Settlement  In the Matter of Paul Romeo

Date:	02/05/1985
Organization:	State Ethics Commission
Docket Number:	278

Disposition Agreement

This Disposition Agreement (Agreement) is entered into between the State Ethics Commission (Commission) and Paul Romeo (Mr. Romeo) pursuant to Section 11 of the Commission's Enforcement Procedures. This Agreement constitutes a consented to final Commission order enforceable in superior court pursuant to G.L. c. 268B, s. 4(d). 

On September 25, 1984, the Commission initiated a preliminary inquiry, pursuant to the conflict of interest law, G.L. c. 268A, involving Mr. Romeo, treasurer and tax collector of the town of Ashland. The Commission concluded its inquiry and on December 20, 1984 found reasonable cause to believe that Mr. Romeo violated G.L. c. 268A. The parties now agree to the following findings of fact and conclusions of law: 

1. Mr. Romeo is the treasurer and tax collector for the town of Ashland, and has held this elected office since 1978. This is a part-time position, with an annual salary of $5,100 per year. As such, he is a municipal employee within the meaning of G.L. c. 268A, s. 1(g). 

2. As treasurer and tax collector, Mr. Romeo is responsible for the collection of real estate taxes owed to the town of Ashland. 

3. Due to financial difficulties, Mr. Romeo failed to make timely payments of real estate taxes he owed to the town of Ashland for the years 1980 through 1983. The taxes due for these years on Mr. Romeo's residence and commercial properties in the town amounted to $23,852 for 1980, $27,392 for 1981, $18,353 for 1982 and $22,171 for 1983, for a total amount of $91,768 in taxes, exclusive of interest. Mr. Romeo's unpaid taxes accounted for approximately 29 percent of the total real estate taxes of $315,433 owed to the town for the years 1980-1983. 

4. Mr. Romeo sent out timely demand notices to all delinquent taxpayers (including himself) for the years 1980-1983. To collect these taxes he followed these demand notices with telephone calls or other informal contacts with delinquent taxpayers and succeeded in achieving a good collection rate of 95-98 percent for these years. 

5. Pursuant to G.L. c. 60, s. 37, unpaid property taxes are a lien upon the real estate for a period of three years from October 1st of the year of assessment. Beyond that period, the town may collect from the taxpayer personally, but without the security of any lien on the land. The generally preferable method of tax collection is for the town to take title to the land. Pursuant to G.L. c. 60, s. 53, tax titles may be filed (with proper notice) whenever a tax is not paid within 14 days of demand. Up until 1978, the town of Ashland had a practice of filing tax titles when taxes were approximately three years overdue. Since 1978, the town has not made use of this procedure. As tax collector, Mr. Romeo was responsible for initiating tax title proceedings for the town. 

6. Pursuant to G.L. c. 58, s. 57, delinquent taxpayers must pay 14 percent interest on overdue taxes. However, once a tax title has been recorded by the town,t he taxpayer may redeem the land only by paying the full amount in the tax title account plus 16 percent interest G.L. c. 60, s. 62. 

7. On January 13, 1984, the town's independent auditor informed the Board of Selectmen by letter that Mr. Romeo was in arrears on the payment of all real estate taxes for 1980-1983. The letter also advised that tax title proceedings should be initiated within 45 days of the tax bill. 

8. On January 20, 1984, Mr. Romeo paid $114,182.77 to the town, which covered interest owed of $31,736.54 for the years 1980-1983 and taxes for these 

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years of $82,446.23. In November, 1984, Mr. Romeo paid the balance due of $4955.92 in interest and $31,117.70 in taxes for 1983 and 1984, for a total of $36,073.62. 

9. Mr. Romeo paid a total interest, calculated at 14 percent, of $36,580. If he had continued the prior practice of recording tax titles on delinquent properties when taxes were approximately three years overdue, he would have owed 16 percent interest on at least the 1980 taxes, so would have paid an additional $1,823.00 in interest. 

10. Section 19(a) of G.L. c. 268A prohibits a municipal employee from participating in a particular matter in which, to his knowledge, he has a financial interest. By participating as tax collector in the decisions as to when and how to collect his own delinquent real estate taxes for the years 1980-1983, Mr. Romeo violated s. 19(a). 

Based on the foregoing facts, the Commission has determined that the public interest would be served by the disposition of this matter without further enforcement proceedings on the basis of the following terms agreed to by Mr. Romeo: 

1. that he pay the Commission the sum of fifteen hundred dollars ($1,500.00) as a civil penalty for violating G.L. c. 268A, s. 19(a); 

2. that he pay to the town of Ashland the sum of one thousand eight hundred twenty-three dollars ($1823.00) as recoupment of the two percent interest lost by the town in connection with the 1980 taxes because tax titles were not recorded; and 

3. that he waive all rights to contest the findings of fact, conclusions of law and conditions contained in this Agreement in this or any related administrative or judicial proceeding in which the Commission is a party.

[1] This lack of security could have significant adverse consequences for the town, e.g., if the delinquent taxpayer filed for bankruptcy protection, the town, as to its tax claim more than 3 years old, would be just one of many unsecured creditors whose claims of recovery would be questionable.