City will hire debt collectors to track down arts tax dodgers

PORTLAND, Ore. -- City Hall has a message to half of the adult population in Portland: it knows you dodged the arts tax and still expects the money.

Even though it's been a year since the deadline of April 15, 2013, the city is offering a grace period to the 200,000 or so people who perhaps thought nobody noticed.

The revenue bureau will accept last year's $35 tax with no penalty if paid within 30 days of this year's deadline, April 15, 2014.

Nearly all adults 18 and over in the city are required to pay the $35 yearly arts tax, which was approved by voters in 2012 to fund arts and music education for Portland's elementary schools.

The city collected $7.9 million and spent much of the money to hire 45 full-time art and music teachers in Portland Public Schools, according to spokeswoman Christine Miles.

Only 55 percent of taxpayers paid the arts tax last year, falling below what the city predicted for the first year it was due, according to Kelly Ball, an analyst with the Office of Management and Finance.

Ball says the city predicted 75 percent of taxpayers would pay.

If the remaining 45 percent of taxpayers still do not pay what they owe, Ball says the city plans to tack on a $35 late penalty and eventually hire an outside collection agency to track down the money.

A banking professional called that plan "totally impractical," but declined to be identified because she did not know the specifics of the city's plans.

Ball said she was not able to answer how the collection process would work, including whether it would pay debt collectors a fixed fee or a percentage of funds collected.

The banking professional said it would be unheard of for any organization to hire a debt collector to track down an unpaid bill of $35 or $70, given the time and resources it takes to contact each individual debtor.

Even if the city hires a debt collector, it's unclear what would happen if taxpayers simply ignored them, too.

The debt collector may report the debt to credit bureaus, but the impact of an unpaid $70 bill on your credit history remains questionable.