Moundsville Reports Windfall in Back Taxes
MOUNDSVILLE – Moundsville’s coffers have grown by more than $100,000 in unrealized Business and Occupation tax collections, thanks to a firm the city partnered with last year that locates companies doing business in Moundsville but not paying taxes to the city.
Moundsville City Manager Rick Healy told council recently that in the first year of partnership with DataMax, the city received $143,495.86 in unrealized B&O taxes. This is half of the $286,991.71 collected, as the agreement with DataMax allows the company to keep half of what it collects in the first two years. Afterward, Moundsville will receive the full amount of funds recouped.
Healy said DataMax uses a database of businesses that operate within the city but may not be paying B&O taxes. He said some businesses slip through the cracks because the city does not know to pursue them for the taxes. The example Healy gave was a dairy company that may provide milk for schools within the city, but which the city does not directly contact.
“A lot of these, they’re not brick-and-mortar businesses you see on Main Street, it’s more like … a dairy that delivers milk to the schools, and they’re people who should be paying B&O taxes because they’re conducting business in the city,” he said. “They generally don’t (pay) because we don’t go after, and have never thought about it. They’re a large company working in many cities in West Virginia, and I think we were one of the last of the larger cities to utilize them.”
Healy said he was satisfied with the financial arrangement with DataMax, because the income generated was due to the city anyway, but was not being billed or collected.
“The agreement we have with them is that when they find somebody, for a two-year period, they receive about 50 percent of the payment. … The way I look at it, we would have never gotten it, because we don’t have the time or, more importantly, the methods to go out and get this. We started with them last September, so this amount was for the first year, and it’s a nice chunk.”
Healy also said that funding through the CARES Act, which provides reimbursement for city employees who had experienced work disruption due to COVID-19, had arrived for the August filing period. The city had received $143,625.91. This brings the total amount received to 807,606.81.