After resident reaction, Scott Township commissioners find tax collector compromise
Scott Township leaders recently reversed course after upset residents objected to slashing the local tax collector's duties in favor of privatization.
At issue: Who handles going after taxpayers who don't pay municipal property tax on time? It's a sum that amounts to less than $300,000 for 2015 through 2017. The annual budget is about $5 million.
The township late last year entered into a contract with law firm McGrail & Associates of White Oak to collect delinquent taxes starting Jan. 1. But after public pressure, council leaders in January reached a compromise that leaves some late payers in the hands of longtime elected tax collector Lisa Riley, who said she knows many of the residents by name.
“I'm happy with that instead of not getting anything at all,” Riley said. “I still think it's a shame. There's no need for all this. Residents don't understand why it's even happening.”
She'll turn over accounts for property owners who haven't paid the previous year's taxes by March 31 of the new year. Initially, McGrail was going to handle all delinquencies — so on Jan. 1 the previous year's late payers would have been turned over to them.
Council President Frank Bruckner said constituents called him — and called him some more.
Now halfway through a four-year term, he described himself as a “numbers-oriented guy” but added that some things are not just about numbers.
“Numbers leave out a lot, and public sentiment is one of them,” he said.
He said he and other township leaders wanted to resolve the delinquencies, and he viewed outsourcing that service as one way to do it, and at less expense to taxpayers.
“The township had this customer-oriented approach for more than 40 years. The constituency loves that and I have to respect that as an elected official,” Bruckner said.
In Scott, the municipal tax is 5.33 mills. A resident with a home assessed at $128,000 would owe $640 annually.
Bruckner said the township reached an agreement with McGrail, which has a three-year contract with the township. Law firm representatives did not return a call seeking comment in time for this paper's deadline.
Privatizing is “a way to increase collections at the lowest cost to the treasury,” said township attorney Robert McTiernan, of the law firm Tucker Arensberg.
He pointed out that most other communities use a law firm or similar professional service to collect delinquent taxes, as opposed to an elected tax collector.
Fees to late payers charged by McGrail include $160 for the first demand letter and $175 for the second demand letter, as well as other fees for processing paperwork. Those fees are tacked on to a delinquent's account. Riley does not charge those fees.
Instead, Riley gets 5 percent of the face value when delinquent collections come in — which had averaged about $8,000 to $10,000 per year. She also retains a flat $2,000 fee for overseeing collection of current tax bills on about 6,700 parcels.
Taxpayers who remain unpaid for 2016 and earlier will be turned over to McGrail. There's about $117,000 in outstanding property tax owed for 2015 and 2016, Riley said.
As of Dec. 31, about $177,000 was outstanding in late municipal taxes for 2017 alone.
“A lady came in the other day. She's 77 years old and she's trying to make ends meet. I set her up on a payment plan,” Riley said. “I'm able to do payments, too.”
Kimberly Palmiero is a Tribune-Review contributing writer.