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County not likely to regain money lost to Manatron

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Hubbard County may not be able to recoup the $200,000 it paid for a tax recording and billing software program two years ago that it eventually abandoned.

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As the county researched suing the Michigan-based company called Manatron, it encountered some obstacles, said county coordinator Jack Paul.

"We're not doing anything with them," Paul said this week. "This is gonna be tough because it's kind of like suing yourself, suing your family."

Hubbard County formed a consortium of 30 counties to purchase the Manatron software through Minnesota Counties Computer Cooperative.

But Hubbard County was not a signatory to the contractual agreement, Paul said. MCCC was. Manatron never fulfilled its contractual obligations and the software never performed up to expectations.

"You're suing yourself," agreed Hubbard County Attorney Don Dearstyne. "We are MCCC.

"It's very problematic," Dearstyne said of the county's situation, "and the contracts were poorly written by MCCC because they gave outs for Manatron that I would not have OK'd."

He said the contract, which favors Manatron above any of the counties, was signed before he won office in 2006.

The county hastily returned to its former program called ASC Property Tax/ASC Tax Solutions earlier this year so it could get the spring tax bills in the mail.

Meanwhile, this week, Ramsey County found it was unable to mail 160,000 tax bills because of glitches in the Manatron software it used.

County officials there found discrepancies in property tax valuations, resulting in incorrect tax bills being sent out.

"Looking at what happened in Ramsey, which has its own full-time IT department to run this thing and they're having problems, I think the board made the right decision going back to ACS," Dearstyne said.

Hubbard County does not have an Internet Technology department, so hired consultants to try to get the software installed and working, spending many thousands of dollars in the process.

Meanwhile, many other Minnesota counties, including Wright County, pulled out of Manatron for similar non-performance reasons and threatened legal action to get their money back.

"MCCC, which we belong to, made a contract with Manatron and another group that was to approve each step of the way and they've been sort of out of the picture, so if you were going to sue someone I'd sue Manatron and them," Paul said,

"The way this agreement reads it looks like we'd have to sue MCCC first and that's the group we belong to, so I don't know how we'd do that."

"It kind of ties our hands from that standpoint," Dearstyne said. "There was a meeting of counties, the ones interested in going forward with a suit, or exploring it, so they're doing some exploration on it but nothing definitive has come out of that."

But if Ramsey County can't get its tax billing straightened out that county's problematic situation could add some clout to Hubbard's.

"If we had a big county like Ramsey joining us, I think we would probably go somewhere," Paul said.

Many of the counties on the southern border that are disenchanted with Manatron don't have the resources or personnel to recover their losses, Paul said.

"Maybe someone there would have some expertise in tech law but I think all the county attorneys are so busy I don't know who's gonna push this thing," Paul said.

"The bottom line is that we've got $200,000 on the shelf back there and we'd like something back out of it.

"In the future if they ever iron this out and do it right we might join Manatron," Paul said.

The current program, ASC, is antiquated, Paul said, but may benefit by a recent sale to Xerox Corp.

Meanwhile, Manatron continues to sell its assessing, billing and tax valuation software to other states.

"If I was to pick the problem from this entire thing is how convoluted the Minnesota state property system is," Paul said. "It's a mess. There's so many permutations and combinations that I don't think the programmers knew what they were getting into.

"I think they thought. 'Well, we've got seven or eight other states down pat, we'll just add another state because they're pretty much the same.' Well they're not the same," he insisted.

"What's the same and what's not the same is a big difference once you get to Minnesota."

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Sarah Smith
Sarah Smith is the outdoors editor. She covers courts, business and breaking news in addition to outdoors events.
(218) 732-3364
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