NHTCA 69th Annual Business Meeting  - Thursday, October 18, 2007
Association President Joan Porter called the meeting to order at 1:30 p.m. in Hampshire Hall.  After reminding everyone to turn off cell phones, she introduced Stanley Gorzelany, President of the Connecticut Tax Collectors’ Association.  Mr. Gorzelany and his wife Connie made the trek up north again this year to attend our annual conference.  He was greeted with applause while Joan asked everyone to make him and his (kite flying) wife feel welcome. 
 
Joan made reference to all of the reports from the packets and asked for a blanket motion to accept.  A motion was made by Pat Tucker to accept the Annual Reports as submitted by the Finance Committee, Certification Committee, and County Coordinators.  Also, to approve the Secretary’s and Treasurer’s Financial Reports for the Year Ending June 30, 2007.  The motion was seconded by Jill Hadaway and passed by unanimous voice vote.

The President asked members of the Executive Board to stand up one more time and thanked them all for an outstanding  job and acknowledged them for their hard work over the course of the last year.  Applause from the audience came in recognition of their efforts.

Patricia Woolsey stepped forward as Chairman of the Nominating Committee and respectfully nominated the following slate of officers for 2207-2008:

Nominations recommended by Marcia Shackford, CTC, Madison; Raymah Simpson, Bristol; and Patricia Woolsey, CDTC, Bristol – Nominating Committee members.

Joan asked if there were any nominations from the floor.  There being none, a motion was made by President Joan Porter to instruct the Secretary to cast one ballot for the slate of officers as proposed by the Nominating Committee.  The motion was passed by unanimous voice vote.

Rhoda Quint the incoming 2nd Vice President was asked to stand and be recognized. 

In the record time of only four minutes and seventeen seconds the meeting came to a close with a motion to adjourn being solicited from Pat Tucker and seconded by Marcia Shackford.  The motion passed by unanimous voice vote.

Desiree Mahurin stepped forward and said that with the plethora of gifts brought to the conference she decided to give some away now instead of waiting until the banquet tonight.  Thus a short break ensued to allow for gift winning to take place.

Tax Collector Technical Issues Round Table  (A3)
Discussion panel:  Don Borror DRA; Barbara Reid, CPA – LGC; Bernie Campbell, Attorney; Gail Lavallee, CTC Goffstown; Dawn Oswalt, CTC Jaffrey; Cynthia Torsey, CTC Franklin

Cheryl opened the session by introducing members of the Education Committee:  Don Borror, DRA; Pat Tucker, CTC, Ashland; Cynthia Torsey, CTC, Franklin; Gail Lavallee, CTC, Goffstown; Dawn Oswalt, CTC, Franklin; and Ruth Raswyck, CDTC, Nashua.  A round of applause was given to Cheryl and the committee in recognition of their time, energy and efforts.  Cheryl stated that the topic for Spring Workshops in 2008 will be the repurchase, lien and deeding processes.  She also reminded everyone about the New Collector’s workshop held in the spring of each year.  This is an example of an educational forum available to everyone in the Association.  Last year several “seasoned” Collectors chose to attend as well and it made for a more interesting forum.  She asked everyone to make sure they have a copy of the “test”.   Answers and discussion will take place at the end of session. 

Betsey Patten, State Representative and local Selectman in the town of Moultonborough, was introduced as a special guest at the meeting. 

Members of the discussion panel were introduced and the session began in earnest.  The intent of the meeting this afternoon is to provide the opportunity for questions and answers from various points of view.  Represented on the panel are people who can speak from both the technical (legal and State) and practical (Tax Collector) side of the profession.

The first question came from Susette Remson of Moultonborough who had a question about “Right to Know”.   She recently sent a taxpayer a certified notice and the green card did not come back.  When she checked the post office website to see if the notice had been delivered there was a new city and state listed so she went on-line to obtain a telephone number for the taxpayer and a left message.  The taxpayer returned the call and was extremely upset about the fact that she had been “tracked down”.  She did not want the town to have her mailing address due to a family feud.  Susette now has the taxpayers’ phone number and address on file but asked if she is obligated to give it out if someone inquires how to get in touch with this person.

Attorney Bernie Campbell was the first person to respond saying the short answer is, “No, the phone number does not have to be revealed.”   RSA 91:A – Meetings and Records -  In part this RSA states that all municipal records are subject to public inspection.  However, part of that same statute under 91:A:5 states “ . . . pieces of information that would constitute an invasion of privacy.”  A telephone number would probably fall under this section as it really has no bearing on the assessment process or even the amount of taxes owed.   Another portion of the same RSA under 5:VII states  -  “Any notes or material made for personal use that do not have an official purpose, including notes and material made prior during or after a public proceeding . . .”.   Certainly an argument could be made that noting a phone number is a personal note intended only for the Tax Collector.  So it looks like divulging this piece of information would not be required if asked. 

Of more concern to Mr. Campbell was the fact that the taxpayer did not want to provide a legitimate address.   Obviously the warrant should have a mailing address for the owner so perhaps the taxpayer could be persuaded to go through some other entity for an address.  Maybe send to attorney, mailing service, or other agent, that way their physical address remains private.

Is it okay to share this type of information between offices within the town?   Bernie responded by saying that it depends upon the circumstances in which the information was obtained.  If the piece of information is not essential under the Right to Know then the other office is not necessarily entitled.

The next question came directly from a 2007 Spring Workshop Evaluation Form:
“This situation has occurred in my town.  A home with two apartments was converted to condominiums after April 1st.  In July, the first condo unit was sold.  The second condo unit was sold in August.  The closing companies did not consider a December tax bill.  The property was taxed as a home as of the April 1st requirement.  How should a municipality handle this?”

