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Delinquent taxpayers stymie city's efforts
(by Joseph Koziol Jr. - February 17, 2010)
Delinquent taxpayers stymie city's efforts
By JOSEPH KOZIOL JR.
Chardon City Council weighed the benefits last week of a 2-year-old program to go after delinquent taxpayers.
Finance Director Jeff Smock reported to council last week that, while the city is making progress in identifying and collecting from delinquent municipal income-tax payers, the process is arduous and time consuming.
He told council that the city has identified $64,500 in owed income tax but has collected only $12,500. "Collections are extremely difficult, like getting blood out of turnip," Mr. Smock said.
Even those who have met with the city to discuss the owed taxes, he said, have been less than cooperative. He said those people set up payment plans and often make the first one, but months may pass before another payment is made.
He said the 16 hours per week that one employee dedicates to those collections is not enough time, because the city is "chasing them continually."
Mr. Smock said he is not sure the program would be self-sufficient, as originally intended.
But he said he believes the city should continue with the program, because it reinforces the law. He said it's similar to police setting up speed enforcement along a road. After a while, he said, people will obey the law.
"Even if it's not cost-effective, we have to continue to do it to maintain a sense we are enforcing it just so people don't continue to ignore it," Mr. Smock said.
One problem the city is encountering, Mr. Smock said, is that landlords have been less than cooperative in providing lists of tenants. To enforce ordinances that require landlords to provide those lists would require the city to take them to court.
He said there are about 20 people who owe more than $1,000, with a few owing $3,000 to $4,000.
He said it seems people may be aware they owe the city tax but choose to pay their electric or water bills first. "Nobody's at the door to shut off something," he said.
Council President Philip King said the city should take landlords to court to force them to comply with city ordinances. "Once it hits their pocketbooks, it's going to start registering with them," he said.
But Mr. Smock said preparing to go to court will take considerable time on the city's part. He said, if he turned over all the cases to Law Director James Gillette, he likely would have to hire another attorney to assist him.
Council asked whether it's possible to put publicize the delinquent taxpayers' names.
Mr. Gillette said court cases have found that you cannot publicly embarrass someone over a debt. He said there also are privacy provision in state law dealing with income taxes that could prevent such an action.
Councilwoman Nancy McArthur said reporting them to a credit bureau may be another way of forcing taxpayers to act.
Mr. Smock said, even if the city takes the person to court and gets a judgment in its favor, there is no guarantee that the people will pay.
Mr. Gillette said the city may get more cooperation from delinquent taxpayers if it establishes a "grace period" type of arrangement. He said the city could offer to waive penalties or interest, if people pay within a certain time period. He said the city's ordinances would have to be revised to allow that.
Council agreed to allow council's finance committee to review the situation and provide recommendations at a future council meeting.
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