School board allowing taxpayers to make installment payments
CONNELLSVILLE – Property owners that were overwhelmed last year when they opened annual tax notices and found that they would have to reach deeper into their pockets to pay the bill will have an option this year to make installment payments. Eugene Cunningham, Connellsville Area School District business manager, said that the tax notices that will be delivered to mailboxes in August will contain a memo to explain the plan.
Last year, by a 5-4-vote margin, the district board members agreed to increase the property tax rate from 9.5401 mills to 12.6 mills, which translated into a 32-percent increase in the amount of taxes paid by the school district property owners.
While taxpayers lobbied the board to rescind the substantial increase, the directors instead agreed to implement a payment plan to ease the lump sum payment burden.
The plan, said Cunningham, will permit taxpayers to divide the payment into four equal installments that would be due Aug. 31, Sept. 30, Oct. 31 and Nov. 30.
If the installment option were selected, said Cunningham, the taxpayer would not be permitted to take advantage of the 2-percent discount offered to those paying the full amount in August or September.
Despite a nearly $1 million deficit in the 2005-06 district budget, directors chose not to implement a tax increase.
The payment policy was based on a plan enacted in the South Fayette School District. Of the 6,231 taxpayers, only 28 opted into the program, said Cunningham.
Louis Bell, Bullskin Township tax collector, speculates only a small number of taxpayers would opt into the installment program.
“Township taxpayers will gripe and grouse a little bit about paying (the taxes), but they are very responsible,” he said. “More than 80 percent take advantage of the discount period, so I don’t see many deciding to make the installment payments.”
Despite the tax increase, Bell said the majority of property owners did make timely payments under the lump sum system.
“I think my collections were up a little bit,” he said. “I think they looked at the higher bill and knew if it went to the (county Tax Claim Bureau), the cost would be even higher, so they just paid it.”
A property owner with a home valued at $100,000 will pay $1,260 in school taxes, said Bell.
Marigrace Butela, Dunbar Township tax collector, said she anticipates some confusion with the payment plan, especially for those who will be accepting and tracking the bills because of a stipulation that penalizes those who fail to make timely payments.
The taxpayer opting into the installment program will be additionally charged a 10-percent penalty fee if they fail to make the payment by each of the due dates.
If full payment is not received on Nov. 30, an additional 10-percent penalty will be assessed on the original face value of the tax.
“It’s going to be a lot of extra work on our part to keep track of all of this,” she said. “We’re going to have to keep separate records for those using the installment plan.”
The record keeping would be made easier, Butela added, if it could be done electronically.
“We should be computerized; online with the taxing body,” she said. “We should be doing our deposits online; we’re way behind.”
Butela suggests those with difficulty paying the lump sum amount take personal responsibility in setting aside a monthly payment and forward the tax by the Nov. 30 deadline to avoid any of the 10-percent penalty fees.
“I believe that’s a better way to do it,” she said.
Cunningham, meanwhile, said that taxpayers making partial payment in August will be considered enrolled in the installment plan and will receive a coupon booklet for the remaining three payments.
“I don’t know how many people will sign up for it,” he said. “We’ll have to wait and see.”