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VOL. 127 | NO. 105 | Wednesday, May 30, 2012

Trustee Pitches Tax Collection to City

By Andy Meek

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Bob Patterson, the county official known for his felt hats and folksy charm, repeatedly gave it a try.

After he died in 2008, Paul Mattila picked up the attempts where Patterson left off. So did Regina Morrison Newman, who replaced Mattila when he died in 2009.

Now current Shelby County Trustee David Lenoir, like county trustees before him, also is giving it a try. The “it” is convincing the city of Memphis to let the trustee’s office collect current and back taxes from Memphis property owners.

The county trustee – who essentially is the county’s banker by collecting taxes, managing investments and performing financial projections, among many other tasks – already is collecting county property taxes from those same people. The attempt from each trustee has basically been the same: to strike some sort of deal that sends taxpayers to one place to pay everything.

The city is currently collecting some property taxes from city residents in-house. Current taxes are paid to the city treasurer’s office. An out-of-town law firm, Linebarger, Goggan, Blair & Sampson LLP, won a no-bid contract in 2004 from former Memphis Mayor Willie Herenton to collect the city’s back taxes.

The trustees have written letters. They’ve made pitches to city officials. Years ago, Patterson calmly dug into a handful of peanuts from a dispenser on his desk as he described for The Daily News some of his meetings with Herenton about the matter.

Herenton is on record as saying the Linebarger arrangement has been a net positive for the city. But current city of Memphis attorney Herman Morris told The Daily News the Wharton administration was already prepared to take a new look at the city’s arrangement with Linebarger almost as soon as Wharton took office.

The deal Lenoir has presented the city is to perform the service at an annual fee of $1.25 million. According to his office, that would provide savings for a city government that’s currently budgeted $1.4 million to collect those taxes.

“Now, more than ever, we need to look at new collaborations that make sense for taxpayers,” Lenoir said.

He believes that with one countywide tax collector, the city could eliminate a $3 million plan to upgrade technology to improve its collections process.

Lenoir first proposed collecting delinquent taxes for the city in January 2011. Since then, he has been critical in broad terms of the city’s financial picture and with the way city officials are addressing it.

“The ongoing budget issues for the city of Memphis make this proposal more relevant than ever,” he said.

The trustee’s office currently collects around $685 million in property taxes. Linebarger has collected more than $182 million in back taxes from city residents since it was first hired to do so.

Linebarger on Feb. 1 filed a lawsuit on behalf of the city in an effort to move forward in collecting more than $20 million in delinquent 2010 taxes owed to the city. That represented the ninth annual lawsuit the law firm has filed on behalf of the city.

The law firm is jointly sponsoring several area tax clinics throughout this year, along with the city treasurer’s office, to help Memphians who are delinquent on their property taxes.

PROPERTY SALES 57 280 1,209
MORTGAGES 55 244 916
BUILDING PERMITS 158 699 2,751