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Finance committee backs change to Loudoun delinquent-tax penalty structure
Summary
The finance committee voted to recommend the board advertise an amendment to Ordinance 860.02 that would set a 2% late penalty for taxes paid within 30 days and 10% thereafter, effective May 1, 2027; Treasurer Henry Eichelberg said the change could lower penalty collections by an estimated $2–3 million.
The Loudoun County Finance, Government Operations and Economic Development Committee voted Nov. 13 to recommend the Board of Supervisors prepare and advertise an amendment to Ordinance 860.02 that would replace the current flat $10 minimum and 10% late penalty with a two-tiered system: 2% on any delinquent tax amount paid within 30 days of the due date and 10% on amounts unpaid more than 30 days after the due date, effective May 1, 2027.
Treasurer Henry Eichelberg told the committee the ordinance change is intended to ease the burden on taxpayers who miss payment deadlines by a short time. "Right now, it's 10% with a $10 minimum," Eichelberg said. "I'm proposing that it would go down to 2% if you pay within 30 days and then go up to 10%." He said current penalty collections modeled at roughly $10 million could fall by about $2 million to $3 million under the proposal, though behavior changes are uncertain.
Supervisor Umstead raised concerns about the impact on incorporated towns, saying Leesburg could lose an estimated $36,000 annually under the county modeling. Eichelberg noted the towns had been briefed and that planned assessment changes could offset some town revenue losses. Committee members also asked whether the county budgets late-fee revenue; staff confirmed it is a budgeted line item.
The committee recorded a motion and second to recommend staff prepare and advertise the amendment; the motion passed on a 3–0–2 vote with two members off the dais. The item will go to the full Board of Supervisors for public notice and hearing as required by law.
If approved by the board after public hearing, the change would apply to taxes due on and after May 1, 2027; the ordinance amendment process and any changes to town payments will be resolved as staff prepares the legal edits and public notices.
