Assessor’s office reports $2.45 million in automatic penalties, expands audits and tax‑sale collections

The tax assessor’s office reported several revenue‑recovery efforts and collection updates to the Finance and Claims Committee on Sept. 11, including income-and-expense (INE) penalty assessments, an ongoing motor vehicle audit program with Municipal Tax Services, a rapid tax sale for zoning and blight fees, and updates on exempt organizations, business personal property filings and cannabis receipts.

Tax assessor Paul Gorman told the committee the office issued INE requests to about 1,900 accounts this spring; roughly 655 did not file and the office issued penalty bills in August that total $2,445,206. Gorman said the state statute governing INE filings requires the assessor to impose a 10% penalty on assessments when owners fail to return required income and expense statements and that local officials have no statutory discretion to waive the penalty. He said the assessor’s office will add a second mailing in future years to improve compliance.

On motor‑vehicle audits, the assessor said the city’s contract partner Municipal Tax Services (MTS) ran an initial billing sweep producing 486 bills; after the vendor fee the city’s net if all bills are paid would be about $85,771.13. Through August the city had collected roughly $49,000 (netting about $30,000 after fees) from early MTS work; the vendor’s first round has a Sept. 12 pay‑by date and a larger street‑sweep billing will follow.

Gorman described planned mailings for business personal property declarations (due Nov. 1 with extension to Dec. 15) and a quadrennial exempt‑organization filing (due Nov. 1 with a 30‑day extension). He said Norwalk maintains a local ordinance that can allow midyear exemption for qualifying organizations when they occupy property immediately for tax‑exempt uses.

Collections staff reported improved collection percentages: a 60‑day collection rate moved from 98.70% to 98.82% and the motor‑vehicle early billing strategy produced higher on‑time payments in June. Collections staff also reported the city has received over $400,000 in cumulative cannabis receipts since April; finance will direct those funds per state law once thresholds are met.

On tax sales the collections team said an expedited sale for zoning and blight fees started with about 15 properties, has generated more than $200,000 in revenue so far and is scheduled for Sept. 18; the office noted two remaining properties and that one owner has sought an injunction to halt a sale. Collections staff said the tax‑sale approach increased compliance and payments that likely would not have occurred otherwise.

Garbage billing adjustments: the assessor explained that once Public Works provides a final customer list, assessor software and the billing vendor (QDS) will issue certificates of correction to add or remove parcels from the garbage assessment. Staff cautioned that per‑parcel garbage charges are modest (example given: roughly $100 on a $500,000 assessed house) but that corrections will proceed after DPW finalizes the list.

Committee members asked whether the $2.45 million in INE penalties is recurring and whether it should be budgeted. Gorman and members agreed the amount varies year to year and should not be relied on as a stable budget line; the office will run historical reports to establish a conservative projection if councilors want to include a forecast in the budget.

No formal votes were taken because the committee lacked a quorum. The assessor and collections offices will continue billed enforcement, MTS audits and the scheduled tax sale and will report back to the committee with updated collections figures and historical trend data if requested.