Meeting Minutes Mar. 24, 2010

Centre County Tax Collection Committee Meeting
Meeting Minutes
Wednesday, March 24th, 2010

I. Call to Order
The Wednesday, March 24th meeting of the Centre County Tax Collection Committee (CCTCC) was called to order at 7:05p.m. with Randy Brown, Chair, presiding. The meeting was held in the Bellefonte High School Library.

II. Roll Call

Mr. Stewart conducted the roll call. All taxing authorities were represented except Burnside Township, Howard Township, Miles Township, Port Matilda Borough, and Snow Shoe Borough. Mr. Stewart stated that a quorum was present.

III. Approval of Minutes
Mr. Brown asked for an approval of the February 23rd meeting minutes. Mr. MacMath made a motion to approve the minutes. Ms. Farkas seconded the motion. With no changes to the minutes, the motion passed.

IV. Report from Committee Chairperson
Mr. Brown summarized the meeting agenda.

V. Financial Report
Mr. Brown referenced a copy of the Profit and Loss statement for the period of January 1 through March 12, 2010. The net income was $2,537.85 with Total Expenses of $1,106.25. Mr. Wall made a motion to approve the financial report as presented. Mr. Gribble seconded the motion. The motion passed.

VI. Presentations

Mr. Hunt introduced himself and Mr. Kennedy. Mr. Hunt referenced a handout which summarized the number of officers, full time employees and the date the company was founded – 1936. Mr. Hunt stated that Berkheimer collects 25% of the total EIT monies in the State with $1 Billion distributed. He stated they have internal programs and best practices that meet or exceed Act 32. Mr. Hunt stated that the company has had online filing for ten years for businesses and the last three years for individuals. They spent $10 Million to automate for the processing of customer returns. All documents are scanned into their system so that everyone has access to data.

Ms. Wyatt asked where the closest office is located. Mr. Hunt replied Huntington currently, but that they would open a Centre County office if designated as the collector. Ms. Wyatt asked what percentage fee is currently charged to municipalities for collection. Mr. Hunt stated that it varies but that the average was 2.5%.

Mr. Long asked about completeness of tax roles. Mr. Hunt replied that they would work closely with current tax collectors, as well as use real estate reports, student registrations, PA IRS and other tools.

Mr. Sharer asked if the company has a main office and satellite offices. Mr. Hunt replied that they have a main office and 24 satellite offices. He envisioned the Centre County office having 3-4 employees depending on the volume.

A question was asked, what is the SAS 70 Audit. Mr. Hunt stated that it looks at all operational procedures to see that no one individual has access to funds or information from beginning to end of process.

Central Tax
Mr. Hill of Central Tax referenced a handout and stated that deciding to go with for-profit or not-for-profit is a tough decision. He stated that their management philosophy is to partner with boroughs, townships, and schools to do a more effective job. They pride themselves on giving out their contact numbers to resolve client problems the same day they arise if possible. Mr. Hill stated that they use Oracle scanning technology to view returns. Reports are sent in pdf report to clients. He also stated that the transition from the current system to the new present challenges that Central Tax is prepared to handle. He gave the example of the Walmart amendment and that they are automated and able to handle these challenges. Their motto is “people collect taxes, not software.” Mr. Hill also stated that they are committed to opening up an office in Centre County if designated the collector.

Mr. Erickson asked what other county’s were doing. Mr. Hill stated that there is still a lot of indecision and issues over the voting.

Mr. Brumbaugh asked how they gauge customer satisfaction. Mr. Hill stated that they have weekly meetings internally to get input from employees about issues. He stated they have a main office in Bridgeville and two data processing operation centers. He stated that the collection fee would be 2% or less.

Mr. Sharer asked about the contract between the TCC and Central Tax. Mr. Hill replied that they have a contract available that spells out all of the details.

A question came up about collecting from postal workers. The consensus was that PA might not be able to collect from federal workers.

State College Borough
Mr. Groff, State College Borough Finance Director, is offering a not-for-profit service that is uniquely qualified, ideally positioned, and ready to serve. He referenced a handout that proposes a two office set up – one main office at the State College Municipal Building and a satellite office in the Bellefonte area. Mr. Groff stated that they offer common sense and that they know and understand the people of Centre County. They not only collect for one of the largest municipalities, but they also collect for one of the smallest municipalities – Halfmoon Township. They are capable and interested in collecting the local services tax as well.

Mr. Sharer asked about the fee they would charge. Mr. Groff estimated between 1.5 and 3% of revenue distributed.

