Besieged Taxpayers Make Their Pleas

Allan Appel PhotoAfter emerging from a physically abusive marriage, Thessola Pearson discovered her ex-husband had registered several cars in New Haven using her name.

When she moved back to town to open a new chapter of her life, and sought to register her new vehicle, she discovered at least four unpaid tax accounts.

Two cars were repossessed, and Pearson, who now lives in West Haven, didn’t know what became of another. Her total tax bill: $744. An additional $1,855 in interest that has accrued at 18 percent since 2003 is also past due.

She could pay the tax bill but needed help to pay that steep interest. Or better yet, she could use some forgiveness.

Pearson sought that forgiveness in the Aldermanic Chambers of New Haven City Hall at the most recent monthly meeting of the Board of Alders Tax Abatement Committee. She was one of 27 people asking for tax relief in a monthly Solomonic government ritual.

After hearing Pearson’s story, the alder’ recommended that the total $1855.09 be forgiven — if she can come up with the $744.48 by Dec. 18. The decision, along with all others made at the Aug. 28 meeting, now advances to the full Board of Alders for final approval.

“I’m ecstatic,” Pearson declared.

Pearson’s situation was typical of the unexpected curve balls life throws at people, and the resultant financial stress. Among the triggering events that unfolded in quietly tense scenarios narrated at the hearing were sudden illness and injury, change of status, the loss of a job,  drug addiction, release from jail, and identity theft. Alders monthly face the tricky question of when to give individual taxpayers a break and when to protect the city treasury.

“We try to be helpful,” Fair Haven Alder Ernie Santiago, the committee chair, repeated as each person, some overcoming nerves and others speaking softly with a sense of embarrassment or barely concealed shame, took his or her seat before the alders.

“Make your plea,” Santiago encouraged them.

Although each situation is different, in nine of the instances, the committee voted to eliminate the interest due on past car accounts provided the applicant pay all of the taxes due by Dec. 18.

The interest, which accrues at the rate of 18 percent, is sometimes as much as double the amount of the tax due. It presents the biggest hardship to the applicants.

“We’re trying to help you,” Santiao told Eric Dones, a young man emerging from drug struggles who owes $1,839.49 in taxes and $3,226.72 in interest on five old car tax accounts. “But as elected officials we need to help the city: as well.

The committee’s ethical juggling act — weighing the needs of the city with an arrangement that lends a helping hand but in a manner to inspire responsibility as well — was also evident in the case of Anthony Velez.  He was asking for help on $1,749 in taxes and a similar amount in interest on seven old car tax accounts. The debts accrued over the past five years while he was in jail.

“I was recently released and am trying to put it behind me,” Velez told the alders as he took his seat at the large oval table in the legislative chamber. “I also just got hurt and got laid off.” He is also struggling to make child support payments, so that $1,755.68 in overdue interest payments was a tough nut to crack, he said.

Santiago asked if Velez could make the tax payment.

“I can’t pay it all up front. Can I make a payment plan?”

No, he can’t. While back due property taxes can be dealt with via a payment plan, that is not the case with cars. It all has to be paid at once.

When Velez heard that, he said he would find a way. Then the alders said they would look favorably on forgiving all of the interest.

Velez thanked the alders. He left the chamber with the understanding that the alders would vote on the recommendation at the end of the session, and then the whole board later in September.

During their discussion at the end of the presentation of cases several of the alders argued to forgive not only the interest but the taxes as well. Others on the committee reminded Santiago that Velez had volunteered to pay the taxes.

“Yes, we help people just out of jail,” Santiago offered as a reminder. “I’d love to help him [with forgiveness], but the city needs the money. We didn’t force him” to say he could pay back the taxes.

When the vote was taken, the majority of the committee members voted to forgive only Velez’s interest.

In many instances, the work-outs permit people to have their vehicles removed from the city’s towing list and thereby to have the transportation they need to get on with their lives.

Howeowner Pleas

In addition to the past due tax accounts for cars, the committee regularly oversees a state-organized tax deferral program for people living in their homes who can demonstrate their expenses exceed their income, and therefore have property taxes deferred. Many of the 20 or so homeowners currently in the program are elderly, but there is no specific age qualification, only a low-income eligibility requirement.

