Anyone working in the state of Mississippi who is at least 60 days late on payments to the City of Meridian could eventually see the money taken out of their state tax refund.
The city will participate in a new pilot program next tax season to collect certain debts like police fines and water and garbage bills, according to Brandye Latimer, the city's chief financial officer.
The city council approved a resolution Tuesday night for an agreement with the Municipal Intercept Company, LLC.
“Any debt that’s more than 60 days old that’s more than $50 can be sent to the Mississippi Municipal League and they’ll send that debt to the Department of Revenue to collect it against the person’s individual state tax refund,” Latimer said.
The Local Government Debt Collection program, which will be operated by the Municipal Intercept Company, was authorized under House Bill 991 during the 2019 legislative session, according to a letter from the executive director of the Mississippi Municipal League.
Before the city can submit a debt for setoff, it must send a notice to the debtor that they have 30 days to request a hearing if they don't believe they owe the debt, the letter said.
A hearing officer will make a determination on what is owed, Latimer said.
According to the city's resolution, the debtor will pay a 25 percent collection assistance fee on top of the amount owed. Twenty percent of that fee will go to the Municipal Intercept Company and five percent will go to the Mississippi Department of Revenue.
Meridian has more than $500,000 in unpaid garbage, sewer and water bills that are more than 60 days overdue, according to Latimer.
Under the pilot program, the city will start out submitting larger debts first, she said.
“I think it’s just important because cities can either tax the people living within the city to raise revenue to do the operations of the city or we can have the people who owe money to the city pay their fines, their bills so we’re not assessing you for something that someone else has not paid,” Latimer said.
Council member Tyrone Johnson, who represents Ward 2, voted against the resolution Tuesday night.
He said although the city needs the overdue funds, it should leave it up to the citizens to come in and pay back the city.
“We never know what they’re going through and if at that time, that little piece of money they get for their taxes, the tax refund could possibly get them back on track,” he said.