Tax collectors’ fees questioned
DeKalb, Fulton officials’ salaries inflated by supplemental charges.
By Mark Niesse
When Irvin Johnson took over as tax collector in DeKalb County last year, he became Georgia’s second-highest-paid elected official.
His compensation of $285,781, inflated by fees charged to 10 cities for preparing their residents’ property tax bills, is more than that received by state Supreme Court justices ($171,404), Gov. Nathan Deal ($139,339) and Attorney General Chris Carr ($139,169).
Among the state’s elected officials, Johnson’s pay trails only Fulton County Tax Commissioner Arthur Ferdinand, who earned about $390,000 last year — in large part because of similar direct payments from the county’s cities.
Though the arrangement isn’t new, DeKalb commissioners say it’s unusual enough to warrant another look now that the county has a new tax commissioner.
“We should review the contracts,” said Kathie Gannon, the DeKalb Board of Commissioners’ presiding officer. “The cost of the service is what we need to charge. It’s a new time and a new day.”
When DeKalb Tax Commissioner Claudia Lawson took office 10 years ago, she negotiated her fees for generating tax bills for city residents. She retired Dec. 31, 2015.
Johnson has been receiving the same fees since he took office in January 2016, though Lawson’s name is still on the contracts with the cities. Every city in DeKalb except Decatur, which has its own tax office, relies on the county for property tax administration.
On top of Johnson’s $173,000 base salary, he receives nearly $113,000 in payments from cities. That’s $2 per parcel except in the county’s three largest cities, which pay a $25,000 flat rate.
The contracts were negotiated between the cities and the county, and they automatically renew each year unless either party terminates the agreement.
Commissioner Greg Adams agreed that the board should revisit the issue.
“It’s something we would take a look into and see how it should be properly disbursed,” Adams said.
Johnson declined to comment. His staff members referred to his statements before last year’s election, when Johnson won a four-year term.
“The pay tells you it’s a little more than an administrative job,” Johnson said in a May 2016 interview. “If we don’t follow the law in terms of collecting and distributing money, it’s a serious legal matter. Somebody could go to jail.”
While some other tax commissioners in Georgia collect fees from cities for handling their taxes, not all do. Tax commissioners in Gwinnett and Cobb counties don’t receive salary supplements from cities.
In Gwinnett, eight cities contracted with the county to pay $100,407 this year for tax and fee collections, but that money goes to the county, not the tax commissioner, for the cost of printing bills, postage, accounting and customer service. In Cobb, cities send out their own tax bills, so no payments are made to the county.
Cities save money by working with county tax offices rather than setting up their own municipal tax departments, said Dan Ray, executive director for the Georgia Association of Tax Officials.
Tax commissioners deserve compensation for the job of handling so much of the public’s money — more than $2 billion a year in DeKalb and Fulton combined, Ray said.
“That’s a boatload of money, and that’s a responsibility and liability that somebody should be compensated for,” Ray said. “I’m going to argue that they’re worth it. They’re taking on a huge responsibility.”
Ray said a tax commissioner could face criminal charges if public money went missing from his office.
“It’s almost like a salary,” said Jackson County Tax Commissioner Candace Taylor, who receives $7,000 a year from four cities for their tax bills and then gives about $2,700 of that amount to her nine-person staff as a bonus. “Cities rely on our knowledge to prepare their tax bills. They have the option to do it themselves if they choose to.”
State legislators have tried to crack down on side payments to tax commissioners, with limited success.
The Georgia General Assembly passed a bill this year that eliminates a 50-cent fee that Ferdinand collected every time he sold a tax lien. That fee added up to between $22,000 to $31,000 extra per year to Ferdinand.
He still receives $1-per-parcel payments from the cities of Atlanta, Sandy Springs and Johns Creek to do their property tax bills, for a total of $210,281 last year. Atlanta paid him the largest amount: $152,865.
Ferdinand didn’t respond to emailed questions.
The city of Atlanta pays much more than other cities to both Fulton and DeKalb’s tax offices. The city pays DeKalb a total of $100,000, with $25,000 of that amount going to Johnson. That’s an expense to Atlanta taxpayers of $7 for each of the city’s 14,148 parcels in DeKalb. No other city in the county pays more than $2.43 per parcel.
Atlanta paid nearly $1.9 million to Ferdinand and Fulton’s tax office last fiscal year, according to a city spokeswoman. That comes to $12.40 per parcel.
Atlanta Councilwoman Felicia Moore said state action might be needed to rein in the city’s spending on tax billing and collection.
“If there is an effort or will to change that, the state law really needs to be changed so tax commissioners can’t charge it,” Moore said. “As long as the law allows it to occur, I suspect it will.”
The payments to the tax commissioner are negotiated by Atlanta Mayor Kasim Reed’s office and approved by the City Council.
A spokeswoman for Reed declined to comment when asked whether Atlanta taxpayers are getting a good deal.
Ethically challenged Fulton Tax Commissioner Ferdinand has been absent from the news recently, now he is back with the below long running civil suit. It is said that if you look up 'crook' in a dictionary they have a photo of Ferdinand next to the entry. Below is the latest AJC report on this guy.
And one final matter, the AJC and Ferdinand have had a long running war with Ferdinand slapping a lien on any Cox property in Fulton if they miss paying a tax by even a day (the AJC is a Cox newspaper) and the AJC runs articles on Ferdinand whenever they find an opportunity to take a shot at him. A good summary is that Ferdinand is a first class sleezeball and deserves all the bad press he gets.
Big tax breaks for homeowners, a new city in south Fulton County and curbs on the Tax Commissioner Arthur Ferdinand’s ability to profit from tax liens will be back on the General Assembly’s agenda in 2015.
A Fulton County judge has rejected Tax Commissioner Arthur Ferdinand’s request to dismiss a lawsuit that accuses him of abusing his authority.
Note: This issue has other relevant posts further down the blog. Put the term 'Hausmann' into the 'search' bar at the top of the blog to bring up these posts.
April 7, 2014
Legislation to stop Fulton County’s tax collector from personally profiting off tax debts moved from the House to the Senate on Monday. House Bill 819 passed 173-1.
An investigation by The Atlanta Journal-Constitution last year found that Tax Commissioner Arthur Ferdinand has been using an old law to collect 50 cents every time he sells a tax lien to a private collector or a property owner pays off a lien on his own — amounting to tens of thousands of dollars per year. The practice, initially done without the County Commission’s knowledge, has boosted Ferdinand’s annual pay to about $383,000 — by far the highest compensation for any elected official in Georgia.
“It’s paying someone for not doing their job,” said the bill’s sponsor, Rep. Chuck Martin, RAlpharetta.
The bill would also require tax commissioners to try to find a taxpayer through Internet searches and people-finder databases, among other records, to make sure he is notified before the county sells a lien against his property.
Legislation to protect homeowners and stop Fulton County’s tax chief from profiting off their debts could go belly up this session, just as similar proposals have done in past years.
If taxpayers don’t know about the debts, the collection firm racks up more interest, and it can eventually auction a home to settle the debt.
Monday, January 27, 2014
Saturday, January 25, 2014
State lawmakers will try again this year to rein in the sale of overdue property tax bills to private collection firms, aiming to cut profits for both the Fulton County tax collector and his biggest buyer of tax liens.
Ferdinand sells more liens than any other commissioner in the state, a practice he has defended as a guaranteed way to boost collections.
Read more of our coverage of his extra payments, including:
From the Sunday Jan 12, 2014 AJC Metro Section:
Tax chief gets farm subsidies
Top-paid elected official takes public monies for property upkeep.
By Johnny Edwards email@example.com
Fulton County’s tax collector, Georgia’s top-paid elected officeholder, has tapped another source of taxpayer money: U.S. farm bill subsidies. It’s for his cows. Along with being tax commissioner, Arthur Ferdinand raises Angus cattle in rural Chattahoochee Hills, about 30 miles southwest of downtown Atlanta.
He acquired the farm in a shabby state a decade ago, then used public funds to help spruce up his pastures, taking in tens of thousands of dollars to put up fences, install watering stations, enhance grass quality and make other improvements to an operation he calls “Chaguanas Farm,” an investigation by The Atlanta Journal-Constitution found.
The funds came through a U.S. Department of Agriculture program that encourages ecofriendly land management, and Ferdinand has been one of the metro area’s top recipients of the subsidies during the past decade, data obtained through a Freedom of Information Act request shows.
Though legal, it’s yet another way the Atlanta official has steered public money his way, even as many of his constituents struggled to pay their bills in the wake of the Great Recession.
The taxman known for his aggressive collection tactics has also used legal loopholes to pocket fees from the county and three cities, boosting his take-home pay to upwards of $380,000 per year, previous investigations by the AJC discovered. Ferdinand now earns close to triple the pay of the governor and nearly as much as the U.S. president, even though his base salary is just $134,279.
Meanwhile, he has spent thousands of county taxpayer dollars taking his highest-paid staffers on budget-planning trips to lakefront luxury lodges and dining with unidentified individuals for business lunches at posh restaurants. Last year, he spent $39,000 of his department’s funds to buy himself a take-home 2013 Ford Explorer Limited.
Ferdinand has responded that state law allows his extra compensation, and that his methods, including selling unpaid bills to private collection firms, keep the county flush with cash and tax rates low.
But incensed state lawmakers have pushed measures to stop Ferdinand from enriching himself off public office, and at least two bills targeting him are expected in next year’s legislative session.
His beef operation is modest — about 30 head of cattle on 70 acres. He apparently qualified for aid as a beginning cattleman earning less than $1 million per year.
“I’m not surprised he’s found another way to skin the cat,” said state Rep. Wendell Willard, R-Sandy Springs, Ferdinand’s foremost critic in the Legislature.
The AJC found that, since 2005, the federal government has allotted Ferdinand almost $35,000 in Environmental Quality Incentives Program, or EQIP, money — the second-most given to any farmer in Clayton, Cobb, DeKalb, Fulton and Gwinnett counties.
Some conservationists were shocked he has been a recipient and questioned the program’s priorities.
“I would prefer to tighten these things up so that farmers of need get them,” said Alan Toney, the elected chairman of the Fulton County Soil and Water Conservation District, a citizen oversight committee. “Like with any other government program, there’s things that you wish were different.”
Living a dream
Ferdinand did not respond to messages seeking information about his cattle farm or the subsidies. A call to Chaguanas was answered by his wife, Betty.
She said the government gave them the money because their farm met all the program specifications, and she advised staying away from “things you don’t understand.”
“I’ve spoken to you longer than you deserve,” she said after a brief conversation, “so I’m hanging up.”
The Ferdinands sparked controversy when they bought the property in 2003, leading to a hearing before the county’s ethics board, but no charges.
The tax chief used Tom Biggers, his delinquent-tax administrator at the time, as a middleman to buy it from Foxworthy Inc., a company that had bought millions of dollars in tax deeds from the county.
Ferdinand has said he needed Biggers’ help because, in the past, he and his wife had problems buying property in Georgia because they are black. He said his office had no involvement in the bank foreclosure auction where Fox-worthy obtained the land.
The board ruled unanimously that there wasn’t enough evidence to pursue ethics charges.
In affidavits filed in the case, the Ferdinands said they shared a dream of owning their own farm, and Betty Ferdinand said she led the search for income-producing acreage.
She described the land they chose, off Hutcheson Ferry Road, as abandoned and overgrown, with a dilapidated swimming pool and a burned-out house. They also bought an adjacent property with a house that they planned to rent out.
They named the land Chaguanas, which is the largest borough of Trinidad and Tobago, Arthur Ferdinand’s native country. Their driveway is within a few hundred yards of an entrance to south Fulton’s eco-chic Serenbe community.
They don’t live there; county records show their primary residence is in southwest Atlanta.
Saving nature or boosting production?
An online article produced by the Natural Resources Conservation Service, a branch of USDA, touts the Ferdinands’ farm as “another conservation success story.” It describes the couple spending four years clearing kudzu and brush before they could start farming.
The article says Ferdinand sought help getting started from the county extension office, which directed him to USDA.
Through EQIP, taxpayers helped turn his property around.
The federal government chipped in almost $2,800 in fencing costs, more than $1,700 for pasture and hayland planting, $3,000 for drinking stations and $3,300 for grading, graveling and soil protection, records of his earliest contract show.
