With unanimous votes Tuesday night, the Schuylkill County Tax Collection Committee appointed a Northampton County firm to process its earned income tax bills.
The tax committee hired H.A. Berkheimer Inc. as the tax officer and tax collector for the Schuylkill Tax Collection District, at a rate of 1.79 percent of the taxes it will process. That will include 0.09 percent for postage. Berkheimer's contract term will end Dec. 31, 2013, according to Paul Datte, committee solicitor.
"Now, show us the money," said Sharon Chiao, a delegate from Mahanoy Township, echoing the committee's frustration over its previous tax collector, Centax Group of Allegheny County.
There's an estimated $22 million in earned income tax collected in the county every year, with a little more than $5 million collected every quarter. Centax had failed to process EIT bills in a timely manner, Datte said.
While in the process of trying to expand its operations and streamline operations, Centax was overcome by faults in the system, John DeRemer, vice president at Berkheimer Outsourcing, Allentown, Lehigh County, said previously.
As a result, Centax failed to distribute millions in income taxes received from employers to school districts and municipalities in several counties in Pennsylvania, including Luzerne.
The county tax committee was not sure exactly how much Centax owed Schuylkill County municipalities and school districts Tuesday night.
The tax committee is made up of 73 delegates, 62 from municipalities and 11 from school districts, and 53 delegates were present for the meeting Tuesday at the county courthouse.
At its June 26 meeting, the committee authorized Datte to terminate its agreement with Centax Group.
"It's been an interesting couple of weeks since we last met. Here's the bottom line - the contract with Centax is terminated as of today. The basis for that termination is a provision in our tax collector agreement which permits us to terminate if we believe that there has been a material adverse change in the financial or business condition of the company," Datte said at Tuesday's meeting.
Centax is required to provide the committee all of its tax records, Datte said.
However, the committee voted to give Datte the right to pursue legal action if Centax does not cooperate during this transition period.
"We're prepared to get an injunction if need be," Datte said.
While some committee delegates said payments from Centax were still trickling in, Larry Padora, committee chairman, and Leo Schwartz, committee vice chairman, said the committee hasn't received a report from Centax on the matter since June 12.
"There have been numerous attempts to contact Centax directly. Berkheimer, I know, has made numerous efforts as well. There's been some contact but not a lot of contact," Datte said.
Padora said he has made "numerous attempts" to contact the Centax CEO, Don E. Wilkinson II.
"I got his personal cellphone number and was probably calling it every three hours for the past two days and leaving messages," Padora said.
Padora said on Tuesday, Robert Villella, a consultant for Centax, called him on behalf of Wilkinson.
"I let him know what the situation was and that in good faith we can't stay with them. So I talked to him about the issues. It's the first time somebody from Centax has called any of us back in about two weeks," Padora said.
Padora said he expects the committee's master tax rolls will be uploaded to Berkheimer's website later today. He also expects a representative from Centax to sit down with Berkheimer next week to work on the transition.
"They want to sit down and have a meeting to start the transition of all of our data and all of our information pertaining to the collection of our EIT and LST taxes," Padora said.
While the committee's tax collection contract covers the collection of all EIT taxes, municipalities were given the option to choose their own method of finding an agency to collect the Local Service Tax. Some, like the borough of Port Carbon, had chosen Centax as their LST collector.
"If you made a resolution to go with Centax for your LST, all you have to do is rescind that resolution. If you signed a contract, we'll have to see how it works out with the legal process," Padora said.