Mayor, Conrad differ on code

Sunday, May 13, 2007

By GINNY WRAY - Bulletin Staff Writer

Martinsville Mayor Kimble Reynolds Jr. said Treasurer Pat Conrad would have to approve the transfer of delinquent tax collections to City Attorney Eric Monday under the state code.


The code states, “The governing body may appoint or hire, with the approval of the treasurer and upon such terms as may be agreed upon, one or more attorneys to collect any local taxes or other charges which may have been delinquent for six months or more.”

“Obviously we want to make sure we do not encroach on the treasurer,” Reynolds said Saturday as he quoted the code.

But Conrad is not so sure Reynolds is right. She pointed out that the next paragraph in the code states, “In the alternative to the procedure set forth in subsection A, the governing body may place local taxes or other charges which have been delinquent for six months or more in the hands of the sheriff of the county or city for collection or employ a local delinquent tax collector to make such collections ... .”

If given the say on the matter, Conrad said she “absolutely” would want to keep the collections.

“I want to do it because across Virginia, except Bristol, treasurers do it. It’s more efficient financially for the treasurer to do it because there is no commission, all revenues go into the general fund, and the taxpayers won’t have to pay an additional fee” for the commission of a tax collector, she said.

As part of his contract to become a full-time attorney for the city of Martinsville and Patrick County, City Attorney Eric Monday would take over collections of taxes that are delinquent more than six months. That contract, which Monday drew up, has been approved by Martinsville City Council and the Patrick County Board of Supervisors but not signed.

As the delinquent tax collector, state law permits him to collect and keep a 20-percent commission on all past-due tax bills he collects, according to both Monday and Conrad.

City treasurers are not entitled to the commission, Conrad said.

Conrad provided statistics showing that from July through April, her office collected about $456,562 in delinquent personal property taxes and about $500,000 in delinquent real estate taxes, for a total of $956,562.

If all of the $956,562 was owed at least six months, the 20 percent commission would equal $191,312.40, calculations show.

However, it could not be determined Friday how much of those taxes had been delinquent for more than six months and therefore would be subject to the commission.

Monday defended the 20-percent commission, saying it was set by state code and is less than an attorney would make in private practice. For instance, he said a private attorney who takes a case on contingency would get a one-third commission on a personal injury case and 40 percent on a medical malpractice case.

“When you compare it with the standards of the legal profession, it’s half of what a lawyer would normally take,” he said.

It also can reflect the effort that goes into a case, Monday said.

“If someone is willing to pay their taxes, they’re not going to pay 20 percent. If they make me run all over creation ... I don’t have any problem taking 20 percent,” he said.

Monday said he intends to offer delinquent taxpayers a chance to pay less.

“My intention is to send notification to these folks that says, ‘You’re six months in arrears. If you pay now, it will be significantly less than 20 percent. ... If you don’t pay (the tax bill), you have to pay 20 percent,’” he said.

He added that he has not yet determined what “significantly less” will be.

Most people pay their taxes, Monday said, noting that only about 1 percent of the city’s total tax bills are delinquent. It is virtually impossible to have 100 percent collections, he said.

“I think Pat’s (Conrad) collections have been quite effective. She has a 98-99 percent collection rate,” he said.

But, Monday said, tax collections are time-consuming for her office, and there are different collection tactics that could be used.

“If I’m effective, council will be pleased,” he said. If not, council can return the collections to the treasurer’s office at the end of his three-year contract, he added.

Conrad plans to approach Martinsville City Council to oppose shifting the collections from her office at its work session Tuesday.

She will say that the change will cost Martinsville residents more money, will decrease city revenues “and I can continue to do the same job that I am and if they would hire an attorney to sell properties, they would have a win-win situation.”

Several years ago the city hired a Norfolk law firm to sell properties with delinquent taxes because then-City Attorney David Worthy said he did not have time to deal with it. Conrad said she referred about 10 properties to the firm and three were sold.

She would like to see the city hire an attorney to do that work, she said, adding that it costs money in the short run for the legal work, but in the long run it returns properties to the tax rolls.

Monday said the city has about $1.5 million in delinquent taxes, but Conrad says that varies month to month. Most months, it is a little over $1 million, she said.

As of May 1, the city had about $700,000 in delinquent personal property taxes and $578,000 in delinquent real estate taxes, according to figures from her office.

Patrick County has just less than $400,000 in delinquent taxes, Monday said.

source : www.martinsvillebulletin.com