Haywood Tax Collector will pay for own mistakes

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Haywood Tax Collector will pay for own mistakes

Mike Matthews.

A slew of county tax penalties waived by Tax Collector Mike Matthews’ office will have to be re-added to some tax bills because they were improperly released.

“This is the way it’s always been done, and the way I was shown how to do it,” Matthews said. “And it’s not something we do very often. It’s usually because of a postmark issue, or if it’s an error when somebody comes in here and pays 15 or 20 bills, and one got missed or didn’t get picked up in the system. As a courtesy we would waive the interest because they came in with the intention of paying everything. So that’s when I would remove the interest, because that’s the way we were taught to do it.”

But that all came to a screeching halt a few weeks ago.

“The auditor was doing a routine periodic internal audit in the tax collector’s office, and in that audit it was discovered that there were some refunds and releases that had been granted that were not authorized by state statute,” said Joel Mashburn, interim county manager.

As soon as that was discovered, Finance Director Julie Davis along with Mashburn met with Matthews and asked him what he was going to do about it, and told him the tax collector doesn’t have the authority to waive such penalties.

General Statute 105-381(b) gives the governing body responsibility for approving refunds and releases only if there is a clerical error, if the tax is illegal or if the tax is levied for an illegal purpose.

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“Even county commissioners don’t have the authority to waive a tax bill unless it fits into one of those categories,” Mashburn said.

A list of improperly waived penalties provided by both Mashburn and Matthews is based on the audit period, and dates back to shortly after Matthews took office in late 2015.

More than 120 accounts with amounts ranging from $464 on down to 9 cents had the penalties waived improperly by at least five county employees, including Matthews. The total amount is just shy of $4,108.

“I never realized this, and obviously I should have,” Matthews said. “I mean, I’ve read the Machinery Act [a longstanding group of statutes that deal with taxation and revenue collection, among other things] but I was told this is the way it’s always been done.”

Some elected officials can be held personally liable for improperly waived fees, however, all Matthews probably needs to do is re-bill taxpayers.

Matthews said he’d pay all the improperly waived accounts he personally authorized, to the tune of $1,279.77, even though he doesn’t have to.

“Because if I personally guarantee something to you, and we come to find out [it’s incorrect] I mean, it’s not your fault,” said Matthews. “I had the option of billing everyone for it.”

The other accounts not personally authorized by Matthews will have the penalties added back to the taxpayer’s balance; a letter from Matthews to individual taxpayers informing them of the improperly waived fees has been at the ready for days, but due to some software installation issues hasn’t yet gone into the mail.

An argument could be made that the improperly waived penalties could be considered a “clerical error” and thus waived by commissioners, but Mashburn made the case that such errors were more along the lines of typos or other innocent mistakes, not the intentional acts by Matthews and others who approved the waivers.

“Waiving the penalty was the error, but the tax itself was not an error — the tax was correct itself,” said Mashburn.

“It’s been that way forever,” said County Attorney Chip Killian.

Mashburn said he didn’t know if Matthews and other county employees were following an established departmental procedure left over from the previous tax collector David Francis’ office, and had no immediate plans to find out.

“I do think this is something we will have to discuss, obviously,” he said. “But there has been no decision at this point to do that.”

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