Connecticut Seal

General Assembly

 

Raised Bill No. 820

January Session, 2013

 

LCO No. 2669

 

*02669_______PD_*

Referred to Committee on PLANNING AND DEVELOPMENT

 

Introduced by:

 

(PD)

 

AN ACT CONCERNING THE INTEREST RATE ON DELINQUENT PROPERTY TAXES.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. Section 12-145 of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2013, and applicable to assessment years commencing on or after said date):

The tax collector of each municipality shall, at least five days next preceding the time when each tax becomes due and payable, give notice of the time and place at which the tax collector will receive such tax by advertising in a newspaper published in such municipality or, if no newspaper is published in such municipality, by advertising in any newspaper of the state having a general circulation in such municipality and by posting such notice on a signpost therein, if any, otherwise on a signpost in the town within which such municipality is situated, if any, or at some other exterior place near the office of the town clerk. The tax collector shall repeat such advertising within one week after such tax has become due and payable and, again, at least five days before such tax becomes delinquent. Each such notice shall give each date on which such tax shall become due and payable and each date on which such tax shall become delinquent, and shall state that, as soon as such tax becomes delinquent, it shall be subject to interest [at the rate of one and one-half per cent of such tax for each month or fraction thereof which elapses] from the time when such tax becomes due and payable until the same is paid. Such notice shall further state the rate at which any delinquent tax shall accrue interest. The tax collector of a municipality may waive the interest on delinquent property taxes if the tax collector and the assessor, jointly, determine that the delinquency is attributable to an error by the tax assessor or tax collector and is not the result of any action or failure on the part of the taxpayer. The tax collector shall notify the taxing authority of the municipality of all waivers granted pursuant to this section.

Sec. 2. Section 12-146 of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2013, and applicable to assessment years commencing on or after said date):

Unless the context otherwise requires, wherever used in this section, "tax" includes each property tax and each installment and part thereof due to a municipality as it may have been increased by interest, fees and charges. If any tax due in a single installment or if any installment of any tax due in two or more installments is not paid in full (1) on or before the first day of the month next succeeding the month in which it became due and payable, or if not due and payable on the first day of the month, (2) on or before the same date of the next succeeding month corresponding to that of the month on which it became due and payable, the whole or such part of such installment as is unpaid shall thereupon be delinquent and shall be subject to interest from the due date of such delinquent installment. Except for unpaid real estate taxes the collection of which was, or is, deferred under the provisions of section 12-174, and any predecessor and successor thereto, which unpaid real estate taxes continue to be subject to the provisions of such deferred collection statutes, and except for any taxes due in a municipality that has adopted the provisions of section 3 of this act, the delinquent portion of the principal of any tax shall be subject to interest at the rate of eighteen per cent per annum from the time when it became due and payable until the same is paid, subject to a minimum interest charge of two dollars which any municipality, by vote of its legislative body, may elect not to impose, [and] provided, in any computation of such interest, under any provision of this section, [each fractional part of a month in which any portion of the principal of such tax remains unpaid shall be considered to be equivalent to a whole month] interest shall be calculated on a per diem basis. Each addition of interest shall become, and shall be collectible as, a part of such tax. Interest shall accrue at said rate until payment of such taxes due notwithstanding the entry of any judgment in favor of the municipality against the taxpayer or the property of the taxpayer. Except as hereinafter specified for taxes representing two or more items of property, the collector shall not receive any partial payment of a delinquent tax which is less than the total accrued interest on the principal of such tax up to the date of payment and shall apply each partial payment to the wiping out of such interest before making any application thereof to the reduction of such principal; provided, whenever the first partial payment is made after delinquency, interest from the due date of such delinquent tax to the date of such partial payment shall be figured on the whole or such part of the principal of such tax as is unpaid at the beginning of delinquency and provided, whenever a subsequent partial payment of such tax is made, interest shall be figured from the date of payment of the last-preceding, to the date of payment of such subsequent, partial payment on the whole or such balance of the principal of such tax as remains unpaid on the date of the last-preceding partial payment. If any tax, at the time of assessment or because of a subsequent division, represents two or more items of property, the collector may receive payment in full of such part of the principal and interest of such tax as represents one or more of such items, even though interest in full on the entire amount of the principal of such tax has not been received up to the date of such payment; in which event, interest on the remaining portion of the principal of any such tax shall be computed, as the case may be, from the due date of such tax if no other payment after delinquency has been made or from the last date of payment of interest in full on the whole amount or unpaid balance of the principal of such delinquent tax if previous payment of interest has been made. Each collector shall keep a separate account of such interest and the time when the same has been received and shall pay over the same to the treasurer of the municipality of the collector as a part of such tax. No tax or installment thereof shall be construed to be delinquent under the provisions of this section if the envelope containing the amount due as such tax or installment, as received by the tax collector of the municipality to which such tax is payable, bears a postmark showing a date within the time allowed by statute for the payment of such tax or installment. Any municipality may, by vote of its legislative body, require that any delinquent property taxes applicable with respect to a motor vehicle shall be paid only in cash or by certified check or money order. Any municipality adopting such requirement may provide that such requirement shall only be applicable to delinquency exceeding a certain period in duration as determined by such municipality. Any municipality shall waive all or a portion of the interest due and payable under this section on a delinquent tax with respect to a taxpayer who has received compensation under chapter 968 as a crime victim.

