Fran­chot: New com­put­ers will speed re­funds, im­prove ser­vice

Baltimore Sun - - FRONT PAGE - By Michael Dresser

Comptroller Peter Fran­chot is promis­ing Mary­land tax­pay­ers faster re­funds and stronger pro­tec­tions against fraud­u­lent re­turns after the state be­gins us­ing a new, $160 mil­lion tax col­lec­tion com­puter sys­tem.

After years of plan­ning, a con­tract to im­ple­ment the sys­tem will go Dec. 19 to the state Board of Pub­lic Works, where ap­proval is ex­pected.

The in­te­grated sys­tem is ex­pected to re­place sev­eral “legacy” sys­tems — in­clud­ing one that’s been in use for 31 years.

Fran­chot, a Demo­crat who was re­cently elected to his fourth term as Mary­land’s chief tax col­lec­tor, said the in­vest­ment will pay off for hon­est tax­pay­ers and for state gov­ern­ment rev­enues.

“This is a chance to get rid of an out-of-date sys­tem that has served the state

“It means to Joe Tax­payer that the comptroller’s of­fice will be able to de­liver its ser­vices in a more ac­cu­rate, faster and cus­tomer-friendly man­ner.” Deputy Comptroller Sharonne Bonardi

won­der­fully, but is no longer flex­i­ble enough to pro­vide the level of cus­tomer ser­vice to our tax­pay­ers that we want to,” he said.

The comptroller’s of­fice now uses dif­fer­ent sys­tems to col­lect taxes, in­clud­ing a main­frame busi­ness tax col­lec­tion sys­tem that dates to 1987 and a sys­tem in­tro­duced in 1992 for in­di­vid­ual in­come taxes and the sales tax.

The new project is ex­pected to bring the col­lec­tion of all Mary­land taxes — in­come, sales, al­co­hol, fuel and oth­ers — un­der a sin­gle sys­tem.

“It means to Joe Tax­payer that the comptroller’s of­fice will be able to de­liver its ser­vices in a more ac­cu­rate, faster and cus­tomer-friendly man­ner,” said Deputy Comptroller Sharonne Bonardi, who is over­see­ing the sys­tem’s im­ple­men­ta­tion.

The con­tract is ex­pected to be awarded to Rev­enue So­lu­tions Inc. of Pembroke, Mass., which ac­cord­ing to the state un­der­bid the com­pe­ti­tion by more than $20 mil­lion. The con­tract is worth $117 mil­lion over 10 years, with an op­tion for a fur­ther five years worth $42 mil­lion.

Bonardi said that for the roughly 85 per­cent of peo­ple who file their Mary­land tax re­turns elec­tron­i­cally, it typ­i­cally takes 2½ to 3 days from the time they click to file to the time a re­fund lands in their bank ac­count. The new sys­tem will speed up the re­funds, she said.

Amended tax re­turns now have to be pro­cessed by hand, Bonardi said. But with the new sys­tem, those, too, will be pro­cessed elec­tron­i­cally and any money due should ar­rive within three days, she said.

Even peo­ple who file pa­per re­turns should see faster re­funds than they do now, she said.

While this might be good news for some, the comptroller’s of­fice ac­knowl­edges that it could be bad for oth­ers. Bonardi said the in­te­grated sys­tem will make it eas­ier for the agency to de­tect fraud­u­lent re­turns in­tended to steal tax­pay­ers’ re­funds.

“Let’s just say that if you are a fraudster, we’re go­ing to be more ef­fi­cient than we have been in the past,” she said.

The sys­tem will pro­vide ben­e­fits to busi­nesses as well, Bonardi said. She gave the ex­am­ple of a busi­ness owner who may pay sev­eral dif­fer­ent types of taxes — for in­stance, sales tax and cor­po­rate in­come taxes — in ad­di­tion to per­sonal in­come tax. That per­son will now be able to track all their ac­counts through the same sys­tem.

Bonardi said the sys­tem will also let the comptroller’s of­fice im­ple­ment changes to Mary­land tax laws more quickly than it can now. She said that the agency has some­times had to ask law­mak­ers for more time to make changes be­cause of the dif­fi­cul­ties in pro­gram­ming the legacy sys­tems.

“We would def­i­nitely be able to be more re­spon­sive, more ag­ile and, hap­pily, at a lower ex­pense,” she said.

None of this will hap­pen right away, Bonardi cau­tioned. She said the con­trac­tor would be­gin phas­ing in the In­te­grated Tax Sys­tem So­lu­tion next year. The comptroller’s of­fice ex­pects var­i­ous fees and ex­cise taxes, such as those on al­co­hol, to­bacco and gaso­line, to be­come part of the sys­tem in 2020. Per­sonal in­come taxes would fol­low in 2021. The cor­po­rate sales tax and the sales tax would be in­te­grated into the sys­tem in 2022.

Karen Syrylo, a board mem­ber of the Mary­land As­so­ci­a­tion of Cer­ti­fied Pub­lic Ac­coun­tants, said the comptroller’s of­fice has worked with her group in de­sign­ing the new sys­tem. She said CPAs will be part of the test­ing process of a sys­tem that she sees as a sound use of state dol­lars

“It’s go­ing to make things a lot bet­ter for us, the tax pro­fes­sion­als, the tax­pay­ers, as well as the state em­ploy­ees,” Syrylo said. “The tax­pay­ers are go­ing to see a big dif­fer­ence.”

Mary­land has had a dis­mal track record in im­ple­ment­ing large-scale in­for­ma­tion tech­nol­ogy sys­tems — most no­tably a sys­tem in­tended to op­er­ate the state’s in­sur­ance ex­change un­der the Af­ford­able Care Act in 2013-2014. But Bonardi said the comptroller’s of­fice has done its due dili­gence to make sure its roll­out goes smoothly, vis­it­ing states around the coun­try to see what has worked and what has not.

“We found the so­lu­tion that’s best for the state of Mary­land,” she said.

Fran­chot

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