A proposal within the the New York State budget could make accepting property tax payments much more complicated and expensive for taxing authorities.
The goal of the provision is to simply give towns and school districts the ability to accept payments in varying amounts during the collection period.
Essentially, it would give the taxpayer the ability to name the number of installments they’d make to completely pay off their tax bill before the period ends.
It’s a good idea in principle, but accepting those payments for an entity like — a county — could get expensive. Real Property Director Kelly Anderson said Cayuga County is not equipped to handle it, according to reporting by the Auburn Citizen.
Other officials agree noting that it could result in the necessity of more employees to handle the responsibility.
The proposal within the budget reads:
”Allow Taxpayers to Make Partial Real Property Tax Payments. The Executive Budget reverses the existing general prohibition on partial property tax payments. When a partial payment is made, the outstanding balance may be subject to penalties and interest. Collecting officers will be required to accept partial payments that meet the applicable restrictions unless local authorities take specific action to restrict or prohibit such payments.”
Seneca County Manager John Sheppard said on Saturday that “Property tax levying authorities currently have wide latitude to issue property tax installment plans as a ‘Home Rule’ state.”
“Seneca County routinely engages in this practice through the Treasurer’s office. The interests rate has recently been 1 percent,” he explained.
Sheppard did note that as a matter of practice, he feels that “reactively” administering property tax installment plans costs more in “administrative effort,” than “proactively” administered plans would to avoid delinquencies.
One area of potential change would involve modifying the length of time before the foreclosure process is started. “It is my preference to reduce from three to two years for foreclosure and reduce the number of installment plans and associated administrative effort.”
Currently, residents must be three years behind on their taxes before the foreclosure process begins.
Sheppard continued, “I would rather concentrate effort in a proactive program to have constituents pay their tax liability on time, before foreclosure risks develop.”
According to the County Manager, the installment plan process currently is executed through the Treasurer’s Office. As Anderson pointed out in Cayuga County — Sheppard doesn’t believe Seneca County is prepared to handle an influx of payment plans.
“Neither our Finance Department nor our Treasurer Department is staffed to provide an expanded effort for property tax installment plans,” he concluded.
Officials from the Budget Office said that a local law could be passed, if the payment plan process was not suitable to their community or constituents. However, it’s clear that the process could get complicated.