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Diving Into Delinquency: Effective Strategies for Addressing This Growing Issue

Diving Into Delinquency: Effective Strategies for Addressing This Growing Issue. Carolyn Rice Montgomery County Treasurer, Ohio. Montgomery County’s Story. The Role of County Treasurer The Situation We Face In House: New Mindset, New Tactics, New Tools & Techniques Outreach & Communication

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Diving Into Delinquency: Effective Strategies for Addressing This Growing Issue

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  1. Diving Into Delinquency:Effective Strategies for Addressing This Growing Issue Carolyn Rice Montgomery County Treasurer, Ohio

  2. Montgomery County’s Story • The Role of County Treasurer • The Situation We Face • In House: New Mindset, New Tactics, New Tools & Techniques • Outreach & Communication • What’s Next?

  3. The Role of County Treasurer • The County’s banker • The County’s tax collector • The County’s investment manager • CEO of the Organization • Chief Deputy = COO • Four teams, 27 people

  4. Montgomery County’s Situation Large urban county 250,000 parcels Dayton– largest city, heart of region 69 taxing jurisdictions Economy in transition 11% unemployment rate, population decline Forbes 2009 List of Dying Cities

  5. Montgomery County’s Situation 2nd highest property tax rate in Ohio Predatory lending 25,000+ foreclosures since 2005 Vacancy rate = 20% in Dayton Great Recession– double whammy! 2008 Property Reappraisal Budget cuts & more…

  6. Montgomery County’s Situation 2001-2008: ~95% current, 87.7% overall 2009: 93.8% current, 85.7% overall Tax charges 2001-2009 increased from $493.9 m to $754.4 m(53%) DQ charges 2001-2009 inc. from $63.6 m to $98.2 (54%) Taxpayers hitting “the wall”

  7. Montgomery County’s Situation How 2010 Is Shaping Up First Half Collection Results: $375,125,052 current charges collected (97.1%), $392,800,995 total charges collected (85.1%) DQ contracts voided Foreclosures- 1653 filings YTD Revenue challenges continue

  8. 2007: Let the Change Begin Sworn in Feb 2007 Don’t rock the boat (4-6 mos) Question everything- why? Turnover in key managers Mindset change– reactive to proactive, we’re all in this together Orientation for Everyone

  9. Deploying New DQ Tactics Return mail project launches (July 07) 2 Strikes You’re Out… maybe not Keeping better notes in the system Tax lien sale in Nov 07 ($2.69m) Prosecutor letters Robo calls DQ + prepay Fourth collection (Oct 09)

  10. New Tactic: Return Mail Assigned to Taxpayer Services Send out new bill to forwarding address Met with Post Office & Mail House Researched each bill (5000+) Tracked results & gave credit Prosecutor okays bill suspension 2009 Results: $3.3 m 2010: LexisNexis pilot

  11. New Tactic: 2 Strikes You’re Out Before: Residential- 2 DQ plans; Commercial – 1 DQ plan allowed 3rd Chance = 50% down + DQ plan No plans below $500 Proactively called tax exempt applicants (churches) Proactively called commercial accounts Delving into bankruptcy cases & met with court administrators, lawyers (new brochures)

  12. New Tactic: Keeping Better Notes Capture who, what, why… for future reference Train staff to thoroughly research Offer homestead, roll backs, etc when not receiving but qualified Filling out the paperwork on remittance of penalties Helping out Auditor’s office (obituary records, send out Homestead & BOR applications)

  13. New Tactic: Tax Lien Sales Auction- One Buyer Pays All Taxes Owed First auction – 2005, only top 10 counties Last auction in 2007- 875 parcels, $2.69m, 18% interest 2008- Financial crisis, term changed to 6 yr Motivates property owners to pay or get on DQ plan, 2nd to last resort Working to get terms “3 or 6” yrs. Don’t want to be last auction in the state

  14. New Tactic: Prosecutor Letters Have not done since 2007 Being more selective– property owner cares and chance for it to sell Gets the property owners attention Goal– payment or get on a DQ plan Target: 125- easy to follow up, cheap to do Need to show we still foreclose

  15. New Tactic: Robo Calls Started 2008 Tell DQ plan & tax lien reminders will come Takes so little time to do, costs pennies– very efficient Works– very effective! We aim to use this technology in new ways in the future

  16. New Tactic: DQ + Prepay Fact: 50% of DQ contracts void after each collection Work hard to find sweet spot– pay monthly on back taxes and pay toward future so they stack on track and don’t void Our computer system isn’t designed for this “People aren’t Stupid”- rework DQ payment system & offer new plans in August 2011

  17. New Tactic: Fourth Collection 2009– significant increase in # DQ parcels August 2009– did our usual DQ notification Lots of property owners upset Oct 2009- 4th notice to newly DQ home-occupied residences and agriculture (6,480) Softer approach, giving benefit of doubt Results: 570 on DQ plans, 1649 parcels paid, $1.6 m collected Changing 3rd collection this year to incorporate this approach Different messages, different targets

  18. New Tools & Techniques in the Works Researching every parcel in 1 township AND 1 city to understand what’s going on Preliminary findings: foreclosures put many properties in limbo Personal letters and phone calls to Top 25 Home Owners (letter + brochure + bill) Cross-training staff + Tune Up Sessions – focus on “we’re all in this together” and no such thing as “downtime” Working with County Prosecutor to offer foreclosure mediation program (25-30% stay in their homes)

  19. Outreach & Communication United Way 2-1-1 Housing Counseling Agencies Council & Board Visits Treasurer’s Update Community meetings & field trips

  20. United Way HelpLink 2-1-1 Clearinghouse for agencies and services available to the public Partnered in 2007; cross-trained and set up dedicated line Help property owners get the help they need beyond taxes Qualify for grants & programs Most citizens not aware of this service

  21. Housing Counseling & Agencies Train counselors on property taxes & delinquent payment options Have housing counselors on-site during collection period Literature rack in waiting area Attend agency events to stay current on their activities & programs

  22. Councils & School Boards Routinely report our activities to city councils, township boards, and school boards Publicize options for property owners with delinquent taxes owed Build relationships with jurisdictions & work together to improve situation

  23. Treasurer’s Update Quarterly 15-minute television broadcast on government channels of local cable TV stations Free, effective way to promote information about property taxes & things we do Steers citizens to website and to call our office People watch these programs! Programs available on our website www.mcohio.org/treasurer

  24. Community Meetings & Field Trips Important for people to put a face with a name Increases awareness of community needs and services– links Treasurer’s office into the community Builds trust and credibility in the community Fosters our approachability and compassion so people will not be afraid to come talk to us

  25. What’s Next? Stay on cutting edge of technology: launching new merchant service agreement (May 2010) Redesign DQ payment plans (August 2011) Analyze information & DQ trends to better understand what’s happening & identify issues Robo calls in last week of regular collection Tune Ups, Supervisor Sessions, etc.

  26. What’s Next? Land Banking Authorization!!!! Overwhelming bi-partisan support, Ohio Legislature voted approval of HB 313 3/24/10 Gov. Strickland signed into law 4/7/10 Montgomery County & 41 other counties will have authority Most robust land banking authorization in nation Create Montgomery County’s Land Bank

  27. Thank You!!! Contact me with questions, concerns, ideas. Carolyn Rice Montgomery County Treasurer 451 W. Third St. Dayton, OH 45422-1475 937-496-7755 (direct #) 937-496-7122 (fax) riceca@mcohio.org

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