City, school district eye state program to collect debt

Posted: Nov. 20, 2012 10:21 am Updated: Dec. 4, 2012 11:15 am

Herald-Whig Staff Writers

The city of Quincy and the Quincy School District plan to begin using a new state-run service to collect delinquent debts.

The Quincy City Council unanimously approved an intergovernmental agreement with the state comptroller's office Monday night to become part of the Local Debt Recovery Program.

Earlier in the day, the Quincy School Board's Policy Committee reviewed a proposed policy that would clear the way for the district to start collecting debts through the same program. That measure is expected to go before the full School Board for action in December or possibly January.

Under the proposal, any debts the district and city are unable to recover could be forwarded to the comptroller's office in accordance with a state law that went into effect in December 2011.

Quincy City Treasurer Peggy Crim said the program -- instituted at no cost to the city -- would primarily target overdue nuisance abatement payments, which she said totals $129,000 over the past seven years.

"If we do some kind of nuisance abatement at a property and they don't pay the bill, then the only recourse we have is to put a lien on that property," she said. "The only way that lien gets paid is that if you try to sell that property, you have to pay the lien first.

"The way we have drawn this up with my office staff is that once we've exhausted all the other avenues we have in trying to collect the debt, it will be turned over to the state program."

The way the program works, the city or school district would have to try to collect the bills initially and provide "due process" if the bill doesn't get paid immediately, which would involve sending out a warning letter. But if payment is still not forthcoming, they could ask the comptroller's office to withhold the amount owed from the individual's income tax refund.

The state also has authority to withhold money from the person's paycheck if the person is a state employee. Or if the person is a contractor who does work with the state, the comptroller's office "would withhold it from their payment," Crim said

Once a overdue bill is sent to the state, a letter will be sent to the individual letting them know that they owe the money. People will have 60 days to protest the deduction. Crim said people who have entered into a payment plan to address overdue bills will not be submitted to the state.

Joel Murphy, business manager for the school district, said "it's one of those no-brainer type of programs."

"Anything over $10 and less than seven years old we can send to the state and go through collections from the state," he said. "A lot of cities and municipalities are using it for collecting parking fines."

Dennis Gorman, the school district's attorney, said the district has historically had some difficulty over the years collecting book fees owed by some families.

Murphy said the district in July sent out "demand letters" seeking more than $100,000 in delinquent fees owed to the district and has subsequently collected only $20,000.

Gorman said once those who still owe the district money receive a notice from the state that a portion of their income tax refund is going to be withheld for nonpayment, "you may get a better response."

Board member Stephanie Erwin said the state program would "snag" money owed to public schools out of state checks in much the same way that the state withholds money owed by deadbeats for overdue child-support payments.

"That will be good," she said.



-- mhopf@whig,com/221-3391