Cindy Torsey fielded this question by responding that she would handle the tax as it was originally billed.  If the building was taxed as a home as of April 1st, then the city would not become involved in the closing.  This is something that is left up to the buyer and the seller before they close, not the Tax Collector.  Bernie pointed out that this is a similar situation with subdivision of lots.  According to RSA 674:37: a, lots are taxed based upon the approval date of the subdivision. If the taxes do not get paid in a timely manner then anyone that has an interest in the main parcel stands to lose if the property ends up being deeded.  He also stated there is a provision in the land use laws that provides for a jeopardy assessment where you can in essence “pre-bill” for the entire year.  (RSA 674:37-a)   Jill Hadaway asked, “Who actually are you going to be billing?”  Attorney Campbell said you may end up billing any new owners as though they were the sole owner.  This thought left many confused so in an attempt to clarify Mr. Campbell stated it would be up to the owner of the original property to initiate a jeopardy assessment.

Lillian Knowles offered that in Seabrook they create a “mother” account which has sub-accounts.  Down the road if there is something left outstanding on the main account she will know to notify owners of the sub-accounts. 

In Hampton Falls a new subdivision has not yet been approved but the owner has already started to sell off the lots, what is the best way to handle this situation?  Bernie responded by referencing RSA 676:17 which provides for a penalty for sale of unapproved lots.  He advised notifying the Codes and Assessing offices so they can initiate any cease order or penalty assessment.

Moving on, “Currently I perform my own title searches in conjunction with properties that require liening or deeding.  The Selectmen judge this practice to be inefficient (my office is closed on the days that I am at the registry) and costly (title abstractors have given quotes to do title searches at a per title search rate that offers significant savings to the municipality).  Who makes the decision to do the title searches?”

Dawn Oswalt responded, “The Board of Selectmen.”  She gave an example from her town where she was asked by the Board who to choose to perform the work.  Joann Platt asked what kind of cost estimates where coming in from title search companies because she feels that her price is cheaper.  Cost estimates came in with a high of $25.00 to a low of $8.00.   Debra Desimone was surprised that someone would do their own research and asked if the town carries liability insurance in the event of an error.  Joann said, “Yes.”  It was noted that usually the errors and omissions insurance is quite costly and most towns would not fund this type of expenditure.   Kathy Vallerie said she used to do her own searches but ended up making some errors at one point due to a subdivision that was recorded incorrectly at the registry.  The end result was some abatements and a whole lot of stress!  After that she decided it was not worth the risk and now has a company (with insurance) handle the job.  Many other Collectors expressed a similar point of view.  Someone asked what to do if a company has been hired that is making errors in reporting by leaving out UCC filings and IRS liens.  Cheryl said that if the contract with the company includes these types of liens then they are breaking the contract.  Bernie advised getting the towns’ attorney involved.  One new Collector wanted to know what the majority recommends.   General consensus is to hire someone else.  Cheryl has a list of companies and individuals that perform title searches if anyone is interested.

One person raised the issue of being told to do the research when they really did not want to be burdened with the responsibility.  The ultimate decision as to who does the research is up to the Board of Selectmen, so it is worth the time and energy to investigate the options and present them to the Board.  If the case is make strongly enough a reasonable Board should agree to hire out the service.  Kathy Vallerie said one good point to make is that the town does get the money back as the cost of the search is a recoverable cost; paid by the taxpayer.  Cheryl added,  “Don’t forget to budget for the cost of the search if you decide to hire it out.’

What qualifications do you look for with a person or company to perform mortgagee research?  Dawn Oswalt said that when she first was looking into it she sent a letter out to each company and checked them out to make sure they met all of the criteria and were reputable firms.  Mr. Campbell suggested a request for proposal (RFP) which would ask for the name of company, training, background, list of employees, references, insurance coverage, etc.   Make sure to get a certificate of insurance that names the town as a loss payee in case of claim.   The level of insurance coverage should be no less than $500,000 per occurrence.

Clarification to a question that came up during the last session in the Avitar user group was offered by Don Borror.  The issue was on prepayment of taxes and whether or not it takes a vote of town meeting or Board of Selectmen to authorize.  The answer to the question can be found in RSA 80:52-a, which states that it can be done by either entity.  

A property tax payment arrives in envelope that does not have a postmark.  How do you handle the payment in terms of charging interest if it is near the due date?

Cindy Torsey said that in Franklin they mark the date received and record the payment as of that date.  Barbara Reid said she recalls being asked a similar type of question except the check was dated as of the due date but was not received until much later.  As a former auditor she recommends having a written policy outlining the procedures to follow in these types of situations.  The bottom line is to make sure that everyone is being treated equally.  But the best advice is to be consistent. 

A mid afternoon break was allowed for about 15 minutes after which more gifts were given away.  Desiree also announced the winner of the vendor game – Jennifer Call from Sutton.

Before getting back to business Cheryl asked how many perform their own title searches.  Surprisingly, a number of hands went up in response.  A suggestion by Becky Benvenuti was to have the Association provide a draft RFP for contracting out title services.  This idea seemed to go over pretty well so expect to see one available on the website sometime soon.

“I seem to recall from one of the tax workshops being told not to let anyone else take tax payments except for our Deputies.  During the last tax cycle I was handed tax payments by the Town Clerk (separate from the Tax Collector position), Administrative Assistant and Building Inspector.  Their office hours are slightly longer than mine.  Is there an RSA that speaks to this issue or is it just a good practice to only have the Tax Collector receive payments?”

Cindy Torsey responded to the question answering from a Tax Collector’s perspective.  In Franklin she has a box available for people to drop off payments when the office isn’t open.  This is the first place she checks when the office reopens so there is no need to drop off payments with someone else.  A receipt is issued and marked paid when it is actually received and deposited in her office.  Deb Desimone said she cannot stamp paid in full.  Cheryl also does not stamp paid in full only “paid” and the date received.  Bernie said that if the issue about stamping receipts “paid in full” is just in case the check is returned, then there is no need to worry as RSA 80:52-b covers this issue and allows you to move forward with collections.

