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E-filing, credit-card payments on tap for N.H. tax-collection agency

New Hampshire’s tax-collection agency is well on its way to trading in its armored cars and green-screen computer terminals for electronic tax filing and credit-card payments, Revenue Commissioner Kevin Clougherty said yesterday.

The Department of Revenue Administration got $7 million in 2009 for its “Granite to Green” modernization project, which included modernizing mail and call-center services and upgrading antiquated software and hardware systems (the department’s Tax Information Management System, for example, dates to 1989).

“It’s on time, it’s on budget and it’s 95 percent complete,” Clougherty told members of the Senate Ways and Means Committee yesterday morning. He later spoke to the House Ways and Means Committee.

Most of the system improvements are done. Greater automation means less manual data entry and other labor, and DRA staffing is down between 29 percent and 53 percent, depending on the division. The department has reduced its vehicle fleet since 2009 from 35 to 18, he said, “because the data is coming to us.” And the process of backing up records at a location outside Concord should get under way early this year.

But, Clougherty said, he needs more money and staff in the department’s operating budget to complete the project, including ensuring e-filing compatibility with the Internal Revenue Service and tax-preparation services like TurboTax and H&R Block.

Those final elements were delayed because, “with the budget cuts we’ve had, that couldn’t be done. We couldn’t do that and still do everything else,” Clougherty said.

He said the department has gone from 191 employees in fiscal 2009 to 119 in the current fiscal year, but he doesn’t need to replace all 72 lost jobs.

“We really need about 25 positions, but they’re not the positions that you used to have,” Clougherty said. “We need different skills, different talents, strategically placed to make these systems really efficient.”

The improvements should reduce the paperwork processing burden for the department, he said. For the 2011 tax year, DRA received 310,000 payments, with 77 percent coming in the form of paper checks. Of the 573,000 documents received by the department, 86 percent were on paper.

DRA’s next budget will be part of the state budget for the approaching biennium, fiscal years 2014 and 2015, which begins July 1. Gov. Maggie Hassan must deliver her proposed budget to the Legislature by Feb. 15.

One more big change in the works: Allowing tax payments to be made with a credit or debit card.

In November, the state Department of Administrative Services issued a request for proposals for a vendor to process card payments for lottery tickets, registrations and licenses, tax payments and other state-government transactions.

Bids are due Friday. The five-year contract must be approved by the Executive Council, and the new system is scheduled to come online July 1.

(Ben Leubsdorf can be reached at 369-3307 or or on Twitter @BenLeubsdorf.)

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