NAUGATUCK — Naugatuck has turned to a private investigations firm as the first step to combat what officials described as an ongoing problem that is costing the borough tax revenue.
Savoy & Associates Private Investigations, a firm based in Naugatuck, will spend three months compiling a list potential cars that are registered out of state but are owned by people who live in the borough and should be registered in Connecticut.
The matter of vehicles that are registered out of state but should be on Naugatuck’s tax rolls has been an ongoing issue, Assessor Carol Anne Tyler said.
“If they aren’t registered here, we can’t tax them here. We can only tax them if we find them,” Tyler said.
Mayor N. Warren “Pete” Hess said Savoy & Associates’ investigation is the first step to see if there’s enough information to get such vehicles on the borough’s tax rolls.
Naugatuck will pay Savoy & Associates $6,000 to do the investigation, which is limited to cars owned by residents living in apartment buildings and condominium complexes.
Hess said officials felt starting with apartment buildings and condo complexes would be easier since the cars are in one location.
According to the information Savoy & Associates provided the borough, the company has access to a database with information on residents in apartment and condominium complexes. The company states it can see when each resident moved in, what utility bills are in a resident’s name, voter registration records, and motor vehicle registration across all 50 states.
Once the company identifies cars that are registered in a different state, the company says it will gather photographic evidence of the cars parked at complexes in Naugatuck.
The Board of Mayor and Burgesses approved the contract with Savoy & Associates earlier this month.
Tyler said the company identified 35 potential cars that should be on the borough’s tax rolls in the first week of its investigation. The list could easily be a couple hundred cars by the time it is finished, she said.
Naugatuck isn’t the only municipality facing this issue.
Connecticut Association of Assessing Officers President of the Chandler Rose, who is the assessor for Windham and Chaplin, said municipalities across the state are seeing residents move in and not register their cars in the state.
Rose said not registering cars in the state is, in part, a way to avoid paying local car taxes.
While Connecticut allows municipalities to tax vehicles, there are 23 states, including New York and New Jersey, which do not.
“By registering your vehicle in another state, you wouldn’t be on a Connecticut grand list,” Rose said.
Also, people may register cars in other towns that have lower tax rates. The 2018-19 tax rate in Naugatuck is 48.35, which is among the highest rates in the state. Over recent years, the state capped the tax rate municipalities can apply to motor vehicles. The cap is 45 mills this fiscal year.
Rose said hiring private firms is one of multiple ways municipalities have considered and used to deal with the issue of people registering cars out of state.
Waterbury has had significant success in getting cars that aren’t registered in the city, but should be, back on the tax rolls
Waterbury Assessor David Dietsch said the city has been working with an outside firm on and off since about 2000 to identify vehicles that aren’t registered in the city.
At first, Dietsch said, the city went after residents who registered their vehicles in other towns to avoid paying Waterbury’s high tax rate. In recent years, the city has seen an uptick in cars with out-of-state plates, Dietsch said.
During the 2017-18 fiscal year, Dietsch said Waterbury brought in $1.5 million in additional tax revenue from vehicles that hadn’t been properly registered.
Hess expects the borough to collect about $50,000 in additional tax revenue from the list Savoy & Associates is creating.
Once the company’s work is complete, the matter will come back before the Board of Mayor and Burgesses for discussion before the borough moves forward.
Correction: The article “Naugatuck chasing cars registered out of state” in the July 19 edition of the Citizen’s News incorrectly referred to the company hired by the Naugatuck Board of Mayor and Burgesses as Savor & Associates. The company is Savoy & Associates Private Investigations.