Candidate for mayor said Santa Cruz City didn’t missed out on collecting $5.6 million in back taxes, but that’s false

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On December 11, Cartagena parish was host to six of the seven candidates for mayor of Santa Cruz for the 2020-2024 term, who debated their proposals for the canton.

The Voice Fact Checking, a Voice of Guanacaste initiative, analyzed the candidates’ proposals and chose a few that could be fact-checked against data and facts and not opinions.

Authentic Santa Cruzan candidate Jorge Alfaro said “We have $5.6 million in uncollectable bills at city hall.” 

After the debate, the Voice of Guanacaste asked Alfaro what he was referring to with the statement and what information he based it on.

Alfaro said the data came from the city finance department and it refers to money the local government will miss out on by not collecting the canton property tax. He didn’t provide a specific year.

The Voice Fact Checking found that Alfaro’s statement is false based on an interview with city financial advisor Mario Moreira, the city’s most recent budget evaluation report and the Comptroller General’s report on city spending and revenue from Santa Cruz property taxes.

According to Moreira, one issue is back taxes owed by residents to the city and another is the amount that is considered uncollectible. The first term refers to past due tax payments from residents. The latter term is an estimate of the city’s opportunity cost by not collecting the tax at all.

The Comptroller General’s most recent report on the issue is from June 2018, when it warned the City of Santa Cruz that it ran the risk of missing out on almost $1million because of poor management in collecting property taxes. The amount wasn’t $5.6 million like Alfaro claimed.

The Comptroller and Moreira were speaking about amounts at risk of surpassing the statute of limitations, meaning that not all of the $1 million would end up lost if the city is able to collect it. The money can’t yet be considered lost. The statute of limitations on collecting past due taxes is three years. 

But taxpayers aren’t exempt from paying after three years. They must go to city hall and request the amount be expunged. The city has the right to reject the request and contest the taxpayer for lack of payment.

Having it expunged isn’t automatic. There are procedures the city follows to recover the money. It’s until the procedures have been exhausted that we can talk about a total loss of the money,” Moreira said.

So where does $5.6 million come from? The closest number the city has to Alfaro’s statement is the amount owed.

For example, there was $4 million in past due property taxes owed in 2018. The past due amount for all taxes including trash collection and the maritime zone was $7.2 million in 2018.

Our methodology: 

The selected statements weren’t the only ones matching these criteria, but were chosen because of their relevance for Santa Cruz.

These are other statements that we fact-checked: 

True: Santa Cruz only has zoning plans along 21 miles of coast

False: “Today we have fewer police officers and more thieves”

The candidates who took part in the debate were Arcadio Carrera for the National Integration Party, Iván Ramírez of the National Liberation Party, Mauricio Mexicano from the Citizens’ Action Party, Pastor Gómez of the Social Christian Unity Party, Marcos Vidal for the New Republic Party and Jorge Arturo Alfaro of the Authentic Santa Cruzan Party.

The only absent candidate was Edka Contreras, who represents the National Restoration Party (PRN).