthly sales tax distribution — much to local leaders’ chagrin. To soften the fiscal blow, city officials received a loan from the state that will give the city up to five years to pay back the money.
“We are not going to seek damages,” he said.
After Laird questioned that decision, the mayor walked back his statement Thursday and said that a lawsuit could still be in the cards.
“At that time, there was no discussion for us to do that,” he explained. “I’m completely supportive of the direction that the Council wants to pursue [in regards to a lawsuit].”
If the majority of the Council wants to consider legal action, they can still direct city staff to explore that option, said Pacheco. He added that any council member can bring this issue up for further discussion at a work session or meeting.
No other council member could be reached for comment Thursday.
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Although Lovett has repeatedly stated that the vendor’s actions were unintentional, some council members are skeptical.
Laird said it may have been advantageous to the vendor to file in Natrona County because Sweetwater County had a higher sales tax.
Sweetwater County’s treasurer Robb Slaughter told the Star-Tribune last month that the county’s sales tax was 6 percent from 2013 until April 1 of this year. The sales tax in Natrona County is 5 percent.
“If they [the vendor] did this intentionally, I think they should be sued,” Laird said during a work session last month.
Councilman Chris Walsh agreed at the time and said the incident didn’t sound like an “innocent mistake.”
Lovett has reportedly stated that tax return information is confidential and declined to identify the vendor — but Laird identified the company as Solvay Chemicals last month while publicly discussing how the error will affect the city.
The councilman later said that he received the vendor’s name from an anonymous source and wants state officials to confirm or deny its accuracy.
Solvay is an international chemical company with about 50 manufacturing, administrative and research facilities in North America, according to its website. Solvay Chemicals, Inc., in Green River is a major U.S. producer of soda ash from trona, a naturally-occurring mineral used in glass manufacturing.
Multiple attempts to reach the local site manager, Todd Brichacek, were unsuccessful. No company official returned a request for comment.
Casper wasn’t the only entity in Natrona County affected by the error. The Natrona County government collected an additional $366,000. Mills ($108,000), Midwest ($13,000), Bar Nunn ($69,000), Evansville ($80,000) and Edgerton ($6,000) also received more than they were due.