Ferdinand has since been allotted another $11,000 for electric and barbed-wire fencing, $4,200 for graveling and $2,100 for cow watering.
The farm improvements allow them to rotate the cattle between grazing sections and protect the paths where the cows trod, the agency reported.
“Establishing these practices has increased the quality of grass and hay supply on their land, diminishing the need for extra additives in his cattle’s food supply,” the article said. “ ... All of these practices cut down on the daily upkeep of the land, thus lowering overall cost.”
EQIP isn’t designed to supplement farmers’ in come, but rather to keep farmers from sullying the environment, according to Craig Cox of the Environmental Working Group, a Washington research organization pushing for farm bill reform.
Like rotating crops, rotating cattle among different grazing areas cuts down on erosion, reducing sediment runoff into tributaries of the Chattahoochee. Fences and alternative water sources keep cows out of streams.
But Cox, the organization’s senior vice president over agriculture and natural resources, said the federal government shouldn’t be paying farmers to do things they ought to do anyway. Cox questions whether too much of the billions of dollars spent on EQIP since the 1990s has gone to helping farmers maximize profits, rather than solving environmental problems.
“This could have been designed to solve a problem that is worth the taxpayer investment,” Cox said of the funds for Ferdinand. “But it could have been designed to improve his pasture so he can graze more cattle, and the cattle gain more weight.”
Washington-based Citizens Against Government Waste has asked Congress to lower the income limits to $250,000 for farmers receiving commodity and conservation subsidies, to no avail.
Valerie Pickard, the USDA’s district conservationist for the metro Atlanta area, approved Ferdinand’s application based on a ranking system. She said concerns about water sources near Ferdinand’s property played into in his allocation. Some of the funds went toward fencing off a pond.
“It’s helping them to achieve their goal of having a farm,” she said, “to maintain a farm and preserve its natural resources.”
The larger picture
Willard, the state representative, said lawmakers can’t do anything about Ferdinand’s federal aid. They’ll focus instead on shrinking his power and forcing a pay cut.
One bill pending in the Senate would make the Fulton tax commissioner an appointed position starting in 2017, meaning that if Ferdinand wants to stay on after his current term ends, when he’ll be 76, he would work at the pleasure of county commissioners instead of voters.
Another measure being drafted would undo a law dating to the Great Depression, when many constitutional officers got paid through fees rather than salaries, allowing tax commissioners to collect 50 cents every time a debtor paid off a tax lien.
An AJC investigation last summer exposed how Ferdinand seized upon that law to profit off his controversial practice of selling liens to private collectors, adding about $22,000 to $31,000 per year to his annual pay.
Frank X. Moore, an attorney who has represented more than a dozen property owners pitted against debt buyers and Ferdinand’s office, said taxpayers should also be concerned about the nearly $35,000 he’s receiving for his cows.
“That’s a whole lot of money to Rita James, who gets by on $700 a month in Social Security,” he said of one client, a grandmother in her 70s who nearly lost her home because of a billing error and a lien sale. “This guy has no shame. He seems to be an expert at benefiting from government.”
Arthur Ferdinand is Georgia’s top-paid elected officeholder, with take-home pay of $380,000.
Fulton County Tax Commissioner Arthur Ferdinand acquired the 70-acre farm off Hutcheson Ferry Road in south Fulton County about 10 years ago.
BRANT SANDERLIN / BSANDERLIN@AJC.COM
METRO ATLANTA’S TOP EQIP RECIPIENTS
An analysis of farm bill data found that of all farmers in Clayton, Cobb, DeKalb, Fulton and Gwinnett counties, Fulton County Tax Commissioner Arthur Ferdinand has received the second-highest allocation of funds during the past decade. The top five recipients:
› Originally authorized by the 1996 farm bill › Funded at more than $4 billion since its inception › Purpose: To help agricultural producers manage their operations in ways that protect soil, water, plant, animal and air resources, on both farmland and forestland.
› Provides financial and technical help through contracts of up to 10 years.
› EQIP contracts in Georgia totaled $13.4 million in 2011, $24.8 million in 2012 and $28.6 million this year.
› An estimated one out of every three EQIP applicants receives funding in Georgia, but no farmers have been turned down in Fulton County in the past several years because so few applied.
› Benefits are limited to individuals or entities with adjusted gross incomes of $1 million per year or less.
› Records show Fulton County Tax Commissioner Arthur Ferdinand has received four allocations: $11,543 (2005), $5,346 (2009), $3,531 (2011) and $14,188 (2013). For the 2013 contract, he has yet to receive $8,518, data shows.
SOURCE: U.S. DEPARTMENT OFAGRICULTURE LITERATURE; DATA PROVIDED
BYTHE NATURAL RESOURCES CONSERVATION SERVICE UNDER A FEDERAL
FREEDOM OF INFORMATION ACT REQUEST; FEDERAL DATA COMPILED BY
THE ENVIRONMENTALWORKING GROUP; FULTON COUNTY SOILAND WATER
CONSERVATION DISTRICT CHAIRMAN ALAN TONEY
AJC WATCHDOG COVERAGE
The Atlanta Journal-Constitution has covered an array of issues involving the Fulton County Tax Commissioner’s Office, including its sales of tax debts to private collection firms and tax chief Arthur Ferdinand’s take-home pay. Through $1-per-parcel fees charged to Atlanta, Johns Creek and Sandy Springs, Ferdinand boosts his annual pay by hundreds of thousands of dollars per year, making him the state’s highest-paid elected official.
This year, the AJC revealed how Ferdinand’s quick sales of delinquent tax bills, before the county collected a 10 percent penalty, handed as much as $20 million in potential revenues to Vesta Holdings, the biggest lien buyer, with a corresponding $20 million loss to taxpayers. The AJC also discovered that Ferdinand dipped into his budget to buy a 2013 Ford Explorer Limited for $39,000, which he can use for his commute to work.
Another investigation revealed he has been earning an extra $22,000 to $31,000 per year by taking 50 cents every time he sells a tax lien to a collector or a taxpayer pays off a lien themselves, which critics called a staggering conflict of interest.
Then the AJC revealed Ferdinand personally intervened after a tax debt owed by Atlanta Mayor Kasim Reed’s real estate holding company, Cascade Investors, was sold to Vesta. The Tax Commissioner’s Office got the debt transferred back to the county, then later filed documents asking the Superior Court Clerk to remove all liens filed against Cascade from the record.
Local neighborhood says Fulton Tax Commissioner is costing them millions
NBC Atlanta - 9:56 PM, Dec 10, 2013
EAST POINT, Ga. -- It is an economic success story on the southwest side of Atlanta. Anchored by the Camp Creek Marketplace, this ambitious area west of Hartsfield-Jackson Airport has quietly thrived over the last decade.
"It's just a nice place to be. We all can't live on the north side," added David Cole, another resident.
For the last seven months, property owners in this area have tried to form a community improvement district. CIDs are commonplace on the north side of town. They are self taxing and funnel extra tax money into their own district for infrastructure and other improvements. They've been unable to form that CID, they say, because the Fulton County tax commissioner has blocked it.
The tax commissioner is Arthur Ferdinand-- the elected official with the highest salary in the state. Ferdinand made $383,000 last year -- by taking his county salary, personally collecting fees on certain tax bills, and by personally collecting legal kickbacks from debt collectors.
"This by the way is taxation that I volunteered for," said Neel Shah, who owns two hotels in the proposed CID.
Neel Shah owns two hotels in the proposed district. He says seven months of foot dragging by Commissioner Ferdinand is costing his area's proposed CID millions of dollars.
"So I feel like I've lost $6.5 million or more than that - money that was going to be directed into that area, specifically for security, lighting and cleanup," Shah said.
Shah says instead, much of that money has been redirected to wealthier communities on the north side of Atlanta.
Ferdinand released a statement that said in part: "Our office is required to assure prior to certification, that each CID establishes that 50% of the property owners approve the creation of the CID and those consenting owners must own 75% of the fair market value of the properties within the proposed CID boundary.
"In vetting the ownership information of the proposed Airport West CID, we have concerns that give rise to a need for further review to assure the thresholds have been satisfied."
Shah says Ferdinand is mistaken. "They themselves admitted that we were within 100 percent compliance on our paperwork," he said.
Another effort is brewing to cut the pay of the state’s highest-paid elected official — something frequently attempted but never accomplished.
Commissioners were unaware of the arrangement until it was exposed in an investigation by The Atlanta Journal-Constitution in August.
Ferdinand is likely the only Georgia tax chief keeping that fee, which also fattens his paycheck when delinquent taxpayers pay off a lien on their own. He has been pocketing roughly $22,000 to $31,000 extra per year. That boosted his pay last year to about $383,000 for a job where he started out earning $77,400 in 1997.
Commission Vice Chairwoman Emma Darnell, who represents the western portion of Atlanta, called the practice “citizen exploitation,” giving the tax chief a personal financial incentive to transfer more liens to profit-driven investors.
Another try came in this year’s session, when Republicans introduced House Bill 346, which would make Fulton’s tax commissioner an appointed county official again in 2017, serving at the will of the County Commission. That bill stalled in the Senate but will be back in play next year.
The Atlanta Journal-Constitution has uncovered problems stemming from the Fulton County Tax Commissioner’s Office’s sales of tax debts to private collection firms. Previous articles described how homeowners didn’t know they owed overdue taxes until their homes were being auctioned and they owed thousands of dollars in penalties and interest to settle small bills. Arthur Ferdinand has also taken heat for being the state’s highest-paid elected official through personal fees from tax collections in Atlanta, Sandy Springs and Johns Creek.
The Atlanta Journal-Constitution has covered an array of issues involving the Fulton County Tax Commissioner’s Office’s sales of tax debts to private collection firms and how tax chief Arthur Ferdinand’s pay has come under scrutiny. This year, the AJC revealed how Ferdinand’s quick sales of delinquent tax bills, before the county collected a 10 percent penalty, handed as much as $20 million in potential revenues to Vesta Holdings, the biggest lien buyer, with a corresponding $20 million loss to taxpayers. The AJC also discovered that Ferdinand had dipped into his budget to buy a 2013 Ford Explorer Limited for $39,000, which he can use for his commute to work.
Another investigation, published Sunday, revealed that Ferdinand personally intervened after a tax debt owed by Atlanta Mayor Kasim Reed’s real estate holding company, Cascade Investors, was sold to Vesta. The Tax Commissioner’s Office got the debt transferred back to the county, then later filed documents asking the Superior Court Clerk to remove all liens filed against Cascade from the record.
Reed dodges lien on late tax
Fulton tax chief ’s intervention departs from aggressive tactics.
By Shannon McCaffrey firstname.lastname@example.org and Johnny Edwards email@example.com
Atlanta Mayor Kasim Reed’s real estate investment company has been chronically late paying taxes on a vacant warehouse south of the city. And when one overdue bill got turned over to a collection firm, Fulton County Tax Commissioner Arthur Ferdinand — another prominent Democrat — intervened personally to return the debt to the county.
Ferdinand’s intervention, which spared Reed potential public embarrassment, runs counter to the aggressive tactics the tax office typically uses in selling liens on delinquent properties.
The chain of events, exclusively documented by The Atlanta Journal-Constitution through open records requests, left a bitter taste in the mouths of some who have battled with Ferdinand’s office over the years.
"It must be nice to have the ability to handle something like that without eight to 10 years of litigation," said attorney Frank X. Moore, who has represented more than a dozen property owners pitted against debt buyers and the county tax office. "I would say, it sure pays to have friends in power." Reed’s lawyer, Robert High-smith, denied that Ferdinand gave Reed special treatment. "He didn’t make an exception," Highsmith said. "If the tax commissioner had not agreed with us (that the debt was sold in error), they would not have withdrawn the lien."
Neither Reed nor Ferdinand consented to the AJC’s requests for interviews. Reed’s representatives pointed out that the company is now current on its tax bills.
His camp reiterated what Ferdinand himself had said in legal filings: that the lien should never have been sold, because the mayor’s company had already paid the taxes.
However, on that and other crucial points, their explanations do not square with records obtained by the AJC. The check for the tax bill was dated months after Ferdinand’s office bought the debt back from the collection company.
