PhillyDeals: Offering a break to delinquent taxpayers

There's nothing like hard times to bring out the soft side of the taxman. Or of the cash-starved state and local government.

Gov. Rendell Monday opened Pennsylvania's first tax amnesty since 1996.

That year, the commonwealth brought in $93 million, according to Auditor General Jack Wagner. This year, the state and its contractors are trying to collect a bigger chunk of the more than $2 billion that the Department of Revenue says your neighbors owe.

Taxpayers who were officially state-tax delinquent as of last June 30 can avoid penalties, and run up only half the usual interest charges, by owning up and paying out. More at www.pataxpayup.com. The amnesty runs through June 18.

Separately, Philadelphia "will waive all penalties and half the interest due on eligible delinquent tax bills" in its own amnesty, the first since 1986, under a bill passed by City Council last year.

As city Revenue Commissioner Keith Richardson had warned, tax amnesties can make people feel entitled to paying late.

Still, as Wagner noted, New Jersey and other states have raised millions by declaring amnesties, instead of spending scarce recession dollars on tax enforcement against citizens and businesses.

That's welcome news to Richard Leonard, of Northeast Philadelphia, who recently started working for the U.S Census Bureau following a period of unemployment when he lost his store job. "I did that Philly thing where you pay the utility bills to keep the heat on, but fell behind" $1,600 on his real estate taxes, he told me.

Leonard pledged to make good during the amnesty: "We try to stay honest, tax-paying citizens."

The city amnesty starts May 3 and runs to June 25. City contractors have set up a phone line for the program, 877-645-4108, running from 8 a.m.-9 p.m. weekdays (only until 6 p.m. Fridays), also Saturdays from 10 to 2.

The Web site, www.phillytaxamnesty.com, went online last week. "On May 3 you will be able to log on and start the application process, but you can send a post-dated check right now, if you really want to," said program manager Marisa Waxman.

There's even a walk-in center, at 1315 Walnut St., Suite 1300, 8 a.m. to 5 p.m., weekdays. But the city would just as soon you stayed home and dialed your money in: "It's easier if you go online, or by phone," says Waxman.

Harleysville's fine, but First Niagara Group may want to move its local headquarters closer to Philadelphia. It's scouting new locations, says Robert Kane, the ex-PNC Bank executive tapped by First Niagara business-lending chief Daniel E. Cantara 3d to run the former Harleysville National Bank, which First Niagara bought last year.

"We need to be in Center City," going after the most "dynamic" part of the local business market - and may also move the regional headquarters "closer to Philadelphia," Kane said. First Niagara Bank is headquartered in Buffalo.

First Niagara took over after Harleysville ran low on capital following its purchase of the former Willow Financial Bank.

First Niagara says it has plenty of capital, having picked up a net $3 billion in new deposits from the former National City Bank in western Pennsylvania, and raised another $1 billion by selling shares in 2008-09. With all that new money, "we want to lend it out," Cantara told me.

The new owner has fired administrative, financial, and other workers from the former Harleysville Bank; it's also hired a handful of new business lenders, and will be hiring more, Cantara said.

"Customers 1st Bank" is the new name for the former New Century Bank, the ailing Phoenixville-

based lender taken over and recapitalized (with $67 million in investors' money) by ex-Sovereign Bancorp boss Jay S. Sidhu last year.

Sidhu says he'll open four new offices spread across Bucks and Berks Counties and Mercer County, N.J., this year. The bank will hire up to 20 new staff.