ORDER-2020-77 : An Order to Provide Motor Vehicle Excise Tax Relief

Transcript (~27 min @ 10:45)

Speakers identified by voice; unnamed voices are numbered within this recording. Auto-caption text — verify against the video.

▶ 10:43 Speaker 1: Yes. Councilor Stewart. Yes. Councilor Thomas. Yes.

▶ 10:48 Speaker 3: Councilor Jamaleddine. Yes.

▶ 10:57 Christopher Cinella: Greg Redis. Yes. Chairman Sinella. Yes. 11 yes. 3rd order we have order 2020-77A in order to provide motor vehicle excise to Council of Tramontozzi and McMaster.

▶ 11:14 Shawn M. MacMaster: Do you want to speak to this Councilor McMaster? Thank you Mr. Chairman. This is an order that Council of Tramontozzi and I filed on March 26th. The order, as originally written, sought to provide motor vehicle excise tax relief in various forms to residents facing financial hardship during these trying economic times. As everyone knows, since filing this order, Governor Baker's municipal relief bill was enacted, addressing much of what Consulate Chairman Tosi and I were attempting to do. The governor's emergency law, in part, waived penalties and interest for late payments and extended tax deadlines until June 1st, with all penalties and fees waived until June 30th. Some of the relief in the original order that Consulate Tramontozzi and I filed goes beyond what the enabling legislation allows, which is the reason that I have submitted the revised language that is before us this evening. As much as I appreciate the governor's order, we as a city can go even further. We have the statutory authority to do so. The reality is that people with families who are struggling financially in March are still struggling today. If anything, the length of the pandemic has caused even more strain and hardship over time. So this order is an affirmative step to help our most vulnerable residents. Those who are low income, those living on fixed incomes, and those who are unemployed. This order does two things. First, it lowers the demand notice fee from $15 to $5 for a period of nine months. Now on the surface, $15 may not sound like an unreasonable amount, but $15 goes a long way when families are struggling. At $15 a family can get themselves a gallon of milk, a dozen eggs, a loaf of bread, and a pound of butter at Shaw's. The second component of this order would prevent the city's tax collector from transmitting the names of delinquent taxpayers to the registry of motor vehicles for nine months. Residents are given no forum and have no right to plead hardship once their names are furnished to the registry this particular collection measure is highly punitive and that it will further compound the financial strain experienced by residents now and in the foreseeable future why because notification to the rmv will automatically result in non-renewal of a resident's motor vehicle registration and driver's license in In addition to a mandatory $20 release fee, non-renewal of these essential documents could result in somebody not being able to travel to and from work, which will jeopardize that person's ability and income. If you look at those who are suffering the hardest right now, and if you look more generally to history as a guide, you'll see that those who are injured most by tax collection measures are those who can't afford both literally and figuratively to be injured any more than they already are by structural inequities. Punitive tax collection measures have always throughout history disproportionately affected the elderly immigrants in communities of color. It's no different today. Food insecurity and the risk of homelessness is a stark reality even here in Melrose. The reality is if someone doesn't pay their excise tax bill by June 30th after already being given a three-month extension, it's not out of personal negligence. It's simply because they cannot afford to pay. I would argue that an excise tax falls at the bottom of a household's economic priority list. Paying your mortgage or rent, your heat and electricity, child care, car payment, phone service, these are the essentials that take priority over an excise tax until it eventually catches up with someone. And that's what this order looks to avoid. Let's revisit some of what Ms. Minchello, our Council on Aging Director, told the Council last week. She discussed quote the heightened anxiety among our senior population these days. She talked about seniors expressing fear to the Council on Aging staff about dying hungry and alone in their apartments. There are a few direct quotes from Ms. Minchello that should resonate with all of us. Quote, as far as food insecurity goes, the virus has really hit them hard. I talked to a senior earlier today and she never realized how much she relied on the senior center for her meals. Ms. Minchello also said we have homeowners in Melrose private residents that are paying their taxes we have elders with mortgages and that just scares the dickens out of me because they're struggling to say to stay house rich and pocket poor I hate for them to choose between pet food prescriptions and food she added quote there's a perception that Melrose folks are well off and take care of themselves but when you put it into reality the number of elders we have in their relative incomes i just like to go home at night and hope that they're all eating miss mancello also painted a vivid picture of the ways in which the city has responded to these concerns she talked about how the loading dock at the high school is being used as a base from which to ship vegetables to residents she said that the city has gone so far as to even purchase cheese for those experiencing food insecurity Perhaps most eye opening was when she mentioned having recently bought 800 pounds of chicken to be distributed to people in need. Purchase of 800 pounds of chicken evokes memories of the slogan from the Great Depression, a chicken in every pot. Yes, it has gotten that bad. Sadly, these are the very real and personal impacts of the COVID-19 pandemic. People are struggling. Our residents are hurting. Despite all of the public assistance being coordinated by the broader administration, the Mayor has signaled that he is not in support of this order, an order which at its core aligns with the very values of Melrose Cares. The Mayor has made references to the apparent discretion that the City already applies in situations where people have difficulty paying their tax bills. What's playing out on the national scene and locally right now raises some very serious questions about discretion in government. Discretion sounds like a good thing on the surface, but the problem with discretion is that it's inherently unfair because by virtue of the word itself, it's not something that is ever universally applied, meaning that some people benefit from it while others don't. And when you place authority and power in the hands of municipal employees, whether it's a police officer, a teacher, or a tax collector, marginalized populations lose out when there are no formal policies to govern the perimeters of that discretion. Is the young single mother relatively new to Melrose who appears at City Hall before the tax collector with three fussy children in tow who is perhaps sleep deprived and understandably impatient receive the same discretion as the 80-year-old widow who's resided in Melrose her entire life and who's been active in the community? Is the immigrant from Morocco with limited English skills who may have difficulty advocating for herself received the same discretion as the elderly woman these are fair questions to ask questions that are only further necessitated in light of the irascible way that mr flavin the city's collector interacted with this very council two weeks ago because it begs the question how does the tax collector interact with members of the public claiming hardship when he clearly demonstrated a lack of patience and understanding with all of us the city's elected leadership to me this is a common sense measure a tangible example of how we as citizen legislators can improve the quality of life for those who we are elected to serve simply put passing this order will give reprieve to residents most in need the alternative would sanction a regressive fine that does not distinguish between income levels. It would permit the issuance of a collection warrant and it would do nothing to prevent the collateral consequences attached to the excise tax like the draconian measure of reporting names to the registry of motor vehicles or the adverse impacts on a credit on a resident's credit score. Allow me to conclude with this personal impression. I have now been a City Councilor for two and a half years. With the nine new members I can tell you being still relatively new myself that there is no greater failing than unanimously passing an order that affects people at the most intimate of levels as a council i believe that this can be one of those orders there has been are currently and will continue to be matters on which we can't reach consensus as a council but i don't think this has to be one of those issues passing this i would suggest is not only needed for our residents but it's needed now more than ever to show that we as a city council can in fact be united on an important issue

