Leisure World pays penalty for late taxes

The Golden Rain Foundation will have to pay nearly $273,000 in penalties for failing to pay Leisure World’s property taxes on time.

As previously reported in the Sun, the Golden Rain Foundation, which runs the Seal Beach retirement community, did not pay Orange County property taxes for at least 13 of the 16 “mutuals” that make up Leisure World.

The past due property tax payment was expected to be a topic at the Tuesday, May 17 Golden Rain Foundation board meeting.

The Foundation is a private, non-profit agency. Only members are allowed to attend board meetings. Details of the meeting were not known at press time.

Ray Silver, chief of staff for the Orange County Treasurer/Tax Collector’s Office, said on Friday, May 13, his office had finished a letter to be addressed to Leisure World Administrator Dan Schaeffer that notified the Foundation of the late fee.

Silver said the penalty would be $272,948.32.

The Golden Rain Foundation had not received the letter by the time the Sun went to press.

Silver said county tax collector’s staff had finished a letter to Leisure World Administrator Dan Schaffer that said under California law, the county could not waive or cancel the property tax default penalty.

“We have to treat everybody the same,” Silver said.

“We’re really sorry it has to be done,” Silver said.

“It appears to be an honest mistake and they happen,” Silver said.

According to Dave Lyon, a Leisure World resident and critic of the Golden Rain Foundation, the Foundation has a management contract to provide accounting services to all 16 mutuals.

Last week, GRF President Bruce Smith said the checks were made out on April 8. The deadline for payment was April 11.

However, in a recent letter to the Sun, Lyon wrote, “The tax payments were actually due in February, and April 11 was the date after which any payment would be subject to delinquency penalties of ten percent.”

Orange County Supervisor John Moorlach, who used to be the treasurer/tax collector, said the checks were not signed.

Moorlach described the situation as “awkward.”

“It’s awkward in that the rules are pretty clear,” he said.

Moorlach also said the penalty represented 10 percent of the tax due.

“It’s amazing that checks totaling that much money are left lying around,” Moorlach said.

Lyon’s comments were blunt.

“Despite Bruce Smith having told the Sun that he didn’t know if the Leisure World mutuals would be assessed penalties for late payment of their property taxes that were due in February, he had two days earlier informed four GRF directors that the penalties would be $357,000,” Lyon wrote in Monday, May 16 e-mail.  “Only when the Sun inquired did the facts become clear.  Now the shareholders know that their mutual property taxes were paid late, and that delinquency penalties are being assessed by Orange County.  Despite the SUN knowing the amount of the penalty, as of this afternoon shareholders are being told that GRF Administrator Dan Schaeffer is ‘still gathering information.’”

Leisure World apparently is not the only delinquent taxpayer in Orange County.

Silver said that 37,387 property tax bills were delinquent out of 840,000 bills sent out by the Orange County Treasurer/Tax Collector’s Office.

“This is pretty normal,” Silver said.