Nancy Clifford addressed the main issue about letting other people in the office collect taxes. She gave an example from her own experiences where she had someone from another office take a payment and never turned over it to her.  Based on this instance she strongly advised against letting anyone else take payments and to establish a policy clearly stating who is allowed to collect.  Dawn Oswalt said that in her town there are some offices that have longer hours than she does so if someone comes in after the tax office is closed and tries to pay, the other people will receipt the payment but hand the customer an envelope and tell them they need to deposit it into the drop box outside.  This places the responsibility upon the customer and the other office does not have the liability.

“If you let someone else take cash payments, how do you prove that it was received?”  

The short answer here is that no one should be allowed to accept payments unless they are bonded. .  Pat Tucker said there are only two people in her municipality that are allowed to accept payments because of the bonding issue.  Steve Boscarino, the guy from the little town of Richmond which is approximately 136 miles from North Conway, mentioned an issue about where payments are sent and how they are retrieved.  At one time he had someone else pick up payments form the box and deliver them to him, but no longer does because the some taxpayers objected to the practice.    This led to the question, “Should there be a separate PO box just for taxes?”    Cheryl said not necessarily but it might make it easier to identify if the envelopes coming in were directed specifically to the Tax Collector.  Vikki Fogg has a policy in her town that unless an envelope is clearly marked, all mail goes to her office first.  Barbara Townsend commented that she has an issue with someone else having a paid stamp that is for the Tax Collector.  By limiting access to the Tax Collector receipt stamp you ensure that the Tax Collector or Deputy is the only one that can officially receipt the payment.   Another comment, if the law states anything over $500.00 must be deposited daily then if a payment for over that amount is received and not deposited it could be called into question by the auditors.   Susette Remson brings the payment issue up at Department Head meetings.  She also writes a memo and reminding departments that taxes are out and they do not have the authorization (or bonding) to accept payments in her absence.  (Is everyone paying attention here?  This is good stuff!)

From Hannah in Campton comes the questions, “Does a  Town Administrator and Planning/Zoning secretary have to be bonded in order to accept payments and deposit the money themselves?  For example, early betterment payments paid in full given to the Town Administrator and she deposits.”

Barbara Reid wanted to comment on this question with regards to the issue of bonding.  There is a statute that states the specific positions that are required to be bonded such as Town Clerk, Tax Collector and Treasurer.  For those cities and towns that have insurance through the Local Government Center, property and liability, there is a section that deals with those positions that are not mandated by statute or DRA’s administrative rule, and provides a blanket bond to secure payments.  Mr. Campbell said there is a distinction to be made between a bond that is associated with someone’s name or position and a blanket bond that would cover the municipality for a whole host of circumstances such as forgery or theft.  New statute amendments found in Chapter 246 indicate that the Treasurer can delegate, in writing, upon approval by the Board of Selectmen, someone else to make deposits. The list of people that can be delegated to make deposits is relatively scripted in that it calls for only people that are bonded under RSA 41:6.  The Treasurer should be stepping in under a case like we have been discussing, and state that certain people are not allowed to deposit money.  Vikki Fogg noted that from what has just been said even a Finance Director would not be allowed to deposit.    Barbara Reid took exception to this interpretation because a new portion of the law adds to the list of people that can deposit (Tax Collectors, Town Clerks, Deputies, etc.) “persons delegated”.  The Treasurer can delegate to a person who is already bonded but also to someone not on that list.  The level of the bond would fall under DRA’s administrative rule.  Ms. Reid gave a brief history as to why this law was modified.  Going back to the original question Kathy Seaver said that betterment assessments should be taken only by the Tax Collector’s office anyway. 

The Tax Collector from Lempster asked a question about how much money should be allowed to have in the building at one time.  During tax season it would not be unusual for there to be hundreds or even thousands of dollars in the safe.  A suggestion to the Board of Selectmen about the Treasurer depositing more often got a luke warm response.

Barbara Reid responded by referring to RSA 41:35 which directly addresses this issue.  This is one reason why the section about delegating the authority to deposit was added so that the money could be put into the bank as soon as possible.  It is of particular help in the instance where the Treasurer is only around part time.  Barbara referred to another section of the law that enables Treasurers to be appointed rather than elected so in the case where someone may not be carrying out their duties to the fullest extent of the law a vote of town meeting could change how that person is chosen. 

Someone asked if the local Police Departments might be able to help out in the case where it is difficult to get to the bank and the payment should be secured. 

Dawn Oswalt said you can go with the police to make a deposit, and would even strongly recommend it if there is a lot of cash, but you have to physically make the deposit because the police officers are not bonded. (This advice came directly from DRA.) Also, this really is not an appropriate function for the police to undertake on a regular basis.  Mention was made that one town has a policy where all payables and other such functions can be handled by the Deputy Treasurer.  Cindy Treadwell offered a thought about having the police take deposits – if they should get a call during a bank run that money is going with them and not to the bank!  One final thought from yet another person, one of the bank vendors (Citizens Bank) offers some new technology via a scanning devise, that will allow for deposits (checks only) to be made automatically without having to go to the bank.  This might be a solution for some of the people who do not have a bank conveniently located.

Joyce McGee raised a new topic with respect to charging interest on accounts where in one case the payment comes through the mail and another is brought into the office.  The point she wanted to emphasize is that we really need to be consistent with the taxpayers but wonders how different offices are handling these situations.  

Kathy Seaver said that although everyone should be treated alike sometimes the cost of collection might be as much, or more than the accumulated interest charges.  In this case she wouldn’t pursue.  When someone comes in to pay in person there is a greater likelihood that they will pay any difference whereas chasing small amounts of interest with a letter does become more of a burden.  A lot of buzz came about because of this dialogue.  Barbara Reid stepped in to say that she would compare this circumstance to one that was discussed earlier where there was no postmark on the payment.  While some judgment does come into play, being consistent and  having a written policy would be vital to keeping procedures the same throughout.

