The bond for new Hazle Township tax collector Ryan DeCosmo will cost Luzerne County approximately $24,630 more this year, but he has agreed to forego pay in that amount so county taxpayers are not shortchanged, county Manager C. David Pedri said Monday.
And that doesn’t cover the added costs of DeCosmo’s bond to the township and to the Hazleton Area School District.
Pedri said the county agreement, which the administration will cement in writing, should allow the mailing of 2018 county and municipal real estate tax bills in the township.
Tax bills in the other 75 municipalities were mailed weeks ago with a Feb. 12 issue date, but county officials held up the township’s mailing because DeCosmo had not submitted a valid bond protecting taxing bodies and property owners if tax payments are lost or stolen.
DeCosmo had originally turned in a bond issued to his father, prior township elected collector Michael DeCosmo, who also serves as county Democratic chairman. County Controller Michelle Bednar released an audit Feb. 9 concluding this bond was invalid because state law requires bonds be in an elected collector’s own name.
The elder DeCosmo, who is approaching his mid-60s, had said the family was shopping around for a better rate for the son, who is in his 30s.
The resulting bond, submitted last week, totaled $81,722 for the combined collection of school, county and local taxes in 2018, Pedri said.
In comparison, the bond for DeCosmo’s father cost taxing bodies a combined $7,208 in 2017, of which the county paid approximately $2,600, officials said.
Varying percentages
School districts typically pay around 59.5 percent of the bond premium, while the shares have been 36 percent for the county and 4.5 percent for the township, officials have said.
That would place the payments at approximately $29,420 for the county, $3,677 for the township and $48,625 for the Hazleton Area School District.
However, county council had passed a resolution in January 2017 indicating it would pay one-third of the bond, which would reduce the county’s payment share to $27,238 — or about $24,630 more than last year’s $2,600 total.
Pedri said DeCosmo has agreed to sign a contract giving up enough county collection fees necessary to ensure the county does not pay more than the 2017 amount.
It’s unclear whether the other taxing bodies will seek special agreements from DeCosmo due to the bond increase or when they must pay their share of the bond to ensure coverage for all. County officials said the county/municipal tax bills must be mailed by March 15.
The county agreement stemmed from the administration’s concerns about the sharp increase.
A budget transfer would be necessary to pay DeCosmo’s bond because the county has $25,644 remaining from its $60,000 allotment for such bonds, records show.
The county’s total cost was $28,240 to bond all 67 other elected collectors and three home rule municipalities that handle county collection within their jurisdictions, county records show.
Another $6,116 was spent on treasurer’s office bonding for that office to collect county taxes in the four cities and Newport Township, records show.
Reaching the amount of pay required for DeCosmo to cover the bond difference shouldn’t be an issue, Pedri said.
The county pays elected collectors $2.50 per paid bill, with a cap of $25,000 each, under the 2017 agreement.
The township has 10,469 taxable properties. DeCosmo would generate enough fees to cover a $24,630 bond difference by collecting about 95 percent of the taxes, which equates to 9,945 bills and fees totaling $24,864.
The county has long required collectors to be bonded for one-third of the maximum school, county and local taxes they can collect. The township total is $24.63 million, which sets bonding at $8 million, officials said. County officials are reevaluating whether the one-third should be lowered in future years.
