The Elk County Tax Collection Committee met Wednesday at the Francis S. Grandinetti Elementary School in Ridgway to further discuss measures involved in replacing Elk County's current earned income tax (EIT) collector following the firm's breach of contract.
CENTAX was contracted to collect and disburse earned income tax monies to Elk County municipalities following the standardization of that state's earned income tax system under Act 32, which mandated one EIT collector per county as well as the formation of county tax collection committees.
An analysis of the Elk County Tax Collection Committee's PLGIT account shows deposits totaling $1,042,494.30 between May and July which, according to Committee Chairman Brent Rhoads, should total between $1.2 and $1.4 million in that same period. Likewise, distributions during that time are shown to be $801,312.90, leaving $241,181.40 yet to be distributed as of July 25.
Citing the company's failure to make timely payment and submit monthly written reports, both provisions of the contract with the county, the committee determined it was within its rights to terminate the contract with CENTAX and enlist the services of a different tax collector to take over operations from CENTAX in the third fiscal quarter. A request was then made for bids from Keystone Collections Group, Berkheimer Associates and Dave Farabaugh, the former EIT collector for St. Marys.
While Farabaugh did not submit a quote, Keystone Collections Group and Berkheimer Associates had, and both were represented at Wednesday's meeting during which their representatives fielded questions from committee delegates regarding the logistics of taking over EIT collection in Elk County.
Delegates asked what assurances either company could offer them regarding the efficacy of a transition, as well as the expected time frame for implementation.
Both companies said the amount of time it would take to do so entirely depends upon the level of cooperation seen from CENTAX.
"How fast we can do it depends on obstacles. If they [CENTAX] are willing to release data, it's immediate. The only thing to slow that down is resistance if we have to depend upon employers for information," said Joseph W. Lazzaro, vice president and general counsel of Keystone Collections Group.
With both companies having taken over accounts from CENTAX in other Pa. counties, William Leonard of Berkheimer Associates said if there is difficulty obtaining information pertaining to Elk County accounts, there are options available to them, including contacting the bond company, in this case Traveler's Insurance, which grants CENTAX permission to release the forms. This was the case when Berkheimer assumed EIT operations in Schuylkill County recently.
In addition, Lazzaro said that the state government is also a possible resource, if necessary, in leveraging against CENTAX in the event of their failure to cooperate.
"In this crisis, the state would have a real reason to work with us," Lazzaro said.
In their respective sales pitches, both companies assured those assembled of the ease with which the change could be facilitated, promising available and adequate staff for processing as well as the highest prioritization of Elk County accounts.
Committee delegates said they had been inundated with calls from residents and business owners concerned that checks sent to CENTAX as long ago as January had yet to be cashed.
According to Leonard, when Berkheimer came in as EIT collector in Susquehanna County following CENTAX, "We picked up boxes and boxes of returns with checks that were sitting there."
Pick up a copy of the Friday, July 27, 2012 edition of The Ridgway Record for more.
Elk County Tax Collection Committee
Thursday, Aug. 2
Johnsonburg Borough, 100 Main Street