The Luzerne County Tax Collection Committee has appointed the H.A. Berkheimer of Bangor as its new tax collection agency.
The committee earlier voted to terminate Centax-The Don Wilkinson Agency's contract to collect taxes for county municipalities and school districts due to non-performance.
Centax had problems determining how much is owed to each of the 91 municipalities and school districts for which it collects earned income taxes, creating a budget crisis for many area municipalities and school districts that have not received significant portions of taxes collected in the first and second quarters of 2012.
Committee Treasurer/Secretary Pam Heard said municipalities within the county are still owed about $12 million, though she added “it's just really hard to handle because we're still not getting good information from Centax or their bonding company.”
Centax began collecting the tax in January as part of changes in tax collection procedures mandated by state Act 32, which requires most of the state’s 67 counties to have one tax collector for earned income taxes. Previously, the tax was collected by tax collectors in each community.
The committee heard proposals from Berkheimer and Keystone Collections Group of Harrisburg. Keystone promised a lower interest rate for its services, at 1.45 percent plus postage to keep county tax reciepts in a segregated account or 1.4 percent for a non-segregated account, versus Berkheimer's rate of 1.48 percent plus postage for a non-segregated account. Berkheimer did not offer a segregated option, but promised a "virtual segregation" would be maintained by its reporting.
But ultimately the agency chose the more familiar agency. Berkheimer representatives said it collects taxes for municipalities and school districts in 30 counties, including neighboring Schullkyll, Carbon and Columbia conties, and formerly collected taxes for many Luzerne County muncipalities prior to Act 32 taking effect in January. It is the largest tax collection agency in the state.
Berkheimer has also purchased Centax's contracts, Berkheimer officials confirmed Tuesday. Those contracts include the distribution of undisbursed taxes from the first and second quarter of 2012 in Luzerne County.
Berkheimer received 67 percent of the totatl vote, which gives school greater weight than municipalities. Keystone received 27 percent, with the remainder absent or abstaining.
Under the terms approved tonight Berkheimer will take over through December 31, 2013.
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