City trying to deal with delinquency on property taxes

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Cumberland Times-News

Elaine Blaisdell, March 2, 2011

 

CUMBERLAND — A recent notice sent out by the city to property owners who were late or delinquent on their taxes alarmed some residents.  

During Tuesday’s city council meeting, Mayor Brian Grim apologized for the notice stating that it wasn’t the council’s intention to alarm residents.

“Language included in a recent mailing to Cumberland citizens with tax bills has resulted in considerable anxiety and confusion,” said Grim. “The language was not cleared through my office or that of council was an effort to aggressively seek tax revenues owed to the city that total $2.6 million worth of outstanding taxes due.

“The language scared many residents into believing that their properties may be put up for tax sale. While it is true that the city does maintain the right to engage in tax sales of all properties that are in arrears in taxes due, that is not the common practice.”

During the city council meeting, there were no complaints regarding the notice. However, resident  Jim Combs suggested that the city put an incentive in place similar to the county’s incentive to encourage residents to pay their property taxes early.

“I think you should look into giving those who pay their property tax before July an incentive, and if they don’t, then compound the amount that they would have to pay,” said Combs.

The city can’t legally compound the payment, said Michael Scott Cohen, city solicitor.

Property owners who are one to two years late on their taxes may have their property sent to a tax sale, according to the notice sent out by the city. Property owners who were three years delinquent or late were sent their usual notice this year.

“Notices were provided to approximately 25 percent of the property owners in Cumberland who were either late or delinquent in paying their property taxes (1-3 years),” said Jeff Repp, city administrator. “Two different notices were provided to city property owners who are delinquent on their taxes.”

According to Jeff Rhodes, director of administrative services, there has been no  final decision made to send people who are one to two years behind on their property taxes to tax sale.

The first notice, for those who were years past due in property taxes, listed the amount and years overdue and listed the amount that will be sent for inclusion in the tax sale, unless paid by March 31.

Property owners that were three years past due, always had the option of paying the oldest year past due. For example, if a property owner was past due for 2008, 2009 and 2010 they would have to pay the full amount for 2008, said Rhodes.

“The only confusion with the second notice,” said Repp, “is that property owners who are eligible and elect to pay semi-annual payments don’t read the property tax bill sufficiently to notice the payment dates when those payments are due. Most residents assume that ‘semi-annual’ means that I can make the first payment before January and the next payment before July.  In reality, both payments have to be received by the city before Dec. 31 for the bill not to be considered delinquent.”

A tax bill sent to property owners explained the following semi-annual payment schedule; the first installment (Coupon 1) is due during the months of July, August, and September; and will be overdue as of Oct. 1. Once the payment is overdue, interest and penalty charges will be assessed each month thereafter until paid. The second installment (Coupon 2) is due by Dec. 31 and will be overdue on Jan. 1. Once the payment is overdue, interest and penalty charges will be assessed each month thereafter until paid.

Most people pay in two installments, and this hasn’t changed, said Rhodes.

“Most property owners, when the notice is explained to them, understand that what they thought was being current was not necessarily the case and that the payment by various month on their bill is the amount of tax with penalty and interest for being late applied to the tax bill,” said Repp.

State law provides that any amount of past due taxes can be certified for tax sale, whether one, two or three years. The past practice in Allegany County has been to only certify those which are three years past due.

Contact Elaine Blaisdell at This e-mail address is being protected from spambots. You need JavaScript enabled to view it. .