Committee recommends lowering late-payment penalties for refuse collection fees

The Huntington Public Works Committee voted Tuesday to forward to full city council an ordinance that would reduce late-payment penalties for refuse collection fees from 5% per quarter to 2% per quarter.

Scott Damron, acting city attorney, told the committee the change would align refuse-fee penalties with penalties charged on the municipal service fee and reduce the compounding effect that can drive penalties above the unpaid principal over time.

“Currently, if there's no payment on a refuse fee over the year, the penalties would be, if you compound them out for a year, would be 21.5%,” Damron said. He added that reducing the quarterly penalty to 2% would make the annual penalty roughly equivalent to the municipal service fee penalty — about 8% per year — and cited the Internal Revenue Service’s additions-to-tax rate of 0.5% per month (6% per year) as an example of a less-aggressive penalty approach. Damron also noted that the IRS limits penalties to 25% of unpaid taxes regardless of duration.

A council member moved to forward the ordinance to full council with a favorable recommendation; the motion passed by voice vote and Miss Walling agreed to sponsor the ordinance on the full-council agenda.

Damron said the proposed amendment would modify section 951.08 of the codified ordinances of the City of Huntington concerning refuse collection; he referenced section 8-13-14 of the code as the existing authority that provides for penalties. The committee packet included the ordinance language but did not include an estimated fiscal impact or examples of how many accounts are affected.

The ordinance will appear on a future full-council agenda for final action.