City Council on Thursday approved a one-year contract with a tax collection agency the city has used in the past.
Central Tax Bureau of Pennsylvania Inc. will work with the city treasurer. Council wanted to ensure that effort remains ongoing and is stepped up this year.
"This is a one-year contract," said City Treasurer Thomas P. O'Connor, who presented council with a plan to improve tax collection in the months ahead.
CENTAX agreed to reduce its billing fee. The agency had been billing the city 1.75 percent for mercantile and business privilege taxes and 2 percent for local services tax it collected.
The contract reduces the fee to 1.50 percent. O'Connor explained the scenario: "Before, if the local service tax collection was $100,000, they would charge us $2,000," he said. "This year, it will be $1,500."
Council expressed hope the agency and a plan to hire a part-time treasurer's office employee to cross-check those efforts will pay dividends in terms of tax collection.
"We hope they were doing that all along," Councilman Randall J. Allison said. "But if we can raise their performance up a notch, it's going to benefit us tremendously."
But, Councilman N. Clifford "Skip" Smith voted reluctantly to renew the agency's contract and grilled O'Connor about his efforts to check on the company's performance history.
Smith expressed irritation with some of the language in the contract, in particular, a section that says the agency will hire someone to audit its records. He likened that to a "fox guarding a chicken house."
"Why wouldn't there be an independent firm or firm we choose?" Smith asked O'Connor.
"It's done through business," O'Connor said. "That's is the way it is."
But Smith retorted: "That can be changed ... we should have a choice of who audits the books."
He also asked for a quarterly report from the treasurer's office on the tax collection process.
"That decision will be made mid-year," O'Connor said. "You certainly will be involved."