Leaders ask for more time to review proposed increase to fees for delinquent taxpayers

By: Michael Campbell | Twitter: @itsthesoup
Posted: Nov. 13, 2017 | 7:45 p.m. 

DINWIDDIE – In the interest of continued review and analysis, supervisors opted to delay moving forward on a measure that would see the fee associated with the collection of delinquent increased by ten dollars.

During their October meeting, the Dinwiddie Board of Supervisors heard from Dinwiddie County Attorney Tyler Southall, who explained that the county’s treasurer’s office has been informed by the Virginia Department of Motor Vehicles that the vehicle registration withholding collection fee that is charged to localities has increased from $20 to $25.

The withholding collection fee is part of the state DMV’s Vehicle Registration Withholding Program, where they assist government entities in collecting delinquent revenue. As part of that program, if someone has “delinquent local government personal property taxes, parking citations, toll violations or other fees,” that individual may not be able to renew their registration, or decals until they contact that locality’s treasurer or director of finance to pay the amount due, which ends the “DMV Stop” action.

During his detailed report, Southall explained the Code of Virginia gives localities the ability to pass along that administrative cost to delinquent taxpayers but in reviewing both the Code of Virginia and the county’s code, Dinwiddie “does not currently charge a number of administrative costs allowed for under the Code of Virginia.”

Currently, if a taxpayer “fails to timely pay taxes due [to] the county,” that person is “subject to and liable for administrative costs of $20” for taxes collected before a warrant or other legal measure, such as a judgment is filed. After that legal action, the fee for those administrative costs increases to $25, according to county documents.

The proposed amendment to the county code would mirror the new language within the Code of Virginia, which says a locality can charge a fee to cover “administrative costs and reasonable attorney’s or collection agency’s fees” to a delinquent taxpayer and those fees cannot exceed $30, ten dollars more than the current ordinance in effect. Following legal action, that administrative cost cannot exceed $35.

Unlike some portions of the Code of Virginia that dictate what a locality must do in accordance with state regulations, Virginia Code Section 58.2-3958 states that a locality “may impose” the language to allow for the collection of the fees related to administrative costs of collecting past-due taxes.

According to Southall, the proposed ordinance would “bring the fees charged to delinquent taxpayers in Dinwiddie County up to the amounts allowed for by the Code of Virginia.”

During the nearly ten minute discussion, supervisors also heard from Dinwiddie County Treasurer Jennifer Perkins, who explained that their office executes “about 2,000” DMV collection actions a year, which, if all of those collection actions were completed without further legal action at $20 per account, that accounts for approximately $40,000 in fees yearly.

A ten dollar increase to that with an average of 2,000 DMV collections a year would see the fees collected from those delinquent taxpayers rise to roughly $60,000 a year, and even higher if some of those require further legal action, such as a judgment.

“The $20 fee has been that way for years,” Perkins explained to supervisors and residents listening on. “When we use those collective actions, it doesn’t go on two vehicles. We do it as one charge. A lot of other localities charge by vehicle.”

“We really try to use this to help us, but we try not to be excessive,” she continued.

Additionally, even though bills have already gone out for this cycle, Perkins noted that “the automated process” doesn’t begin until April, allowing time for supervisors to truly vet the proposed amendment to the county code.

Via consensus, board members agreed to hold off on the item until a later meeting. When it comes back before supervisors, which would be November at the earliest, they will have the option to not move forward or proceed, where it will then head to a public hearing for comment from Dinwiddie taxpayers.

Copyright 2017 by Womack Publishing
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