Jan. 29, 2004 – Realtors, homeowners, landowners and buyers in the territory have been unable to complete real property sales in a timely manner for months due to delays in obtaining tax-clearance documents from the Finance Department.
"This has been going on since last spring," Sharon Hupprich, owner of Calypso Realty, said on Thursday. And, she added, "Sellers cannot get their money until we close."
In order to close on transactions, Realtors and sellers must show proof that there are no outstanding taxes owed on a property. A tax clearance letter, issued by the Finance Department, is the means of verifying the legal holder of the deed to a property and that the owner is current in tax obligations.
Hupprich said she and several other Realtors appealed to Finance Commissioner Bernice Turnbull to see whether they could come up with ways to eliminate the delays, but Turnbull never got back to them.
However, Sen. Lorraine Berry announced in a release on Thursday that "arrangements with the Finance Department will alleviate problems encountered by Realtors, attorneys and residents in buying and selling homes and properties."
The solution as laid out by Berry — and to be effective Thursday, according to the release — is for the department's tax clearance office to close to the public at 2 p.m. daily so that "tax-clearance letters will be processed five days a week from 2 to 5 p.m. until the backlog is cleared."
James Francis, Berry's chief of staff, said "a few hundred" tax-clearance letters are pending. "They have a backlog and are trying to get caught up," he said.
Hupprich said she believes the main reason for the backlog is that the department is understaffed, and she doesn't think the new schedule will help unless more personnel are added.
"The people who work in the tax-clearance office are overwhelmed," she said. "These people work very hard. They just need more personnel."
However, Rosemary Sauter-Frett, president of the V.I. Territorial Association of Realtors, said on Thursday that setting the three hours a day aside for processing tax-clearance letters might help.
"Certainly, that would be very favorable, if they are not answering the phones as well," Sauter-Frett said. "Right now, we're waiting 60 to 90 days for tax-clearance documents. All Realtors on St. Thomas are experiencing delays in closing because of this."
Sauter-Frett noted that the delays have a negative impact on the government, too, by delaying its receipt of stamp-tax revenues. She suggested that the government hire two additional staff members to focus solely on the issuance of tax-clearance documents.
Berry's release said the tax-clearance problem came to her attention "when several residents reported the government's failure to produce the documents cost them severe financial reversals."
She also noted that the V.I. treasury would benefit from quicker closings on the transfer of property and said she supports Turnbull's request for "additional personnel in assisting the department and the hard-working employees in this revenue-producing endeavor."
Turnbull did not return calls to her office on Thursday.
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