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Wednesday, July 24, 2024
HomeNewsLocal newsGovernment Checks Didn’t Really Bounce

Government Checks Didn’t Really Bounce

BIR Director Joel Lee said not many tax checks are bouncing. (V.I. Senate photo)
BIR Director Joel Lee said not many tax checks are bouncing. (V.I. Senate photo)

Joel Lee, director of the Bureau of Internal Revenue, told the Committee on Budget, Appropriations, and Finance that his bureau did not have a problem with bouncing checks.

Kevin McCurdy, the commissioner of Finance, told the same committee earlier in the week that the government had accepted over $2 million in bad checks this fiscal year, and BIR had accepted most of them. His comments raised the concern of Finance Committee Chair Sen. Donna Frett-Gregory, who said something had to be done. She suggested that it become the government policy that if a check is over $25,000, it must be a cashier’s check.

The government has a service, Telecheck, that guarantees checks under that amount.

Lee said Friday most checks that BIR receives that must be returned are not for insufficient funds. They are for minor mistakes—wrong dates or missing signatures—and can be easily rectified. Lee said that of the $1.7 million returned checks the bureau received last fiscal year, $900,000 worth was quickly corrected.

Lee said he would not recommend requiring cashiers’ checks for amounts over $25,000 because doing so would just add an extra burden on taxpayers.

Lee added that writing a bad check to the Bureau is not like writing a bad check to a business. A person writing a bad check to a business walks away with something “tangible,” a product. A person writing a bad check to the Bureau still owes the tax.

However, even if the Bureau has no problem with bounced checks, it is owed about $150 million in back taxes.

Lee said tax debt is less than 1 percent of what is billed. The Bureau predicts collecting $855 million in taxes in the upcoming fiscal year. It collected $829 million in fiscal year 2023.

Lee testified, “We paid $15 million in refunds for this fiscal year. Currently, the Bureau has $68 million in refunds processed and ready to be paid.”

The Bureau requests that its entire $13 million budget be funded from the general fund. This is a decrease from the FY 2024 budget recommendation of $14.4 million.

Eighty-two percent of the budget, $10.6 million, is for personnel services. There are 152 positions: 101 in St. Thomas, 50 in St. Croix, and 1 in St. John. There are 31 vacancies. Some of the vacancies are cut in the proposed budget. Only 134 positions are requested to be funded.

Supplies are budgeted at $224,500, other services and charges at $1.9 million, and utilities at $93,601.

Travel and cash advances are budgeted at $30,000; advertising is budgeted at $10,000 and printing costs are budgeted at $5,000.

Rental obligations include properties on St. Thomas and St. Croix totaling $889,129 for fiscal year 2025.

Senators attending the committee hearing included Frett-Gregory, Novelle Francis, Diane Capehart, Dwayne DeGraff, Ray Fonseca, Kenneth Gittens, Javan James, and Carla Joseph.

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