Firms to collect back taxes for county

FRONT ROYAL – Warren County has hired a second law firm to help the Treasurer’s Office track down unpaid taxes.

The Board of Supervisors recently approved contracts with Pond Law Group and Taxing Authority Consulting Services to collect delinquent real estate tax accounts. Front Royal-based Pond Law Group has handled real estate tax collections for the county. Taxing Authority Consulting Services is based in Richmond and operates statewide.

Interim County Attorney Dan Whitten explained Monday that the Board of Supervisors wanted to split the work evenly between the two firms and give them a year to see which one provided better results during the period. The firm that shows more favorable results would receive a long-term contract, Whitten said.

Using a law firm outside Front Royal-Warren County also helps reduce the chance of a conflict of interest arising.

“Well, I guess that’s the advantage of having two firms,” Whitten said. “If the treasurer feels that there’s any conflict with any of the potential taxpayers she can just send that case over to the other law firm.”

State code gives the treasurer the authority, with approval of the Board of Supervisors, to hire attorneys to collect any local taxes delinquent six months or more. Purchase of legal services is exempt from state procurement laws. The treasurer plans to split the workload between the two law firms.

The contracts take effect Aug. 1 and expire July 31, 2017, but give the county the option for renewal. At the end of the first year, the treasurer and the supervisors plan to analyze the monthly collection reports to determine the effectiveness of each firm.

State code authorizes each law firm hired by the treasurer to receive 20 percent of delinquent taxes collected as its legal fees. The county will pay the fees out of the taxes collected. The agreement between Taxing Authority Consulting Services and the county states that the firm will receive either a fee of 20 percent for collections of accounts prior to filing suit or a fee of 25 percent for collections of accounts subsequent to filing suit. If the firm is appointed special commission of sale, the fee will be the greater of 25 percent or the statutory fee allowed. The agreement also states that properties sold at auction will subject to a minimum legal services fee of $1,500 and properties sold at a non-judicial sale will be subject to a minimum fee of $500, provided funds are available after payment of the costs of the sale.

Pond Law Group will continue to follow a prior agreement with the treasurer and will actually only collect 20 percent of the delinquent taxes that are more than two years delinquent. If appointed special commissioner, Pond Law will collect a flat fee of $2,000 for the sale of the property, paid out of collected funds. If the sale price of the property doesn’t cover the legal fees and costs, the county will pay the difference.

Contact staff writer Alex Bridges at 540-465-5137 ext. 125, or abridges@nvdaily.com