Title
Dept/ Agency: Finance
Action: (X) Ratifying (X) Authorizing ( ) Amending
Type of Service: Implement a Temporary Interest Reduction Program
Purpose: To reduce the interest rates charged on delinquent property taxes, City-owned Municipal Tax Liens, Tax Abatement charges and Water and Sewer charges for the year(s) 2020 and prior.
Program Period: May 1, 2021 through August 31, 2021 only.
Additional Information:
Current Rate Proposed Rate
8% on first $1,500.00 delinquency 4% on first $1,500.00 delinquency
18% on remaining balance 9% on remaining balance
The controlling Departments for the Temporary Interest Reduction Program are the Department of Finance and the Department of Water and Sewer Utilities.
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WHEREAS, the Coronavirus (COVID-19) Pandemic continues to cause a financial hardship on property owners, residents and homeowners and the City Administration and Municipal Council recognized that there is an ongoing need to assist those who are delinquent in their property taxes and water/sewer payments by offering a short term “Interest Reduction Program”; and
WHEREAS, given the serious financial issues caused by the COVID-19 Pandemic, the City Administration and Municipal Council desires to set forth an Interest Reduction Program to include Delinquent Property Taxes, City-owned Municipal Tax Liens, Tax Abatement charges and Water and Sewer charges for the year(s) 2020 and prior, and will authorize the Director of the Department of Finance, the Tax Collector, the Manager of Special Taxes and Tax Abatements and the Director of the Department of Water and Sewer Utilities to reduce the current interest rates of 8% on the first $1,500.00 of delinquency and 18% on the balance; to 4% on the first $1,500.00 of delinquency and 9% on the balance of said delinquent charges for the period of May 1, 2021 through August 31, 2021 only; and
WHEREAS, this Interest Rate Reduction Program does not include:
• Third Party Lien Holders
• Tax Appeals (pending stipulations)
• Bankruptcy Accounts; and
WHEREAS, the City Administration concurs with the mandate of the Tax Collector to increase all collections by offering a reduction in the current interest rates. Said benefit will be for a time certain, to commence on May 1, 2021 and end on August 31, 2021; and
WHEREAS, to receive benefit of the rate reduction, the payment must be for the entire delinquent amount due at the time of payment. Partial payments cannot receive benefit of the interest reduction.
NOW, THEREFORE, BE IT RESOLVED BY THE MUNICIPAL COUNCIL OF THE CITY OF NEWARK, NEW JERSEY THAT:
1) The Director of the Department of Finance, the Tax Collector, the Manager of Special Taxes and Tax Abatements, and the Director of the Department of Water and Sewer Utilities are hereby authorized to reduce the current interest rates charged on delinquent property taxes, tax abatement charges, and water and sewer from 8% on the first $1,500.00 of the delinquency and 18% on the remaining balance, to 4% on the first $1,500.00 of delinquency and 9% on the balance of said delinquent charges; provided payments are received during the period of May 1, 2021 through August 31, 2021.
2) This interest rate reduction is exclusive and does not include:
• Third Party Lien Holders
• Tax Appeals (pending stipulations)
• Bankruptcy Accounts
3) Upon expiration of the aforementioned period, interest will be assessed without regard to this temporary reduction at the rate of 8% on the first $1,500.00 of delinquency and 18% on the remaining balance.
4) Payments shall be for the entire outstanding balance due at the time payments are made and partial payments cannot receive benefit of the interest reduction.
5) This resolution shall take effect on May 1, 2021 and end on August 31, 2021, and will not be amended or extended.
6) The Director of the Department of Finance, the Tax Collector, the Manager of Special Taxes and Tax Abatements, and the Director of the Department of Water and Sewer Utilities are hereby authorized to conduct all actions necessary to administer the Temporary Interest Reduction Program.
STATEMENT
This resolution authorizes the Mayor and/or his designee, the Director of the Department of Finance, the Tax Collector, the Manager of Special Taxes and Tax Abatements, and the Director of the Department of Water and Sewer Utilities to reduce current interest rates of 8% on the first $1,500.00 of delinquency and 18% on the remaining balance, to 4% on the first $1,500.00 of delinquency and 9% on the remaining balance on delinquent property taxes, tax abatement, and water and sewer charges for the period of May 1, 2021 through August 31, 2021 only.