I received my warrant late so I hurriedly ran the property tax bills and mailed them without the signatures of the majority of the Board of Selectmen.  Am I in trouble?

Cindy Torsey said, “Yes, absolutely.”   You should never, ever send out any bills without having the proper authorization.  Bernie Campbell agreed and said the statute is pretty clear about this.  RSA 76:10 and 11 cover this thoroughly and if there are any questions should be referenced.  He did advise that if anyone runs into this type of issue the best policy is to get the situation rectified as soon as possible.  The legal side is that you are definitely in trouble; however, there is always the practical side where the Selectmen do not always meet on a regular basis.  This discussion went on for quite awhile as many experiences were shared.

When land is in current use and then put in conservation easement does the land come out of current use?

Attorney Campbell said for the answer to this question look in RSA 79a:7.  The simple granting of a conservation easement would not have any effect on land that is already in current use unless it meets the criteria to come out of current use. 

“Do we file a current use release with the registry when the town pays the tax to execute the lien or do we wait until the property owner actually pays the lien?  Also, if a town deeds a property that is in current use should the lien be released?”

Bernie once again came at the question from a legal point of view.  RSA 79a:7, II-c tells us to not release the lien until payment actually is received.  Looking further into the rest of the provisions, Bernie concluded that a fair interpretation of the statutes would seem to be that if the payment comes from a tax lien executed as a result of unpaid current use penalties it would not necessarily trigger the requirement to send a release to the registry.  The answer to the second part of the question having to do with the town releasing the lien if it were to deed the property would probably depend upon how the town was going to dispose of the parcel.  If the town ended up selling the property to a third party it might consider releasing its current use claims at the time of the sale.   Kathy Seaver took exception to the response on the first question and said that in practicality when the town gives her a check for all delinquent taxes, be it yield, current use, or whatever, it is in essence clearing those records by placing a lien against the property for unpaid amounts.  Therefore she sends a release to the registry at that point indicating that the current use change tax was paid by virtue of the tax lien.  Bernie responded that he did not think this way of handling those types of liens was incorrect; he just is giving a strict interpretation of the statute as it is written and it does not mandate a release be sent until payment is received.  Kathy said that by doing it sooner than later it is less apt to be missed.   

Nancy Cowan, “If towns have voted to have the land use change tax go into the Conservation Commission’s funds and the property goes to lien at what point does the money get turned over?”

Mr. Campbell was really being put to the test but rallied the best he could on this issue and asked the audience to assist with answering the question.  Kathy Seaver said that when the lien takes place she turns the funds over to the town.  No one else came forward to suggest a common practice on this one so for now it looks like there is no definitive answer.  One person offered that she gives only the amount of the current use tax to the Conservation fund.  If there is interest or penalties collected because of a delinquency she deposits those to the general fund as compensation for collection procedures.

A question was put out to the audience as to how many people release the current use when it goes to lien.  It appeared as though not many. 

Ruth Raswyck said that in Nashua she chooses to lien separately for each type of tax.  This makes it easier to track from beginning to end.  She asked if the town can deed if the land use change tax remains unpaid.  The answer is, “Yes.”

The final question for the session was “What can we do about the credit unions and the fact that we are constantly being asked to clean up taxpayers’ credit records? 

Jill Hadaway gave the sad history of bill that was put before the legislature this year.  It went to the commerce committee and they ended up coming up with the bright idea that because credit bureaus fall under federal rather than state regulations it would be up to the Tax Collectors to send letters to taxpayers notifying them when a lien was released. Rather than burden us with more work she advised against passage of the bill and it was voted inexpedient to legislate.  To help us go on from here she has put together some information that will be handed out at the Spring Workshops.  Vikki Fogg related her experience with Transunion, taking it all the way to the Attorney General’s office.  Unfortunately they did not help at all other than writing a letter or two.  She said that if enough taxpayers complained directly to the AG’s office then eventually it might go to the Justice Department and that is when we would see some results.   Deb Cornett expressed dismay at how time consuming this is for us when ultimately the responsibility falls upon the taxpayer to resolve.  Kim Noyes gave a suggestion for cutting down on the repeat requests.  She types up a letter, on town letterhead, giving details including the date of release.  She then tells the taxpayer to record it at the registry and hands out information about dealing with the credit bureaus.  Sometimes she has the town pay for the letter to be recorded, other times she has the customer make a check made out to the registry of deeds.   In Grantham, Sullivan County has deeds on line so taxpayers are directed to do their own research.  Cheryl expressed the opinion that homeowners do not want to be bothered doing the research and that is why we end up with so many requests.  Some registries are helping to fuel the fire by telling people to ask at their local tax office.

A few other miscellaneous tidbits were offered and the session came to a close with the answers to the Education Committee’s test being revealed.

