ITTA BENA — The federal government has placed a tax lien on the city of Itta Bena’s assets, seeking repayment of more than $200,000 in unpaid federal payroll taxes.
The Internal Revenue Service took the action Tuesday, reports the Greenwood Commonwealth, giving the federal government the power to seize city property if taxes remains unpaid.
Between January 2012 and March 2013, the city failed to pay Medicare, Social Security and income taxes withheld from city employees’ paychecks.
Itta Bena Mayor Thelma Collins, who took office in July 2013, said she learned of the unpaid taxes and lien on June 25.
Collins said the Itta Bena city clerk, LaCheronda Spivey, had been in discussions with the IRS about the unpaid taxes but had avoided telling the mayor about the problems.
Spivey “just said she didn’t want to bother me with it,” Collins said. “I was just not informed about it.”
Spivey, who has served as clerk for the past eight years and handled the city’s payroll during the period for which the taxes went unpaid, declined comment Thursday.
Asked if Spivey would retain her position in light of the lien, Collins said the Board of Aldermen would decide. The board is next scheduled to meet Tuesday for a budget hearing at City Hall.
Collins said the tax lien adds to the city’s debts, which also include unpaid electricity bills to the Municipal Energy Agency of Mississippi, a six-city electricity cooperative.
The payroll taxes went unpaid over a 15-month period during the administration of the previous mayor, Walter Parker.
Parker declined to address the city’s payroll tax issues Thursday, saying, “I’m not really aware of what you’re talking about, and I’m certainly not going to comment on it.”
The city has not completed a financial audit since 2010 after its accounting firm stopped being paid. Meanwhile, city payments to the Mississippi Public Employees Retirement System have been so irregular that, according to Collins, the city is now required to send them by cashier’s check.
When Collins, a 69-year-old former teacher, was sworn in as mayor of the town of about 2,000 residents on July 1, 2013, she said the city owed nearly $500,000 to energy agency, more than $7,000 to the Leflore County Solid Waste Department, $15,568 to the retirement system and $15,000 to a Greenwood accounting firm which had previously audited the city.
Collins, who served two other non-consecutive stints as mayor, said Itta Bena has been making progress toward paying debts, but not as quickly as she hoped because of persistent financial shortfalls.
Without a current audit, Collins said, she’s been unable to apply for grants to address the city’s crumbling infrastructure, which includes a faulty sewer system.
“My hands are tied. I can’t get a grant, I can’t get anything without a current audit,” she said.