Controller asks for more power to collect debts
Controller Kim Wallin told lawmakers on Thursday they need to strengthen and standardize collection of debts owed the state by centralizing more of the process in her office.
She said when the state of Kansas did that, it increased collections from $196,000 to more than $37 million in a year. For Nevada, Wallin estimated collections of unpaid debts and taxes could increase by 35 percent.
Agencies have turned over about $80 million in uncollected debt to the controller’s office over the past four years.
Wallin said in many cases, agencies aren’t very good at collecting money owed them because, “debt collection is not the primary function of their office and they don’t have the resources to do it.”
She told the Legislative Commission that centralizing the process in her office would enable her to standardize the procedures for notifying and collecting debts across agencies as well as the rules for write-offs and settlement compromises with those who owe.
The bulk of the money owed the state is for taxes the Department of Taxation has been unable to collect. Director Dino DiCianno estimated his department is owed some $50 million but much of that debt “is very old.”
DiCianno said one problem is the workload: his revenue officers have about 3,000 accounts each.
“If we had additional revenue officers and additional auditors, my collection rate would go up,” he said.
Wallin said before legislation approved by the 2009 Legislature, her office was only able to collect on about 11 percent of the debt turned over to them. She said since that legislation was passed, the rate has risen to 28 percent. That includes allowing the controller to collect by deducting it from money owed to companies and individuals currently contracting with the state.
“I have a real problem if we’re giving them a check but they’re not giving us a check,” Wallin told the commission.
Her goal, she said, is a collection rate of 70-80 percent. She said if lawmakers give her added enforcement tools, they will be able to improve collection. That includes holding up renewal of professional licenses for those who owe the state.
The agency with the best collection rate is the Gaming Control Board.
“A licensee would be in jeopardy of losing his gaming license for nonpayment,” said Frank Streshley, head of gaming’s tax and licensing division.
As a result, gaming’s collection rate is higher than 99 percent. Out of $4.7 billion the control board has collected in the past five years, only $196,000 is uncollected and most of that is tied up in bankruptcy court.