An investment that stalled
Reed’s tax problem had its roots in 2006, when he formed Cascade Investors with four other men to purchase property near his home in the southwest corner of the city. Reed was listed as managing member of the investment group until 2012, according to personal financial disclosures filed with the state and city.
According to the mayor’s spokeswoman, Sonji Jacobs, the partners also include Atlanta lawyers Lawrence and Robbie Ashe, father and son, respectively, of former Democratic state Rep. Kathy Ashe. The other partners are Aldrin Davis, a rap artist and producer better known as D J Toomp, and Darrell Anderson, a longtime friend of Reed who owns a limousine company. Reed has a 20 percent stake in the property.
At a foreclosure auction in November 2006, Cascade bought a vacant warehouse on Fairburn Road, paying about $1 million. Seven months later the partnership purchased a 3.5-acre wooded parcel adjacent to the warehouse for another $425,000. Both properties lie in unincorporated Fulton County, a stone’s throw from the Atlanta city line.
The plan, Anderson said in an interview with the AJC, was to create retail space and loft apartments, akin to the development taking place on the north side of the city.
"We wanted to do something and create investment on the south side, where there wasn’t anything of that level going on," Anderson said.
But their timing was off. The real estate collapse in 2007 stalled their plans, Anderson said, perhaps indefinitely. The warehouse sits empty. And since 2006, county records show that Cascade has repeatedly been late in paying its taxes, ultimately paying $15,000 in interest and penalties as a result.
Ferdinand takes a hand
During the 2009 mayor’s race, rival Mary Norwood blasted Reed’s failure to pay taxes on time. Reed narrowly beat Norwood.
When he became mayor in January 2010, Cascade Investors owed about $16,000 in overdue 2009 taxes.
Records show that in May 2010, the tax commissioners’ office sold that debt to Vesta Holdings, the county’s biggest buyer of tax liens. Vesta could have eventually auctioned off the warehouse to settle the account.
A week after the debt was sold, Ferdinand’s administrator of delinquent taxes, Terry Noble, sent an email to Richard Robinson of Vesta.
"Based on my conversation with Dr. Ferdinand," Noble said, "I am requesting that you transfer the referenced parcel... back to to Fulton County as soon as possible."
Reed’s lawyer, Highsmith, told the AJC that he did contact the tax office on behalf of Cascade, seeking to have the lien reversed. But he said no political favoritism was involved, because he did not mention that Reed was among Cascade’s partners.
Subsequently, the AJC obtained a letter, written by High-smith, indicating that Ferdinand already knew of Reed’s involvement. That’s because Reed himself had previously spoken to Ferdinand about Cas cade’s tax troubles.
According to the letter, Reed met with the tax commissioner in April 2010, seeking to clear up confusion over the address to which the tax bills should be mailed.
Queried about that meeting, Jacobs, the mayor’s spokeswoman, portrayed it as accidental, not an attempt by the mayor to involve Ferdinand in resolving Cascade’s tax delinquency.
"Mayor Reed checked on his tax records," she told the AJC in an email, "and like any other citizen might do, went to the office in person. When folks heard he was in the building, they apparently told Mr. Ferdinand, who came out to speak with him."
Jacobs said Cascade failed to pay the 2009 bill because it was sent to the wrong address: the midtown Atlanta law firm Holland and Knight, where Reed was a partner before becoming mayor.
Highsmith is the firm’s executive partner. As recently as 2012, he said in a letter to Ferdinand that the firm represents Cascade Investors in tax matters.
Jacobs said Reed had tried multiple times to change the address. However, the Tax Assessor’s Office, which is separate from Ferdinand’s office, and which maintains the address files, told the AJC it has no record of any attempt by Cascade to change where its mail was sent before 2012.
Highsmith also blamed a mailing mix-up for Cascade’s problems. He said the partnership never received a legally-required notice before the county filed a lien against its property, and that’s why the Tax Commissioner’s Office had to undo the lien.
But records in Ferdinand’s office show a notice was generated well in advance. The AJC obtained a copy, and it bore Holland and Knight’s address.
It is not uncommon for property owners whose tax liens are sold by Ferdinand to claim they were not properly notified; Ferdinand’s policy in such cases is to tell the taxpayers to resolve the matter by satisfying the debt with the firm that bought it.
One more twist
In 2012, two years after his initial involvement, Ferdinand took another action that benefited Reed. He filed a document saying the county had erred in placing a tax claim against the warehouse in the first place. And he instructed the Superior Court Clerk to remove the lien from the record.
A stamp on the document said the lien was issued through "inadvertence," and that "payment processed before lien was filed."
But Cascade’s check was dated months after the county bought back the debt from Vesta.
In response to questions about the apparent discrepancy, Highsmith said Cascade had tried earlier to pay the taxes with a cashier’s check. No such check turned up in an open records request to the tax office for all checks received from Cascade, dating back to 2006.
Highsmith said he could produce a copy for the AJC, but he did not.
Ferdinand also nullified the only other two claims ever placed against Cascade’s properties despite years of late taxes, according to Superior Court records. The tax chief filed documents telling the clerk to remove both a lien for 2009 taxes against the wooded parcel and a lien for 2011 taxes against the warehouse because of "address change" issues.
Those who have tussled with Vesta and Ferdinand’s office over the years were livid to hear of Reed’s treatment. Moore, the attorney, said some of his clients have been held to a different standard despite having far better excuses for not receiving notice of taxes or liens.
One such client was Rita James, a grandmother in her 70s, who nearly lost her home because of a billing error.
After James paid off her mortgage, Moore said, she paid the tax bills that came to her house in her name.
But her house straddles two subdivision lots. Another bill, as well as notices of overdue taxes and notices of the lien sale, apparently went to Archie James, a person the woman had never heard of, at an address that does not exist.
Ferdinand’s office issued a lien, then sold the debt to Vesta, which auctioned the parcel. The winning bidder put a claim against James, and she had to hire Moore and take the matter to court to keep her home. Last year Ferdinand’s office placed two liens against Mark Scott’s Buckhead house when he was three and two months late paying his city and county tax bills. A Vesta company bought the liens.
Scott paid $34,650 to settle up. He acknowledges that he was at fault, but he said he wishes he’d had the privilege of dealing with the county instead of Vesta. Taxpayers have long complained that Vesta makes little effort to inform them of debts and can be difficult to contact when they try to pay them off.
"It’s flat-out wrong," Scott said of the way Reed’s firm was treated. "You need to be held to the same standard as the people that are paying your salary."
A vacant warehouse sits fenced off along Fairburn Road in Fulton County. Records show that property taxes on the warehouse, owned by an investment company managed by Atlanta Mayor Kasim Reed, have been habitually paid late. KENT D. JOHNSON / KDJOHNSON@AJC.COM
Atlanta Mayor Kasim Reed did not seek special treatment from the Fulton County tax commissioner, the mayor’s spokeswoman says. HYOSUB SHIN / HSHIN@AJC.COM
HOW WE GOT THE STORY
With Atlanta Mayor Kasim Reed seeking a second term, Atlanta Journal-Constitution reporter Shannon McCaffrey decided re-examine his financial records and real estate holdings, discovering that the mayor’s real estate holding company, Cascade Investors, had a history of paying taxes late. Meanwhile, AJC reporter Johnny Edwards had been scrutinizing the collection practices of Fulton County Tax Commissioner Arthur Ferininand, having recently exposed how he personally profits from the sale of tax liens to private investors.
The reporters discovered an email, obtained through an open records request, that brought the two issues together. In June 2010, Ferdinand’s delinquent tax administrator, Terry Noble, sent an email to Richard Robinson of Vesta Holdings, seeking the return of a lien worth $18,500 against Cascade’s warehouse on Fairburn Road. Noble said he’d had a"conversation with Dr. Ferdinand"about the matter.
Intrigued, McCaffrey and Edwards pored through online tax records and lien records filed with the Fulton County Superior Court Clerk. They also filed open records requests for checks used to pay taxes on the property, discovering that — contrary to a court filing by Ferdinand — Reed’s company actually paid eight months late. Attempts to interview Ferdinand and Reed about the matter were fruitless, and Reed’s camp offered a shifting narrative that didn’t hold up to scrutiny.
For example, Reed’s representatives said he never received notice that the county planned to file a lien against the property because the county failed to process a change-of-address request. However, the Tax Assessors Office says tax mailings went to Reed’s attorney’s office from 2007 to 2011.
Also, Reed’s attorney said he contacted the Tax Commissioner’s Office seeking reversal of the lien, and that he never dropped the mayor’s name. However, the reporters obtained a letter, written by Reed’s attorney, saying that Reed and Ferdinand had met in April 2010 to discuss Cascade’s tax account.
November 2006: Kasim Reed creates Cascade Investors LLC, a real estate holding company. Cascade purchases a 38,156-square-foot warehouse in southwest Fulton County for $1 million at a foreclosure auction.
July 2007: Cascade Investors purchases another 3-acre parcel adjacent to the warehouse for $425,000.
December 2009: Reed elected mayor of Atlanta.
March 12, 2010: Fulton County Tax Commissioner Arthur Ferdinand places a lien against the warehouse property for a $16,392. The bill, at this point, is almost three months late.
April 2010: Ferdinand and Reed meet personally to talk about Cascade’s tax account, according to a letter written by Reed’s attorney.The newly elected mayor, the letter says, asked for an address change, and Ferdinand told him to take that up with the Tax Assessor’s Office.
May 26, 2010: Vesta Holdings buys the warehouse lien from Ferdinand.
June 2, 2010: Ferdinand’s delinquent tax administrator, Terry Noble, sends an email to Richard Robinson of Vesta Holdings saying,"Based on my conversation with Dr. Ferdinand, I am requesting that you transfer the referenced parcel (2009 FUL cycle) back to Fulton County as soon as possible." Aug. 10, 2010: Cascade Investors issues a check totalling $25,147 to Ferdinand for the 2009 taxes, interest and penalties on the warehouse, as well as for most of the 2009 taxes on the adjacent lot.
February 24, 2012: Ferdinand’s office files another copy of the warehouse lien with a message saying it was filed in error because payment had actually been received before the lien was originally filed.
March 12, 2012: Ferdinand’s office files copies of two other liens against Cascade’s properties for late-paid 2009 and 2011 taxes, again directing the Superior Court Clerk to remove them from the record because of"address change"issues. The letter from Reed’s attorney to Ferdinand referencing their April 2010 meeting is dated the same day, and adds, "We are grateful to your office for having the FiFa marked as having been issued in error."
August 2013: Reed announces he will seek a second term.
The complicating factor here is that Ferdinand is BLACK and a Democrat, most other Black voters/taxpayers are not going to back any effort to look into a fellow Black and Democrat. This is just the way minorities act, they protect their own, but until a grand jury takes up the matter, Ferdinand will continue to line his pockets and run rough shod over anyone he perceives as an 'enemy'.
Liens a cash cow for Fulton tax chief http://gapundit.com/2013/08/12/liens-a-cash-cow-for-fulton-tax-chief-www-myajc-com/
Posted on August 12, 2013 5:45 AM by Todd Rehm
Seizing on a law on the books since the Great Depression, by 2010 Tax Commissioner Arthur Ferdinand had found a way to personally profit from the controversial collection system he set up.
Now, Ferdinand takes a cut every time his office sells a tax debt to a private collection firm or the taxpayer antes up, an investigation by The Atlanta Journal-Constitution has found. He already was Georgia’s highest-paid elected official, but a 50-cent fee he now gets on each and every paid-off lien has added tens of thousands a dollars a year to his pay.
With the boost, Ferdinand earned $383,000 last year for a job where he started out earning $77,400 in 1997.
Not even county commissioners knew how much he really makes, even though the fees were going into county coffers before they were diverted to Ferdinand’s pocket. He may be Georgia’s only tax commissioner taking that money.
Ferdinand wouldn’t discuss the payments, saying only that they are "permitted by law." And Fulton County’s lawyers have blessed the arrangement, though they will not explain their reasoning.
Other attorneys, though, are not so sure Ferdinand can legally take both a full salary and a slice of lien proceeds, and they say the arrangement creates a staggering conflict of interest. The tax commissioner, critics say, now has a profit motive to hurl more taxpayers into a system that can put them at risk of losing their homes over small debts.
