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Goshen board tables proposed 10% penalty on small unpaid water and sewer balances for attorney review
Summary
The board reviewed a proposal to place a 10% penalty on outstanding water and sewer balances above $500 that would be relisted on the town and county tax bill, but tabled the item for the Oct. 23 meeting pending review by the town attorney about legality and percentage caps.
The Town of Goshen Board on Sept. 25 discussed and tabled a proposal to impose a 10% penalty on outstanding water and sewer balances above $500 that are later transferred to town and county tax bills. Members asked the town attorney to review whether the proposed penalty and any percentage cap are legally permissible.
Why it matters: The penalty is meant to encourage timely quarterly utility payments and reduce the administrative burden of year-end tax relists. If adopted, it will increase costs for customers with delinquent balances and change collection practices.
Finance staff described the operational problem: many customers place unpaid quarterly balances on their property tax bills at year'end, which affects quarterly cash flow. The board discussed precedent in nearby municipalities (some charge penalties or interest during the year but not both) and noted the town had previously suspended such penalties during the COVID-19 period. Several board members expressed concern about the legal cap on late fees and asked the attorney to confirm the town's authority and any percentage limits. The board voted to table the proposal to the Oct. 23 meeting to allow the attorney to review the proposed 10% figure and how the charge would be assessed.
Discussion vs. action: No penalty was adopted. The board tabled the item to Oct. 23 for legal review and possible revision; staff and the attorney were asked to prepare a clear legal recommendation and alternative penalty structures if required.
What to watch next: The Oct. 23 meeting, when the town attorney is expected to report back about whether a 10% penalty is legal and how it would be implemented (thresholds, timing and whether penalties and interest may be charged concurrently).
