A senior judge from Monroe County will decide the suit brought by Carbon County against the Panther Valley School District over delinquent tax files and collections.
Wednesday Judge Jerome P. Cheslock heard testimony in the case. The one-day trial concluded about 4:15 p.m. with Cheslock telling attorneys for both sides he would hear argument and accept legal briefs from the parties before deciding the issue.
The county sued the school district in November 2009 over delinquent tax files that were never given to the county tax claim bureau as required by law. The suit was based on a ruling in a Monroe County lawsuit filed against the East Stroudsburg School District. In that case the court ruled that tax records and returns are to be filed with the county tax claim bureau.
Carbon claims Panther Valley has been withholding delinquent tax collection records and has instructed its elected tax collectors to withhold the information from the county.
The suit also charged that Panther Valley hired a private law firm, Portnoff Law Associates, of Norristown, Montgomery County, to collect delinquent taxes.
At yesterday's proceeding attorney Jane Maughan, of Stroudsburg, who is representing the county in the action, told the court that Portnoff continues to collect the funds. The firm charges a fee for filing the lien against the taxpayer who is delinquent, a fee for the collection and a fee if a person wants a copy of the tax record for a particular property.
Testimony from the president of Portnoff, Michelle Portnoff, revealed that the firm has made a profit of $6.9 million since taking over the collection of the taxes for the school district in 2001 to date.
In the suit the county claims it is entitled to a 5 percent commission on all delinquent tax collection revenues and has not received any of it since 2001.
In her opening statement Maughan told Cheslock that in the Monroe case, which she successfully handled, the court said that all tax records are to be filed with the county tax claim bureau even if a private collector is hired. The collector, Maughan claimed, must report its collections to the county so it can receive a 5 percent commission.
Maughan told Cheslock the county is seeking the return of all tax records, a record of collection payments be made directly to the county tax claim bureau, so that the commission be paid directly to the tax claim bureau and that the public has the right to access tax records without paying a fee.
Attorney David Conn of the law firm of Sweet, Stevens, Katz and Williams, of Pittston, who is representing the school district, said that the school district has been turning over the tax records for the past three years and since the lawsuit was filed. He argued, however, that the county is not entitled to the files dating back to 2001. He also said the district is cooperating in the matter as required by the law.
Attorney Jeffrey C. Schwartz, representing Portnoff, said his client has been cooperating since the suit was filed in reporting collections made on delinquent taxes. He argued further that the county is not entitled to the files back seven plus years.
He said the Monroe case does not make the collection retroactive but from the date of the ruling. He said the county is seeking over $250,000 in fees and that could force the district to cut programs and increase taxes to cover the amount.
He claimed that if a tax record is sought Portnoff does charge a fee for a certified copy. However, he said, if a person does not want it certified, no fee is charged.
Several witnesses were called by the county including attorney Daniel Miscavige, solicitor for the tax claim bureau; Renee Roberts, tax claim bureau director; Commissioner William O'Gurek, chairman; and Scott Miller, a certified public account from Reilly & Company, Stroudsburg.
Called by the defendants were Kenneth Marx, PV school district business manager; Michelle Portnoff, president of the Portnoff Law Associates; and attorney Kim Roberti, a local attorney who has dealt with Portnoff.
The legal briefs will be filed after a transcript of Wednesday's proceeding is given to each side. The transcript will be ready in about 20 days. Each side then has 10 days to submit their legal briefs.