No other tax commissioner in Georgia sells so many tax liens to private debt collectors. With each sale, Ferdinand hears cha-ching!
(Misc FYI: If you were going to a specific page and no longer find it, keep in mind that the site has been consolidated and to save space posts have been lumped together)
When the housing crisis was squeezing Atlanta and many homeowners struggled to pay their property taxes, life was getting sweeter for Fulton County’s chief tax collector.
Seizing on a law on the books since the Great Depression, Tax Commissioner Arthur Ferdinand had found a way by 2010 to personally profit from the controversial collection system he set up.
Now, Ferdinand takes a cut every time his office sells a tax debt to a private collection firm or the taxpayer antes up, an investigation by The Atlanta Journal-Constitution has found. He already was Georgia’s highest-paid elected official, but a 50-cent fee he now gets on each and every paid-off lien has added tens of thousands of dollars a year to his pay.
No other tax commissioner in Georgia sells so many tax liens to private debt collectors. With each sale, Ferdinand hears cha-ching!
To questions about his personal profits and the potential conflict, Ferdinand’s only response was to cite the state law that the Fulton County Attorney’s Office said justified the payments — a law dating back at least to 1933, when most tax commissioners earned their pay through fees.
“Just because there is a law on the books that authorizes certain behavior,” state Rep. Lynne Riley, R-Johns Creek, said, “that doesn’t mean it’s ethically or morally the appropriate thing to do.”
Seizing a new cash stream
The lien fees Ferdinand is paid come on top of his six-figure county salary and on top of the $1-per-parcel fees he collects from Atlanta, Johns Creek and Sandy Springs for adding their city tax bills to county bills.
The County Attorney’s Office issued a legal ruling saying Ferdinand had a right to the money, Assistant Finance Director Sharon Whitmore told the AJC. The county would agree to go back only to July 2007 with retroactive payments, she said, so in 2011 Ferdinand received a lump sum payment of more than $87,000.
There was no public discussion of the change, and county commissioners, who set Ferdinand’s budget, say they weren’t aware of it until contacted by the newspaper.
When most tax commissioners began receiving salaries, local legislation forbade them from still keeping fees, too, Dan Ray said. In Rockdale County, where he formerly served as tax chief before leading GATO, county code specifies that.
Tax commissioners in Cobb and Gwinnett are paid a salary and the lien fees go to their counties, not to them. DeKalb Tax Commissioner Claudia Lawson earns personal fees for billing nine cities’ taxes — earning nearly $237,000 last year including her salary — but gets nothing extra when liens are paid off.
The law department won’t release its opinion to the AJC, citing attorney-client privilege.
Several North Fulton state lawmakers, though, were livid upon being informed of the profits from liens. They called Ferdinand’s position audacious, considering that he already earns more than twice as much as Gov. Nathan Deal.
“That’s outrageous,” said state House Speaker Pro Tem Jan Jones, R-Milton, who had to pay the county’s biggest lien buyer — Vesta Holdings — $105 to satisfy a lien against her home in 2011. “He has a built-in incentive to slap a lien before a taxpayer has had adequate notice to clean up a mistake, even.”
Each year, Georgia tax chiefs meet at the state’s top resorts for a conference that allows time to golf and hobnob with vendors. Picking up the tab are taxpayers and companies seeking contracts, an AJC investigation found.
A series of investigations by The Atlanta Journal-Constitution this year has spotlighted concerns about operations of the Fulton County Tax Commissioner’s Office. Among the stories, the AJC reported in February that Tax Commissioner Arthur Ferdinand’s quick sales of delinquent tax bills, before the county collected a 10 percent penalty, handed as much as $20 million in potential profits to Vesta Holdings, the biggest lien buyer, with a corresponding $20 million loss to taxpayers.
In April, another investigation showed how savvy investors use tax liens to short-circuit legal safeguards and quickly snatch homes away from taxpayers who get behind on bills, sometimes for a fraction of the properties’values.
For this story, Fulton County reporter Johnny Edwards used the Georgia Open Records Act to pore through hundreds of pages of documents showing Ferdinand’s compensation and expense reimbursements. Among them were income tax forms revealing that the tax commissioner, the state’s highest-paid elected official, has been earning even more money than previously reported.
Edwards examined campaign finance disclosure statements and property tax records. And with assistance from database reporter Jeff Ernsthausen, he used a tax lien database that the AJC obtained after a two-year open records battle with Ferdinand and the county.
Financial documents show that during the roughest years of the Great Recession, when other county offices were scrambling to cut expenses, the tax commissioner took his five highest-paid staffers to lake-front luxury lodges for their “budget planning” sessions. Taxpayers picked up hotel bills of as much as $295 per night for each person.
Meanwhile, at county expense, he showed up for conferences on Sundays, a day early, when the only items on the Monday agendas were golf and evening receptions.
“My goodness, it never ends,” state Rep. Wendell Willard, a Sandy Springs city attorney who has tangled with Ferdinand over the years. “This guy will find every possible way to milk the taxpayers.”
Ferdinand declined an interview request but answered some questions sent to him in writing. On the staff budget-planning overnight trips, he said, “Our planning sessions are justified based upon the financial results they deliver.”
As to why he collected the county meal per diem for conferences where many meals were provided, Ferdinand said, “County policy also allows for employees to eat outside of the conferences when the meals served are not suitable to the individual’s dietary needs.”
He did not respond to questions about whether he had any such needs. The policy the AJC obtained from the county Finance Department doesn’t list such an exception.
Assistant Finance Director Sharon Whitmore said in an email that it has been an administrative practice to allow for outside meals if someone submits a doctor’s letter and gets approval from the county manager. She said, through a spokeswoman, she was not aware of any such letter from Ferdinand.
Regardless, he told the organizers of the 2009 Georgia Association of Tax Officials conference that he didn’t have any food issues. The registration form asked, “Special dietary re strictions?” He checked “no.”
For that conference in Athens, he took $140 to cover 12 meals, or three per day for four days. Based on the session times, meals provided and county rules, he was entitled to just $60.
The commission has also given him leeway in managing his overall budget. And when other county divisions were being ordered to cut spending, Ferdinand’s office didn’t suffer from the same constraints. The past two years, when other departments have been asked to reduce their budgets by up to 5 per cent, the Tax Commissioner’s Office has been among the few exempted.
Ferdinand has planned his office budgets at posh locations. In 2009, for example, he took his five top aides to an overnight budget-planning trip to the Ritz-Carlton Lodge at Reynolds Plantation. From 2010 to 2012, the budget was planned at the Legacy Lodge at Lake Lanier. The trips cost taxpayers about $1,700 to $2,000.
“It looks to me like a thinly veiled boondoggle,” Jim Honkisz, the interim president of the Fulton County Taxpayers Foundation, said. “The question is whether that’s a fair use of taxpayer dollars.”
That’s also a question when Ferdinand has billed the county for meal per diems — $35 a day for three meals — for the three to four conferences a year he regularly attends at public expense.
Financial records show the conferences provide breakfast, lunch or dinner on some of the days. But Ferdinand repeatedly collected the full per diem.
For example, he received $175 for five days for the four-day 2009 TC Tech conference, at the King and Prince Beach & Golf Resort on St. Simons Island. The conference opened Monday with golf, and Ferdinand arrived Sunday. Breakfast and lunch were provided Tuesday and Wednesday, and dinner was provided Wednesday, according to the agenda.
For the 2012 GATO conference in Athens, he received a meal per diem of $140 for four days, even though it started at 4 p.m. on Monday and ended at noon on Thursday. The registration fee of $230 included lunch Tuesday, lunch and a banquet Wednesday and a buffet breakfast Thursday.
The county policy on meal reimbursements says, “Generally, employees will not be provided the full per diem amount on the departure and return dates ... An employee cannot ask for per diem on a meal that is covered as part of the registration fee.”
However, the county apparently didn’t question his meal spending for years, even though conference information attached to his expense reports often listed the meals provided.
He charged the county repeatedly for lunches at the exclusive Commerce Club on the 49th floor of 191 Peachtree Tower, often ordering crawfish chowder, pink lemonade and the spinach and rocket salad.
On payment vouchers, he did not say who he ate with or what business purposes the meetings served. No county policy requires that.
Ferdinand wouldn’t tell the AJC who accompanied him or why. “All documents required by the county were sent to Finance for processing,” he responded. “All other questions have been answered.”
Commissioner Bill Edwards said there’s nothing he can do about how Ferdinand spends his department’s money.
$438,000 Ferdinand’s total compensation in 2011, including an $87,000 lump sum for four years of back fees on liens
Amount that Ferdinand received $214,000 in personal fees in 2012 for his office’s handling of taxes for the cities of Atlanta, Sandy Springs and Johns Creek $0 Amount of special fees Ferdinand’s staffers receive for their work handling liens and collecting for the three cities $65 Average tab of Ferdinand’s business lunches for two at the Commerce Club at 191 Peachtree St., where he apparently enjoys the crawfish chowder and pink lemonade. Dining companions unknown.
OFFICE / PERSONNEL
Envision Payment Solutions, which has a contract with Gwinnett to handle bad check collections, sponsored a comedy magician who performed during an hour-and-a-half lunch at the conference in June. Tyler Technologies, a software provider for Fulton’s and DeKalb’s tax offices, sponsored a campfire dinner and hayride on the final night.
“To retain public confidence, they need to make sure these people are learning something and not just working on their golf game,” Ellis said.
CONTRIBUTED BY BRASSTOWN VALLEY RESORT
Fulton tax chief Arthur Ferdinand’s expenses show he spent more than $8,000 on himself and five others when TC Tech was at the King & Prince Beach and Golf Resort (left) in St. Simons in 2011. He spent about $6,600 when it was at Brasstown Valley Resort (right) in 2012.
(From the AJC) YOUR TAX MONEY
Dispute to cost taxpayers
Fulton to pay legal fees for tax chief; commissioner sues, alleges retaliation. By Johnny Edwards firstname.lastname@example.org
Fulton County taxpayers have already been funding a take-home SUV for Tax Commissioner Arthur Ferdinand, the state’s highest-paid elected official.
Now they’re paying for his lawyer, too, at a price of $275 an hour.
The county is hiring a private attorney to defend Ferdinand against a lawsuit filed by north Fulton Commissioner Liz Hausmann, who alleges he abused his authority and re taliated against her by revoking the license plate on a 2004 Jeep that her daughter drives. Three weeks earlier, she had publicly questioned why the county pays for his commute, considering his yearly earnings of nearly $350,000.
Documents obtained in a joint effort by The Atlanta Journal-Constitution and Channel 2 Action News show Ferdinand went after Hausmann more aggressively than his office does other residents accused of registering vehicles in the wrong county. He gave her less time to set matters straight before he canceled her registration and informed law enforcement that the Jeep had no valid tag.
And he has yet to provide evidence of the anonymous tip that he says prompted him to look into the commissioner’s residency. Nor has he explained what channel the tip came through, other than telling Channel 2 that it wasn’t by email.
Such details could be crucial. At issue in the lawsuit is whether he singled out Hausmann for harsh treatment, or if he was just doing his job.
The dispute involves power, accountability and use of public resources, and now it’s cutting into county finances, possibly by tens of thousands of dollars. Commissioners approved paying for an outside counsel to represent Ferdinand earlier this month in a closed meeting without Hausmann present.
The county paid for Ferdinand’s defense in the early 2000s when then-Commission Chairman Mike Kenn sued him, alleging political revenge when the tax chief tried to close two north Fulton restaurants by claiming Kenn owed $26,000 in excise taxes for underreporting alcohol sales.
Legal expenses in that case topped $120,000.
"I think he should have to pay his own legal fees," Hausmann told the AJC. "I have to pay my own legal fees."
The county could be further on the hook if she prevails. Hausmann said she’s seeking only to be paid back for legal bills and the rental car her daughter used before Ferdinand finally reinstated the tag. The sum is currently about $18,500, she said.
"I just feel like citizens don’t deserve to be treated like this," she said. "It was a frivolous matter that had no basis in fact and no merit, and unfortunately it has cost me resources to defend it."