▶ 21:11 Speaker 1: thank you mr chairman council janitor yes uh thank you mr chairman um

▶ 21:15 John N. Tramontozzi: what more can i say all i would uh suggest is that this um order is in order and as council mcmaster eloquently stated

▶ 21:28 John N. Tramontozzi: it is a one order that is for the people of this great city so um i would i would make the motion to uh to recommend

▶ 21:41 Christopher Cinella: the passage okay motion to recommend passage made by council chanatozy seconded by council mcmaster on discussion

▶ 21:55 Jack Eccles: So, I'm a little, I'm a little concerned about not having any members of the administration here tonight. It was something that I requested back in April when this order first came and was held in committee. I'm concerned personally about the fact that there's no one here to elaborate on the implications of not reporting information to the registry of motor vehicles. If another counselor through the chair is able to kind of elaborate that and alleviate. I do agree that While the late fee or the demand fee is technically regressive, I think that the excise tax at its core is a progressive tax, whereas some other local taxes and fees may not be progressive. So I do agree with the spirit of reducing the fee, but maybe not tying our hands in the only way to enforce collecting this. So if anyone else on discussion has some details, I would appreciate it.

▶ 22:49 Christopher Cinella: Anybody else for the first time? Councilor McMaster? President Rodriguez?

▶ 22:54 Jen Grigoraitis: Well, I'm happy to yield to Councilor McMaster if he was going to try to answer through the chair. Councilor Eccles on this question.