1. What is the last day for a Tax Collector to execute a lax lien for unpaid 2006 taxes?  September 30, 2007
2. Which of the following might qualify for a discretionary preservation easement?  Milk house, sugar house, carriage house, saw mill, cider mill and grist mill.  (Rabbit house and pepper mill do not qualify.)
3. The application deadline to file for current use is April 15th.  If you come in on April 20th is there any chance you can still file?  Yes, under just cause – accident, mistake or misfortune.
4. What does LUCT stand for?  Land Use Change Tax
5. What is the correct name of the letter otherwise known as the “Barrington” letter and when must it be mailed by?  Notice of Tax Arrearage; mailed 90 days after the due date of the final bill
6. The total amount of tax deferrals on a property shall be no more than what percent of its equity value?  85%
7. If the municipality sells a tax-deeded property what is the statutory penalty?  15%
8. Is it acceptable to enclose any other municipal business along with the tax bill?  Yes, if the governing body votes to do so
9. What is the governing body as it refers to a municipality?  Board of Selectmen; Aldermen or Council
10. What is the legislative body as it refers to a municipality?  Town meeting; district meeting, city/town Council or Mayor
11. How long should the Tax Collector keep paid receipts?  6 years
12. The rate of interest the municipality must pay whenever the taxes have been paid and abatement is subsequently granted.  6%
13. Which one of the following is not a credit bureau service?  Experian, Equifax, and Trans Union  (Accunet is not a credit union)
14. What is the deadline to file for an elderly exemption?  April 15th
15. What is the rate of interest charged a taxpayer annually when paying off an elderly deferral?  5%
16. Do you have to refund an abatement or can it be applied towards outstanding taxes?  No, it can be applied
17. If the bank charges the municipality $7.00 for an uncollectible check, what fee shall the collector charge the property owner?  $32.00 ($25.00 + $7.00)
18. When a property owner subject to a tax deferral dies, how long do the heirs have to redeem the property? 9 months
19. What percent interest does the “Soldiers & Sailors Civil Relief Act” allow the Tax Collector to charge military personnel on active duty? 6%
20. What is the most interest a Tax Collector can waive (with proper approval and consent)?  $25.00
21. Evening Activities – Annual Banquet

All too soon the closing ceremonies for the 69th Annual Conference were upon us.  After a leisurely if somewhat noisy social hour, conference attendants and guests made their way to Champney’s Restaurant and prepared themselves for the feast.  President Joan Porter began the proceedings by asking everyone to take a moment to remember those who are not with us today, former Tax Collectors, family members and friends.  She also asked that we keep members of the military service in our thoughts while we take a few quite minutes of quiet reflection.  After this moment of silence she asked for anyone who is a former member of the military or who has a family member currently serving to stand.  A round of respectful applause followed.  Joan offered up a tearful prayer to protect the members of our military from harm. 

Stanley Gorzelany, President Connecticut Tax Collectors’ Association was introduced and said a few words.  He graciously acknowledged the long standing relationship between our two organizations and hopes that it will continue for many years to come.

Joan Porter came back to the podium and shared a recent quote from one of LGC’s publications.  In the Affiliates Newsletter Kathy Seaver was acknowledged along with the members of the certification committee.   “Another excellent example of the collaboration between LGC affiliate groups is the Joint Certification Program developed by the New Hampshire Tax Collectors’ Association and the New Hampshire City and Town Clerks’ Association.  This multi-year training program has been in existence for more than 15 years and is available to not only those who serve as both Collector and Clerk but also to those who serve in one of those capacities.  This years summer session was attended by 62 participants.  The longevity of this program as well as the level of the participation is clear testaments to the need for and the benefits of these two groups combining their resources for the mutual advantage of their members and the communities they serve.”  Kathy Seaver was asked to stand and be recognized.  She introduced members of the committee – Cheryl-Ann Bolouk, Cathy Kinville, Becky Benvenuti, Theresa Briand, “Pessy” Gaudette, David Fredette, and Joyce McGee.  Kathy read a list of the recent graduates and a round of applause acknowledged their grand achievement.

Attention returned to Joan as she thanked the people from Plodzik and Sanderson for allowing the Executive Board to meet at their offices all year.   She acknowledged Kathy Vallerie who is serving as the President of the Town Clerks’ Association this year.  She next asked members of the Executive Board to stand one more time to be recognized.  She next asked anyone who has ever served on a committee, board, or as county coordinator to stand.  Joan urged everyone who has not had the opportunity to get involved to give it a try.  The Association is always looking for people to serve in some capacity and all are welcome.  The Red Jacket and staff were recognized for their wonderful service and facility.

Before giving her final farewell, Joan proudly shared that she is a five year cancer survivor.  The room erupted with yells of encouragement and thunderous applause.  She used her final moment wisely and gave a public service announcement urging everyone to get tested as recommended by their physicians.  She graciously moved on and thanked everyone for the opportunity to serve as President of the Association and again encouraged everyone to volunteer to serve on one of the Association’s committees or boards when they are ready. 

Longevity service awards were next on the agenda.  Awards were presented by President Porter to:

Joan Porter gave a few closing remarks saying that she saved the best for last.  Emotion overcame her as she thanked the “most wonderful person" she knows – her husband Paul.  As the crowd “Ahhhh” she noted that this year was mostly likely a first – the President of the Tax Collectors’ Association being married to the President of the Assessors’ Association! 

After members of the Executive Board for the 2007-2008 Executive Board were sworn into office, Patricia Woolsey welcomed Joan into the Past Presidents club.  Pat said that it was an honor to have worked with Joan and the Association was lucky to have had her serve as their President.  The formalities dispensed with, Joan introduced the new President of the Association – Pat Tucker.

Noting that Joan would be a hard act to follow, Pat began by saying that she has been cancer free herself for 17 years.  (More applause!)   She continued by introducing her husband, Bob, to whom she has been married for 40 years.  Her first speech as President went on to tell us a little bit about the rest of her family and gave a good insight into the person that she is today.  With heartfelt emotion and a delightful sense of humor she encouraged Tax Collectors to be the best they can be and told how much she is inspired by many within the organization.  She promised to serve as President to the best of her abilities and to be approachable for those who are in need of assistance.

The evening ended with the 50/50 raffle which netted the Association $277.00.  Patricia Woolsey and Jeanne Whitcomb were the luck winners.

Friday, October 19, 2007
Conference attendees awoke to find a gray, misty, miserable day outside.  Not the ideal conditions to be riding back home in so the mood was quite somber.  Reluctantly people began to shuffle in searching for a little pick me up and friendship.  Slowly, the breakfast area began to come to life and before long the last meeting got underway.  The new President called the meeting to order (more than once) and led the group in the pledge of allegiance. 

Legislative Update
Jill Hadaway, Chairman Legislative Committee
Jill Hadaway began the session by going over a few of the new laws and changes to existing laws that have happened this year.  She noted that these changes are reflected in the law book updates. 