Ferdinand has not responded to numerous requests for comment from the AJC about the issue, and he did not respond to a list of questions or to an interview request for this story sent to him by Channel 2.
Ferdinand’s new attorney, Marietta lawyer Randy Turner, said in emails Friday to the AJC and Channel 2 that "the claims against Dr. Ferdinand are without merit."
"This will be established in due course in the Superior Court," Turner said. "Dr. Ferdinand has acted only as he is authorized by law to act in carrying out the responsibilities of his office."
The Ferdinand-Hausmann feud started in early May when, during a review of a routine take-home vehicle report dur ing a public meeting, she questioned why the tax commissioner appeared on the list. Through an open records request, the AJC learned that he dipped into his own department’s funds to buy a $39,000 Ford Explorer Limited — a higher-grade model than the one listed on the take-home report.
Ferdinand later circulated a memo suggesting Hausmann may actually live in Gwinnett County, making her ineligible for office. He cited an out-of-date address on both her campaign disclosure forms and on her vehicle registration. The tax on the vehicle, he said, was paid with a check bearing a Gwinnett address.
Hausmann responded that she moved in with her sister and brother-in-law in Johns Creek because she is going through a divorce, and with that and her father’s recent death she forgot to update her address. Her daughter paid the registration renewal with a check bearing her father’s address, Hausmann said.
Ferdinand eventually reinstated the tag after Hausmann gave him a document from the county elections office showing her new address.
Jim Honkisz, the interim president of the Fulton County Taxpayers Foun dation, said he agrees with paying for Ferdinand’s defense, since he is being sued in his official capacity. But if Hausmann proves he acted beyond his authority, Ferdinand should reimburse the county, Honkisz said.
Channel 2 filed an open records request for any instances since January 2011 when the tax office revoked or suspended license plates as a result of its own investigations. The county provided letters and memos from 17 cases where residents had questionable auto registrations.
The documents show Hausmann’s case may be the only time in the past 2½ years that the tax office pursued someone with a Fulton tag suspected of living elsewhere.
Typically, the records show, Ferdinand’s office finds people claiming to live in Fulton, or businesses based in Fulton, who have vehicles registered in other counties. He then demands they pay up — either the vehicle taxes or reimbursement for years of undeserved homestead exemptions, which are tax breaks for those who live at their properties.
While the letters show other taxpayers have been given between 11 days and two months to settle the matters, Ferdinand gave Hausmann just seven days to prove she still lived in Fulton, which her attorney, Josh Belinfante, says was an arbi trary deadline with no basis in law.
"I think it confirms a lot of the concerns that we had," said Belinfante, a former member of the state ethics commission. "Here you’ve got apparently what is the only situation where he’s telling someone, ‘We don’t want your money.’ "
Tax officials in other counties say such situations come up, brought to their attention by tips from residents, their own observations or other counties that conduct homestead exemption audits. None, however, said they would take such swift, Draconian measures, and that revoking a tag would be done only as a last resort.
Dan Ray, the executive director of the Georgia Association of Tax Officials and Rockdale County’s former tax commissioner, said if he found people living elsewhere but paying Rockdale’s vehicle taxes, he would flag their accounts so they couldn’t register again.
"I don’t know that I would go in and cancel the thing," he said, "but I would go in and put a notation on there."
The Atlanta Journal-Constitution has uncovered problems stemming from the sale of tax debts to private collection firms by the Fulton County Tax Commissioner’s Office, putting residents at risk of losing their homes and giving millions in potential profits to the biggest lien buyer, with a direct loss to taxpayers. Previous articles have shown how Tax Commissioner Arthur Ferdinand has become the state’s highest-paid elected official through personal fees from tax collections in Atlanta, Johns Creek and Sandy Springs.
Sic semper tyrannis
While Counts 1-4 of the May 27th, 7 Count complaint appear moot with Ferdinands backing down within 48 hours and reinstating the vehicle registration, there remain 3 other Counts for the Court to consider
Clearly Count 7, which deals with costs, will be decided in favor of Hausmann. Counts 5 and 6 are more appropirate for an ethics complaint and relevant quotes are:
"Ferdinand's retaliation against Hausmann, under color of law and his authority as Fulton County Tax Commissioner, violates Hausmann's substantive due process guarantee against government power artitrarily and oppressively exercised."
"OCA 45-11-4 imposes a duty on public officers not to use 'oppression or tyrannical partiality in the administration or under the color of his or her office'."
Clearly Counts 5 & 6 will be used to show Ferdinand mis-used his office to settle a personal matter against a County Commissioner but such allegations, butressed with some of his other egregious actions, may well show up in an ethics complaint.
In this instance they will provide impetus for the judge to award the asked for costs to Hausmann.
Keep in mind the terms: 'Malfeasance' and 'Misfeasance' you may see them again this summer.
The 7 Count complaint runs 63 pages, inclusive of extensive exhibits, and you can view it at:
Hausmann 1 - Ferdinand 0
Fulton tax chief reinstates critic’s auto tag
Updated: 7:18 p.m. Wednesday, May 29, 2013
(Tax chief relents in car tag spat)
By Johnny Edwards The Atlanta Journal-Constitution
A struggle over power and accountability between the Fulton County tax chief and a north Fulton commissioner took another turn Wednesday.
Tax Commissioner Arthur Ferdinand reinstated the auto registration on a 2004 Jeep driven by Commissioner Liz Hausmann’s 24-year-old daughter, meaning she can use it again without fear of arrest.
With her daughter out of the fray, the dispute is now between Hausmann and Ferdinand. Hausmann is still suing him for attorney’s fees and unspecified damages, citing abuse of power and retaliation. She claims Ferdinand revoked the Jeep’s license plate because he was angry at her for calling attention to his own county take-home vehicle — an upscale SUV purchased at taxpayers’ expense.
"It is unfortunate that this matter has escalated to the point of a lawsuit," Hausmann said in a written statement, "and I am hopeful that other Fulton County residents will not be subjected to similar undue scrutiny."
Ferdinand did not immediately answer an email Wednesday, and an assistant said he was out of the office. He has not responded to numerous requests for comment from The Atlanta Journal-Constitution during the past month, though he told Channel 2 Action News earlier this month that he was not retaliating against Hausmann, just responding to a tip that she no longer lived in her district.
The two officials will no longer face off in Superior Court on Friday. Hausmann sought a temporary restraining order to force Ferdinand to reinstate the car tag, but her attorney, Josh Belinfante, said he backed off when she gave him a document from the county elections office showing her new Johns Creek address.
The chain of events began earlier this month when Hausmann questioned why the county should pay for Ferdinand’s commute, considering he’s the state’s highest-paid elected official with nearly $350,000 in yearly earnings. Through an open records request, the AJC learned that he dipped into his own department’s funds to buy a $39,000 Ford Explorer Limited.
Ferdinand later circulated a memo suggesting Hausmann may actually live in Gwinnett County, making her ineligible for office. He cited an out-of-date address on both her campaign disclosure forms and on her vehicle registration. The tax on the vehicle, he said, was paid with a check bearing a Gwinnett address.
Hausmann responded that she moved because she is going through a divorce, and with that and her father’s recent death she forgot to update her address. Her daughter paid the registration renewal with a check bearing her father’s address, Hausmann said.
Saying Hausmann still hadn’t proved she lives in Fulton, Ferdinand revoked the Jeep’s license plate last week and informed county law enforcement that the car had no valid tag, according to an internal memo.
Checks with other tax commissioners’ offices in the metro area found license plate revocations over residency questions to be rare. A spokeswoman for Gwinnett’s tax chief said he would not invalidate a registration for that reason.
This isn’t the first time Ferdinand has been accused of retaliating against a Northside commissioner who questioned his practices. In 2000, he tried to close two north Fulton restaurants owned by then-Chairman Mike Kenn, claiming Kenn owed $26,000 in excise taxes for underreporting alcohol sales.
The year before, Kenn had alerted the FBI about a taxpayer’s complaint of how Ferdinand’s office handled a $30,000 property tax refund, which mistakenly went to the wrong company out of state.
Ferdinand denied retaliation, saying the audits of Kenn’s bars were routine. Kenn sued, then later agreed to pay $8,000 in beverage taxes to settle the matter.
The Atlanta Journal-Constitution has uncovered problems stemming from the sales of tax debts to private collection firms by the Fulton County Tax Commissioner’s Office. Previous articles described how homeowners didn’t know they owed overdue taxes until their homes were being auctioned and they owed thousands of dollars in penalties and interest to settle what started as small bills.
Tax Commissioner Arthur Ferdinand has also taken heat for being the state’s highest-paid elected official through personal fees from tax collections in Atlanta, Johns Creek and Sandy Springs. State lawmakers have tried in vain to end the practice, saying that he’s earning extra money using the county’s labor, equipment and materials.
Tax Commissioner and bully Dr Ferdinand gets sued by Hausmann
The highest paid Government official in Georgia (at $347,000) is Fulton County Tax Commissioner Arthur Ferdinand, a Democrat and Black.
He makes enemies easily. Seems he may have his own Nixionian enemies list which keeps growing.
Not surprisingly it involves a lot of White Republicans who object to his using his elected position to coin money for himself, recieving his own substantial salary and also taking advantage of extremely questionable fees and for the sale of Tax Liens to Vesta Holdings *, frequently using them for such lien purchases and reportedly denying sales to other similar firms who are available and wish to make such purchases.
(* Vesta Holdings Rated by the BBB as 'F'
1737-G Ellsworth Industrial Blvd., Atlanta, GA 30318 http://www.vestaholdings.com/vesta/contactus.asp)
The most recent criticisms about his conduct revolve around his office's purchase of a top of the line $39,000, Ford Explorer, Limited Edition, for Ferdinand's personal use as a take home vehicle. Fulton County Commissioner Liz Hausmann, and a lot of others, criticized this misuse of taxpayer funds.
In an obvious retaliation Ferdinand made a bogus complaint to the County Attorney alleging that Hausmann did not live in the County. This is the 2nd time this year that he has used his position to take a shot at Hausmann. Now Commissioner Hausmann has taken the offensive and filed the below suit against Ferdinand for his latest bit of stupidity.
The Ferdinand/Hausmann conflict goes back as far as 2001 when Ferdinand sold a Tax Lien for $52 on property of County Commissioner Liz Hausmann.
Other critics of his cozy relationship with Vesta Holdings have found that they had tax liens placed on their Fulton County properties for trivial amounts (as low
as $21) and many claim that no notice was ever given to them about any late taxes before finding themselves liened by Ferdinand's office.
The 'enemies list' clearly includes the Atlanta Journal Constitution, which has effectively been 'at war' with Ferdinand for years. While a relatively small part of the Cox Empire*, the AJC is the largest of the Cox publications and Ferdinand has repeatedly gone after Cox properties in Fulton County with mostly minor tax liens sold to his pals at Vesta Holdings.
In this chicken and egg drama there is no clear winner and the 'war' continues while the AJC keeps up their articles about Ferdinand and the Tax Office and Ferdinand watches for any opportunity to lien another Cox property or the property of anyone else his considers a threat to his Tax Office kingdom.
I have seen enough reports of Ferdinands' conduct over the past few years to come to the conclusion that he is a bully, misuses his office and will use his position to retaliate or embarrass those who question his ethics or try to pass needed legislation to curb his abuse of the lien process in Fulton County. The relationship between Ferdinand and Vesta Holdings needs to be looked into, it just smells bad. Real bad.
The terms 'Malfeasance' and Misfeasance' come to mind. This ethics lapse is something the Governor should be taking up.
(*Cox Media Group is in 17 markets. In Atlanta they own:
AJC Newspaper, WSB 95.5FM and AM750 News/Talk WSB, WSB-TV - Channel 2, WSB-FM B98.5FM, WALR - KISS 104.1FM, WSRV - 97.1FM)
It is well past time for this out of control bully to get an ass kicking. Hopefully this suit will do the trick.
The 6 Count complaint runs 63 pages, inclusive of extensive exhibits, and you can view it at:
Per the AJC - the story so far
August – Funds from the Fulton County Tax Commissioner’s Office are used to buy an SUV for use by Tax Commissioner Arthur Ferdinand.
May 1 – Fulton County Commissioner Liz Hausmann questions Ferdinand’s need for a Ford Explorer XLT after it appears on a list of the county’s take-home vehicles.
