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Delinquent Tax Collections Going Slowly, Official Says

Property taxes and funding woes filled most of Wednesday morning, as the team from the Lieutenant Governor’s Office broke down its proposed fiscal year 2011 budget for the Senate’s Budget and Appropriations Committee.
The rhythm of testimony and back-and-forth questions between senators and officials was broken briefly a couple hours in, once it was discovered that the head and second in command of the Banking and Insurance Division were in court and it was said that no else wanted to hazard a guess about their work, in case something incorrect was said.
So, around noon, senators voted to call another budget hearing within the next couple of weeks to specifically address banking and insurance issues — a vote that was later rendered moot, when the missing testifiers, who were subpoenaed as part of an insurance case, showed up to fill in the blanks and take the hearing into the afternoon with talks on captive insurance, industry regulation and what’s being done to attract new institutions to the territory.
Meanwhile, a significant portion of the hearing focused on the agency’s collections — namely, what’s being done to pull in delinquent revenues, such as the $37 million in property taxes currently outstanding. Raymond Williams, the lieutenant governor’s chief of staff, explained that no one goes out to collect the delinquent taxes, but rather telephone calls are made and follow-up letters sent out to residents.
"Efforts to identify, update and validate delinquent records have been a slow and tedious task due to the amount of manual steps and paper records involved in the review process," he said. "Nonetheless, we are confident that 70 percent of the parcels have been reviewed, and our records are accurate. The remaining 30 percent will be easier to review since they are of the later years and the information is more readily available."
Once everything is complete, the agency will be ready to upload the data onto a new electronic revenue collection module, which is expected to be in full swing by the end of the first quarter of FY 2011, Williams added.
Meanwhile, FY 2006 property tax bills started going out about two weeks ago, said Tax Assessor Bernadette Williams, who said that about 53,000 out of more than 70,000 notices have been issued so far. The government is still battling its decade-old property tax case in District Court, which has not ruled on the matter since February, when presiding Judge Curtis Gomez denied the government’s motion to lift the injunction that has frozen property tax rates at the 1998 levels for the past few years.
The government anticipates collecting about $90 million in property taxes during FY 2011, which is needed to sustain the territory’s budget.
And on the topic of budgets, it’s been recommended that the Lieutenant Governor’s Office be appropriated nearly $7.8 million from the General Fund in FY 2011 — a 9 percent, or $755,378 drop from FY 2010. Of that amount, a little more than $5 million covers personnel costs, while $1.8 million is slated for associated fringe benefits. The remaining $930,000 is split up between supplies, other services and charge and public utilities, officials said.
The agency also receives money from its revolving fund accounts, primarily made up of fees generated by each of the divisions. The Tax Assessor’s Office is budgeted $990,000 from the Tax Assessor’s Revolving Fund in FY 2011, while $200,000 is budgeted for the Recorder of Deeds from the Recorder of Deeds Revolving Fund, $3 million for Banking and Insurance under the Commissioner of Insurance Administration Fund (along with another $1.7 million from the Financial Services Fund) and $300,000 to the Division of Corporations and Trademarks from the Corporation Revolving Fund.
The Lieutenant Governor’s Office is also slated to receive $34,554 in federal funds for the V.I. State Health Insurance Program and $430,000 in the miscellaneous section of the FY 2011 budget, bringing its overall budget total to $14.5 million — still a drop from the $16.2 million expected for this year.
Coming back after a late lunch, senators also reviewed the budget for the V.I. Board of Nurse Licensure, which is asking for $291,000 from the General Fund instead of the $163,000 recommended by the government. The board’s executive director, Diane Ruan-Viville, said the extra money will cover salaries and fringe benefits for four full-time employees.
Ruan-Viville also asked that the board be allowed to use $188,200 from the Nurse Licensure Revolving Fund for operational expenses instead of the $183,200 recommended by the government.
Present during Wednesday’s meeting were Sens. Craig W. Barshinger, Louis P. Hill, Wayne James, Terrence "Positive" Nelson, Nereida Rivera-O’Reilly, Sammuel Sanes and Patrick Simeon Sprauve.

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