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Council reviews proposal to use outside legal collection services, treasurer outlines fee structure
Summary
Treasurer Todd Mumpire and Auditor Sal Salvino summarized a proposed collection arrangement using RITA's legal program and outside collection agencies, including a $3,000 retainer, shared hearing fees, and collection agency fees passed to taxpayers; finance committee voted 3‑0 to ask the law director to prepare an ordinance.
Treasurer Todd Mumpire told Salem City Council members on March 4 that the finance committee recommended preparing an ordinance for the treasurer to enter into a new contract with an outside collection/legal program to pursue delinquent income‑tax accounts. According to committee minutes and the treasurer’s presentation, the legal program requires an initial advance/retainer of $3,000 that would be held in a legal fee pot and replenished from recovered court costs.
Auditor Sal Salvino and Treasurer Mumpire summarized how the program would work: the legal department would file civil cases to secure judgments on outstanding balances; judgments remove the statute of limitations and enable garnishments or liens. Mumpire told council the attorney appearance fee is $35 per hour (split among municipalities filing in the same court) and that when cases go to an outside collection agency the agency charges 18% of collections, a fee the provider says is passed to the delinquent taxpayer. The committee report also indicates RITA (Regional Income Tax Agency) or the contracted legal program charges a processing/collection fee — described in the discussion as approximately 3% of collections — and that the upfront retainer would be deducted from the first month's distribution after contract startup.
Councilmember Andrew Noll said he wanted the law director to draft an ordinance to permit the treasurer to enter the contract; at the finance committee meeting a motion passed 3‑0 to prepare that ordinance and forward it to council. Council members asked follow‑up questions on how attorney fees and court costs are handled; some expressed skepticism about whether attorney's fees would be recoverable in every county, and the treasurer said he would clarify those points with the vendor.
Mumpire and Salvino described operational benefits to having a full‑time collection staff handle filings and court processes instead of relying on limited city staff time for sending accounts to the attorney general's office. Mumpire highlighted that RITA and the legal program have existing collection experience and infrastructure and that using the program could reduce delays in processing delinquencies. The financial details provided in the meeting materials show past activity: the attorney general's office collected $25,956.32 for the city in 2024, with $57,661.38 sent to the attorney general for delinquency processing in 2024; 2023 send‑outs were $70,039.04.
Finance committee members said additional clarifications are needed on which fees are recoverable from defendants, how the retainer is managed over multiple years, and whether any up‑front city outlay occurs beyond the retainer pot. The law director was asked to prepare the ordinance language for council review; committee minutes reflect a 3‑0 committee vote to forward that ordinance to full council for consideration.
