Limerick City and County Council is to clamp down on businesses not paying their rates - and is considering taking bankruptcy proceedings against one individual.
The local authority is owed almost €25m in commercial rates, which are a property-based charge levied on business owners.
At the end of 2013, just 53% of rates had been collected, and this has led the newly merged local authority to decide to take action against outstanding debts.
After hiring external debt collectors earlier this year, the council is also in the process of securing judgements against 12 ratepayers for a combined €82,444.
The move has been criticised by one councillor as not being a “proactive way of keeping people in business”, while Limerick Chamber has called on local businesses to engage with the council to avoid costly legal proceedings.
A council spokesperson said that two new matters were sent to court this month for judgements against Eastpride Limerick and the Four Elms at Drombanna. These total €48,579.
“The council has instructed its solicitors to register these judgements against any properties held in the name of the debtor to include the family home and other personal assets,” a council spokesperson confirmed.
For the first time, the council is considering initiating bankruptcy proceedings against one business owner, who has a variety of companies, mainly located in the county area.
But Fianna Fail councillor James Collins, a ratepayer himself and a member of the economic strategic policy committee, criticised the move.
“City retailers have gone through a tough time and the council should be helping them continue trading. Bankrupting businesses does not seem a pro-active way of keeping people into business,” he said.
He said that in the past a situation existed where the former City Council had seen rate-payers only as an income stream. The council operates a rates rebate scheme for closed businesses.
Cllr Collins said instead of waiting until a business is closed, the local authority should help firms “keep the show on the road”.
“Maybe they want to reinvest, but they don’t have the cashflow. If they did reinvest, they might be able to earn more profits,” he argued.
The chief executive of the Limerick Chamber Dr James Ring has called for a ring-fenced fund to be put in place to support businesses by reinvesting money back into the local economy and support growth and job creation.
He said while the Chamber cannot comment on individual cases, “nobody wants to hear of any businesses being brought through the courts, and we would urge people to engage with the local authority to find a resolution”.