ORDER-2016-176 : Acceptance of MGL Chapter 60, Sec. 15B, as amended by Chapter 390 of the Acts of 2014 allowing for the establishment of Tax Title Collection Revolving Fund.

Transcript (~13 min @ 47:07)

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

▶ 47:03 Speaker 5: you Thank You alderman's worker I think motion moves the bottom line we have number nine one

▶ 47:08 Peter D. Mortimer: six alderman Boyce L to move the bottom line for budget number nine one six duly second by alderman Forbes seeing no further discussion all in favor please say aye aye any opposed hearing none this This budget will be recommended to the full board for passage. The next item we have before us is order number 2016-176. It is the acceptance of Massachusetts General Laws, Chapter 60, Section 15B, as amended by Chapter 390 of the Acts of 2014, allowing for the establishment of tax title collection revolving fund. is there a motion to conjoin this with the next order rather have them separate

▶ 48:03 Peter D. Mortimer: all right then is there a motion we need a motion to proceed with conversation please motion suspend the rules what the rules are already suspended and maybe

▶ 48:15 Monica C. Medeiros: mr. Flavin could talk again more since we're under we're in committee so we'll

▶ 48:19 Peter D. Mortimer: allow I'll make a motion to recommend okay we have a motion to recommend the order duly seconded by alderman Boycelle on discussion please alderman Medeiros

▶ 48:37 Monica C. Medeiros: yes okay maybe mr. Flavin you could explain this to us a little bit again and how the process works now and I don't I don't know how to explain it

▶ 48:51 Speaker 5: differently we assess fees we incur costs we code we collect it back when we redeem the tax title instead of going to a budget line item which is limited and and we may not use it and with needlessly tying up money this gives us a revolving fund to work with so that the money is always working for itself to do the same thing kind of segregated out um it's it's just an efficiency so when you say that

▶ 49:21 Monica C. Medeiros: it's um you said earlier during um the the uh the treasure collector budget that

▶ 49:33 Monica C. Medeiros: this ties up the money and it's not allowing you to be as aggressive as you'd like so i think no

▶ 49:43 Speaker 5: this just gives us we've been very aggressive we've had an excellent year and collected delinquent taxes over half a million dollars this year we view we

▶ 49:55 Speaker 5: use a new firm it just creates efficiencies to allow us to work easier with them I'd hate to have to stop halfway through the year because I ran out of budget money this lets me reuse those dollars the ones that have come in

▶ 50:11 Speaker 5: immediately when something comes in it goes back in it's now reusable rather

▶ 50:14 Monica C. Medeiros: than waiting for the end of the fiscal year and for the cash to be served or

▶ 50:20 Speaker 5: you know for the books provide a continuing product I guess thank you

▶ 50:29 Peter D. Mortimer: Alderman Medeiros Alderman Forbes please thank you mr. chairman in essence I

▶ 50:31 Scott M. Forbes: I think what we're trying to just clarify, this type of revolving account will provide you with the much needed flexibility to work in the short term in real time. As money comes in, money comes out, instead of asking for an appropriation or trying to forecast further on down the road, you're able to perform the function in your department a lot more fluidly. Am I correct in saying that? Well said. Okay, I have no further questions, thank you.

▶ 50:55 Peter D. Mortimer: Thank you, Waldeman Forbes. President Kahn, please.

▶ 50:58 Speaker 6: Mr. Flavin performs his function relative to this well already. I don't like revolving funds. It has nothing to do with the particular function that's going on here. Maybe I'm being an obstructionist, but we set up all these revolving funds all across the spectrum. And we don't see the money.

▶ 51:28 Speaker 6: And I don't want to support the creation of any further revolving funds. I'm not going to support this order. I don't think by failing to support the order, we make the cities any less efficient or that they do any poorer of a job in performing this function. But I just do not wish to support the creation of more revolving funds.

▶ 51:52 Peter D. Mortimer: Thank you, President Kahn. Alderman McAteer-Margolis, please.

