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City seeks collection alternative

Monday, July 3, 2006

NEW MADRID - New Madrid residents will soon only have one stop when paying their 2005 local taxes. An agreement is being developed to have the city taxes collected by the New Madrid County Collector's office.

The change comes with the announcement by Sherry Phillips, city collector, of her intention to retire from her elected position July 31. Phillips, who was re-

elected in April to a two-year term, cited family reasons for her retirement.

In response to the collector's announcement, city officials began looking at alternatives to electing a collector.

The Board of Aldermen at the June 19 meeting approved an ordinance calling for voters to decide on April 3, 2007, whether city collector should be elected or appointed by the Board. At the same time, the Board passed an ordinance setting the collector's salary at $1 per year beginning Aug. 1.

Also City Manager John Gilbert, along with City Clerk Marian Bock, met with New Madrid County Collector Dewayne Nowlin to discuss the possibility of his office collecting the city's taxes.

Gilbert noted similar tax collection systems are being used by communities across the state. Among them, he pointed out, the cities of Cape Girardeau and Jackson have city taxes collected by the Cape Girardeau County Collector's office.

According to Gilbert, the county collector has a 96 percent collection rate, surpassing the city's collection rate. He explained this is because a personal property receipt is required from the county collector showing county taxes are paid to obtain a car license. He expects the city taxes, which would be collected at the same time, would see a similar high collection rate.

The change not only makes government more efficient but also will save taxpayers money, Gilbert said.

The savings would be realized from no longer having to pay a city collector's salary, which currently is more than $13,000. Instead the county would charge a 2 percent collection fee.

"It will cost an estimated $3,600 to have the county collect for us and now the city will pick up interest on delinquent accounts so the estimated net savings could range from $9,400 to $15,300 depending on interest collections. Since we have no experience with (interest collections), we don't know what the range will be," said Gilbert.

Another plus noted by the city administrator would be that the county would handle the sale of property sold for delinquent taxes.

"We will be able to use the savings to provide other services needed for the very citizens who pay all these taxes," said Gilbert.

As the county collector, Nowlin is already providing a similar service for Howardville. For the past two years his office has collected Howardville's taxes and, he said, it has worked well for the community and his office.

"This is something that is going on across the state and it just makes good sense," said Nowlin. He pointed out cities are able to cut down on the costs of printing and mailing while his office has to make minimal adjustments to collect a city's taxes.

"It is really no big deal," said Nowlin. "It is one more check and one more space on the spreadsheets."

Nowlin also noted the money charged a city for the service goes to the county's general revenue fund.

Agreeing that more communities will be going to such collection systems, Gilbert called it an effort by government "to be more efficient and more accountable to taxpayers. This is a movement going on statewide and we are jumping on that bandwagon."