U.S. Mayor Article

New Haven Builds Tax Revenues By Public/Private Partnership

October 15, 2001


The City of New Haven is among the first in the nation to receive a financial boost from a sound new public/private partnership. With the assistance of JER Revenue Services (JER), the city has collected $18.6 million in delinquent real estate taxes, improved itís overall tax collection rate by 3 percent and avoided raising taxes. The city contracted with JER in 1999 to collect a portfolio of older, hard-to-collect liens. The program was such a success, that the city now uses JER as part of its continuing collection process and JER manages over 5,460 liens.

The city has always taken a progressive approach toward eliminating delinquencies in New Haven. Prior to signing on with JERís Direct Servicing program, we took advantage of other creative strategies including tax lien securitizations and bulk sales. Having experienced all of the available options, Direct Servicing is the best. In partnering with JER to collect delinquent real estate taxes, the cityís internal resources can focus on current taxes, and past due motor vehicle and personal property taxes. The combined effort of the two teams has improved the cityís collection rate, lowered delinquencies and increased the cityís cash flow.

Increased cash flow is a plus for taxpayers because it means that more money is available to support local services without raising taxes. Non-paying citizens continue to benefit from government services and their failure to pay places an unfair burden on the taxpayers who do honor their tax obligations. Another factor is the issue of property values. If people are not paying their taxes, they are probably not maintaining their property. Poorly maintained and abandoned properties deteriorate our neighborhoods and negatively impact the community as a whole. The end result is lower property values and higher taxes. How has JER assisted the city to avoid the dilemma of mounting tax delinquencies and deterioration of their community? JERís Direct Servicing program combines assertive collection strategies along with sensitivity to taxpayer needs. The focus of the program is to pursue collections primarily though redemptions and payment plans. JERís program employs various methods for contacting taxpayers and educating them regarding their rights and responsibilities. Many taxpayers are not aware of the resources available to assist them with financial obligations. Speaking with JERís courteous professionals can put the taxpayer at ease by helping them understand and explore options to satisfy their tax obligations. JER offers a Credit Outreach Program designed to put residential taxpayers in touch with local lenders and non-profit agencies that can provide confidential credit counseling and explain financing alternatives. JER also has bilingual staff available to assist non-English speaking taxpayers.

At regularly sponsored city events, known as ďMayorís Night InĒ, New Haven taxpayers having difficulty paying taxes are invited to city hall to meet representatives from JER and its Credit Outreach participating agencies. The forum provides a convenient opportunity for taxpayers to get financial assistance, negotiate payment plans and file loan applications. The joint effort of the city and JER has proven to be a success for the city and New Haven taxpayers.

While JERís mission is to generate cash through redemptions, there are circumstances where taxpayers do not respond or remain unable to pay. Unfortunately, in these cases, the law provides local authorities with little option but to initiate foreclosure. JER can manage the process and provide both property management and disposition services. For example, JER conducts highly visible marketing campaigns that generate interest from adjacent property owners and community groups. Having these resources available allows local governments to confidently take title and get foreclosed real estate into the hands of new owners who can revitalize property and return it to the performing levy.

In addition to the collection and real estate services, there is also the benefit of JERís technological support and reporting systems. Thorough management reporting allows the city to monitor collection performance, update taxpayer records and direct the course of the program. State-of-the-art data processing, communication systems and a specialized collection program enable JER to manage large volumes of accounts and provide the city with important information not easily accessible internally.

JER Revenue Services is one of the leading delinquent tax servicing firms in the nation serving diverse communities including New York City and the Government Bank of Puerto Rico, as well as communities such as New Haven. Since 1996, JER Revenue Services has managed over $1 billion in delinquent taxes nationwide.

JERís Direct Servicing program is an innovative new concept that is setting the standard for tax lien collection. Improved collections and satisfied taxpayers go hand in hand with JER approach.

For more information call (203) 503-6280 or visit JERís web site at www.jer.com.

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