May 10 – The Atlanta Journal-Constitution, through an open records request, obtains the purchase order for the vehicle, which turns out to be a higher grade of the model, a Ford Explorer Limited. The price was $39,000.
May 13 – Ferdinand sends a memo to the interim county attorney and county commissioners, citing a tip, that says Hausmann may not live in Fulton County. The house that Hausmann had listed as her address on campaign documents had been sold, and a check used to pay for the registration of a vehicle in her name bears a Gwinnett County address. Hausmann says she neglected to update her address because she is going through a divorce and recently dealt with the illness and death of her father. The vehicle’s registration renewal was paid for by Hausmann’s daughter, who drives it, using a check bearing her father’s address.
May 16 – Ferdinand denies retaliating against Hausmann and says he needs the SUV to drive to meetings, public appearances and his satellite offices. He also says he will not consider giving up the vehicle unless told to do so by the whole commission.
May 25 – Hausmann seeks a restraining order and after learning that Ferdinand has revoked the tag on the vehicle registered in her name.
Fulton County Commissioner Hausmann Files Suit Against Arthur Ferdinand
Hausmann has publicly called for an investigation into Ferdinand’s tax lien sales, which opponents say may have deprived the county of revenue and property owners of adequate time to pay their debts, and has rebuked Ferdinand’s use of a county-paid vehicle.
Hausmann’s attorney, Josh Belinfante, email@example.com, a partner at Robbins Ross Alloy Belinfante Littlefield and former ethics commissioner, said Ferdinand is disputing Hausmann’s vehicle registration and threatening to revoke the license of Hausmann’s car, which is used by her daughter.
“Defendant, without authority, has revoked the registration, even though all taxes due have been timely paid, ostensibly because Hausmann failed to provide proof of her place of residence to Ferdinand’s satisfaction,” the complaint states. “In reality, Ferdinand revoked Hausmann’s vehicle registration in retaliation for a recent inquiry by Hausmann regarding Ferdinand’s personal use of a county vehicle.”
Ferdinand was not available for comment. An attorney for him was not listed on the complaint.
Hausmann is seeking a temporary restraining order halting the revocation of her vehicle registration and injunctive relief ordering Ferdinand to reinstate her car tag. She is also seeking unspecified damages.
The case is Hausmann v. Ferdinand, Case No. 2103CV231746
full article found at: http://www.atlawblog.com/2013/05/fulton-county-commissioner-hausmann-files-suit-against-arthur-ferdinand/comment-page-1/#comment-81681
Fulton commissioner says tax chief revoked car tag in retaliation
Posted: 6:34 p.m. Friday, May 24, 2013
By Johnny Edwards - The Atlanta Journal-Constitution
She messed with his car, so now Fulton County Tax Commissioner Arthur Ferdinand has messed with hers, a county commissioner alleged in court documents Friday.
It began when north Fulton Commissioner Liz Hausmann publicly questioned why taxpayers are funding a $39,000 Ford Explorer Limited for the state’s highest-paid elected official. Then Ferdinand sent a letter to the interim county attorney and county commissioners suggesting that she may live in Gwinnett County, which would make her ineligible for office.
Now Ferdinand has revoked the license plate on a 2004 Jeep in Hausmann’s name, which her daughter drives, and alerted law enforcement that the car has no valid tag, according to an interoffice memo. The tax commissioner said Hausmann still hasn’t given him valid proof that she lives in Fulton
In court documents asking a Superior Court judge to put a stop to the action, Hausmann accused Ferdinand of retaliation, "tyrannical partiality" and violating her right to free speech. The Jeep is parked now because anyone who drives it could be arrested, her attorney said.
"I consider this escalation to be harassment to not only me, but also my family," Hausmann said in a written statement.
Ferdinand did not immediately respond to emails or a phone call seeking comment Friday, nor has he responded to several other similar requests from The Atlanta Journal-Constitution this month.
In a recent interview with the AJC’s news partner, Channel 2 Action News, the tax commissioner denied retaliating against Hausmann, saying he sent the memo to the interim county attorney after receiving a tip from a constituent and after the Jeep’s registration renewal was paid two weeks late with a check bearing a Gwinnett address.
Ferdinand told Channel 2 he did not recall what channel he received the tip through. The AJC filed an open records request seeking any documents connected to the tip, and the county responded that it has no such records.
"On its face, it sure looks like it was retaliation," Jim Honkisz, the interim president of the Fulton County Taxpayers Foundation, said Friday. "It underscores the lack of sensitivity and the pettiness of the tax commissioner."
Through a separate records request, the AJC learned that Ferdinand dipped into his own office budget last year to buy a 2013 Ford Explorer Limited, giving him the newest, most upscale vehicle in Fulton’s fleet of take-home vehicles. The dealer said it has a moon roof, leather seats, built-in navigation and four-wheel drive. The County Commission was not aware of the purchase then because it fell under a $50,000 threshold.
Because the vehicle is part of the county’s fleet, taxpayers also pay for its fuel. Records show the county has paid $1,250 to gas up the SUV since its purchase.
Ferdinand told Channel 2 he needs it to drive to meetings, public appearances and his satellite offices. He said he wouldn’t even consider turning in the SUV, as Commission Chairman John Eaves has asked, unless told to do so by the whole commission.
After a review of a routine take-home vehicle report at a May 1 commission meeting, Hausmann questioned why Ferdinand can’t drive his own car, considering he earns nearly $350,000 per year. Most of his money comes through personal fees charged to Atlanta, Johns Creek and Sandy Springs for adding their city tax bills to county tax bills.
State lawmakers have tried and failed to stop him from collecting those fees. Ferdinand’s opponents say he is pocketing money for services done with county staff and equipment.
About a week and a half later, Ferdinand alerted county officials that Hausmann used an out-of-date address on campaign forms and her vehicle registration. Hausmann responded that updating her address slipped her mind because she is going through a divorce and recently dealt with her father’s illness and death.
Her attorney has given Ferdinand an affidavit from her sister and brother-in-law saying she lives with them in Johns Creek, as well as a bank record reflecting the new address.
A hearing on Hausmann’s request for a temporary restraining order could be held as early as Tuesday.
"Tax Chief Calls Out a Critic"
The AJC article below, by J Edwards, it says in part:
- "Less than two weeks after a county commissioner questioned his need for a county owned vehicle, Fulton County Tax Commissioner Arthur Ferdinand has aired potentially damaging or embarassing tax information about her. It was the second time this year that he has released such information about North Fulton Commissioner Liz Hausman, who first asked why Ferdinand, the state's highest-paid elected official has a $39,000 county owned SUV that allows him to commute to work at taxpayers expense. . .
- He sent a memo to the interm county attorney and county commissioners this week reporting that Hausmann may not live in her district or even in the county. . .
- In March, after Hausmann called for an investigation into Ferdinand's tax lien sales that allowed a private company to collect millions of dollars in late fees, Ferdinand sent documents to state lawmakers showing he put a lien against her property for $52 in 2001. . .
- Dan Davis, the executive director of the Georgia Association of Tax Officials, said ethical issues could be raised if the tax commissioner zeroed in on a potential enemy and dug into her tax records. . .
- William Perry, executive director of Common Cause Georgia, said he's less concerned with Hausmann failing to update her address than he is with Ferdinand's apparent retaliation. "The timing of it gives the appearance that it's a 'gotcha' complaint," Perry said. "Bottom line, the situation purely sounds like intentionally coming after her for questions that seem like legitimate issues."
The take-home report showed Ferdinand has a Ford Explorer XLT, a midgrade model, but the purchase order revealed it is actually an Explorer Limited, which means he has the newest, most upscale vehicle of any Fulton official who is allowed to take one home.
Monday, March 4, 2013
State may target tax lien sales
Fulton tax commissioner says they help schools, local governments
By Johnny Edwards and M.B. Pell
article at: http://www.ajc.com/news/news/state-may-target-tax-lien-sales/nWgFf/
An Atlanta Journal-Constitution investigation has spurred some state lawmakers to try to reel in Fulton County Tax Commissioner Arthur Ferdinand, outraged that his quick sale of tax liens may have deprived the county of up to $20 million.
Fulton County Commissioner Liz Hausmann says the AJC’s findings also warrant an official investigation.
The AJC reported Sunday that Ferdinand sold thousands of property tax liens before the county would have been eligible for a 10 percent penalty. That resulted in the county handing over as much as $20 million in potential profits to a private company that is the biggest lien buyer – with a corresponding $20 million potential loss to the county.
State Rep. Wendell Willard, R-Sandy Springs, said the AJC’s findings underscore his suspicion that there’s a tight relationship between the tax commissioner and the company.
He and other Fulton County lawmakers say they also have had long-standing concerns about Ferdinand’s process for selling liens.
State Sen. Vincent Fort, D-Atlanta, described the process as abusive. "It’s designed to make sure that people cannot make good on their taxes," Fort said.
Ferdinand has said that lien sales are legal and buyers reap the benefit of penalties and interest because they take the risk of collecting overdue taxes. He wouldn’t comment on potential legislation, saying it would be premature to respond until a final bill is submitted.
The 2013 Ford Explorer Limited used by Fulton County Tax Commissioner Arthur Ferdinand cost taxpayers $39,000.
The Atlanta Journal-Constitution reports that residents in the metro Atlanta county are funding Ferdinand's daily commute to work, including gasoline.
The purchase came to light when county commissioners raised questions about a routine take-home vehicle report.
Ferdinand did not respond to the Journal-Constitution's phone messages or questions emailed to him Monday.
Updated: 8:41 p.m. Tuesday, May 14, 2013
Tax commissioner's SUV costs taxpayers $39,000
The Associated Press
Records show that a Georgia tax commissioner used public funds to buy a full-sized SUV for his own use.
The 2013 Ford Explorer Limited used by Fulton County Tax Commissioner Arthur Ferdinand cost taxpayers $39,000, according to a report in The Atlanta Journal-Constitution (http://bit.ly/YS9zDN ).
The newspaper reported that residents in the metro Atlanta county are funding Ferdinand's daily commute to work, including gasoline. The purchase came to light when county commissioners raised questions about a routine take-home vehicle report.
Ferdinand did not respond to the Journal-Constitution's phone messages or questions emailed to him Monday.
Ferdinand has been the focus of criticism in the past, some of it related to an annual income that exceeds that of Gov. Nathan Deal and approaches the pay for President Barack Obama.
A key factor behind his earnings is a charge of $1 per parcel in fees for doing the tax billing for Atlanta, Johns Creek and Sandy Springs — a practice state legislators have tried to halt. Ferdinand's opponents say he is pocketing money for services done with county staff and equipment.
Criticism has intensified with the revelation of Ferdinand's latest auto purchase.
"Greed is the only word I can think of," Midtown resident Carol Brantley said. "Most people realize that Fulton County and all governments are struggling with their budgets and looking for ways to cut expenses, not ways to increase their personal incomes at the expense of taxpayers."
But Commissioner Tom Lowe, a Republican who represents a portion of north Fulton, defended Ferdinand, a Democrat, as "a high-ranking department head" who "makes more money for the county than anybody else."
"If he wants a car," Lowe said, "I don't give a damn whether it's a go-kart or a Cadillac."
Chairman John Eaves said Ferdinand has not explained to commissioners why he needs the SUV and it's questionable whether it allows him to do a better job.
Eaves said Ferdinand should consider reassigning the SUV to an employee or department that can make better use of it.
"Given the budgetary constraints and the public's expectations that we be as thrifty as possible," Eaves said, "to me, this is an unnecessary expense."
Fulton Tax Commissioner Defends Use of $39,000 Vehicle By Michelle Wirth 90.1 FM WABE
Fulton County Tax Commissioner Arthur Ferdinand spoke with WABE in his first radio interview since controversy surrounding a $39,000 dollar county vehicle he purchased for county use began earlier this month.
Concerns about the 2013 Ford Explorer purchased by Ferdinand last year for his official use were raised by Commission Chairman John Eaves and Commissioner Liz Hausmann. Both commissioners questioned the vehicle’s expense after examining a routine take home vehicle report. Despite the concerns, Ferdinand says he’s done nothing wrong. He says the opinions expressed by Chairman Eaves and Commissioner Hausmann don’t represent the feelings of the entire board.
