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Municipalities updated on progress of claim against Central Tax Bureau

Carbon County municipalities must continue to determine their losses after the earned income tax collector that was hired was removed for not fulfilling its contract.

During the meeting of the Carbon County Tax Collection Committee on Wednesday evening, Attorney Keith Strohl of the Law Offices of Steckel and Stopp, who the committee hired as its lawyer, updated the board on the progress of the claim against Central Tax Bureau of Pennsylvania Inc.'s bond; as well as the transition from Centax to Berkheimer and Associates of Bangor.Strohl said that the transition has gone as smoothly as expected; but right now, Travelers, Centax's bond holder, is currently asking for supporting documentation on each municipality's losses due to Centax not holding up their end of the contract.The supporting documentation, Strohl noted, would include expected revenue that never was received from Centax, additional commissions that must now be paid to Berkheimer on the collections; postage costs; and any other fees that were incurred as a result of the transition.He noted that in addition, Centax owes an additional .25 percent on commissions collected because the company was taking the commission at a 1.49 percent collection rate instead of the negotiated 1.24 percent commission.Once the information is compiled, Strohl will look into and organize the committee's overall claim and submit all documentation to Travelers.He noted that if the bond doesn't cover all of the lost finances the municipalities claim, then there is a possibility that the remaining money would be lost due to Centax not having any funds or assets available to cover the remaining losses.The committee asked a number of questions regarding figures to include in supporting documentation.The breakdown of the EIT collector appointed by the Carbon County Tax Collection Committee; as well as a number of other Pennsylvania counties began in late June 2012.In July, the tax collection committee voted to terminate its contract with Centax as the EIT collector because it failed to process and distribute earned income taxes to municipalities and school districts. They then voted to hire Berkheimer as the interim EIT collector.In September, Strohl updated the group on the claim against Centax's bond.During that meeting, he told representatives that Centax's bond holder, Travelers, is investigating everything and asked all municipalities and school districts to gather information on any economic damage they suffered as a result of Centax's failure to make payments in a timely manner.Centax was hired as the countywide EIT tax collector on Sept. 15, 2010, after the county tax collection committee determined that Centax would meet its needs under Act 32, which requires a single tax collector to handle earned income taxes collected. Three other tax collection companies Berkheimer and Associates, Capital Tax Collection Bureau of Harrisburg, and JP Harris Association of Mechanicsburg also submitted proposals to the committee in 2010.In other matters, the committee also held its annual reorganization.Bill Ravert of Bowmanstown was named the chairperson for 2013.Other officers include John Wieczorek of Mahoning Township, vice-chairperson; Donna McGarry of Palmerton, secretary and open records officer; Kenneth Marx of the Panther Valley School District, assistant secretary; and Michael Malay of Lehighton Area School District, treasurer.Other positions filled or renewed also included keeping the Law Office of Steckel and Stopp as the committee's legal counsel; and retaining Jim Thorpe National Bank as the primary bank depository.Committees were also renewed for another year.The Carbon County Tax Collection Committee was formed in October 2009 because of Act 32 of 2008, which amends the Local Tax Enabling Act.Under Act 32, counties were required to form a countywide collection committee, comprised of delegates from each municipality and school district within the county; and hire one tax collector who would be responsible for the collection of earned income tax.The law states that this reduction in the amount of earned income tax collectors would provide for quicker money turnarounds, which means municipalities and school districts should get paid sooner.The Carbon County Tax Collection Committee members include delegates from Jim Thorpe, Kidder Township, Penn Forest Township, East Penn Township, Franklin Township, Lehighton, Mahoning Township, Parryville, Weissport, Bowmanstown, Lower Towamensing Township, Palmerton, Towamensing Township, Lansford, Nesquehoning, Summit Hill, Coaldale, East Side, Lausanne Township, Lehigh Township, Packer Township, and Weatherly; as well as Jim Thorpe, Lehighton, Palmerton, Panther Valley and Weatherly school districts.