November 07, 2024
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Owe the state? You’d better pay up

AUGUSTA – With state revenues down, lawmakers and Gov. John Baldacci’s administration are looking at every way they can to collect taxes, fees and fines owed the state, and several proposals are under consideration.

“There is nothing like a revenue shortfall to bring out creativity,” Finance Commissioner Becky Wyke said last week. “We have to look at everything.”

The proposed budget already includes one new way to assure the state gets taxes it is owed: an automatic check of tax liabilities by the Maine State Lottery before they send a check to the winner.

“We don’t expect it will generate a lot of revenue,” she said. “It is in [the budget] at $100,000, but it will help.”

Members of the Appropriations Committee say they will explore a whole range of tools now used to collect child support to collect taxes, fees and fines owed the state. Those tools include suspending professional licenses, hunting and fishing licenses and the suspension of the ability to register an all-terrain vehicle or snowmobile.

“Or if they have a tax refund due, you withhold the tax refund and offset it,” said Sen. Karl Turner, R-Cumberland, a member of the committee. “That’s just fundamental blocking and tackling.”

He believes the state should use all the tools available to collect what is owed. He was shocked to find out the state was not already taking tax debts from lottery winnings.

“It’s sort of one of those no-brainers that you would expect we were already doing,” he said.

Sen. Peggy Rotundo, D-Lewiston, the co-chair of the panel, expects the committee will explore all of the methods used to collect child support. She said making every effort to collect what is owed the state is only fair.

“It seems like that is only fair to people who are paying their taxes, and their fines and fees,” she said.

But, she said, the committee will need to discuss whether all methods of collections are cost effective. She said it would not be prudent to spend more to collect a fine or fee owed the state than the amount that is owed.

“People say we should run the state like a business,” Turner said. “I tell them we can’t, because government is not a business. But we should use the tools business uses to collect what they are owed.”

But, Wyke cautioned, each type of collection effort needs to be weighed for its effectiveness and its appropriateness for use by government.

“We have to look at everything,” she said, “but we have to weigh just what it does. We are a rural state – taking away a [person’s] driver’s license puts a burden on a person to support their family.”

But Turner said suspending recreational licenses, such as hunting, could be effective in getting people to pay what they owe. He said the well-publicized success of the state’s child support effort blocking a person getting a moose hunting permit indicates it could help the state collect other unpaid fees and fines.

“I think there are more things we can and should do to collect what is owed the state,” Turner said. “I think you will see us doing more, but I am not sure we need more legislation. I think some of this can be done administratively, through rule-making.”

Wyke said all proposals will be explored, but also pointed out the language in the budget dealing with lottery winnings was added because lawyers reviewing the proposal believed specific legislative authority was needed.

She said also complicating collection efforts is that the judicial branch operates a separate collection effort for the millions of dollars in fines it assesses every year. She said all three branches of government need to collaborate on how to improve those collections.

The success of child support collections was underscored in a recent report to the legislature’s Judiciary Committee. Stephen Hussey, director of the Support Enforcement Unit, said more than $110 million in child support was collected last year.

“We have worked to close every loophole we can to make sure we can collect this money for the children that deserve it,” he said.


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