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Manager Tyler asks committee to study third-party collections for delinquent meals and transient taxes
Summary
At the Nov. 13 Budget Personnel Committee meeting, Manager Tyler reviewed current excise tax collection steps and recommended further study of a third‑party law firm to recover delinquent meals and transient-occupancy taxes; the committee asked staff for more information and tabled the item until the next meeting.
Manager Tyler told the Budget Personnel Committee on Thursday that the town’s current approach to delinquent excise taxes begins with a 10‑day late notice, a second 10‑day notice and, if unpaid, a summons filed in court.
"When the tax is 10 days late, we send a letter giving the, giving the taxpayer another 10 days," Manager Tyler said, describing the existing letter-and-summons process and acknowledging that court filings do not always happen promptly.
Tyler said transient‑occupancy taxes are currently paid up and only a small number of meals‑tax accounts are delinquent, but that the town’s collection method can be inconsistent. He described Virginia Beach’s practice — three delinquent notices, a treasurer’s lien against property after the third notice, field visits and a warrant in debt filed in court — as one model the town might follow. "They do not use a 3rd party for meals and transient, although that's 1 of the things I've been looking at," Tyler said.
Tyler also said he has spoken with a law firm that specializes in municipal tax collection and with a deputy treasurer in Virginia Beach. He had not yet obtained a fee quote from the firm. The town ordinance was cited during the discussion; Tyler noted the ordinance contemplates a 10‑day notice followed by automatic suspension of a business license until payment is made.
The Chair observed that collection fees "can be passed on" to the taxpayer, a point raised as a potential way to avoid net cost to the town. Committee members agreed to table the item until the next meeting and asked Tyler to return with more information about third‑party costs, timelines and methods.
The committee did not take a formal vote on a policy change; the direction given was to investigate options and report back at the next meeting.