▶ 23:00 Shawn M. MacMaster: Thank you, Madam President. Thank you for the questions, Councilor Eccles. Yes, so under Massachusetts General Law Chapter 60A, it provides complete discretion to municipalities as to whether a municipality chooses to do so. I think what's important here is we are not seeking a tax deferral. People are still expected to pay their excise tax, but we're giving people nine months free from the imposition of a fine. So we're still going to collect the excise tax within presumably that calendar year, so long as somebody pays within nine months. If somebody doesn't pay, then all of the lawful authority granted to municipalities under state law would apply to resume any and all collection efforts, including having names furnished to the registry of motor vehicles. So this is not asking that the tax be deferred. It's simply saying that because the law that the governor passed supersedes this. we can extend the deadline past June 30th. The only discretion that we have is to lower the penalty. The other discretion, of course, relates to the registry of motor vehicles, again, which I think is punitive. I think it's in line with what we're seeing across the country, especially in terms of criminal justice reform and court fees, and trying to get rid of fees that place hardship on people rather than trying to work with people who are struggling. So, again, we're not, we're not hampering ourselves from pursuing those collection measures. The other thing that I would suggest is we have two years under the law, under Massachusetts general laws, chapter 60A, section 2A, to pursue the measure of utilizing the registry of motor vehicles from the time the demand notice is issued. So if a demand notice is issued, and I believe it's 20, I think it's maybe 20 days under the statute from the time that the bill is not paid, you have two years from that date to pursue. So we're not prejudicing the city because the city is going to have two years from notifying somebody that they're late paying. So again, all of these measures that we're seeking to provide relief doesn't prejudice the city in any way. All that it does is give people additional time to figure out how to pay this. They're going to have to pay it, but that fee is going to be dropped to $5 pursuant to this order. And I would say there's precedent there. This fee used to be $5, and the law changed in 2008, giving municipalities the discretion to raise it up to $30. We chose, for whatever reason at that time, to do $15. But in light of the circumstances, I don't think there's, there's any reason why we can't temporarily for 9 months, go back to 5 dollars. And the language in the order says that after 9 months, it goes back to the cost of 15 dollars. So, I hope that I hope that answers your question to chairman and I just with the excuse me, Mr. and the council echoes and with respect to your question about the administration, the administration had furnished the questions that I had asked. If there's any specific questions relative to those, I've broken down some of those numbers. But again, I'm satisfied that we're not prejudicing ourselves to collect the tax. We're just giving people nine months of not having to deal with a fine and not having their information prematurely in my mind during this pandemic sent to the Registry of Motor Vehicles.

▶ 26:43 Christopher Cinella: President Villanueva.

▶ 26:44 Jen Grigoraitis: Thank you, Chairman Sinella and respectfully the chair i just if um counselor if any of the two makers of the order would know if other municipalities um are going in the same direction given the governor's order or if this is something

▶ 27:00 Shawn M. MacMaster: that would be unique to melrose uh to the chair uh thank you main president for the question that's a good president a good question from the president i'm not aware of any other community doing it and this actually goes back to a question that uh council echoes had um uh presented uh to the Council of the Chairman Tosi and I a few weeks ago is about wondering whether or not there's precedent. I think it's a fair question. I'm not aware of any other community doing it. What I can tell you is I've had multiple conversations, at least two, with the Department of Revenue, with legal counsel from the DLS, who have essentially said, yes, we're within our rights to do this. We can't do as much as Council of the Chairman Tosi and I were looking to do originally, and that's why we've revised the language of the order. So that is discretion that that we have the other thing about precedent I would say, is that precedent doesn't and I'm not suggesting you're suggesting this, but precedent doesn't need to exist in order for us to act. And I would say, we have an opportunity here to be a trendsetter to set precedent and to have other communities follow that can have wider public policy implications beyond Melrose. So, I'm not aware of other communities doing it, but we certainly don't have to wait for another community to do it. We know the DLS says we can do it. We're well within our rights, and it's a matter of if we should do it. And I think that we should, I hope that answers your question, Madam President.

▶ 28:25 Jen Grigoraitis: It does. Thank you. I just had 1, honestly, sort of administrative point of order for the clerk of committees. Do we know if the updated order is available via public view? And I. In the portal, I'm scared to log out, so I'll never be able to log back in, but I just want to make sure that the public is seeing the most current version.

▶ 28:44 Speaker 1: They are last night when the revisions came in, they both both this order and 2023 have the most current revised edition online.

▶ 28:52 Jen Grigoraitis: Okay, thank you. Thank you very much. Sure.

▶ 28:57 Leila Migliorelli: Vice chair, thank you. Mr. Chairman similar to Councillor Eccles and perhaps this question can be answered by the makers of the order. Do we have a sense of. How much revenue this brings in for the city, like, how much we would lose by by bringing down this amount and then about how if there's any information on how many people have not paid their motor vehicle excise tax.