Sec. 3. (NEW) (Effective October 1, 2013, and applicable to assessment years commencing on or after said date) Any municipality may, by a vote of its legislative body or, where the legislative body is a town meeting, by a vote of its board of selectmen or its town council, elect to subject the delinquent portion of the principal of any property tax to an interest rate of twelve per cent per annum from the time when such tax became due and payable until the same is paid. Such interest shall be calculated on a per diem basis and collected in accordance with the provisions of section 12-146 of the general statutes, as amended by this act.

Sec. 4. Section 12-169b of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2013, and applicable to assessment years commencing on or after said date):

If a municipality does not file a lien under any provisions of the general statutes to recover costs for the inspection, repair, demolition, removal or other disposition of any real estate in order to secure such real estate or to make it safe and sanitary, pursuant to any provision of the general statutes or municipal building, health, housing or safety codes or regulations, then such municipality may assess the amount of such costs against the real estate upon which such cost was incurred. Upon certification by the municipal agency incurring such cost of the assessment amount due and owing reasonably related to the municipality's actual cost, the tax collector shall add the amount of such assessment to the extent unpaid to the taxes due on such real estate and such amount shall become a part of the taxes to be collected at the same time and shall bear interest at such rates and in such manner as provided for delinquent taxes in accordance with section 12-146, as amended by this act, or section 3 of this act. Any amount added to the assessment under this section shall constitute a lien upon the real estate against for which the amount was imposed from the date such amount was due. Each such lien may be continued, recorded and released in the manner provided by the general statutes for continuing, recording and releasing property tax liens. Each such lien may be enforced in the same manner as property tax liens. Any agency of a municipality that incurs costs that have been assessed against real estate under this section shall maintain a current record of all real estate with respect to which such costs remain unpaid in the office of such municipal agency. Such record shall be available for inspection by the public.

This act shall take effect as follows and shall amend the following sections:

Section 1

October 1, 2013, and applicable to assessment years commencing on or after said date

12-145

Sec. 2

October 1, 2013, and applicable to assessment years commencing on or after said date

12-146

Sec. 3

October 1, 2013, and applicable to assessment years commencing on or after said date

New section

Sec. 4

October 1, 2013, and applicable to assessment years commencing on or after said date

12-169b

Statement of Purpose:

To provide municipalities with a local option to charge interest on delinquent property taxes at a rate of twelve per cent per annum, and to amend the manner in which interest on such delinquent property taxes is calculated so that a payment that is only delinquent for a fraction of a month shall not be charged interest for a full month.

[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not underlined.]