"The board of commissioners have approved the use of a vehicle for that office, tax commissioner, since 1998. It meets all the county guidelines, and as recently as this year my vehicle has been approved for take home purposes. "
Ferdinand says he and members of his staff only use the vehicle for county purposes.
"I do a lot of things besides sit in my office and collect money. I have a very long county, I have five offices, I speak a lot at night, and I would say that I do not use that vehicle for my personal use. I have several vehicles myself."
Chairman Eaves says Ferdinand did not violate any county policies but he’s concerned about public perception due to the expense of the vehicle. As a result, Eaves says he’s hoping to meet with Ferdinand and plans to ask him to reassign his vehicle to another department.
"He’s doing a great job in terms of his duties, but the issue of the public trust in terms of our resources is out there, so let’s try to figure out some sort of resolution so we can restore the public trust, that were doing the best we can in terms of managing our resources and being as frugal as possible.
Ferdinand says he will sit down with Eaves if asked, but as far as giving up the vehicle..
"At this point in time no. There’s no reason why I would consider not using that vehicle in the way we’re using it right now."
Chairman Eaves says the board of commissioners should also reexamine its current policy when it comes to county take home vehicles.
Article and voice link at: http://www.wabe.org/post/fulton-tax-commissioner-defends-use-39000-vehicle
Contact Info for the Fulton County Commissioners:
Fulton tax commissioner goes nuclear on AJC, state reps
Posted by Thomas WheatleyHYPERLINK "http://www.twitter.com/thomaswheatley"@thomaswheatley
Wed, Mar 6, 2013 at 3:25 PM
Over the last few days, the AJC published several pieces about Fulton County Tax Commissioner Arthur Ferdinand transferring tax liens to third parties.
They're interesting stories, and part of a multi-year series of articles about metro Atlanta property taxes that have scrutinized Ferdinand. The pieces serve a public good while also making homeowners grit their teeth with anger. Anti-Fulton state lawmakers will probably pick up the articles and use them as ammunition in their ongoing effort to crack down on the county. That includes legislation making the tax commissioner an appointed, not elected position.
That legislation and the recent AJC stories apparently didn't sit well with Ferdinand. This morning, CL was cc'ed on an email from the tax commissioner. Attached were scanned copies of letters to state Sen. Judson Hill, R-Marietta, and state Rep. Lynne Riley, R-Johns Creek, who chair the Fulton County legislative delegation under the Gold Dome.
In the letters (which we've embedded after the jump), Ferdinand says discussions about his salary - he reportedly made nearly $350,000 in 2011, making him Georgia's highest-paid elected official - have devolved into attacks on his character, which he claims is a "clear indication that this campaign for 'change and reform' solely directed at my office is more of a personal agenda, rather than a public one." He then claims that some of the actions by the AJC and state lawmakers are "simply retaliatory."
He goes on to say that the AJC failed to disclose in its articles that the commissioner's office has placed several liens in past years on properties owned by Cox Enterprises, the paper's parent company, and which were transferred to Vesta Holdings. Among those properties, Ferdinand says, was a "luxury hanger" at Fulton County Airport-Brown Field. He also notes that Cox Enterprises is the beneficiary of development authority exemptions, "a privilege usually reserved for new companies coming into the county, a practice now being challenged." Ferdinand says the exemptions helped Cox save more than $2 million in taxes. (I'm curious why Ferdinand didn't lob these accusations in an op-ed that appeared in the AJC a few days ago. We asked and will update if we hear word.
UPDATE, 10:54 p.m. Ferdinand tells me he hadn't seen the liens at the time.)
He also claims that sponsors of the legislation have, in the past, had liens placed on their properties or transferred by Ferdinand's office for non-payment of taxes.
We asked AJC Managing Editor Bert Roughton if the paper knew about the alleged conflict of interest prior to publishing the articles. He said in an email to CL that the paper started looking into the liens issue "as a matter of important public interest."
"Delving deeply into the manner in which public officials conduct their affairs is essential to what we do and in the best traditions of American journalism," he wrote. "To suggest that we were motivated by anything else is absurd and a distraction from the important questions raised by our reporting. We knew nothing about our parent company's property taxes one way or the other."
Ferdinand closed his letters with the hopes that everyone involved can return to "civil and intelligent discourse about public policy regarding taxes." We'll see if that happens - or if the missive only spurred the majority Republican delegation into taking action. We're reaching out to Riley and Hill to get their take on Ferdinand's letter.
UPDATE, 11:54 p.m. Roughton notes in an email that the paper has written about these issues "long before December 2010." That's around the date the lien was placed on Cox Enterprises' "luxury hanger" and when Ferdinand says the AJC's Open Records requests started arriving in his office.
See article at: http://clatl.com/freshloaf/archives/2013/03/06/fulton-tax-commissioner-goes-nuclear-on-ajc-state-reps
Fulton tax chief may face pay cut
by Johnny Edwards
The Atlanta Journal-Constitution
Because of a loophole in a state law -- and by personally collecting fees for billing taxes in three cities -- Fulton County Tax Commissioner Arthur Ferdinand has become the state's highest-paid elected official.Taking in $347,000 last year, Ferdinand's earnings approached the level of the U.S. president.
Six north Fulton legislators say it's time he took a massive pay cut -- and some residents agree.
Ferdinand, though, says he earns his money, taking on the massive responsibility of collecting property taxes for the state's largest and sixth-largest cities, which he's not required by law to do.
"You shouldn't expect people to do additional work and not get paid," he said.
A bill introduced this legislative session by state Rep. Lynne Riley, co-sponsored by five of her fellow Northside Republicans, aims to end the personal payments by removing Ferdinand and all Georgia tax commissioners from negotiating tables when cities want county governments to handle their tax bills.
The issue shines a spotlight on how revenue totaling hundreds of millions of dollars is collected. That money is used to fund police, fire protection, parks, road paving and other services for more than a half million people.
The legislation would also apply to DeKalb Tax Commissioner Claudia Lawson, who collects fees from nine cities, including Chamblee, Dunwoody and the DeKalb portion of Atlanta.
Last year, Lawson earned more than $237,000.
Tax commissioners in Cobb and Gwinnett, meanwhile, don't collect fees.
So how were Ferdinand and Lawson able to earn so much money?
Answering that question requires a better understanding of Georgia's old way of doing things.
Throwback to fee system
There was a time when constitutional officers, such as sheriffs, probate judges and clerks of court, earned their pay by personally collecting fines and fees.In a throwback to that fee system, some county tax commissioners collect tax money for cities that don't want to do it themselves.
Those cities not only pay the county for the services, but they also pay a personal fee to the tax commissioner.
Last year, for instance, in addition to paying the county $2.76 million, Atlanta, Johns Creek and Sandy Springs paid Ferdinand a personal fee of $1 per parcel.Those personal fees alone totaled $212,624.
In DeKalb County, Lawson collected a total of $50,000 in personal fees from the cities of Atlanta and Dunwoody -- and $31,260 more in personal fees from seven other cities.
State Rep. Wendell Willard, who serves as Sandy Springs' city attorney, tried to end the practice five years ago.
But Ferdinand and others were able to continue to collect the fees because of pre-existing contracts.
The new bill, which Willard is co-sponsoring, would close that loophole.
Cities could cancel their contracts with tax commissioners, then negotiate with county commissions on new pay arrangements.
Only counties could collect the money, which would be "substantially approximate" to the actual cost of doing the work.
That means the personal fees collected by the tax commissioners would end.
Fulton's help needed?
Though nine Fulton cities handle their own billing, Atlanta, Johns Creek and Sandy Springs all believe they need Fulton's help.
To do it any other way, they say, would actually cost their taxpayers more money, likely with lesser returns.
After all, Ferdinand's office has staff and software in place, boasts a 99 percent collection rate thanks to his system of selling tax liens to private collection firms, and can send residents a single bill for both county and city property taxes.
In Lawson's case, the practice, she said, started with her predecessor, Tom Scott. As tax commissioner, she takes on personal liability if cities' billings are flawed, she said.
But Riley sees it differently.
"The intent is to protect taxpayers who live in cities from double taxation," Riley said. "I don't believe any public officials should receive personal fees. The county is actually providing the resources, through the manpower and the technology."
Lawson doesn't have strong feelings if legislation were to bring the payments to an end, she said. Ferdinand said he doesn't feel as if he is overcompensated.
"With respects to the merits of the bill, I'll deal with it when it's passed," he said.
Jackson County Tax Commissioner Donald Elrod, president of the Georgia Association of Tax Officials, is concerned, though, that a group of Fulton lawmakers trying to cut Ferdinand's pay might set bad policy statewide.
Elrod said the law would give county commissions power to order constitutional officers to take on outside work, which his association opposes.
"It's Willard going after [Ferdinand]," Elrod said, "and it's hurting some of our smaller counties."
But Major Thompson, a 27-year Johns Creek resident, said an official profiting from taxes just "doesn't smell right."
Fulton tax chief's earnings
In addition to his regular county pay, Fulton County Tax Commissioner Arthur Ferdinand personally collects $1 per parcel for handling taxes for three cities. Other tax commissioners do that, too, but Ferdinand reaps higher returns because he handles the state's largest, sixth-largest and 10th-largest cities. Here's what he earned last year:
-- County pay: $134,440 (including supplement pay)
-- Atlanta fees: $154,726-- Sandy Springs fees: $31,428
-- Johns Creek fees: $26,470
Source: Atlanta, Sandy Springs and Johns Creek finance offices; Fulton County personnel office
Elected officials' pay
-- President Barack Obama: $400,000
-- Fulton County Tax Commissioner Arthur Ferdinand: $347,064
-- DeKalb County Tax Commissioner Claudia Lawson: $237,290
-- Georgia Supreme Court Chief Justice Carol Hunstein: $167,210
-- Gov. Nathan Deal: $139,339
See article at: http://www.ajc.com/news/news/local/fulton-tax-chief-may-face-pay-cut/nQQ4g/
Taxpayers’ loss is lien buyer’s gain
Penalties, fees boost tax bills
Property owners face substantial penalties and interest charges when their property taxes are delinquent. If a tax lien is sold, those penalties and interest accrue to the benefit of whoever buys the tax lien. Here’s what Georgia law allows:
Interest rate on any late taxes of 1 percent per month, or 12 percent a year
A 10 percent penalty on taxes that are 90 days delinquent
If a tax lien is executed, an additional administrative fee equal to 5 percent of the tax, with a $50 minimum and $250 maximum. The property owner can also be charged for recording, advertising and title research costs.
If a tax deed is sold at auction, a flat penalty of 20 percent is immediately applied.
If the property owner doesn’t pay all delinquent taxes, interest, penalties and fees after 12 months from the date of sale of the tax deed, the buyer may begin the process to foreclose. That process may result in additional fees for sheriff’s service and advertising, as well as charges for attorney fees.
If the tax deed buyer chooses not to foreclose on the tax deed, for each year or fraction of a year after that, another 10 percent penalty is applied to the tax bill.
This story has been two years in the making.
It started with a question to Fulton County Tax Commissioner Arthur Ferdinand in November 2010: How many tax liens have you sold?
At first, officials in the tax commissioner’s office said they didn’t know. Then employees said they knew, but wouldn’t say. Further, they said the number of liens and the value of the liens wasn’t written down anywhere and therefore was not subject to the Open Records law.
So the AJC filed an Open Records Request for the county’s entire tax data system. Ferdinand said the AJC could have the records – for $16.2 million.
The database couldn’t be turned over, county attorneys claimed, unless it was first printed out and then scoured of the names and addresses of public employees like judges and teachers. The data didn’t identify the occupation of property owners, but the Open Records law allowed government agencies to withhold home addresses of public employees, and some agencies used this as a loophole to avoid releasing embarrassing documents.
But the Open Records Act was amended in 2011 to stipulate that the exception did not apply to public records that do not specifically identify public employees or their jobs, titles or offices.
The AJC filed another Open Records request for the database under the amended Open Records Act.
This time Ferdinand said he would not turn over the data because it would disclose the trade secrets of Tyler Technology, the company that sold Fulton the software to maintain the tax data.
