Property Tax COVID-19 Updates
March 26, 2020
Property Taxes April 10, 2020 Delinquency Date and COVID-19
As your county tax collector, I know that everyone is being impacted by the COVID-19. I and my staff care about the people, businesses and communities we serve, and we are working hard to balance the interest of individual taxpayers, community needs for essential services during this emergency, as well as state and national financial impacts.
The Placer County Tax Collector’s Office has a long history of working with taxpayers in times of emergency and disaster, including the recent public safety power shut-offs, wildfires, and floods. As a result, it is known the best and only way to currently provide relief to taxpayers is to provide penalty waivers to those who have been directly impacted by loss of wages, jobs, health and other circumstances.
What can tax collectors do?
State laws prohibit the county tax collector from changing the deadline or the amount due. The California Association of County Treasurers and Tax Collectors continue to explore and evaluate the potential to extend April 10th property tax delinquency date, however those efforts have not yet been helpful.
Over the past weeks, I have been working along with other Tax Collectors across California and through our association, the California Association of Treasurers and Tax Collectors regarding the April 10 delinquency date. We are continuing to work directly with state officers, including the Governor’s Office, State Controller’s Office, State Treasurer’s Office, legislators and other statewide organizations regarding COVID-19 impacts to identify mechanisms to provide relief to taxpayers. We will continue to engage state officials and will provide information as it becomes available.
At this time taxpayers affected by impacts from the COVID-19 pandemic are best helped through the penalty waiver process. Tax collectors can waive penalties based on individual circumstances. Defining those circumstances ahead of time isn’t practical. Experience tells us there are likely to be a wide variety of circumstances and as the COVID-19 pandemic evolves, factors will continue to change
It may not make anyone feel better, but here is why it is difficult to move the April 10th delinquency date.
We know the state and federal income tax deadlines have been moved and I hope that brings relief to those directly impacted, as well as broader economic relief to the state and nation. I am glad to know that other state and federal measures are taking shape to provide additional relief. The state and federal government have been able to provide income tax relief because most income tax revenues have already been collected on a per paycheck basis. In addition, state and federal governments have far greater resources than local government agencies, including the ability to print money and provide other forms of economic stability and relief through monetary policies and other tools.
In Placer County, property taxes go to over 90 different local government agencies to pay for many local government services such as: police, sheriff, public health, fire, schools, and cemeteries. It is important to maintain essential services and the cost ramifications of responding to COVID-19 are yet unknown. It may not be visible, but in Placer County many local government public health workers, emergency services personnel and first responders are working hard in the fight against COVID-19.
The county tax collector does not have the authority to unilaterally reduce the property tax revenues they collect on behalf of many local government agencies. Proposition 13 enacted into law by a statewide vote specifies the amount to be collected for general fund revenues to local agencies. Other charges on the property tax bill are for local voter or landowner approved charges used to repay bonds. Therefore, only the voters may overturn the amounts due on property tax bills.
What are the potential financial consequences if property taxes are not paid on time?
Voter and landowner approved bonds issued to build schools and to provide public infrastructure are repaid from charges on property tax bills. If charges for bond debt service are not collected timely, and in the amount necessary to pay bond debt service, municipal bonds may begin to default. Widespread default on California local government bonds has the potential to create additional economic shock on a national scale. These defaults can further impact mutual funds, 401ks, IRAs, pension funds and other investment savings which have already experience considerable losses.
In California and Placer County we’ve had our fair share of economic distress as well, including the housing crisis, great recession, financial meltdown, dot com boom and bust, and savings & loan collapse. Assisting taxpayers isn’t new for tax collectors. We know and understand these are challenging and unprecedented times. We hope and strongly encourage those who are fortunate enough to be in the financial position to readily pay their property taxes will do so as they always have. For those who have experienced wage reductions, layoffs, illness or even the death of a loved one, we are here to assist.
We fully expect to work with many taxpayers over the coming weeks and months to waive penalties based on hardships related to COVID-19. I know that an extraordinary number of individuals and business have been affected and my office will do everything we can to assist them.
As the COVID-19 pandemic is a fluid and evolving situation, taxpayers should continue to check the Placer County tax collector’s web sites for updates and information.
I wish you all good health,