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Tax collection needs review

Taxation is a necessary evil that takes property from private individuals for a public purpose. Those of us in government who set the tax levy owe it to the populace to continually assess the amount of taxation, as well as the collection process. We owe it to our residents to assure that the collection process is uniform and least burdensome. An initiative I am spearheading in the county seeks to do just that.

In Dutchess County, property taxes become due each year on March 1. Yet in three of the 22 towns and cities for reasons of convenience and/or desperation taxpayers have the option to pay their taxes in installments, spread out over the course of a few months, albeit it with interest accruing. Current state law disallows small towns from implementing installment payments. Because fairness is at the heart of due process, and because I believe government should strive to ease the lives of it citizens I have revived efforts to examine the collection process.

In 2012, as county representative for the town of Stanford I received a bipartisan, unanimously-passed resolution from the Town Board asking that Stanford be permitted to collect property taxes in installment payments as is presently allowed in Hyde Park, Wappinger and the town of Poughkeepsie. Because Stanford is rated by state standards as a “second class town” (a legal designation based upon population and accessed value) the town is barred from determining its own policy with respect to tax installments. This is currently permitted for “first class towns.” The Dutchess County Legislature, at my urging and through a bipartisan sponsorship, unanimously asked our state delegation by resolution to end the discrimination imposed by such class designations. Our state delegation failed to act.

County residents — particularly those on fixed incomes or who struggle with their bills — could benefit from installment payments. Current policy is “all or nothing” due March 1. If a taxpayer does not have the total tax, interest is levied on the entire amount until which time she can make the whole payment. However, if a taxpayer could pay half or a third in March, interest would only accrue on the outstanding sum. Struggling taxpayers who reside in a “first class town” (where installment payments are the norm) have an advantage over “second class” town taxpayers. They pay less in interest penalties because their balances are lower. This raises justice and equity concerns.

In 2013, $5.8 million was paid in penalties and interests for county residents who could not pay their property taxes on time.

Most people pay taxes out escrow from mortgage payments, but for those who struggle with scraping their dollars together to pay the taxes during the same month when heating bills tend to soar, the option to pay taxes in installment could be helpful.

Two years ago I presented on this topic to the Supervisors and Mayors Association. The discussion was lively and we determined together to give towns and cities an opportunity to assess whether such a county-wide installment plan could assist their residents. Earlier this month I again wrote the supervisors and mayors asking for an update so as to possibly introduce a bill in the county legislature for consideration later this year. Stay tuned.

Michael N. Kelsey represents the people of Amenia, Washington, Pleasant Valley and Millbrook. Write him at KelseyESQ@yahoo.com.