The AJC filed an Open Records Act violation complaint with Attorney General Sam Olens. County attorneys claimed Ferdinand was not fighting to hide the data, but that’s not how Olens saw it.
Ferdinand “absolutely” fought to hide the data and only agreed to release it after the AJC and the Attorney General’s Office threatened a joint lawsuit, he said.
“It’s very unfortunate that it took so much time to do what was right and it’s very unfortunate that it took a letter saying that suit would come within 10 days,”
Olens said. “That’s not the way the Open Records Act is supposed to work.”
Even after the county agreed to turn over the data last September, there were problems.
The tax commissioner released an incomplete copy of the data in a jumbled mess. Instead of a standard format with each individual table in its own file, the data was turned over as one huge text file with each of the thousands of tables, regardless of its structure, dumped one on top of the other. There was no indication of where one table ended and the next began.
After the AJC and the Attorney General’s Office reiterated the threat to sue, the county agreed to turn over the data in a standard format.
There still were problems.
The county never turned over a complete data dictionary that included all of the definitions for the codes used in the data. The tax commissioner’s office refused to discuss the data.
For example, an analysis of one table showed the tax commissioner sold 192,000 liens worth more than $380 million from 2002 through 2011. Ferdinand said in a written reply to AJC questions that his office did not know how many liens were sold or the total value, but if the AJC’s figures came only from one table, they were incorrect.
He did not say why or what other tables need to be consulted to develop a more accurate number.
To look for any adjustments to the data, the AJC sorted through other tables to seek information on tax bills that were sold and retroactively lowered by the tax assessor’s office. After a bill is adjusted, the county gives a refund to the taxpayer and is supposed to seek reimbursement from the lien buyer.
If that was the case, it could result in as much as a 10 percent decrease in the value of the liens sold, though the number is probably much lower.
The tax commissioner’s office could also have required lien purchasers to return some of the liens they bought and given the buyers full reimbursement.
But the tax commissioner would not say how or if they track lien purchase refunds.
In addition, there were problems with the data. For example, more than 8,000 records indicated that liens were sold for $0.
All liens are transferred for the total amount owed, never $0, Ferdinand told the AJC in an email. Ferdinand did not explain why the sale amount was incorrect in the database.
Arthur Ferdinand, the incumbent, has two opponents for the Democratic nomination, including John Jamont and RJ Morris. The winner of the Democratic nomination will face no opposition in the General Election in November.
Morris raises a number of concerns about Ferdinand.
First, Morris questions Ferdinand’s total annual income of $342,000 dollars per year, which includes 130,000 dollars in salary and $212,000 in fees from cities in Fulton County that Ferdinand collects for himself. These fees would otherwise be payable to the County, and are thus being diverted from services for the taxpayers.
“We’re one of the only counties in Georgia that has a Tax Commissioner that still collects double salary. Arthur Ferdinand called up the cities and said he’d no longer collect their taxes unless they pay him personally. Once we get him out of office, he is one of five [tax commissioners] still grandfathered in... no future tax commissioner can ever do that again,” Morris said.
Morris raised concerns about Ferdinand’s practice of selling property tax liens to a private company after thirty days, which Morris argues is bad for the homeowners and bad for the county’s revenue stream.
“In all other counties, if people don’t pay their property tax, it goes down as a delinquent tax. Ninety percent of the time it is paid within six months, 99 percent within a year. The homeowners pay one percent on the money until its paid per month, and a 10 percent penalty after 90 days. Counties like it. It’s revenue for them,” Morris said, noting that after one year, the revenue is 22 percent interest.
“He sells liens within the first thirty days to a private company called Vesta Holdings. (see following article for Vesta info) He started this process about twelve years ago or longer because of a backlog from a former tax commissioner. The private company then got the 22 percent interest instead of the county, but at least the county got a huge chunk of change up front. Now, we’ve collected the back taxes, Ferdinand still sells these tax liens,” Morris said.
Morris said he wants to provide every homeowner at least six months to work out a payment plan. Only after that point, in absence of a payment plan, would Morris sell the lien to Vesta.
Morris also wants to open a Taxpayer Advocate Department within the Tax Commissioner’s Office, to focus in part on setting up payment plans.
Ferdinand has also been at the center of a dispute under the Georgia Open Records Act, in that he has refused to provide electronic data of all the tax liens that are sold.
“Ferdinand says he outsources these and they are outside of the scope of Open Records Act. We’re gonna sue Ferdinand, the Attorney General’s office is gonna be involved,” Morris said.
Morris said he believes that the records will show the disproportionate negative impact of Fulton County tax liens on the southern portion of the county, where more low-income minority families live. He argues that low-income families are often unable to hire the attorneys that families in North Fulton are able to hire.
“The Tax Commissioner has decimated low-income and predominantly African American neighborhoods for the last eleven years,” Morris said.
Barbara Payne, Executive Director of the Fulton County Taxpayers Foundation, said that her foundation is concerned about the impacts of property tax liens on South Fulton. The Foundation routinely holds property tax workshops throughout South Fulton and often provides significant discounts on Foundation membership fees and appeal assistance fees to anyone who cannot afford the full prices.
“We offer such significant discounts that the Foundation doesn’t gain any revenue. They still have to join the Foundation, but it’s cut in half. It’s a challenge, we can’t reach everyone. We’re a small group,” Payne told Atlanta Progressive News.
Updated: 5:11 p.m. Monday, Feb. 7, 2011
Private firms collecting back Fulton taxes fall behind
Controversial practice not allowed in most places
By M.B. Pell
The Atlanta Journal-Constitution
(extracts from the much longer article)
Companies that buy Fulton County liens for unpaid property taxes themselves owe hundreds of thousands of dollars in overdue property taxes, calling into question the county’s justification for selling the liens: that it saves taxpayers’ money.
Fulton County government’s practice of allowing private companies to collect delinquent taxes is controversial and barred by almost every other Georgia county and by 30 states, largely because of its potential to victimize property owners.
But a closer look at the industry by The Atlanta Journal-Constitution raises questions about the lien purchasing companies and about Fulton’s defense of the practice. Fulton tax officials declined to be interviewed for this story, but have said in the past that selling liens to private companies helps them collect a higher percentage of overdue tax bills. . .
Fulton County routinely sells tax liens to private third parties who can pump up the lien value by tacking on monthly interest charges and use foreclosure to collect the debt. . .
Some real estate tax experts criticize both the fairness and the effectiveness of the practice. Experts say selling tax liens can put properties in limbo for years, while, often, no one pays property taxes, possibly canceling any cost benefit of selling the original liens.
The private players include:
● Harpagon, a sister company of Vesta Holdings, the largest tax lien purchaser in Georgia. Harpagon owes about $120,000 in Fulton and Atlanta property taxes dating back to 2008, according to Fulton County Tax Commissioner’s online data.
● Heartwood11, a tax lien and deed purchasing company formerly managed by Vesta and a subsidiary of BankAtlantic. Heartwood11 owes about $300,000 in Fulton and Atlanta taxes dating to 2006, according to county online records. Fulton County collects Atlanta property taxes. BankAtlantic did not return multiple calls from the AJC. . .
Robert Proctor, a lawyer representing Vesta Holdings and sister corporations, said lien purchasers use the same process the government uses to collect tax debts, but reduce the expense through the efficiency of the private sector. And Proctor said the amount Vesta’s sister company owes in taxes is small compared to the revenue they provide to the city and county. . .
Vesta and other companies that buy the liens can use courthouse-steps sale of the property to collect the debt. . .
Vesta buys tens of millions of dollars in Fulton County tax liens, and Harpagon could owe a small fraction of that in taxes. . .
See the much longer article at: http://www.ajc.com/news/news/local/private-firms-collecting-back-fulton-taxes-fall-be/nQqPb/
Updated: 7:42 a.m. Monday, March 18, 2013
Reform legislation is retaliation, tax commissioner says
Brant Sanderlin, firstname.lastname@example.org
By M.B. Pell The Atlanta Journal-Constitution
For the third year in a row, the legislature is considering limiting the sale of tax liens to private collection companies. And for Fulton County Tax Commissioner Arthur Ferdinand, this time it’s personal.
Ferdinand is the only tax commissioner in the state to rely on the sales to collect a sizable portion of overdue tax bills.
In letters to Sen. Judson Hill, R-Marietta, and Rep. Lynne Riley, R-Johns Creek, Ferdinand framed the legislative effort as a personal attack by lawmakers who had liens placed against their property.
Similarly, he dismissed Atlanta Journal-Constitution investigations into the sale of liens as retaliation for liens he placed on property of the paper’s parent company, Cox Enterprises.
"These discussions have progressed to a public onslaught of innuendo and my character which is a clear indication that this campaign for ‘change and reform’ solely directed at my office is more of a personal agenda, rather than a public one," Ferdinand wrote. "In fact I wish to provide to the Fulton delegation some real clear facts that should not and cannot be ignored which show that the actions being taken against me by members of this great body and Cox Enterprises through the Atlanta Journal Constitution (AJC) is simply retaliatory."
There is no tax lien bill currently before the legislature. But Rep. Wendell Willard, R-Sandy Springs, the driving force behind legislation this year, said language regarding lien sales is still under consideration. That language could be added to a bill that’s already been approved by the House.
Willard wouldn’t discuss specifics. Earlier in the session he said he might increase debt notification requirements, require the county to have a searchable database of lien sales or even pursue a total ban on sales. He has also said he wants to forbid transferring liens until bills are six months overdue and slash in half both the 10 percent penalty and 1 percent monthly interest charged to delinquent taxpayers.
An AJC analysis of Fulton tax data found Ferdinand gave Vesta Holdings the opportunity to collect a potential $20 million in late fees that would otherwise go to fund Fulton County government.
The AJC also reported that days after he sold thousands of liens to Vesta last fall, his office told a smaller lien investor that the lien sales program was temporarily suspended. And last December Ferdinand’s office announced the availability of 2012 liens via an email to five people. A government ethics expert said that is not a transparent process.
Ferdinand did not dispute those findings in his letters to Riley and Hill.
Instead, Ferdinand enclosed documentation detailing the sale of liens on the property of critics and Cox.
Since 1998 Ferdinand sold to Vesta Holdings three liens on property of Willard’s.
His office also sold an $88 lien for a late fee against the property of House Speaker Pro Tem Jan Jones, who also supports a change to the lien sale process. Jones has said she never received notification of the late fee and says lack of notification is a problem for many Fulton taxpayers.
Ferdinand sold a 2001 lien for $52 on property of County Commissioner Liz Hausmann, who has called for an investigation of lien sales that allowed Vesta to collect millions of dollars in late fees. Hausmann said her mortgage company got its wires crossed and sent her taxes in late, but she did not even know about the lien until last year.
"I have no beef with the tax commissioner," she said. "I do think the penalty issue you guys uncovered is significant. I think $20 million deserves a look."
Ferdinand also included documentation of several liens he said were placed against Cox properties and sold to Vesta. One was for $21. The largest was for $39,000.
"One can only deduce that by failing to disclose their own liens, they essentially had an ulterior motive along with their cohorts in the delegation in this effort to discredit me," he wrote.
A statement issued by Cox Enterprises said that as a consistent business practice, it processes and pays all property taxes when bills are received. "After looking into the properties in question and issues raised, we have been in contact with the Fulton County Tax Commissioner’s Office to obtain written confirmation of one, outstanding lien for approximately $500. Our records indicate we have satisfied all other obligations we are aware of for Fulton County taxes."
In his letter, Ferdinand accused the AJC of launching a two-year open records battle with him the day after his office placed a lien against a Cox property.
But three weeks before Ferdinand placed the lien, the AJC had started issuing open records requests for lien sales data. It took action after Ferdinand refused to discuss how many liens he sold, how much he sold them for and who bought them.
In the lengthy legal fight that followed the initial request, the AJC issued many additional requests, including one the day after Ferdinand placed the lien against the Cox property.
AJC reporters did not know of the lien against Cox when they started writing about controversy over the sale of tax liens to private collection companies. The tax commissioners’ website listed the owner of that property as the Fulton County Development Authority.
Fulton County Property owned by Ferdinand
From 7/93 units 7/99 FERDINAND had 'Productivity and Quality Incorporated' registered with the Georgia Secretary of State.