The law firm handling the bankruptcy of Luzerne County's former tax collection agency wants to have tax records destroyed, saying there's no money to pay for their storage.
Not so fast, say representatives of local municipalities that are still owed $9 million and whose taxpayers could have refunds due.
Central Tax Bureau of Pennsylvania and the Don Wilkinson Agency, also known as Centax, was appointed by the Luzerne County Tax Collection Committee as official tax collector for the county and its municipalities in August 2010. The agency collected, depending on the municipality, taxes including earned income, real estate and local service. In some cases, the agency also collected sewer fees.
Centax declared bankruptcy this year, after collecting taxes for the first and second quarters of 2012 but not distributing them. The company officially ceased operations on Sept. 21.
Luzerne County's municipalities and school districts are still owed taxes for the first half of the year. The city of Wilkes-Barre alone is owed $1.5 million. Harveys Lake recently got a $30,000 earned income tax check and is only owed $10,000 more.
Missing Centax revenue contributed to some municipal officials' decisions to raise taxes. Wilkes-Barre officials blame it for the $1.9 million deficit and resulting layoffs.
In many cases, the problem is trying to sort out which municipality is owed what, and which taxpayers paid and which didn't.
Attorney Paul J. Cordaro of the Pittsburgh-based law firm Campbell & Levine LLC filed a motion last week to have the Centax records destroyed. In it, he notes that Centax leased 10 office spaces and storage facilities throughout the state, which contain assorted tax-related documents including files and records.
Campbell & Levine was appointed receiver by Allegheny County Court on Nov. 5 and is overseeing the winding down of Centax's business, liquidating its assets and investigating claims against it.
Mr. Cordaro says most - if not all - of the materials are unnecessary to wind down business, and are in fact a burden: There aren't sufficient funds to pay rent, so continued storage of the records is an undue hardship on the landlords of the leased buildings.
Nanticoke City Administrator Pam Heard, secretary-treasurer of the Luzerne County Tax Collection Committee, said the county's 92 taxing entities are short about $9 million for the first half of 2012. She said she has been asking for the Centax records on their behalf, but didn't get a response.
Attorney Jeffrey Malak, solicitor for the Luzerne County Tax Collection Committee, sent a letter to Mr. Cordaro asking that the committee's records be sent to him or Ms. Heard immediately.
Contact the writer: eskrapits@citizensvoice.com