State agencies owed more than $100 million in taxes, fees

Friday, Jan. 16, 1998 | 9:36 a.m.

Auditors say about $50 million of the delinquent taxes never will be collected because the debtors filed bankruptcy, closed down or owe small amounts.

About $55 million in taxes weren't collected by the Department of Taxation, while the Division of Industrial Relations failed to collect $18 million and the State Industrial Insurance System is short $17 million.

About $5 million in unemployment taxes wasn't collected by the Employment Security Division, while $7 million in casino taxes is owed to the Gaming Control Board.

"It is very disturbing if the state of Nevada is losing this much money," Assemblyman John Marvel, R-Battle Mountain, said after the audit was detailed Thursday.

Marvel serves on the Legislature's Audit Subcommittee with Sen. Ray Rawson, R-Las Vegas, and Assembly Speaker Joe Dini, D-Yerington.

Gary Crews, the Legislature's chief auditor, said the $103.5 million represents money not collected over several years. State agencies periodically clear their books by writing off old debts as uncollectible.

Dini said the Legislature may need to pass a law that covers all agencies and specifies steps they should take with a delinquent taxpayer.

In a written response to the audit findings, state Budget Director Perry Comeaux said the administration, controller and attorney general will work to solve the problem.

Comeaux said he will establish a working group of representatives from all agencies to develop on a corrective plan.

In the report, auditors said the management of accounts receivable isn't a priority since agencies don't have to measure the effectiveness of their collection policies.

The auditors propose the state prepare written policies and procedures for collecting debts.

Auditors found agencies fail to communicate with each other on which companies or individuals fail to pay taxes or fees.

Five companies surveyed by auditors received payments of $41,000 from the state even though they owed the state a combined $200,000.

Such money might have been collected if all agencies used the state controller's office to withhold payments to people who owe the state money, the auditors said.

In reviewing the agencies' collection efforts, auditors found payment plans were the most effective way to collect debts.

They also found that the longer an agency waited to contact a company or individual about a debt, the less likely the money was collected.

When the first collection effort was within 30 days of a bill's due date, 51 percent of the debt was collected. But if an agency waited more than 30 days, just 30 percent was collected.