Whitesburg KY
Clear
Clear
56°F
 

Tax collections up dramatically in wake of firm buying old bills




Collection of delinquent property taxes has increased dramatically in Letcher County since an out-of-state company began buying up old tax bills late last year.

Records obtained this week from the offices of Letcher County Court Clerk Winston Meade indicate that the collection of late tax payments and the fees that go with them is up about $500,000 for the first six months of 2007.

The records show that since B&L Management Services of Lincoln, Nebraska began buying up delinquent tax certificates late last year, Letcher County’s government has collected $664,705. That figure represents a dramatic increase over the first-half totals collected in years past – $124,062 in 2006; $125,831 in 2005; $228,652 in 2004; $163,574 in 2003; and $154,353 in 2002.

Of the $664,705 collected so far in 2007, the Letcher County School System will get $220,205, while the Jenkins system will get $45,450. During the same period in 2006, the two school systems got $37,751 and $11,159, respectively.

Letcher County’s library board, health department, county extension service and soil conservation board money with which to operate this year.

Delinquent tax payments to the library board for the six months ending June 30 were $30,797, compared to $5,485 in 2006. The extension service’s take went from $3,325 for the first six months of 2006 to $19,002 for 2007. The health department’s portion increased from $3,504 to $19,449. Payments to the soil conservation district jumped from $1,132 to $6,632.

The state’s share of the delinquent taxes went from $15,367 in the first six months of 2006 to $75,428 for the same period in 2007.

County residents will also benefit from the increased collections through the improvement of services offered by the offices of county attorney and county court clerk. Fees collected by the clerk’s office jumped from $8,547 to $47,541, while the fees for the county attorney’s office went from $17,899 to $102,254.

County Clerk Meade is again urging property owners to settle their late tax bills before they are purchased by B&L Management and other companies who make their money back by placing tax liens on property and then charging high rates of interest to settle the old accounts.

Kentucky state law was amended in 2004 to encourage “third party” companies like B&L Management to purchase certificates of delinquency.

Once a third party buys an old bill it is then able to demand repayment of the original amount of a delinquent tax bill plus 12 percent interest and “reasonable” fees for attorneys and processing.


Leave a Reply