County board wants to ease tax penalties

Posted 5/18/20

Taxes are unavoidable, but Edgar County Board members are trying to find a way to make it less burdensome for business owners and unemployed people financially suffering because of the COVID-19 …

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County board wants to ease tax penalties


Taxes are unavoidable, but Edgar County Board members are trying to find a way to make it less burdensome for business owners and unemployed people financially suffering because of the COVID-19 shutdown.

County treasurer Don Wiseman discussed the issue with the county board during the Monday, May 11, study session.

“By statute, we are supposed to mail the tax bills by May 1 for the first payment June 1 and the second payment September 1,” said Wiseman. “Few counties meet that, and COVID-19 is complicating things.”

Wiseman noted his office usually takes about 10 days to get the bills printed and mailed after receiving the financial information from the county clerk and recorder. Edgar County’s 2020 tax bills have not yet been mailed.

County Clerk and Recorder August Griffin said Monday his office did not start on the tax data until finishing all of the work needed to complete and certify the March 17 primary. He also said COVID-19 is complicating the work because he is rotating workdays for staff to provide social distancing in the office, and he has a new employee going through training.

“In an ideal world, I need two to three weeks, and then I can hand the data off to Don,” said Griffin

Wiseman said the county can postpone sending the tax bills for a while in order to delay when people confront that first payment, but he noted school districts will need a distribution not long after their fiscal year starts July 1. He also warned the county has already used a little more than $100,000 on a $500,000 line of credit to meet its obligations,

and he anticipates borrowing more at the end of the month.

“I will be drawing on it again,” said Wiseman.

He suggested on option is to delay when penalties and interest start on a late payment. Legally, those extra charges start accruing the day after the first payment is due. He suggested waiving the interest and fees on a missed first payment up to the time the second installment is due. If the first payment isn’t made by the second installment then the costs apply retroactive to the date of the first payment.

“There will be some hard interest hit on the day after the second installment,” Wiseman said.

By law, the interest charged on a missed tax bill is 1.5 percent for the first 30 days, jumps to 3 percent for the second 60 days and so on until the bill is paid.

“It is the same at 18 percent annually,” said Wiseman. “That’s what a lot of people don’t understand. It really is credit card-level interest.”

Another option is to delay sending the bills so both the first and second installment are due later in the year. Wiseman said his office can work with taking second installment payment sometime in October, if necessary, but he prefers not to go into November since the county’s fiscal year ends Nov. 30.

Wiseman suggested mailing the tax bills by June 30 with a first installment date of Aug. 15 and the second payment due in mid-October. No decisions are made during study sessions, and the board will take the topic up again at another time.

Board member Karl Farnham Jr. advocated some action to help property owners with their taxes.

“I’ve talked with business owners and people who are laid off,” said Farnham. “They are having problems paying their mortgages and other bills. It’s not their fault.”

Board chairman Jeff Voigt said any action must be simple so it is clear to all what is expected.

Board member Derrick Lorenzen liked simple while also advocating for what he described as a nimble approach.

“We have to plan for the worst possible scenario,” said Lorenzen. “We don’t know what this (the COVID-19 pandemic) is going to look like in October. The local situation could be worse with people sick and more businesses closed.”