Date: Fri 26-Jun-1998

Publication: Bee

Author: STEVEB

Quick Words:

council-tax-liens-Spragg

Full Text:

Council Votes To Sell Town's Tax Liens

BY STEVE BIGHAM

The Legislative Council Wednesday voted in favor of a new tax collection

strategy for Newtown: selling municipal tax liens to a collection agency.

Currently, there are about $1.5 million worth of taxes outstanding. The town

would likely receive 100 percent of their worth, with an agency making its

money by charging 18 percent interest. Bridgeport received 100 percent on its

liens, Finance Director Ben Spragg said.

Before the tax liens can be sold, a town meeting must be convened to allow

public comment on the idea. If approved, the money would be deposited into

this year's capital and non-recurring expenditures account to be used to

offset the anticipated $1.3 million revenue shortfall in the 1999-2000 budget,

according to Mr Spragg.

The suggestion that Newtown sell its tax liens was made back in March by

Legislative Council member Don Studley, who felt it was a way to keep the tax

rate down.

Mr Spragg said those delinquent taxpayers will be given one last opportunity

to pay up before the issue is passed on to the collection agency. Mr Spragg

said many people tend to come forward to pay, preferring not to deal with an

outside group.

Council member Will Rodgers wondered why the tax liens needed to be sold on

real estate property since the town is guaranteed to collect on them once the

homes are sold. However, proponents of the plan say this is the best way to

collect that money up front. They concede Newtown will lose the 18 percent

interest, but by selling the tax liens, the town is assured of receiving more

than it would have otherwise.