▶ 51:57 Mary Beth McAteer-Margolis: Thank you, Mr. Chairman. Mr. Flavin, thank you for being here tonight. Does this statute require you to report out on the status of the revolving account at some point during the year? Annually. Annually. So you would report that information as to what you are taking in and expending?

▶ 52:21 Mary Beth McAteer-Margolis: Like any revolving account? Like any revolving account, budget, pre-budget time or at the end of the year. And could this board request that you do that more frequently at the beginning of this enterprise?

▶ 52:35 Speaker 5: You can request whatever you want.

▶ 52:37 Mary Beth McAteer-Margolis: Thank you. Thank you.

▶ 52:39 Peter D. Mortimer: Thank you very much. Alderman McAteer-Margolis. President Kahn, please.

▶ 52:43 Speaker 6: I won't belabor this.

▶ 52:45 Peter D. Mortimer: Oh, I'm sorry. President Kahn, I failed to see. Oh, would you yield the floor? President Kahn, please proceed.

▶ 52:52 Speaker 6: Nobody ever looks at these revolving funds on the board to see what's going on. Nobody does that. it doesn't happen it's not because the information is not available but you know we're not doing that and we're probably not going to do that if we

▶ 53:11 Speaker 5: create more revolving funds I'll have to come back you know put up my budget again to put the tax title back at $12,000 I'd offer a compromise and you can set the limit on the next order to $12,000 instead of the 20 and it's a

▶ 53:31 Speaker 5: zero-sum game. Anything over $12,000 and when it reaches the $12,000 limit, it goes to the general fund. That way I'm tying up $12,000 one way or the other every year.

▶ 53:43 Peter D. Mortimer: Thank you, sir. President Kahn, you had the floor. You finished. Is anybody for the first time? Alderman Suerko and then Alderman MacMaster. My goal is for the second time. Thank you, Chairman. This isn't

▶ 53:52 Michael P. Zwirko: a particular question. It's more of a comment. I do, in principle, agree with Alderman Kahn and the status of revolving funds, but I just don't believe that you should take a blanket approach. I think it's a know-it-when-you-see-it type of thing where you establish them in certain instances and in others. I think in this one, it's purely for the efficacy of government and a very basic function that the treasurer needs. I appreciate your allowance and suggestion of the $12,000. I just wanted to make the comment about the ideology of revolving funds. That's all I had.

▶ 54:24 Peter D. Mortimer: Thank you, Alderman Zwirko. Alderman McAteer-Margolis, please.

▶ 54:28 Speaker 3: No, that's fine. Thank you.

▶ 54:29 Peter D. Mortimer: Alderman McAteer-Margolis has yielded the floor, and next in queue we have Alderman Tramontozzi. Mr. Flavin, now.

▶ 54:37 John N. Tramontozzi: So just so I understand, does this affect the procedural requirements for tax taking?

▶ 54:45 Speaker 5: No. It allows me to pay my bills more efficiently.

▶ 54:51 Speaker 2: I understand.

▶ 54:52 Speaker 5: And recover the monies and reuse them in the same way.

▶ 54:56 John N. Tramontozzi: And the bills are primarily attorney bills?

▶ 55:00 Speaker 5: They're advertising bills. They're recording fees. They can be warrant fees. They can be sheriff fees. They can be eviction fees.

▶ 55:10 John N. Tramontozzi: So in order to pay those fees as they come due, how do you pay them? You have to come back before us?

▶ 55:17 Speaker 5: That's why I left $4,000 in my budget for now until we build this fund where it needs to be.

