S.C. counties are not collecting thousands of car tax bills each year, losing out on what could be millions of dollars in revenue.

Counties rely on a state Department of Motor Vehicles database to send out car tax bills. But they acknowledge that the database, prepared at least two months before bills go out, often is dated.

Some bills — no one knows exactly how many — never reach the vehicle owners.

Then, most counties do not attempt to track or follow up on who hasnot paid his or her car tax bill. State law allows counties to suspend drivers’ licenses for nonpayment of car taxes, but most do that only for people who did not pay property taxes on new cars.

The uncollected money — $6.8 million in Richland County for the year ending June 30, 2003 — could help counties maintain services or reduce tax increases, many argue.

“I can’t believe they are leaving that much money on the table every year,” said Don Weaver, president of the S.C. Association of Taxpayers. “That’s a sizable chunk of change, especially in these tight times.”

County officials say there are legitimate reasons for most unpaid bills. The owner might have moved away or sold the car, for instance.

“Cars are a lot more fluid than real estate,” said Richland County Treasurer David Adams.

But they acknowledge that enforcement of the laws largely depends on drivers realizing their license plate decals are about to expire, or on police to ticket those whose decals have expired.

Counties’ enforcement methods are “not exactly aggressive,” said Robert Croom, assistant director of the state Association of Counties.

Adams has not estimated how much it would cost to track down drivers who have not paid their car taxes.

“There are ways to do it,” he said. “Is the payoff enough? I don’t know.

“Government does what it can and leaves the rest of the burden on the taxpayer.”

‘OH, YEAH, I HAVE TO PAY MY CAR TAXES’

Whether a tax bill reaches the vehicle’s owner has been an issue for several years.

After the state updated the Department of Motor Vehicles computer system in 2002, county officials complained that records were dropped from the system and an unknown number of drivers did not receive car tax bills.

In Sumter County, for instance, officials discovered 1,000 cars had been incorrectly recorded as inactive, resulting in a loss of $164,000.

Drivers who did not receive their bills were frustrated.

“At a certain point, I just had this sense. Then I realized, ‘Oh, yeah, I have to pay my car taxes.’” said Columbia resident Jeff Donovan, who did not receive a bill last year for his 1999 Hyundai Elantra.

Donovan said the DMV charged a $50 late fee because he did not have a letter from the county exempting him.

“I just went ahead and paid it, although I gritted my teeth,” he said. “I didn’t believe it was fair to pay that penalty since it wasn’t my fault.”

County officials say they have worked out the glitches and problems are not widespread.

Still, the issue persists. All counties have a form for drivers whose bill went to the wrong address; the form acknowledges the taxpayer did not receive a bill and exempts them from DMV fines.

Every month, 30 to 40 Richland County taxpayers get the form, said Richland County Auditor Harry Huntley.

‘SURPRISED, DISMAYED OR ELATED’

There is little information available to compare counties’ car tax collection rates.

The state Department of Revenue does not have oversight over car tax collections and does not keep records.

Richland County had a 88.8 percent collection rate for the budget year that ended June 30, 2003. The county billed $60.8 million and collected $54 million, leaving a $6.8 million shortfall.

Croom, of the Association of Counties, said the rate might be a little low, but he does not “have a way to be surprised, dismayed or elated.”

“It may be Richland County is highly transient,” he said.

Lexington County had a 90 percent collection rate last year, billing $48.4 million and collecting $43.6 million, for a $4.8 million shortfall.

By contrast, Charleston County had a lower collection rate — 73 percent last year, with $16.7 million uncollected.

Some counties, such as Kershaw and Horry, have collection rates exceeding 90 percent. But that is partly because those two counties purge records from their computer systems after four to six months if the car tax bill has not been paid.

“We’re assuming that they legitimately have sold them or transferred them or moved out of the county,” said Kershaw County’s auditor, Robin Watkins.

Richland County purges unpaid bills from its records after two years, Adams said.

County officials say they eventually get their money because drivers must pay back taxes before they get a new registration decal.

‘A JUDGMENT CALL’

Several county auditors and treasurers say it would take too much time and cost too much money to track down all the drivers who have not paid and to verify whether they legitimately do not owe the tax or are delinquent.

Instead, auditors and treasurers wait for up to a year for the DMV to update the records or for police to cite drivers for expired decals.

State Highway Patrol troopers last year wrote 961 tickets for expired decals. They have written 292 tickets so far this year.

“We’re not overlooking that violation when we see it,” patrol spokesman Josef Robinson said. “We’re out there being proactive when time will allow it, when we are not working collisions.”

Sheriff’s officers and city police also ticket drivers for expired registration decals.

Counties have the authority under a law passed about two years ago to tell the DMV to suspend a driver’s license for failure to pay car taxes.

Most counties suspend licenses of drivers who bought new cars with dealer-issued tags and failed to pay their first property tax bill. But few use it on renewals because of time, money and the expected low return.

“It’s a judgment call,” Croom said. “Sending them the letter flushes out a ton — good, bad or indifferent. But if 80 percent panic for no good reason and 20 percent are deadbeat? Ehhh.”

The numbers, though, could add up. Even if 20 percent of Richland County’s $6.8 million in unpaid bills were due to people flouting the law, that would amount to about $1.4 million.

Some counties have cracked down on delinquent car taxes and wound up with significant financial gains.

In Chester County, Treasurer Jack Kindle realized in 2000 that there was a backlog of unpaid car tax bills totaling $1.5 million.

Kindle went after drivers “flipping tags” from a higher-valued car to a lower-valued car and then switching them back after they paid the car tax. He also targeted new car owners with dealer-issued plates and drivers who register out of state.

By 2003, the amount of unpaid car tax bills in Chester County had dropped to $85,000.

In Horry County, Treasurer Johnny C. Allen is planning to hire a temporary employee to find people with out-of-state licenses.

“He’s going to drive around from hospital to hospital, from school to school” looking for out-of-state tags, Allen said.

Allen wants to collect $1.5 million in car taxes.

The employee will be paid $16,800 and be provided a county car.

‘NOT THERE YET’

Other officials say the issue is not a huge problem and lay the responsibility on the taxpayer.

DMV spokeswoman Beth Parks said it is a driver’s responsibility to know when his decal expires. “You can avoid a whole lot of hassle if you just pay attention,” she said.

Parks and county officials say drivers should notify the DMV if they move or sell their cars outside of the county. And a driver who moves or sells a car within a few months before the tag expires should notify the county to get the bill. (Drivers who move should notify both their old and new home counties.)

“Most people don’t think about notifying the county,” Parks said. “They think that they magically find you.”

Art Guerry, the Lexington County auditor, said counties would be better able to determine whether a car tax bill was legitimately unpaid if counties had access to a statewide and national database that instantly updated car sales and changes of address. Then, they would know the driver had sold the car or moved out of the county and no longer owed the tax. They also would know which drivers to track down.

“We don’t quite have that ability yet,” he said. “But I’m sure those days are coming.”

Reach Hill at (803) 771-8462 or sehill@thestate.com