Any outstanding debt to the county or state–whether an overpayment of food stamps or a book fine at the library–can be automatically withdrawn from a state payment if the agency in charge submits the claim to the revenue recapture program. More typical debts would result from failure to pay child support, unpaid criminal fines or restitution, or delinquent taxes.
Taxpayers might have been surprised by a deduction from their sales tax rebate checks, but most agencies do contact delinquent accounts and inform them they will be submitted to revenue recapture. Each agency sets its own criteria for submissions to revenue recapture.
The system started in 1981, mainly as an effort to collect child support. In those days, the record keeping was done by hand.
According to Julie Ellis, a human services supervisor for Stearns County who deals with child support payments, their office has received a number of angry phone calls from citizens who had portions of their rebate checks reclaimed. She said her office only submits child support accounts that are in arrears. In some cases, the money is directed to children, or it may be used to reimburse a government agency that provided financial support in lieu of the delinquent child support.
To find the impact of the sales tax rebate, Ellis compared the revenue recapture collections from August 1998 with those from August 1999. In 1998, $222,980 was returned to the county. In 1999, they received $559,529, an increase of $336,549. "I would attribute that increase to the sales tax rebate," Ellis said.
Statewide, $8 million is estimated to have been collected from the sales tax rebate for delinquent child suppport payments.
The revenue recapture system has been computerized since 1992, and Carlson said the result has been dramatic growth. When she started around that time, the program had 170 participating agencies. Now there are more than 600. These days, agencies can submit their claim requests on paper, and the Department of Revenue can enter them on computer, or the claims can be submitted online.
When the state issues checks for tax refunds, political contribution refunds, and even lottery winnings of more than $600, the names are cross-checked against the claims submitted by the agencies. An amount is withdrawn from the check to cover the oustanding debt, and the remaining portion sent to the citizen.
The debt is forwarded to the respective agency.
The Stearns County Court Administra-tors' office uses revenue recapture for unpaid fines and criminal restitution. Susan Wegman, assistant court administrator, said the office's financial team has criteria for determining when payment attempts are exhausted and then forwards these accounts to the Department of Revenue.
Since mid-July, the court administrator's office has received $17,000 in revenue recapture collections, not all from the sales tax rebate. "It's a way for the counties and other agencies to get the money owed to them, Wegman said.
DeWayne Mareck, assistant treasurer for Stearns County, said the treasurer's office collects delinquent mobile home taxes through the program. "If the individual gets a rebate from the state," Mareck explained, tax and interest are deducted first. Then the balance goes to the individual."
Soon, his office will be processing nonsufficient fund checks to the county. Previously, another department handled the checks and also ran them through revenue recapture.
The treasurer's office notifies deliquent taxpayers by letter on several occasions.
In July and August, the treasurer's office received $23,000 through revenue recapture. For the year, they have received $54,000.
Revenues generated by the program are up this year due to the number of rebates issued by the state. In addition to income tax refunds, there has been a property tax rebate and the sales tax rebate.
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