Cost not justified for tax collections

PAT FRIDGEN

Area representatives on the Franklin County Tax Collection Committee opposed the purchase of online filing software by the Franklin County Area Tax Bureau. At the TCC meeting Tuesday in Chambersburg, most of the taxing jurisdictions were against the $60,000 upfront expense, and the $12,000 yearly maintenance and upgrades. Jason Cohen, Waynesboro assistant borough manager, introduced the idea on behalf of absent bureau director James Clapper.

FCATB collects earned income taxes for the county townships, boroughs and school districts. Most of the 25 entities signed up for the service for 2011, though it was not required by law until 2012. Last year the committee hired the former Chambersburg Area Wage Tax Bureau, over competitor Capital Tax Collection Bureau in Harrisburg, to handle the taxes. The fee for collecting the $35 million was not to exceed 2.2 percent in 2011, 2 percent in 2012, and 1.89 percent in 2013.

Of the software package, Cohen said, "It's a pretty pricey endeavor, and the price will have to be offset by members. If we make this purchase, we won't be able to make our cost of collection."

The committee members present Oct. 24 generally opposed absorbing the cost in their own agency budgets. Other municipalities had seen a less-than-steller use of the online service by taxpayers.

"No one will fall apart if they can't file online," said one member. "It's a great service, and eventually we'll get there."

Lloyd Hamburger, Waynesboro borough manager, wanted any purchase to pay for itself, and not increase the cost of collection.

The discussion also noted that while the vendor offered three-year no-interest financing, if FCATB was not rehired after its contract ran out in two years, the taxing bodies would then have to pay off the software system.

Therefore, some confusion reigned when the representatives from Hamilton and Peters townships moved to let the bureau decide whether it wanted to buy the software, and it would not have to meet the fee structure in the contract. The motion failed 21-3.

Voting against included Mary Klein for Antrim Township, James Farley for Greencastle borough, and Eric Holtzman for Greencastle-Antrim School District.

The next motion recommended no software purchase, but if the bureau went ahead, it had to meet the fee structure. It passed by consensus.

Most of the members of TCC are also on the bureau board of directors. They will finalize the matter on Thursday, Oct. 27 at 4 p.m. at the Chambersburg Area School District Administration building. The FCATB is housed next door at 433 Stanley Ave.