Mr. Endresen asked about how they would move to county-wide collection, a much bigger operation, and what experience does RBA have going to a county-wide system. Mr. Groff stated that they can make the transition to county-wide collections and some of the answers will be dependent upon what the TCC wants – number of satellite offices, no satellite offices, etc. Mr. Hilands of RBA stated that they have county-wide collection software programs currently and Centre County wouldn’t be a problem.

Mr. Long asked about a percent fee basis and actual cost plus overhead fee. Mr. Groff said that State College is familiar with both types of fees and is willing to consider the options with the TCC.

Mr. Gribble asked about the transition and the timeliness of it. Mr. Groff stated that they are prepared to talk about early implementation.

Ms. Wyatt stated that her experience with the borough collecting the EIT has been good.

Mr. Brown moved to item 8A on the agenda – Discussion of Presentations.
At the last meeting, the York Tax Bureau model was presented. Mr. Brown reminded everyone to consider the goals set by the TCC.
Mr. Sharer asked if anyone has visited a tax office for the benefit of getting help. A number of responders stated that they have not, but many offices see walk-ins on a regular basis – as many as 100/week. Ms. Farkas stated that State College did a great job for them when they instituted the local services tax.

Mr. Brown summarized the presentations and the types of collections they represent. A number of general comments were made regarding profit vs. non-profit collections.

Mr. Erickson made a motion to authorize the Executive Committee to enter into discussions with State College Borough towards crafting a proposal to become the “Tax Collector” for Centre County. The proposal would be returned to the TCC for consideration as provided in the bylaws. Furthermore, the proposal should identify two specific points: 1) transparent process for fees in that they are designed to cover the costs of collection; and 2) staff expansion should come from those who will be displaced as a result of Act 32. Mr. Wall seconded the motion. Mr. Sharer expressed concern that the TCC was not considering other vendors. There were a number of general comments related to the use of contractors.

Mr. Wall called for the question. Mr. Endresen asked if State College Borough could vote. Mr. Marshall (solicitor) stated that State College could vote and that it would not be considered a conflict. Mr. Brown talked with the State College delegate, who stated that State College Borough would abstain from voting. The motion passed with a weighted vote of 96.4% in favor and 3.6% against.

Mr. Brown asked that delegates forward to him “wish list” items that they would like to see in the draft proposal. Suggestions included a separate bank account for the TCC funds.

Mr. Fountaine stated that he would resign as Secretary to avoid any conflict. His letter of resignation will be acted on at the next meeting.

Mr. Brown went back to old business.

VII. Other Business
A. TCC Insurance – Mr. Brown reported that the insurance broker for the State College School District received two proposals – one in the amount of $7000 and one in the amount of $2000 with no apparent difference between the two. Mr. Brown recommended Penn Prime in the amount of $2000. No action was taken as the insurance isn’t needed until a later time.

B. Data Request – Mr. Brown reminded everyone to turn in their data request forms. Please return the completed data document to his attention,
electronically or papercopy to 131 W. Nittany Ave., State College, PA 16801.

C. Ethics Filings – Mr. Brown reminded everyone to turn in a copy of their ethics form or mail it to him.

D. DCED Webinar – Mr. Brown stated the webinar focused on best practices.

VIII. Other Business - Discussion Items
B. Tax Appeal Board – item needs to be determined by June 1, 2010. Item will be brought up at future meeting.

C. Proposed Amended Budget – Mr. Brown stated at our October 28th meeting, the TCC adopted a budget totaling $7000 for expenses expected to be incurred including professional services for legal fees, advertising and other services. Following the discovery that the TCC needs to provide insurance, an amended budget is presented this evening. In addition, a Tax Collection Agreement is available for purchase from PASBO. This agreement is a model agreement which the TCC may purchase for a cost of $4000. DCED is also providing model agreements which may be modified to meet our needs. A decision to purchase the model agreement does not need to be made tonight. An amended budget of $13,000 was presented for consideration. This amended budget is a change of $6000, of which $5000 would be funded by a DCED shared services grant for start up costs. Mr. Brown stated that he needs to send in the budget and a resolution as part of the grant application. Mr. MacMath made a motion to approve the resolution and amended budget. Mr. Wall seconded the motion. The motion passed.

IX. Public Comment
There was no public comment.

X. Future Meeting Dates
The following dates have been selected based upon a survey completed since the last meeting.
Thursday, April 22, 2010
Wednesday, May 12, 2010
Thursday, June 17, 2010

Mr. Brown asked if there were any additional items for the good of the order.

XI. Adjournment
A motion was made for adjournment by Mr. Erickson and seconded by Ms. Farkas. The meeting was adjourned at 9:09 p.m.