By the end of the hearing, the alders voted to recommend approving for renewal eight currently standing orders deferring property taxes, half of which are on the East Shore. The applicants had provided legislative staff with financial documents required each year.

Past due property taxes also accrue at the rate of 18 percent, Once you are in the program, the city commits not to foreclose on your property, but rather puts a lien on the property that accrues at 6 percent interest.

You can pay off the back taxes in a payment plan if you want—unlike the car taxes which must be paid in one fell swoop—and if not the city will get its money and interest back when the properties are sold. It’s a forbearance program, not forgiveness.

A 70-year-old homeowner, a first-time applicant, was recommended for approval for the low-income property tax abatement program at the hearing. For reasons of privacy — she did not want her children to learn about the application—she asked not to be named. She said her income, consisting of social security and modest pensions, is $41,644, or $3,470 per month.

The city calculated her expenses, based on paperwork submitted, to be $3,709 monthly, which includes $865 in New Haven property taxes. That imbalance of $238 qualified her for the tax deferral program, which alders voted on unanimously.

In an unusual case, Fair Haven condo owner Leslie Timko appeared before the committee to appeal a tax overcharge. Her “D” line one-bedroom unit in the riverine condo complex on Front Street had been inaccurately lumped in, for appraisal and assessment purposes, with the “E” line of two-bedroom condos. The overcharge since 2015 is $756.16. That is what she was seeking to be paid back.

The tax assessor representative to the meeting confirmed the error. Prospect Hill/Newhallville/Dixwell Alder Steve Winter asked why the overcharge repayment being asked for shouldn’t date from 2010 when Timko purchased the apartment.

The applicant, Timko, had not come forward until now, so therefore under the program could qualify for relief based only on the 2015 citywide property revaluation.

Timko said she had only become aware of the issue when she considered selling the unit and looked at the details. When she approached city Tax Assessor Alex Pullen and was told his office could provide no relief, he suggested she speak to Fair Haven Alder Ken Reviez, who helped Timko get onto the committee’s agenda.

“Sometimes people are unhappy with their assessment, and we send them to the alders,” Pullen said in a subsequent interview. The city’s Board of Assessment Appeal is the first stop in disputing accuracy of an assessment. If you are unhappy with that, following state statutes, you can appeal to superior court.

Appeals based on need go to the Tax Abatement Committee, where Tuesday night Timko found a sympathetic voice in East Shore Alder Sal DeCola, but only for three years.

“What’s right is right,” he said. “Just three years; $750.”

All of the recommendations made by the committee — in addition to Santiago, East Shore’s Sal DeCola, and Newhallville’s Kim Edwards and Steve Winter were present — are set to be voted on at the Sept. 18 Board of Alders meeting. Nearly all the recommendations are accepted, Santiago noted.

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posted by: Ulmus Civitas on September 12, 2018  1:09pm

Fret not taxpayers! The thrifty 30 have devised a solution to our massive 11% tax increase. Now, everyone gets $10 back because they made some minor budget cuts. Great work, team!! Rest easy taxpayers.

posted by: Atwater on September 12, 2018  1:10pm

The City should not be charging interest on motor-vehicle tax debts, period. If the tax remains unpaid the car’s registration is revoked and cannot be renewed until the tax is paid, along with the required State registration fees (not to mention emissions testing fees and repairs) and perhaps any tickets that one might get for driving an unregistered vehicle. Usually those who do not pay auto taxes are the working poor, who need their cars to get to work, etc. Charging interests seems like a cruel addition to the multitude of penalties one pays when they cannot pay their auto tax.

Also, this might be an “old man grumble” but why don’t the aldermen wear shirts and ties when they are conducting official business? Just smacks of an informality and lack of respect for the forum and the subject matter. But again, might just be an old man grumble.

posted by: Wooster Squared on September 12, 2018  3:33pm

That’s no “old man grumble”, @Atwater. I’m by no means old and I find the Alders’ informality to be very distasteful. It shows a lack of respect for the taxpayers and citizens they represent, not to mention a lack of self-discipline. On second thought, perhaps that’s appropriate given that they don’t seem to have much respect for those they serve.

posted by: Dennis Serf on September 12, 2018  3:39pm

Kind of wish the Alders had done as much due diligence when trying to limit the 11% tax increase.

Dennis Serfilippi