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Minutes for HB2607 - Committee on Taxation
Short Title
Providing for installment payment plans for property taxes owed on primary residential property.
Minutes Content for Thu, Feb 20, 2020
Amelia Kovar-Donohue, Assistant Revisor, provided an overview on HB2607 stating the bill relates to property tax and provides counties with the authority to allow a property tax installment payment plan. Section 1 of the bill would allow the county the option to provide for a property tax installment payment plan for taxes and special assessments on primary residential property. Applications for the plan would be required to be filed with the county treasurer on or before May 1. A taxpayer must be current on their primary residential property taxes in order to be eligible for the payment plan. The plan may require monthly or quarterly payments. The treasurer may levy a fee in an amount up to $2.50 per monthly payment or $5.00 for quarterly payments. The payment plan may be renewed if agreed to by the taxpayer and the treasurer. Payments received by the county prior to the fiscal year in which payments are owed shall be placed in escrow until the fiscal year in which they are owed. Procedurally, if the county decided to participate in the payment plan, they may elect monthly payments, quarterly payments or both. Section 2 would exempt payments under the payment plan from the statutory payment scheduled in 79-2004.
Proponents:
Representative Kelly, 11th District, testified for HB2607 stating the bill was proposed by cities in Montgomery county and some surrounding counties to reduce delinquent property tax payments. HB2607 allows the advance payment of property taxes for taxpayers who would prefer to pay their taxes in small incremental payments or quarterly payments instead of two large payments in December and May He noted counties in Kansas are experiencing growing property tax delinquencies and the plan would be available if they elect to adopt it (Attachment 1).
In response to questions, Representative Kelly stated if the payment plan is followed, the county would not have a cash flow problem. He noted if the taxpayer used incremental or quarterly payments, half of the amount due would be available for the December 20 and May 10 payment. The taxpayer must be current on their property taxes and not delinquent to participate in the plan.
Trey Cocking, League of Kansas Municipalities, testified for HB2607 stating the bill would be taxpayer friendly and provides local control if a city commission decided they want to participate in the plan. The bill gives the county treasurer or the county commission there is local control a commission can decide if they want to do. The bill maintains the current distribution system for the county to receive their money early June (Attachment 2).
Fred Gress, City Administrator, City of Caney, Kansas, testified for HB2607 stating the county published the delinquent tax list three times in row as required and spent over $3,000 to publish the list. The amount of the outstanding taxes was $3,053,680.42. He stated taxes are not going down unless services are cut. The bill allows taxpayers to pay their taxes in small incremental payments or quarterly payments and gives the county commission local control if they decide to use this option (Attachment 3).
In response to question, Mr. Gress stated allowing incremental or quarterly payments should not be a problem with cash flow.
Opponents:
Jay Hall, Kansas Association of Counties testified for HB2607 stating the basic concerns are implementing the system because many county treasurers that are offering incremental payments are doing so and tracking by hand in their office due to the software is not set up to capture the partial payments. He noted to do this on a long-term basis would require some changes to the system. The cash flow is a big concern when expecting the money to come in and the taxpayer misses their August payment and not caught up until a September or October payment is made. He noted another concern is the county treasurer has authority for collecting taxes and using this plan and should remain with the county treasurer and not the county commission (Attachment 4).
The Committee wanted clarification for HB2607 regarding if the county commissioners can sign the resolution and enact it at the opposition of the county treasurer.
Shilo Heger, County Treasurer testified on behalf of the Kansas County Treasurers Association for HB2607 stating the county treasurers are not opposed to the concept of the bill. The county treasurer has statutory authority for collecting taxes. She noted the authority to set-up a payment plan should be left with the office of the county treasurer and not the county commissioners. Each county treasurer knows the software and the workflow of their office and is best equipped for what works in the office. She noted (Attachment 5).
Sharon Gaede, Kansas County Treasurers Association presented written testimony for HB2607. (Attachment 6)
Hearing closed for HB2607 .
