WINTON – The price of operating a business in Hertford County may be on the rise. That is if local businesses are not accurately listing their property values.

During Monday’s meeting of the Hertford County Board of Commissioners, Roger Ellis made a presentation on behalf of his firm, Tax Management Associates, Inc. (TMA). He offered Hertford County officials a way to possibly increase their tax base.

&uot;TMA is an audit service aimed at business personal accounts,&uot; said Ellis. &uot;Some may call us tax bounty hunters, but I can assure you that if you are operating without an audit program, one that studies business accounts, then you are not maximizing your tax revenues.&uot;

Ellis emphasized that his company isn’t one that points fingers of blame at individual companies for inaccurately reporting their taxable base.

&uot;Our audit division has been open since 1987,&uot; he stated. &uot;Over that time period we have performed well over 65,000 audits in 220 government jurisdictions (county and municipal) in 10 states. I’d say that in 60 percent of those audits, we’ve found businesses in total compliance in reporting their tax values. We found in the majority of the 40 percent not in compliance that they were not knowledgeable in the tax laws or didn’t know what needed to be listed and what did not.&uot;

Ellis said it was a simple matter of everyone paying their fair share of the tax levy

TMA has or is currently providing audit services in 60 of the state’s 100 counties. Locally, they have entered into audit services contracts with Bertie, Edgecombe, Halifax, Nash and Wilson counties. Statewide, they have conducted 25,549 audits (as of July 28, 2003) that have resulted in the discovery of $10.6 billion in escaped tax values

&uot;We may come in and find that every business is in full compliance here in Hertford County,&uot; he noted. &uot;If that’s the case, then you have no need for our services and if you are in an agreement with us where we are paid on a contingency fee, then you owe us nothing.&uot;

However, armed with statistics from similar-sized businesses in similar-sized counties as Hertford, Ellis estimated roughly $600,000 worth of additional tax revenue for the county.&uot;

&uot;It may be more, it may be less,&uot; he stressed. &uot;This is just an estimate based upon a data base of all audits we’ve performed in counties the size of Hertford with roughly the same number and size of businesses.&uot;

The amazing fact surrounding that $600,000 estimate is it covers only 17 percent (166 accounts) of Hertford County’s business personal property account profile. But those accounts represent 93 percent of the county’s business property tax base.

&uot;We’ve found that in the majority of audits, the companies with value ranges between zero and $49,999 – the ‘mom-and-pop’ businesses – are normally in compliance with the tax listing laws,&uot; noted Ellis. &uot;With that in mind, I would recommend that if you decide to use our services, you would allow TMA to audit those accounts with value ranges of $50,000 and greater.&uot;

However, Ellis said that the smaller companies are not off the hook.

&uot;By training the in-house staff within your tax department, we can employ the use of comprehensive audit processes such as benchmarks or on-site visitation in order to effectively review the smaller accounts,&uot; he stated. &uot;If a few of those small businesses jump outside those benchmarks, then a full audit will soon follow.&uot;

Ellis added that the audits would include current year tax status plus the two previous years. He also noted that additional benefits would be realized in years to come as the business tax base is increased for future years tax levies.

&uot;The way I’m looking at this, it’s a no-lose situation for Hertford County,&uot; observed Commissioner DuPont Davis.

The Commissioners voted in favor of allowing the Hertford County Tax Office to enter into contract negotiations with TMA. That contract will call for TMA to be reimbursed a contingency fee equal to 35 percent of the taxes, penalties and interest assessed by the county as a result of the discovery of value found to be escaping taxation for the current year audit and applicable prior years.