THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Sunday, January 29, 1995 TAG: 9501280074
SECTION: SUFFOLK SUN PAGE: 03 EDITION: FINAL
LENGTH: Long : 116 lines
On Wednesday, the Suffolk City Council will hold a public hearing on whether to change change collection dates for real estate and personal property taxes.
A staff report, to be presented then, considers seven options - from no change to several possible collection dates.
The report says that if the City Council opts for change, these dates would most benefit the city and property owners:
Real estate: June and December.
Personal property: September or October.
However, several people involved in the deliberation believe the best choice is no change.
The public may voice their preferences and possible other options during the hearing, at 7 p.m. in the council chamber on the second floor of City Hall, 441 Market St.
Suffolk now collects real estate and personal property taxes on Dec. 5, a practice that has caused numerous complaints because of the approaching Christmas shopping season.
The Sun submitted a questionnaire to City Treasurer Ronald H. Williams, whose office collects personal property and real estate taxes.
The questions and his responses follow:
Q. What is semi-annual tax collection?
A. City Council is considering the semi-annual collection of real estate taxes and possibly changing the due date of personal property taxes away from December to possible September or October.
Q. How would it help the taxpayer?
A. Semi-annual collection of real estate taxes would benefit those citizens who desire to have a portion of their taxes due at a time of the year other than December.
Proponents feel that dividing the payment in half would make each payment easier to work into their budget. The most popular system is a June 5, Dec. 5 combination, with one half of the tax being due on each date.
However, annual collection on Dec. 5 is the most efficient system in that the least administrative cost is incurred and the taxpayers get to keep their money longer.
Q. How would it help the city?
A. Semi-annual collections of real estate tax would even out the city's cash flow and increase interest earnings.
Q. Are you, as city treasurer, in favor of semi-annual collections?
A. If City Council votes to change the method of tax collection, the treasurer's office will support that decision, provided the program can be properly administered.
I would encourage citizens to express their feelings on this matter at the Feb. 1 City Council public hearing or to contact council members individually. I would be glad to discuss it also, but this policy decision must be made by council.
Q. How many Suffolk residents pay personal property taxes? How many of them, on average, cannot or do not pay by the due date? How much money do they pay, and what happens to it?
A. For the tax year 1994, we mailed 32,386 personal property and public service corporation tax bills totaling $9,483,246; and 26,720 real estate bills totaling $19,197,834.
Approximately 5,000 personal property tax bills totaling $1,920,896 remained unpaid after the Dec. 5 due date. These numbers will be reduced to about 2,300 and $400,000 by the end of decal sales and 1,500 and $300,000 by the end of the fiscal year June 30.
Approximately 6,000 real estate tax bills totaling $1,750,890 remained unpaid after the Dec. 5 due date. These numbers will be reduced to about 3,000 totaling $1,409,714 by March 31, then to 1,500, totaling $1,033,732, by June 30.
Q. What is the penalty, and how is it calculated? Could you please give an example?
A. Ten percent on the unpaid tax amount after the due date.
For example: $500 due Dec. 5. If unpaid on Dec. 6, a penalty of $50 is added, and 10 percent annual interest accrues at one-twelfth each month.
Q. If Suffolk adopted semi-annual payments, what choice would taxpayers have? Could they opt to pay in either two equal payments or one lump sum? Other options?
A. The ordinance will specify the due dates. If, for example, a taxpayer desires to pay any amount at any time prior to the due date, we will be happy to accept those payments just as we do now.
Q. What would the switch to semi-annual payment cost? For what?
A. $42,000 per year: $25,000 for additional computer time, $10,000 for postage, $7,000 for tax forms, plus a one-time expense of about $4,000 for additional equipment.
Q. Have Virginia city treasurers, as a group, taken a position on semi-annual payments?
A. Treasurers across the state administer many different tax collection systems which have been adopted by their respective governing bodies.
The Treasurer's Association has never taken a position, as this is a policy decision to be made by the governing body after input from the citizens.
Q. You have said many citizens have complained about getting tax assessments in December where there were so many demands for their money. Why haven't you moved to change it?
A. Again, this is a policy decision that must by law be made by City Council, to whom we have communicated this concern. ILLUSTRATION: Staff file photo by JOHN H. SHEALLY II
City Treasurer Ronald H. Williams' office collects personal property
and real estate taxes. He discusses the possible change in the
timing of the collections.
KEYWORDS: SUFFOLK CITY COUNCIL TAX
by CNB