HB107 – Chapter 6 amends RSA 149-M-17 and authorizes towns to charge residents for solid waste removal.  Although this may seem out of place with the Tax Collector law changes Jill just wanted to include it because many of us are charged with the task of issuing solid waste permits.  If your town decides to implement this new method it will be handled just like any other tax so make sure that you have a warrant to collect.  The law became effective on July 1, 2007.  Some of the highlights include:
“(a) the establishment of such fees shall be governed by RSA 41:9-a, or other applicable statute or charter provision.
  (b) Such charges shall create a lien upon the benefited real estate.
  (c) A town may collect such charges by the use of any of the collection procedures authorized by RSA 38:22.  Interest on overdue charges shall be assessed in accordance with RSA 76:13.”

HB198 – Chapter 42 (Corrections to RSA 80) this change is one that the Association put in for after identifying some inconsistencies with the law.  The change effects RSA’s 79-C: 13; 80:90 I; and 79-E: 11.  The effective date is July 20, 2007.  The change to the first two RSA’s was to make the collection process under RSA 80 uniform with other laws regarding collection.  The change to RSA 80:90, I (f) clarifies the process for penalty assessment on tax deeded properties.  “(f) An additional penalty equal in amount to 15 percent of the assessed value of the property as of the date of the tax deed, adjusted by the equalized ratio for the year of assessment.”  This was not exactly the wording that was proposed by the Association on this portion of the bill.  The intent was to make the two components match (as of either the date of the tax deed or the year of assessment not both).  So this one is still being worked on and another change may be forthcoming.

HB256 – Chapter 246 – This law took effect on August 27, 2007 and it amends RSA 41:35, I.  This one was mentioned briefly yesterday by Barbara Reid.  The law gives Treasurers the ability to designate someone (bonded) to make deposits on their behalf.  It also allows Tax Collectors and Town Clerks (change to RSA 261:165) to be the Treasurer’s designee and make deposits.  Jill took this new law very seriously so she created a written policy (with the assistance of a similar form found on NHLogin) designating her to make deposits and had the Treasurer sign it right away.  (Enough interest was indicated by members of the Association to prompt Jill to say that she would make a draft copy of this document available on www.nhtaxcollectors.com.)  The wording regarding deposits is also changed to read, “at least on a weekly basis or daily whenever tax receipts total $500.00 or more. 

HB 257 – Chapter 35 – Grants municipalities the authority to appoint Treasurers.

HB 316 – Chapter 214 – Establishes a new assessment review schedule for DRA’s review of municipal assessments.  The law became effective on August 24, 2007.  The first 5-year cycle was completed this year and DRA is to notify municipalities of their new review year within 60 days of passage.

HB 803 – Chapter 184 – Amends RSA’s 80:88; 80:89, I; 80:89, VII and VIII and clarifies the procedure for notice to a former owner of tax deeded property and the distribution of the proceeds.  The requirement that notice be given to a prior owner between 120 and 90 days before offering the property for sale is eliminated and replaced with a notice “at least 90 days prior to sale”.  It also changes the statute so that the triggering event for the notice requirement is authorization by the governing body to sell the property rather than the signing of a contract to sell.  This became effective on August 17, 2007.

Jill next went over some of the proposed legislation for the next year (LSR’s).  She referred to the handout and said she was citing just a few of the LSR’s that are relative to the tax collection process.  An interesting phenomenon has occurred this year in that the Tax Collectors Association is getting quite a respectable reputation.  She recently has had two legislators seek her out and try to gain the support of the membership in backing their bills!  While this is good news in one respect it also makes it rather challenging as some of the proposals are not something we would want to see made into law.  At least the Association is now perceived as having some power and clout.  Back to the current proposals, there are seven LSR’s dealing with veterans, a couple related to elderly exemptions, and many were held over from the last session.  There are a couple that bear close watch – LSR 2384-L, relative to limiting the amount of interest charged on a property tax lien; LSR 2412-L, relative to the ability of towns to recoup money lent to homeowners upon foreclosure; and LSR 2537-R, enabling municipalities to establish term limits for elected officials.  Jill also brought up a recent proposal that was brought to her by a legislator, which would call for cities and towns to assist taxpayers with mortgages, suggesting even holding mortgages for people!  Another one in the works has to do with the statewide property tax and a homestead exemption on properties.

One more LSR worth mentioning is 2489-R, making technical correction to town audit and reporting requirements.  This bill is being sponsored by Betsey Patten for DRA.  What this bill does is tighten up the ½% allowance that is given when warrants are received.  (Reference the Commitment Verification Form that is received along with all of the tax rate paperwork.)  She read a bit from the wording of the proposal, “If the municipal tax collector finds a discrepancy of ½ of 1% or more between the amount of the warrant as committed to the Tax Collector of the municipality and the total property tax commitment calculated by the Commissioner based on the pertinent information provided by the municipality under RSA 21J:34 the warrant shall be returned to the municipalities assessing officials for correction.  If a correction cannot be made to generate a warrant with less than ½ of 1% discrepancy the assessing officials shall submit a revised property summary inventory of valuation form as required by RSA 21J:34 I, for recalculation of the tax rate by the Commissioner.  The municipality shall not issue property tax bills until any discrepancy greater than ½ of 1% is resolved.”  So this means that the discrepancy rule that we have been working under will no longer be just a request, it will be law.  This will give us a little more a clout in terms of being able to give a warrant back to the assessors and say, “fix it”.   

In closing, Jill expressed appreciation to members of the Tax Collectors’ Association for showing an interest in the laws and the assistance many of given with going to speak on behalf of us all.  Reminder – an easy thing to do is to “google” NH General Court to find any of the pending proposals on line. 

