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Armstrong County School Board postpones selling delinquent real estate tax claims

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Tuesday, April 15, 2014, 12:41 a.m.
 

The Armstrong School Board has put plans to sell its delinquent 2013 real estate taxes on hold until next month.

School board president Joseph Close said the board did not have the specific figures required to decide if it wants to sell the district's delinquent real estate tax claims to Municipal Revenue Services of McKean for a yet-to-be-determined amount.

Close said the board hopes to see a projection of how the budget would be affected by the sale.

“This program is more designed for districts that need money right upfront,” Close said. “We just have to see if there is money in the budget, and we're giving up money just to be in the program.”

The district would have to pay the company $141,000 upfront, and then 4.75 percent of the money it collects, said Business Director John Zenone.

After the fees, the district would end up paying $236,000 if it were to sell its claims for $2 million.

That's about 12 percent of the delinquent taxes owed.

About 11.6 percent, or just more than 2,900 of Armstrong School District's 25,000 taxable properties, are delinquent. Those properties account for $2.7 million in revenue, according to Zenone.

Last year, the district sold delinquent tax claims for about $2.7 million.

The board is moving toward raising real estate taxes for a third consecutive school year in its $96.8 million preliminary budget.

The spending plan's $3.5 million deficit remains, even with a millage increase of at least 1.84 mills, which is within the state's Act 1 index rate of 3 percent.

Armstrong School District assesses 56.64 mills of real estate tax. The increase would bring the tax rate to 58.47 mills and raise nearly $1 million for the district.

The board plans to pass a final 2014-15 budget by June 30.

Brad Pedersen is a staff writer for Trib Total Media. He can be reached at 724-543-1303, ext. 1337, or bpedersen@tribweb.com.

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