Mortgage fee is appropriate
The state of Kansas Register of Deeds Association has recently had their hands full, fighting a piece of legislation that could affect not only the Register of Deeds Offices, but also any homeowner in the State of Kansas.
As Register of Deeds, I am required by State Statute 79-3102 to collect a 0.26% mortgage registration fee based on the amount of the mortgage. Assuming a mortgage of $100,000.00, the registration fee would be $260. The state collects .01% of the fee for the Heritage Trust Fund ($10 in our example) and the remaining 0.25% ($250) goes into the County General Fund. Farm Credit Services, American AgCredit, Small Business Administration, HUD, the VA, Certified Development Corporations and the South Central Kansas Economic Development District are exempt.
In 2012, the Register of Deeds deposited $92,866.40 into the Cloud County General Fund from mortgage registration fees collected. Out of those fees, $3,410.29 was deposited into the Heritage Trust Fund. For the year of 2013 through the month of November $121,910.61 has been deposited with $4,096.05 being deposited into the Heritage Trust Fund.
If the Kansas Bankers Association is successful in their lobbying to have this fee removed, then in order to make up the difference, our county will have to increase the mill levy anywhere from one percent to one and a half percent, shifting the tax burden to all property owners. The mortgage registration fee is a one-time fee, while a mill levy increase is permanent. The reason the Kansas legislators passed this statute in 1907 was to lower property taxes and to have the mortgage registration fee help fund the County General Fund.
This could also mean that property and sales tax would increase. If the mill levy increases, this will cost everyone in our county. You would then be paying for everyone else's mortgage registration fee, not just yours. That is vastly unjust. Currently in Kansas, if you don't use the fee, you don't pay the fee. Kansas counties have been appealing to their Representative and state Senators to support the Register of Deeds Association in fighting this issue with the Kansas Bankers Association. Ultimately, it is the homeowners across the State of Kansas who would be impacted the most. It is your homes that would be taxed even more if this happens. Even those of you who have paid off your mortgages will get a tax increase on your home. How can the Kansas Bankers Association speak of leveling the playing field when every homeowner across the State of Kansas will be the ones who are going to have to pay the price?
Register of Deeds
Cloud County Kansas