Before turning the program over to Bernie Campbell, Jill asked Kathy Seaver if she could help to clarify the intent of HB 198 and how to apply the 15% penalty.  Kathy said, “Basically you take the assessment of the property for the year that the deed is being recorded and divide it by the ratio for the year that it was originally taxed (the year the deed is based upon).  Once you have this figure you then apply the 15 % penalty.”  This strange way of getting to the market value of the property is not what the Association proposed for wording but it will get you to the correct penalty assessment.  There was a lot of discussion about this issue as some people did not interpret the change in the law this way but Kathy stated that this was the intent.  Bernie Campbell took exception to the interpretation and said that at best the language is still ambiguous.

Mr. Campbell expounded for awhile about the whole repurchase process.  He went from there to speak about the process of conveying  property to former owners and the fact the Selectmen have some discretionary room in this matter and may choose to convey the property or not using the “as justice may require” provision.

Cheryl redirected the discussion to a question that had been raised earlier about current use.  If a property that is in current use is to be deeded and the penalty amount is being calculated what assessed value do you base the 15% upon?  Mr. Campbell advised that the penalty should reflect the taxable value of the property at the time of the taking.

Bankruptcy:  How Tax Collectors’ Should Handle It
Kathy Seaver, CTC & Cheryl-Ann Bolouk, CTC
Bernard Campbell, Esquire - Beaumont & Campbell

Pat Tucker opened this part of the meeting by asking everyone to say a little prayer that everyone pays their taxes and we won’t have to deal with deeds or the upcoming topic of bankruptcy!  The purpose of this final session is to help us all to know what to do with those bankruptcy notices that we get in the mail.

Bernie Campbell referenced the handout that was going around which tackles some of the terminology and also provides some sample forms.  He began by giving a general overview of bankruptcy and some definitions.

Bankruptcy - a legally declared inability or impairment of ability of an individual or organizations to pay their creditors.  Creditors may file a bankruptcy petition against a debtor in an effort to recoup a portion of what they are owed (involuntary petition).  In most cases, however, bankruptcy is initiated by the debtor (voluntary petition).

Bankruptcy Code – authorized by the Constitution (Article I Section 8) and adopted by Congress.

Chapter 7 – a straight liquidation.  A bankruptcy trustee takes title of all non-exempt assets, liquidates and distributes money to creditors.  This type of bankruptcy can only be filed once every six years.

Chapter 9 - Only municipalities may file under this chapter

Chapter 11 – generally used by businesses to seek relief from debt while still continuing to operate business.  A plan is filed to reorganize affairs.  Usually there is no trustee appointed although a representative of the US Trustee’s office provides oversight of the case.  This case may continue for six years.

Chapter 13 – Used only by individuals, who must have a regular income, a secured debt of less than $750,000, unsecured debt of less than $250,000 as of the filing date.  This type of plan is filed voluntarily.  The debtor must file a plan with the petition or within 15 days thereafter.  The plan can propose to adjust debts, and cure defaults by making payments over a period of time.  A trustee is appointed who collects and distributes plan payments.  The debtor must file a plan with the petition or within 15 days thereafter.  This can be a five year plan. 

Note, under Chapter 13 reorganization, the new tax bills (and other on going debts such as mortgages) must be kept current while scheduled payments are made for any back amounts.  If taxes are not kept current, the municipality may move to have the plan dismissed, or converted to a Chapter 7.

Susette Remson said that she just received information about a Chapter 13 bankruptcy where she never received a notice.  How to proceed?  Bernie said that the debtor should be scheduling the debt, if they do not do so, then the debt is not discharged.  Once you have found out about the case, whether or not you have been officially notified, you must abide by the court rules otherwise you will be held in contempt.

Abandoned Property – for Chapter 7 cases only; the Trustee determines he/she has no interest in the property because there is no equity available for creditors.

Automatic Stay – An injunction that begins when a bankruptcy case is filed that stops a creditor from doing anything to collect a debt until the bankruptcy judge says that they can or the case is over.

Certificate of Discharge – this confirms that the debtor has been released for all dischargeable debts.

Claim – any right to a payment of any type against the debtor.

Closure Notice – confirmation that a case has closed or dismissed.  This ends the automatic stay.

Debra Cornet asked if the bankruptcy court is responsible for sending out the notices or are we responsible for trying to determine if the case is closed?  Mr. Campbell said that he is unsure about the answer to this question as he does not deal with bankruptcy cases on a regular basis but if you do not receive anything for awhile on a case you should check with PACER (electronic court records) to check the status and print documents.

Debtor – the person, corporation or other entity that has filed a bankruptcy case.

Dischargeable Debt – a debt that the bankruptcy court finds is unsecured or under-secured and arose prior to the confirmation of the plan and is not subject to a specific exemption from discharge.

Discharged – the case (Chapter 7) is successful and the debtor is released from dischargeable debts.  A certificate can be obtained by the court.

Dismissed – There is a 10 day stay; the case has ended in failure.

Creditor – Any person, corporation or other entity that holds a claim against the debtor on the date that the bankruptcy case was filed.

Motion for Relief of Stay – An action filed in Bankrupcty Court to request that the Court make an exception to the automatic stay or injunction which is automatically entered when a person files bankruptcy.  Usually this relief is granted if the debtor is not making payments or cannot file a plan to catch up the delinquent payments.  This may also occur if there is no “equity” in the property.

Petition – the application which is filed to commence the case.

Pre-Petition – the amount that is owned before the bankruptcy case is filed. 

Post-Petition – the amount that is owed after the bankruptcy case is filed.  The debtor is usually liable to make payment on all “post petition” debts as they come due.

Proof of Claim – an official affidavit from a creditor that supports the financial claim of the creditor. 

Release from Bankruptcy – At the end of a one year period a release is automatic if no bankruptcy offences have been committed.

Secured Claim – the creditor has a lien on property of the debtor given pre-petition to secure a claim (collateral).  Generally a secured creditor’s debt cannot be discharged.

