TOPEKA — For the first time since 2005, the collection of delinquent taxes in Kansas looks to drop.
Those numbers could fall by about $18 million — or roughly 10 percent — this year because of unfilled jobs at the Kansas Department of Revenue.
Gov. Sam Brownback’s administration is seeking help from the Legislature to raise or impose new fees on delinquent taxpayers to fill more than two dozen vacant positions.
“I believe we should be a self-funding model,” said Jeff Scott, chief compliance officer at the Department of Revenue.
The department reported 28 openings out of about 190 positions in the collections enforcement division. In November 2010, two months before Brownback was sworn into office, there were 13 unfilled tax collection jobs.
Revenue officials say the number of vacancies grew because the department could no longer move people from other areas of the agency.
For example, the agency for years had been moving staff from processing income tax returns to collections. That shift was possible because an increase in online tax filings drastically lightened the load on processors.
The transformation means that now 90 percent of Kansas taxpayers file online. It also means the efficiency gained by moving workers from processing to enforcement is also largely complete.
“We are unlikely to see more significant savings from savings from electronic tax filing,” Revenue Secretary Nick Jordan said in a statement.
The revenue department is proposing to raise fees on delinquent taxpayers. A bill pending in the Legislature would:
• Raise by $15 the fee for setting up a plan for installment payments for accounts more than 90 days old. The fee is currently $10. The fee increase could raise $450,000.
• Charge a $50 service fee for taxpayers who request to reduce or wipe away any taxes they owe the state. The new service charge is expected to bring in $175,000.
• Allow the state to keep a $22 fee for any money it turns over to the federal government for debts to the U.S. treasury.
The department had proposed a more drastic measure that called for charging delinquent taxpayers a 12 percent fee on any payment on top of the interest and penalties they are already assessed.
The 12 percent fee was projected to bring the state $17 million more a year. It would have replaced the agency’s entire appropriation from general tax dollars, effectively making it immune from budget cuts when revenues plummet.
But last week, a Senate committee nixed that 12 percent fee because some senators thought it would be too burdensome. The bill is now awaiting action in the Senate. The measure could be debated this week.
During the past decade, the Legislature has tried to beef up collections with different kinds of enhancements.
Yet time and again, those efforts fell subject to budget cuts. Since 2002, the Legislature has spent an extra $4.9 million on adding collections staff, then seen the agency cut by nearly $16 million in that same time frame.
In its current form, the bill would allow the revenue department to fill 12 to 14 positions for collections, or roughly half the open jobs.
“The more people they have acting as collectors, they more they’re going to collect,” said Senate Tax Committee Chairman Les Donovan, a Wichita Republican.