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Luzerne County would save an estimated $123,534 annually by reducing its compensation for 68 elected tax collectors from $2.50 to $1.50 for each county real estate tax payment they collect, according to agenda paperwork for Tuesday’s county council meeting.
A pay reduction vote is on the agenda because compensation changes must be enacted before Feb. 14, the first day prospective collectors can start circulating and filing nomination petitions to appear on the May 16 primary ballot. Any compensation changes would take effect in 2018.
Harrisburg-based Public Financial Management’s 2015 financial recovery plan recommended the elected collectors receive $1.50 per paid bill, which is the amount the county pays three home rule municipalities — Kingston, Kingston Township and Wilkes-Barre Township — to collect county taxes.
An agenda chart shows the new savings projection is based on the 114,755 county tax bills issued to elected collectors in 2016.
Under the current pay structure, the county pays tax collectors $308,834 — $286,887 in compensation and $21,947 in payroll taxes, the chart says.
With the reduction to $1.50, the total payment would be $185,300 — $172,132 in compensation and $13,168 in payroll taxes, it said.
A proposed switch to in-house tax collection by the county treasurer’s office, which also is on Tuesday’s agenda, would save $25,101, the agenda shows.
The savings is less because the administration has tallied a list of additional staff and costs it says would be necessary for the county treasurer’s office to take over county tax collection now handled by elected collectors and home rule municipalities.
The total cost of the current system is $619,892 with the compensation and payroll taxes for elected collectors and these expenses, the agenda says:
• $14,816 for home rule municipalities to collect 9,877 bills
• $47,311 in bonding covering all collectors
• $240,306 in staffing costs for four treasurer’s office employees who collect county taxes in the four remaining municipalities — Wilkes-Barre, Nanticoke, Hazleton, Pittston and Newport Township
• $8,625 for software maintenance
If the county shifts to in-house collection, the costs would be an estimated $674,791, in part due to the addition of three new clerks that would cost $46,621 each with benefits, the agenda says.
One of the new clerks would be assigned to a new “mobile unit” to receive tax payments from residents who want to pay in person without visiting the county courthouse in Wilkes-Barre, it says.
The administration also lists other expenses tied to this mobile unit — a new deputy sheriff costing $53,195 with benefits, a new deputy tax administrator costing $63,477 with benefits and $15,000 in information technology expenses.
Costs for bonding, printing and mailing bills and software maintenance also would increase, it said.
Although the tab for in-house collection is projected to be higher than the current system, a $25,101 savings would be expected because the administration anticipates $80,000 in revenue from fees for providing copies of duplicate bills and tax certifications.
A council majority had halted a switch to in-house tax collection in January 2014, when the elected collectors agreed to accept a reduction from their prior compensation of $3.50 for both paid and unpaid county tax bills. Under the current agreement, which expires the end of this year, they received $2 for each paid county tax bill and nothing for unpaid bills in 2014 and 2015 and $2.50 per paid bill in the final two years of their four-year terms.
The revived push for centralized collection is not expected to pass because a council majority rejected a proposed home rule charter amendment ballot question last year that would have asked voters if they want to switch to in-house tax collection.