▶ 55:21 John N. Tramontozzi: so if the four four thousand dollars is depleted then you'd have to come before us again and say we're still in the process of tax titles i've got some bills to pay correct okay and then i appreciate that i appreciate the time and effort that you have to do and we got to get an order in the and you got to hear it by committee and all that but at least we have that oversight on spending uh the in paying these attorneys fees and paying the sheriff's fees for the tax titles as they're going on how um in in past experience how quickly is four thousand dollars expended in

▶ 55:59 Speaker 5: a fiscal year it depends on how aggressive you are um we're just ending a very aggressive um move on tax on tax title holdings so the pool is smaller than we're going to have to go after this year so that's why it's at four thousand um if you saw the paper there was only 14 or 15 where you might see 30 properties in the paper um things things are on a good level right now so

▶ 56:30 John N. Tramontozzi: i'm not worried about running out of money and these tax takings they take time it's not like they right overnight um and then i can time them if there's money there or if there's not money

▶ 56:39 John N. Tramontozzi: I mean, oftentimes people eventually, they come through with it because it's a significant loss to an individual homeowner to lose the property.

▶ 56:48 Speaker 5: The bank usually gets involved.

▶ 56:51 John N. Tramontozzi: We'll let them pay the fees, right?

▶ 56:52 Speaker 5: Mm-hmm.

▶ 56:53 Jennifer L. Lemmerman: Okay. Thank you. No other questions? Thank you, Alderman Tramontozzi. Next in line, we have Alderman Lemmerman, please. Mr. Chairman, thank you, Mr. Flavin. you mentioned just a few minutes ago when you were talking about the need for this that you would hate to in the middle of a fiscal year have to stop a process that you're in the middle of to come back and ask for additional funds has that happened or have you found yourself in a situation when you're in danger of that happening at the level that you're at now that has not happened

▶ 57:18 Speaker 5: generally we I've been tying up $12,000 in case it happened and only spending

▶ 57:24 Jennifer L. Lemmerman: eight or nine okay so something like you suggested of maybe limiting to about 12 put you in a safe position mm-hmm all right thank you very much thank you mr. chairman Thank You alderman Lemmerman next alderman boys out please in the

▶ 57:38 Robert A. Boisselle: amount of thank you for coming this evening when you've run out of the $4,000 how long does it take to pay the vendor in time a couple weeks month I

▶ 57:49 Speaker 5: wouldn't incur them I wouldn't have a bill if I didn't have the money recording fees that you have to give them money up front that's right and the

▶ 58:03 Speaker 5: lawyer would wait all right thank you very much we'd have the revolving fun when I got the payment I'd pay him he doesn't get paid until we get paid all

▶ 58:08 Speaker 8: right thank you very much Thank You mr. Karen Thank You alderman boy cell

▶ 58:13 Monica C. Medeiros: alderman Medeiros please thank you how about how many of these are we doing

▶ 58:22 Speaker 5: annually how many what a tax title it depends this year we probably did 20 or 25 foreclosure proceedings and that shook the tree and we got a lot of money

▶ 58:36 Speaker 5: out of it you'll see in the free cash numbers the tax takings like I just said

▶ 58:44 Monica C. Medeiros: in the paper 13 to 14 and you know and you said that this varies I know we've had some you know good real estate years we've also had some some bad ones a few years back in particular closures and things like that were up is what would you say the height the number was I have no idea thank you Thank You Alderman

▶ 59:10 Peter D. Mortimer: Medeiros Alderman MacMaster my goal is please thank you um do you know how much

▶ 59:15 Speaker 5: revenue you generated this year mmm half a million dollars well the

▶ 59:27 Mary Beth McAteer-Margolis: receivables down a half a million mm-hmm so that was that was your net after you

▶ 59:32 Speaker 5: paid out everybody the other was 1.3 outstanding now there's about eight

▶ 59:39 Mary Beth McAteer-Margolis: Well, I think, Mr. Chairman, there's a motion on the floor.

▶ 59:42 Peter D. Mortimer: There is a motion on the floor, and I'm not sure if there's anybody else who would like to be heard. Seeing that no one else appears to have an interest in being heard on this issue, the motion is on the floor before us by Alderman Aferna. I think it was Alderman Boisselle who seconded it. All in favor, please say aye. Aye. Any opposed? Opposed. Could I see a show of hands on the opposed, please?