Communities statewide are already grappling with dire predictions of drastic drops in state aid for the upcoming fiscal year as state revenues shrivel. But cities and towns are experiencing a double whammy, as local revenues also suffer under the impact of the slumping economy.
In particular, more property owners are falling behind in their real estate tax payments, according to local officials across southeastern Massachusetts.
"It's not surprising," said John Robertson, legislative director for the Massachusetts Municipal Association. "It's one of the things you would expect to see in a recession."
Taxes that don't come in on time put towns in the red, since estimated revenue amounts are used when budgeting for an upcoming year. The uncollected money also reduces the pool of available free cash towns have historically relied on to fill budget gaps each fall.
"There's a long list of things happening," Robertson said. "There's a drop in motor vehicle excise revenue because people are taking their cars off the road. There's a lot of bad news across municipal revenues." The drop in real estate tax payments "just adds to the list," he said.
Some communities are more aggressive than others at pursuing tax delinquents.
East Bridgewater, for instance, has already advertised its list of property owners who will have liens placed on their deeds for nonpayment of taxes for fiscal 2008.
Tax Collector Marilyn Thompson said the number of delinquents has risen significantly. Forty-six properties had liens placed on their deeds for nonpayment of 2007 bills; Thompson said 72 properties were advertised for nonpayment of 2008 taxes. Those properties will also have liens on their deeds if the taxes are not paid.
Thompson usually publishes the list of tax delinquents by September of each year. This year, she delayed doing that until the end of November, hoping at least some homeowners would pay their bills. It worked, she said. About $190,000 in overdue taxes was taken in during the delay period. According to Thompson, $113,000 remains unpaid.
Several town tax collectors said letters warning residents that their properties will be published on the delinquents list is a powerful incentive for many to pay up. Communities also have the ability to do a land taking through the courts for nonpayment of taxes, although that process can be expensive.
Middleborough's tax collector, Judy MacDonald, has also advertised the 2008 delinquents so that liens can be put on their properties. In 2007, MacDonald had 135 properties with unpaid taxes when she advertised the liens. In 2008, she had 171 properties, an increase, but not as sharp as in some other towns.
"The tax title list is growing some, but I think it will get worse as the economy gets worse," MacDonald said.
Walpole Tax Collector Mark Good said real estate taxes are not the only things going unpaid. "We're seeing it for water and sewer bills, too," Good said. "It's not a nice time out there for folks. That's for sure. People are asking to do payment plans more than we've seen in the past."
John Duggan, West Bridgewater's tax collector, is seeing a rise in the number of tax delinquents as well. "It's definitely related to the economy," he said. Duggan generally holds off on the tax lien process for the previous fiscal year's delinquents until the following spring.
Carver's Assistant Tax Collector Paula Nute says her office also waits until the spring. Carver doubled its tax lien list between 2006 and 2007, going from 13 to 26 properties, she said. "We currently have 121 properties with outstanding taxes from the 2008 fiscal year," Nute said. "That's huge."
In Rockland, Tax Collector Lisa Clark said she is beginning to send out demand letters to delinquent taxpayers.
"It's gone up dramatically in the last few years," she said. "In 2007, we put a lien on eight properties with taxes due from 2006. And in 2008, we put liens on 76 parcels who owed taxes from fiscal 2007. Last year was a big year for Rockland."
Rockland has 116 properties with unpaid taxes. "I've sent out warnings on them, but we haven't sent out our letters of advertisement yet," Clark said. "I'm waiting to see if we'll get some of the taxes in."
Ed Maccaferri, Plymouth's tax collector, said the cost of advertising all the properties with delinquent taxes is quite high, as is the processing necessary to get liens placed on the deeds. "We're working on 2008, but we're trying to have the numbers come down," Maccaferri said. "In 2007, we had 260 with unpaid taxes. Right now there are 500."
Kathleen Shiavone, acting tax collector in Halifax, said she is holding off on the demand letters.
"I made the plan early on to extend it a couple of months so people could pay it off or at least pay it down," Shiavone said. "I can tell you it's gone up, although I can't tell you the percentage. No matter what the bill is, it's taking longer to pay. I did a lot of liens on water bills in 2007, and there are still a lot of bills outstanding from 2008. Things are very tight. It's sad."
Marshfield Tax Collector Nancy Holt said her town is still holding its own, with real estate taxes generally being paid by property owners.
"We will do our 2008 list in the spring," she said. "Our collections right now are right on target with last year's. We did take more liens in last year, but it still wasn't bad. We had 90 liens and we have 12,000 properties. Our liens for 2007 were put on last spring; 60 percent have been paid off since then."
Christine Legere can be reached at email@example.com.