SOUTH ADAMS COUNTY, Pa. – In response to the misallocation
of $1.85 million in tax revenue by the now-defunct Adams County
Earned Income Tax Collection Agency, the York Adams Tax Bureau’s
board of directors will meet on Jan. 29 regarding adoption
of currently proposed repayment options.
The
issue was first brought to the attention of Adams County
municipalities and school districts in an Oct. 10 memo from
the tax bureau transition committee.
Of
concern are the earned income taxes distributed during the
period from Feb. 1, 2005 to July 1, 2006, during which time
ACEITCA alleges it overpaid 28 of the 29 municipalities
and one school district.
Tax
bureau tries to deal with its fiasco
The
first repayment option proposed is to withhold the debt
from the municipalities’ May 2007 distribution, which
is generally about double the other quarterly distributions.
According
to Carroll Valley Borough Manager David Hazlett, the borough
(which has one of the highest repayment figures in the county
at $144,320) would then receive a net check of “about
five or six thousand dollars.”
The
second plan calls for the debt to be satisfied in two equal
withholdings in May of 2007 and 2008.
A third
plan calls for the debt to be withheld from the municipalities’
delinquent tax distributions until December 2008 or the
municipality’s obligation has been satisfied, whichever
comes first.
If
the entire debt isn’t repaid under this plan by the
end of 2008, the municipality would then have to come up
with the balance. ACEITCA Transition Committee member, Dr.
Mark Sewell, has suggested this option may be a relatively
painless way to satisfy the obligation since municipalities
cannot really budget for this irregular stream of revenue.
According
to the current proposal, if the YATB Board adopts these
options, municipalities would have until March 2007 to indicate
their repayment plan. If none is chosen, the second plan
will be the default.
The
issue, according to Fairfield Borough Solicitor Matthew
Battersby stems from a miscalculation of how the tax revenues
were allocated between the municipalities and area school
districts.
Questions
remain unanswered
However,
according to Hazlett, the figures ACEITCA said it distributed
does not reconcile with the receipts of the borough’s
books.
Battersby
summarized most of the municipalities’ sentiments.
“If the numbers are justified and there was a mistake,
then we can address it at that time, but not the way it’s
been handled thus far.”
In
spite of two meetings and multiple requests for additional
information, most municipalities in Adams County feel they
still do not have enough information to warrant giving back
significant amounts of their constituents’ tax dollars.
“We
still have more questions unanswered than answered,”
said Hazlett.
Carroll
Valley and Fairfield have not budgeted for any repayment
in their 2007 budgets that will be approved this month.
Liberty
Township has taken a proactive approach to address their
alleged obligation of $44,066. They have reduced their police
force from two full time officers to a full-timer and one
part-timer.
Additionally,
they have reduced their roads budget for 2007 by $9,000
and the township supervisor’s salaries by 57 percent.
These steps, according to township Supervisor Peter Foscato,
will allow them to repay their share in two installments,
in May 2007 and May 2008.
Foscato
stressed that Liberty is not any more comfortable with the
numbers than any of the other municipalities, but recognized
that they will likely owe something before the issue is
resolved, and steps were taken by the township to be prepared.
Gettysburg
Financial Director Ramona Overton said the borough hasn’t
budgeted for the possible $118,951 bill in 2007, but they
also haven’t accounted for the receipt of delinquent
taxes either. She indicated that although “hundreds
of thousands of dollars” in back taxes are owed the
borough, there is no way to budget how much will actually
be collected. The inevitable receipts of some of these monies,
however, could be used to repay this obligation.
Several
municipalities have indicated that their solicitor is in
contact with other solicitors in the county to pursue collective
legal channels if their clients feel their concerns are
not adequately addressed.