Secured Creditor – a creditor who holds a “secured claim”.

Trustee - a bankruptcy trustee is a person who is appointed by the judge or other creditors involved in the case.  The trustee must be a licensed insolvency practitioner who is registered under the US Bankruptcy Act.  This person will act on behalf of the debtor to guarantee that both the creditors’ and the debtors’ interests are maintained in accordance with the bankruptcy laws and will sometimes act as a negotiator between the two parties.

Unsecured Creditor – A creditor whose claim is not secured by collateral.

Unsecured Priority Claim – Certain types of unsecured debt are ranked a “priority” ahead of other unsecured debts.  Examples of items that are entitled to priority status are child support and alimony, administrative expenses and employee benefit plans.

With the definitions being dispensed with Bernie said the automatic stays does not normally prevent you from assessing property or sending out bills and placing liens.  There are attorneys that take exception to this and question the ability to place liens, but he still believes the practice is acceptable.  Do not, however, proceed to deed properties.  On this one point all legal practitioners are in agreement.

Kathy Seaver said there is one attorney that she knows of who insists that Tax Collectors reverse their liens on property because of bankruptcy.  Mr. Campbell still holds the position that placing the lien is allowable.  So far, the issue has not been pushed enough to determine otherwise. 

Before turning over the remainder of the time slot to Kathy and Cheryl someone asked if Bernie would be willing to provide a copy of the handout he referred to from the 2001 presentation on bankruptcy.  Kathy said she still has a copy and will see that it gets on the website.

So now that all of the terminology has been explained what do you do with the new found knowledge?  Cheryl and Kathy offered some pointers for what to do when you receive that notice of bankruptcy.

To begin with you determine whether or not the person owns any property in your town.  If you do find that the person or entity owns property, the first thing you should do is make a note in your computer system stating the property is in bankruptcy and denote the date of filing.  Come up with some way of identifying this in your computer system so that anyone viewing the records will be alerted as to the status.

Next, read the paperwork to determine if you need to file a proof of claim with the court.  The dates to file will be listed on the front of the  form stating “Governmental units must file by this date . . .”  Cheryl referred to the attachments with the handouts which include a Proof of Claim Form as it would originally come to you; a Proof of Claim Form that has been filled out; a property billing statement which provides the detailed back up for the claim; a copy of an article entitled, Inventory Blanks Must Be Mailed to the Bankruptcy Trustee, an article written by Attorney Campbell recommending filing copies of the Impending Lien Notice with the Bankruptcy Trustee; a sample form for keeping track of bankruptcy accounts; a sample letter to taxpayers advising them of their obligation to keep post petition taxes and utility charges current; sample letter requesting payment of post petition taxes; and a sample lien holder notification letter.

Review the Proof of Claim form line by line when filling out and answer all applicable questions.  Specify the principal amount of unpaid taxes and claim the interest at the applicable statutory rates; 12% for delinquent taxes; 18% for taxes that have gone to lien.  A statement of the account as of the date of the filing should be attached to the claim.  Check the box that says “Check this box if claim includes interest or other charges in addition to the principal amount of the claim.  Attach itemized statement of all interest or additional charges.”

Claims for real estate taxes are secured claims, secured by the real estate being taxed.  You should insert the equalized assessed value of the property when answering the “Value of Collateral” question on the Proof of Claim.

Make sure to sign and date the claim at the bottom. 

Cheryl recommended sending a self addressed stamped envelope with the Proof of Claim to the court. (Just like it says on the form!)  The court will send you back a date stamped copy for your records.  This idea is preferable to sending return receipt requested alone as you get the actual receipted copy back as proof that the court received the claim.

A question came up about the recent mortgage companies that have filed bankruptcy and whether or not we should be filing Proofs of Claims.  The only ones that need to be filed on would be the ones that have actually foreclosed on properties and the property is in the name of the mortgage company.  Along the same lines, if you are getting ready to deed a property that has a mortgage on it and the mortgage company is in bankruptcy then it gets more complicated.  Attorney Campbell stated that the best practice would be to notify the court of the intent to deed.   If the mortgage company is protected under the bankruptcy laws you might not be able to deed one of their assets without permission from the court.  Best advice in this case is to get your town attorney involved.

Interest rates can be determined by the court.  A bankruptcy hearing will normally not include the 18% interest charged on tax liens.  The court may set the rate at federal judgment rate which is a variable rate tied to the T-bill rate.  A Tax Collector may oppose this plan if it does not pay the municipality’s lien in full with interest or if the municipality objects to the rate of interest.

Kathy Seaver offered some suggestions for posting of payments (see sample payment ledger).  The easiest way to go about it is to post the payments just as you would for any other taxpayer.  At the end you will be able to see what was lost and have the Selectmen abate the difference.  There is no real correct way to handle this but this method is a “practical” way to handle the payments.  It also is a way for most computer systems to be able to accommodate without special programming.

Kathy mentioned that in her town they have a large bankruptcy that has a “multitude of issues” including the fact that it has multiple company names.  The point is to look at other names that a company might be using.  She had been getting information on a bankruptcy for a company that she could not identify and it turned out to be for this property.  Someone asked if an alias is not listed on a bankruptcy do you still have to research?  Would this be the same as not being notified?  Bernie felt that this issue would really fall under corporate mergers.  He recommended going to the NH Secretary of State website and look up the name of the entity as it appears on the real estate ledger to see if it exists and was merged.  You may have to contact the court to see if they know why a notice was sent to you.  Be diligent in researching any Proof of Claim you may receive.

With noontime fast approaching and the questions winding down, Cheryl gave a few final announcements.  President Pat Tucker thanked everyone for attending.  She wished us all happy holidays and looks forward to seeing everyone at the Spring Workshops.

Respectfully submitted,

Brenda L. LaPointe, CTC
NHTCA Secretary