▶ 29:21 Shawn M. MacMaster: Thank you for the chair. Thank you. Mr. chairman. Thank you. Council. These are, I know some of the same types of questions and concerns that you had posed another important to you. So I appreciate you asking them. So you may recall that there was some difficulty getting the information relative to this order. It took 44 days for the information to be submitted. So I can tell you what what was submitted a couple of weeks ago. It's unclear if this was closer to the time of my request. Or, if it was at the time that the information was submitted by the chief of staff, but what I can, what I can tell you is that there remains as of today. So, again, the question is, as of today, is that when Mr. Flavin answered the question to the chief of staff, or is that when the chief of staff provided the answer this information to us? So that number is 4111 bills. That are that are unpaid and with respect to so. Let me just look at the number here, because I did do the math. Let's say we do a conservative estimate. Now, mind you, we don't know when when that number was was given to us. We do know that it's been a couple of weeks since the information was provided to us. So, presumably more taxes have been paid, excise taxes. And residents still have until June 20th, excuse me, June 30th, pay their excise tax bill. But if we do a conservative estimate, and just say that 4111 bills remain outstanding. As of July 1st, that essentially, if demand notices were sent at 15 dollars a person. That would total 61,665 again, if we're being if we're being conservative here. If we reduce the collection fee to 5 dollars, we'd alternatively collect. 20,555. So, again, it's not even it's not even that we're giving up the fine. We have to impose a fine and I guess to council echoes. I didn't I didn't even say that earlier. We, we still, we can't just get rid of the fine. We have to statutorily impose this demand notice fine. that is in alignment or that corresponds to when you put residents on notice that a tax is delinquent. So, at the end of the day, through the Chair to answer Councilor Migliorelli question, what that would amount to is we would end up essentially not gaining an additional $41,000. Forty one thousand dollars now, you know, on the surface that may seem like a lot, but to me again, these are people who can't pay it. So imposing a fine on the backs of residents who are unable to pay it or pay that amount that fifteen dollars. If we can save them the money to me, I just, I have concerns with, and then I think related to this council through the chair is that 1 of the questions I asked relative to the. to the rmv is how many names did we submit last year uh and the response was 930 names i found that uh interesting in terms of the number because if you look at uh the poverty rate in massachusetts the poverty rate if you break it down to an actual number is a little over a thousand so you have 930 people who got to the point where the registry had had to be notified that they haven't paid i would say those 930 people are people who you know are are under the poverty threshold um so so again i think that makes the case that these are individuals um who can't pay so again we're not prejudicing ourselves anyway we're simply reducing the fine uh to save families uh you know ten dollars uh as well as uh all of the collateral consequences the additional twenty dollars um the the uh challenges and stress of having to deal with the registry of motor vehicles Get your, your, your license renewed or your registration renewed. If it's, you know, if it's not able to be done, because you haven't paid your tax any other.

▶ 33:50 Leila Migliorelli: All right, so I thank you Councilor McMaster helpful to know that information. I guess it's, it's sort of a guess a big guess to know whether the 930 names were people living under the poverty line. That's just an assumption. Did you get a sense, sorry, through the chair of whether the administration had any issues with this loss of revenue? Was there any, any kind of conversation? I feel like that's missing someone from the administration here. It makes a little bit difficult to kind of figure out, you know, are we able to balance this out? You know, just looking ahead.

▶ 34:24 Shawn M. MacMaster: Thank you. Through the chair, what I would reference is the letter that was provided or sent to consular chairman and I, which is part of the, the record. Dated April, 29th. In that the mayor talks about enacting the governor's. Municipal relief law. also talks about having discussions with Art Flavin the treasurer and tax collector about it and again says that he thinks it's important this is signed by the mayor to preserve its ability to utilize those specific statutory tools again we're not saying we're not going to be able to utilize them we're saying reduce the fine and for nine months and don't transmit names to the registry for nine months and the mayor goes on to answer your question constantly earlier I believe it is unwise to see it in all circumstances the only leverage the city has to collect much-needed revenue again we're not seeding anything we're basically delaying sending names to the registry for nine months and again we're not getting rid of the fee we're reducing it the penalty and we're not deferring the tax. So we prejudice ourselves in no way other than giving up the $41,000. And to me, it's $41,000 and these are difficult times. You've heard me say, and I think the irony of this, Councilor Tramontozzi say over and over again, but $41,000 being collected off of people who can't afford to pay. That's the issue here. Essentially, the whole purpose is to try to aim to provide that relief to those who were struggling most and I believe that those who haven't paid and will not be able to pay by June 30th are those who are most in need and I think those who align with prior years of not

▶ 36:37 Christopher Cinella: being able to pay anybody else on discussion

▶ 36:46 Speaker 1: please call the roll vice chairman liarelli yes councilor Tramontozzi yes councillor mcmaster yes

▶ 36:56 Speaker 1: councillor eccles yes councillor Garipay yes councillor stewart yes councillor thomas yes

▶ 37:06 Speaker 1: councillor maladin yes president Grigoraitis yes chairman sonola yes 11 yes

▶ 37:14 Jeff McNaught: madam clerk i just wanted to enunciate my yes i actually didn't get to vote on that it was an accident but yes i thought i heard you thank you counselor um