POUGHKEEPSIE – During Monday night’s ‘virtual’ meeting of the Poughkeepsie Common Council, members Natasha Cherry and Yvonne Flowers introduced a plan to amend the City’s Tax Code to allow partial payments on real estate taxes. Cherry and Flowers are both members of the city’s Finance Committee and worked with Mayor Rob Rolison and his administration in a bipartisan effort to bring relief to city taxpayers during the COVID-19 crisis.
Under current law, taxpayers must pay the full amount on or before February 15 unless they elect, for a fee, to pay in four quarterly installments. Taxpayers who fall behind on quarterly payments, or do not elect the quarterly option prior to February 15 must pay the entire amount due including a penalty.
The amendment to the local tax code would permit partial payments to be made in any amount at any time throughout the year. The current penalty schedule would be replaced with a simple-interest provision fixed at one percent per month, assessed on the declining balance.
Cherry noted that residents on a fixed income would be provided an opportunity to work with the city’s finance department to develop a budget that would allow individuals to pay taxes while still being able to afford necessities.
Under the proposed changes to the local tax code, taxpayers who have elected the quarterly option, and who face their next payment on May 15, could defer all or some of that payment at a cost of one percent per month charged only on the amount of the quarterly payment deferred. For taxpayers who did not elect the quarterly option and make their first payment on-time by February 15, the current law provides no option other than payment in full and partial payments are not accepted by the city’s tax collector. This amendment to the tax code, if passed by the council, would permit all partial payments to be accepted, whenever they are made throughout the year.
Speaking of the plan, Cherry said, “This is a vitally important, common-sense piece of legislation that provides flexibility to city property owners. Flexibility allows individuals to make decisions that best help them navigate this crisis because everyone’s situation is not the same. We ask our landlords to work with their tenants during this difficult time, and this less rigid tax collection process is going to help make it easier for them to do so.”
Flowers spoke of the plan initiated over a year ago, saying “Every property owner in the city who pays under the current quarterly system has a payment due on May 15. Left unchanged, everyone who misses that payment would be required to pay the full tax and penalty, and our tax collector would be required to return all partial payments. This legislation will not only help hundreds of Poughkeepsie’s property owners, but it will also help thousands of Poughkeepsie residents who live in rented properties because owners may find it easier to defer rent payments until our local economy is reopened.”
During Monday’s meeting, the plan was praised by lawmakers with Councilmember Matt McNamara reiterating the protections it will give to renters, calling the proposal a “win-win.” Veteran Councilman Chris Petsas endorsed the change. He serves as the council’s Finance Committee chairman and said, “I wish it (the change) had been done a long time ago.”
Also endorsing the plan, Council Chair Sarah Salem called the plan an “Amazing suggestion.”
Evan Menist, representing the city’s second ward, suggested changes to the proposal including the waiving of late fees for persons on fixed incomes and also sought to alter the language so it would only benefit homeowners while excluding commercial properties or off-site property owners.
“This needs to be easier for homeowners and harder on real estate investors,” said Menist.
The changes offered by Menist would likely delay the plan and Councilmember Sarah Brannen lobbied against the delay. “The timing seems perfect,” Brannen said, referencing the pandemic. Brannen encouraged her colleagues to expedite the changes and address the suggestions offered by Menist at a later date.
After the merits of the bill were discussed, the council voted to set a public hearing on the proposal on May 18. Following the hearing, the council will have the opportunity to approve the change later that evening during their regular board meeting.
Mayor Rolison applauded the planned change saying, “This is a well-crafted amendment that balances the city’s financial condition with the need to provide flexibility to our taxpayers. Not only will this legislation help individuals, it will help local businesses, many of which also pay property taxes and have not received promised help under the Federal Paycheck Protection Program. The current ‘all-or-nothing’ approach to tax collection, which requires the city to send back partial payments, is at odds with important goals we share as a community: preserving homeownership and housing affordability. The new approach will also help our senior citizen property owners, who may find it easier to pay monthly rather than quarterly.”
