Background Information on Lawsuit
Manheim Township School District was served with a lawsuit by the locally elected Manheim Township Tax Collector, Ms. Patricia Kabel, claiming that the district was not allowing her to collect district taxes. The district refutes these claims, and has made numerous attempts to work cooperatively with Ms. Kabel to provide the best, most efficient and capable practice of collecting taxes for the citizens of Manheim Township. Since February 13, 2013, when Ms. Kabel was first elected the local tax collector, she did not seek to collect taxes for the Manheim Township School District. She has never communicated with the district regarding the process, method, or manner in which the school district collects taxes. School district records indicate that the school district has been collecting taxes internally with the cooperation of previously locally elected tax collectors, including now Representative Steve Mentzer, since at least 1985.
In an effort to meet and establish a positive relationship with Ms. Kabel, the district’s newly hired Chief Operating Officer reached out to Ms. Kabel on September 26, 2017 and again on November 2, 2017. Ms. Kabel did not respond. Sadly, Ms. Kabel chose to initiate a lawsuit that she did not provide to the district until well after the 2017 general election. Until the district was served with the lawsuit, the district was unaware that Ms. Kabel wanted to collect school district taxes at a compensation rate higher than the rate that was previously established by the Board of School Directors. She did not protest, challenge, or make any effort whatsoever to communicate with the district as required by law to revise the tax collector compensation prior to initiating her lawsuit.
Below, you will find more information regarding the lawsuit, and the historical background of how the district has collected taxes for our residents. It is our continued goal to keep our community informed on this process and how it may affect our taxpayers.
Update February 9, 2018
Dear Manheim Township Community:
In recent weeks, the school district has received many emails and phone calls from our residents and other individuals seeking information about the lawsuit filed by our local tax collector, and expressing their concerns about Ms. Kabel’s decision to initiate her lawsuit. Our community members have also offered support to the district through written correspondence to the Lancaster Newspapers and postings on various social media in order to express outrage at the lawsuit whose purpose appears only to be to increase the cost of collecting their taxes. We share your anger. We thank you for taking the time to learn more about the lawsuit, the process for collecting taxes, and most importantly, offering your support of the school district. It is amazing to see how quickly our community comes together!
In order to better understand the situation surrounding the financial impact of having Ms. Kabel collect our district real estate taxes, it is necessary to understand how she will be making money from the collection of our taxes. Our efficient and capable collection of our own taxes has been the reason that the district has collected the taxes over three decades.
The Manheim Township Board of School Directors set the tax collector compensation at 0.15 cents per tax bill in January 1997. The school district has not had any reason to modify this rate since there have been no tax collectors collecting, or expressing any interest in collecting school district taxes. In the past, the district has also offered $1,000/year to tax collectors who have agreed to deputize the school district to collect its own taxes. Deputizing the district provides the most efficient, cost effective and competent collection of taxes by utilizing existing staff and an automatic deposit process through Fulton Bank. This exact process is what Manheim Township School District has been doing for the last thirty years.
Since our last update (posted below on January 5, 2018), the district made yet another attempt to communicate with Ms. Kabel. The district sent her a letter on January 19, 2018 offering the two options as explained above (0.15 cents a bill or deputizing the school district). Ms. Kabel chose to respond through her counsel, who stated that she will not allow the district to continue to collect its own taxes and that she will continue to challenge the compensation of 0.15 cents per tax bill. In short, Ms. Kabel simply wants to be paid more for tasks she never sought to perform prior to her reelection.
So how does this affect you, our taxpayer? The district strongly opposes Ms. Kabel’s effort to increase her compensation through her litigation. The residents of the Manheim Township School District deserve a tax collection system that provides both an efficient and effective process and customer service. Many times, taxpayers come to the school district’s office for tax payment assistance and questions. The district has several individuals on staff that assist with these matters. As mentioned in our previous community letter (posted below), the Manheim Township taxpayers will have to pay significantly more to collect the same dollars while also destroying a well-organized, effective, longstanding practice.
How much more will the taxes be if Ms. Kabel collects them? The answer to this question will be determined after a potentially lengthy and costly legal process.
We are meeting in the near future with a local Senator to address potential legislation.
In summary, it is regrettable that Ms. Kabel pursued her lawsuit against the district to increase her own compensation. The district will continue to insist upon competent and cost effective collection of its taxes for the benefit of our taxpayers. We will continue to keep you updated on the status of Ms. Kabel’s lawsuit.
January 5, 2018
Given inquiries about the public law suit initiated by the Manheim Township tax collector in November 2017, the Manheim Township School District (MTSD) offers the following response in order to keep our community informed and knowledgeable about the facts.
The District imposes a real estate tax pursuant to the Pennsylvania Public School Code (published in 1949), and is a taxing district for the purposes of the Local Tax Collection Law. Under this law, the elected tax collector is authorized to collect real estate taxes on behalf of the school district. The locally elected tax collector is compensated at a rate that is established by the School Board. Tax collector terms for most municipalities run for four years effective the first Monday in January following the election. Most recently, municipal elections in Manheim Township were held in 2013 and 2017.
With the cooperation of the elected tax collector(s), many school districts in Pennsylvania collect their own taxes in lieu of an elected collector due to more modern and less costly collection methods. This cooperation of allowing school districts to collect their own taxes involves an agreement between both parties known as “deputizing.” Therefore, those school districts, along with MTSD, have traditionally collaborated with the elected tax collector(s) to identify agreeable methods for collecting taxes that do not impose additional costs to the taxpayers. The MTSD has been fortunate to have worked collaboratively for many years with past MT tax collectors in order to save money for our district and avoid a negative financial impact on our taxpayers.
Beginning with the first term in office on January 1, 2014 and continuing until the filing of the lawsuit, the current tax collector took no steps, or showed any interest, to collect school district taxes. Unfortunately, this collaborative working relationship with the local elected tax collector has ended without any notice since the collector is now suing the school district in order to hold the sole power of tax collection. By removing the school district from its longstanding centralized real estate collection process, which was designed to protect our taxpayers from wasted monies, we would need to use taxpayer dollars to compensate the tax collector, and to establish a new tax collection process. At the same time, the district would lose revenue that we currently collect with the current process. The school district for many years has used existing staff and an automated deposit method through a local bank to collect taxes, which offers a cost-effective, efficient, and safe method of tax collection that does not pose an unfair financial burden on our taxpayers. At MTSD, the savings to our taxpayers is significant when the school district collects taxes instead of the tax collector. The district estimates that it could spend at least $40,000 or more a year to have this function performed by the elected tax collector.
This example of wasted money exemplifies why the school district has partnered with the local tax collector over the past 20 years or more to protect taxpayers (and the MTSD) from this undue burden. Because the tax collector has refused to speak with district staff this past summer when two separate attempts were made to continue the partnership between the MTSD and the tax collection office, we are unable to determine the rationale for the lawsuit. It would be extremely unfortunate if the primary reason for the suit was to end the longstanding partnership between both parties and force the district to spend additional taxpayer dollars. The district has already paid over $1,500 in legal fees surrounding this lawsuit, and we anticipate additional funds being spent as the tax collector continues to pursue the lawsuit.
It is known that the collaborative relationship of many past years has been a significant cost-savings to our taxpayers. At a time when the school district is striving to save dollars and balance our growing budget, it is unfortunate that an unnecessary lawsuit is the chosen method to dialogue, and end the well-established and cost-effective process that is already in place, especially at the expense of our taxpayers.