Some people aren't paying their vehicle taxes in New London
New London — The simple truth is some people don’t pay their taxes.
Unpaid motor vehicle and personal property taxes in New London over a three-year period, from 2011 to 2013, totaled $971,782.06. The majority — $767,050 — came from motor vehicle taxes.
The City Council this week added the 5,909 accounts associated with those unpaid taxes onto a suspension list. This typically is done every year in every municipality and is something that Finance Director Don Gray said helps clear financial records and ensures the city will not overstate its anticipated receivables.
Accounts with delinquent real estate taxes are not suspended, since the city has other means, such as tax sales, to collect.
Tax Collector Maureen Farrell said the reasons the city has been unable to collect the taxes vary but in the case of motor vehicle taxes, it is largely due to the city's inability to find people who have moved out of the city and state.
The efforts to collect the taxes don’t end with the suspension list, however. Once the council passes the measure, Farrell said, the accounts are handed over to a collection agency. The agency, American National Recovery Group, will scour the country in an effort to collect the taxes and interest at no charge to the city. The city charges 1.5 percent interest per month on overdue motor vehicle tax bills.
The collection agency charges delinquents an extra 15 percent fee for its services.
Farrell said that since 2009 the collection agency has recovered $1.09 million for the city.
“It's a lot of money we wouldn’t be able to find otherwise,” she said.
Much of the money will not be collected, especially the overdue personal property taxes. Uncollected personal property taxes — a total of $204,730 for the three-year period — mostly is due to businesses that closed up and left the city.
The high number of unpaid motor vehicle tax bills might be due to the transient nature of the city’s population; the city has many rental properties and military members. Some members of the military who are on the list may have tax-exempt status but have not submitted the proper paperwork for the exemption.
Farrell said since the state Department of Motor Vehicles will not let an individual register a vehicle with unpaid taxes, there is a good likelihood the people are out of state or are driving without a registration. The DMV recently revamped its own system in an attempt to catch people who have registered vehicles under slightly different names.
When presented with the list earlier this week, several City Council members expressed their displeasure.
“That’s a lot of money,” Councilor Martha Marx said. “Can’t we put their names in the paper or something? I’m being a little bit facetious but I’m being a little bit serious, too. That’s a lot of people not paying their car taxes.”
Marx asked Gray for a list of names.
“If it’s my next-door neighbor, I’ll go knock on their door,” Marx said.
City Council President Anthony Nolan agreed with the idea of a public shaming of sorts.
“If my name’s in the newspaper for not paying taxes, I’m paying my taxes,” Nolan said.
Councilors also questioned the reason for the spike in unpaid taxes from 2013. Farrell said it was the year the City Council delayed setting a mill rate for several months which in turn caused tax bills to be late and compounded the number of delinquent tax bills. There are many people, she said, who wait until they try to register a vehicle before they are forced to pay their tax bill.
It was unclear if the City Council will pursue the idea of outing the delinquent taxpayers.
Comment threads are monitored for 48 hours after publication and then closed.
