Norwalk approves suspense-tax transfers; collector says contractor has billed $1.6 million in previously suspended accounts

At its May 4 meeting the Norwalk Board of Estimate and Taxation approved the annual transfer of delinquent accounts to the suspense list, a bookkeeping step that allows certain unlocatable or legally uncollectible accounts to be turned over to a third-party collection contractor.

Tax Collector Lisa explained the accounts are primarily motor vehicle bills for which the city lacks a valid address or other contact information. "These are primarily motor vehicle bills for which we have no valid address," Lisa said. She added that some business personal property accounts and bankruptcy restrictions also contribute to suspensions.

Lisa said the collection contractor the city contracted with in December 2022 "has billed 1.6 million dollars in previously suspended accounts," and that the contractor charges fees to the taxpayer rather than deducting from the city's receipts. The contractor typically retains a 15% fee, she said, and can pursue accounts for up to 15 years from the due date.

Board members asked why the suspense list rose (the collector said the increase was driven in part by business personal property entries and a small number of industrial pre-treatment fees) and discussed the tradeoffs of early collection-agency referral versus continued in-house effort.

The board approved the suspense-tax list by voice vote. Lisa said the city continues to report suspense collections separately and that the collection agency's skip‑tracing capabilities supplement city efforts.

What happens next: staff plan to turn the approved accounts to the contractor for further pursuit and will continue monthly reporting on suspense collections.