SCHENECTADY COUNTY -- With the COVID-19 public health crisis forcing businesses to close and causing unemployment to spike, the Schenectady County Legislature is considering waiving penalties and interest on property taxes still owed and canceling all back-tax foreclosures for 2020.
"The effects of the COVID-19 pandemic to the residents of Schenectady County will become apparent in the weeks and months ahead," County Manager Rory Fluman wrote to county legislators on April 1. "The County of Schenectady is prepared to enact multiple formal and informal measures across all sectors of County Government to assist our residents in the transition back to 'normal' life."
The Legislature's Ways and Means Committee is expected to review a series of proposed measures to relieve delinquent taxpayers when it meets at 7 p.m. Monday in Schenectady. Assuming they are approved by the committee, the full Legislature will consider them for approval during an April 14 meeting.
Under emergency procedures allowing virtual meetings of public bodies, legislative leaders have decided that leadership and key staff will attend the meeting in person in the legislative chambers, while all other members will participate remotely using the online meeting platform WebEx Meeting. The public may also watch the meeting on that platform.
The series of resolutions the Legislature is considering would cancel any plans for back-tax foreclosures in 2020, and waive penalties and interest on taxes collected between May 1 and July 31. May 1 is the date when any property taxes not collected by the city of Schenectady or towns and villages are turned over to the county for collection.
In normal times, the county charges property owners who don't pay their annual property tax bills on time a 1.25 percent penalty each month. That fee would be waived for payments from May through July.
Normally, the county also forecloses each year on hundreds of properties where taxes have gone unpaid: two years for commercial properties, and four years for residential properties. While in most cases the owners eventually pay their back taxes, the foreclosures give the county the right to auction those properties off to the highest bidder, returning them to the tax rolls.
However, with the stress of the current public health and economic crisis, both the county attorney and finance director are recommending a break from the usual procedures.
"The COVID-19 response has resulted in mass unemployment and caused significant financial hardship to residents," County Attorney Chris Gardner said. "Therefore, commencing a property tax foreclosure proceeding in 2020 would not be practicable."
If taxes remain unpaid, however, they aren't forgiven. The county expects to resume unpaid-tax foreclosures sometime in 2021.
All but "essential" businesses have been shut down since mid-March under state orders intended to slow the spread of the novel coronavirus. That has resulted in those businesses having little or no new revenue, and laying off employees. While the full impact on unemployment has yet to show in government statistics, economists believe it may have risen abruptly into double digits within a matter of weeks, after rates have been at some of the lowest levels in recent times the last several years.
Because of the economic devastation, many banks and financial institutions are also offering temporary moratoriums on mortgage payments and foreclosures.