Paying taxes is painful enough without added interest and penalties.

And in Hall County, taxpayers sometimes can get late fees waived by presenting a reasonable explanation to the Hall County Board of Commissioners as to why it should forgive fees accrued for paying property taxes past the
due date.

Tax Commissioner Keith Echols said taxes become delinquent after the due date, which is Dec. 1 in Hall County and Dec. 20 in Gainesville. After 90 days, a state-mandated 10 percent penalty is applied.

At the same time, a tax lien is placed on the property, making it eligible for the city or county to sell in order to recoup the owed taxes.

In Hall County, there are nearly 5,000 unpaid 2009 tax bills.

“Because of the economy, they don’t have the funds to pay,” Echols said.

Hall County is preparing a tax sale in July. Gainesville will hold its first tax sale in 10 years next month.

There will be 170 parcels for sale representing 38 taxpayers. Many are owners of subdivisions that went under due to the slumping economy.

“At this point, we normally have about 25 taxpayers,” said Beverly Williams, Gainesville’s financial services manager.

Williams said a tax sale is unusual because most taxpayers are able to make payments again before it gets to that point.

Even after a tax lien is placed on the property, Williams said the city sends out four notices, runs a list of delinquent taxpayers on cable channel 18 and places signs on the property.

“We make every effort,” she said. “We don’t want to be selling people’s property on the courthouse steps.”

All real estate tax is usually collected, Williams said, though much of the delinquent personal property tax is nearly impossible to collect.

Personal property includes items such as business inventory. When companies go out of business, they are nearly impossible to track down, she said.

Hall County also has a hard time collecting personal property taxes. Echols said a big problem is that mobile homes, which are considered personal property, are almost never bought in a tax sale because they are so expensive to move, and zoning regulations restrict where they can be placed.

While the Hall County commissioners hear requests for waivers on a quarterly basis, Gainesville City Council does not.

“Penalty fees are mandated by the state; it’s my understanding that we can’t reverse penalties since it’s required by the state that we charge it,” Williams said.

Commissioners often hear from taxpayers and businesses with different scenarios. Often, it is out of compassion that the commissioners will waive penalties for people who have been laid off or an elderly person who has been in the hospital.

“It’s mostly people who are having hard times,” Echols said.

Other times, people complain the bill was sent to the wrong address because of a recent move.

This problem has been exacerbated by the economy and furlough days.

“We get a lot of return mail,” Echols said. “This year I was not able to go through the return mail like we have in the past. We don’t have the staff.”

Regardless of the reason, it is up to the commissioners to judge if the waiver should be granted, Hall County attorney Bill Blalock said.

“When they exercise discretion, people don’t always agree with it,” Blalock said.

Blalock said according to Georgia code, the county commission may waive penalties and interest on the collection of ad valorem taxes when it is determined that the default giving rise to the penalty or interest was due to reasonable cause and not due to gross or willful neglect or disregard to the law or regulations or instructions issued pursuant to the law.

“It’s pretty broad discretion,” Blalock said. “Based on case by case, fact, circumstance.”

Waivers have been granted to both small property owners and large businesses. Though frowned upon by some, there is nothing illegal about granting them.

“It would have to ruled on by a court at some point if there was a particular case under scrutiny,” Blalock said. “I’m not aware of where they’ve done anything that would rise to the level of abuse, because they do have fairly broad discretion.”

Commission Chairman Tom Oliver said he believes the system works well.

“It’s good that we, as a commissioner, can look at it on a case-by-case basis,” he said. “We just try to be fair to the taxpayer and to the community, the people who do pay their taxes on time.”

Commissioner Billy Powell said he listens to each circumstance before making a decision.

“Every situation is different,” Powell said. “I look to see if there was an honest mistake made by either party that might have contributed to a late fee.”

Powell said he does not consider the county’s tough financial situation when hearing requests for waivers of interest and penalties, which can range from a few hundred to a few thousand dollars. Powell said he is more likely to consider giving a waiver to a local business if it has “a long history of paying on time and if they are good corporate citizens.”

“The main thing is that they get their fair share of taxes paid,” Powell said. “That (penalty or interest) is not a detriment to the county, but could be a strain on an individual or small business.”