Monroe hopes ‘extra step’ will improve collections of delinquent income tax, other debt

Ohio Attorney General’s delinquent debt collection is a free service for municipalities.

MONROE — The city’s finance department hopes an “extra step” will lead to “better collections,” said Jake Burton, finance director.

On Tuesday night, City Council unanimously passed a resolution that will allow City Manager Bill Brock to enter into an agreement between the city and the State of Ohio Attorney General for the collection of delinquent income tax and other debt.

The resolution passed 6-0 with council member Ben Wagner excused from the meeting.

This strategy was briefly discussed at the October budget retreat, and with the Finance Committee at the Nov. 22, 2022 meeting, and discussed at the Jan. 24, 2023 meeting, Burton said.

He said the the Ohio Attorney General’s delinquent debt collection is a free service for municipalities. However, a collection fee of 11% is passed onto the taxpayer, which is in addition to their certified tax balance. So for every $100 owed, the person will pay an additional $11 to the OAG office.

The 11% provides a significant cost savings for the city when compared to collection agencies that typically charge 30% to 50% of the debt collected, according to Burton. He said the OAG office also has the ability to capture state and federal tax refunds and lottery winnings for up to 10 years to pay off the debt.

This summer Monroe will join about 200 local government clients utilizing the OAG’s collection services, he said.

From 2007 to 2021, the city had $734,000 in tax balances and $265,000 in penalty and interest for a total balance of $1 million, according to the city’s finance records.

The city has 2,449 delinquencies in its system, but this is not the number of accounts that are delinquent because many accounts have two or more tax years with a delinquent balance, he said.

There are 195 accounts the city could send directly to the AGO based on the criteria amount established with outstanding balances of $1,500 or greater. This number of accounts does not include accounts who either live outside of Southwest Ohio or have defaulted on a payment plan that could also be sent directly to the AGO, according to the city.

Even with the program, the city’s Income Tax Division will continue with its current practice of issuing multiple balance due letters/statements, offering payment plans, and working with taxpayers on an individual basis prior to sending an account to the Attorney General for collection, he said.

Sending the collection to the OAG office would be the “end of the process,” Burton said.

In other Monroe news

City Council approved spending more than $290,000 on four pieces of equipment for the Public Works Department.

Council member Marc Bellapianta questioned why the city is purchasing new equipment when a larger Public Works building hasn’t been constructed. He was concerned about the equipment being stored outside.

He said it was like the city was “putting the cart before the horse.”

Public Works Director Gary Morton said the equipment will be stored inside during the winter. He said some of the city’s equipment is aging and needs major repairs so it makes financial sense to have it replaced.

Council approved the purchase of a John Deere Flex Wing Mower ($69,133.75), mid-sized dump truck ($131,982), KM International 4-ton Trailer Mounted Asphalt Hotbox ($47,385) and a 2022 Bomag BW120SL-5 Asphalt Roller ($41,487).

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