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Struggling taxpayers offered an alternative
Option surfaced after treasurer solicited assist from local banks
10/27/2013 6:00:00 AM
By Suzanne Adams-Ockrassa
KINGMAN - The Mohave County Treasurer's Office and Mission Bank are making it easier for property owners to pay their taxes and solving several property tax collection issues for the county.
It all started when County Treasurer Cindy Landa Cox asked the County Attorney's Office if her office could accept partial payments for property tax liens.
"We were running into problems with accepting partial payments," Cox said. "Lien holders weren't getting the interest due to them and property owners were struggling to make payments."
The county places a lien against a property when a property owner doesn't pay their taxes. The county auctions the liens off to investors every year. The investor pays off the delinquent taxes in exchange for the lien.
When a property owner pays off the lien, the money goes to the investor. If the property owner doesn't pay off the lien within three years, the investor can foreclose on the property.
When the County Attorney's Office checked Arizona Revised Statutes, it found out that county treasurers don't have the authority to accept partial payments for tax liens, she said.
Now, the Treasurer's Office didn't have a way to help people pay off their property tax liens, she said.
"I had people coming in with $20 bills and saying 'this is all I can afford right now. If you let me leave with this I'm going to spend it somewhere,'" Cox said.
Cox reached out to local banks for help.
"I wanted to make sure options were available for property owners," she said. "I was looking for a savings account, something like the old 'Christmas Clubs' where you set a date and put a little bit away each month and you're penalized if you take the money out early."
When Mission Bank stepped forward to help out, Cox was "thrilled."
The bank created a "Tax Saver's Account."
savings account with a low maintenance fee and a set date to withdraw the money, said Vearl Haynes, Mission Banks chief financial officer.
All a property owner has to do is bring in their driver's license or state ID, their tax bill and a $25 opening deposit, he said.
Customers do not need to have proof of good credit in order to open one of these accounts, Cox said.
The bank will help them calculate how much money they have to deposit each month in order to pay off their tax lien and the interest on the lien, Haynes said.
When the account matures, the customer can either roll the money over into another Mission Bank account or have a check sent to them to deposit in a different bank account, he said. The customer can also bring the check to Mission Bank and the bank will cut them a free cashier's check payable to Mohave County.
The account has a variable interest rate, which is added to the account on a quarterly basis, he said. There is also a $25 fee for any early withdraws, which includes electronic transfers from the Tax Saver's account to another bank account or to a third party. Closing the account early also triggers a $25 fee and a loss of all interest earned.
There is also a $5 per quarter maintenance fee, Haynes said.
"That was the lowest we could go on a maintenance fee. A lot of people don't realize how much it costs a bank to run an account," he said. "This is not an especially profitable project for us, but there is definitely a need for it. It's a tool to help people save. We're a hometown bank and many of us live here. We want to see this community thrive."
The accounts are not limited to property owners with tax liens, Cox said. Property owners who just want an account to stash money for next year's tax bill can sign up for an account too.
Cox said the county has no involvement in running the Tax Saver's Accounts.
"We don't know how much money is in there and we don't want to know," she said. "The county is not in the banking business. We're not obligated to do anything for these people. I just wanted to make sure there was a vehicle for people to pay their taxes."
Helping people pay their taxes helps everyone, Cox said. Property owners get to stay in their homes, lien holders get their interest and the county gets its tax dollars, which is good for those property owners that pay their taxes on time, because then the county doesn't have to raise property taxes to cover the loss of revenue from delinquent taxes.
For more information on the Tax Saver's Account, visit the Mission Bank offices at 2439 Hualapai Mountain Road or 1370 E. Northern Ave. in Kingman or at 1455 Palma Way in Bullhead City or call (928) 718-5555.
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