At our inception 20 years ago, we chose to be different. Unlike other news organizations, we made the decision to provide in-depth, regional reporting free to anyone who wanted access to it. We don’t plan to change that model. Support from our readers will help us maintain and strengthen the editorial independence that is crucial to our mission to help make Western North Carolina a better place to call home. If you are able, please support The Smoky Mountain News.

The Smoky Mountain News is a wholly private corporation. Reader contributions support the journalistic mission of SMN to remain independent. Your support of SMN does not constitute a charitable donation. If you have a question about contributing to SMN, please contact us.

New Haywood tax collector sidelined after hitting a bond snag

fr matthewsThe newly elected tax collector in Haywood County has been benched indefinitely.

Mike Matthews was supposed to take office Monday, but his swearing in ceremony was canceled at the 11th hour. Matthews wasn’t able to get bonded at the amount stipulated by county commissioners — namely a $410,000 professional liability bond. 

If and when he gets bonded, he can step into the role.

But for now, the long-time tax collector David Francis is staying on in an interim basis.

Francis had already stripped the pictures from the walls and knick-knacks from the shelves of his corner office — leaving it slick and clean save a desk and a chair to make way for Matthews this week, who now isn’t starting after all.

It’s not the only empty office on the tax collector’s hall these days. Three of the five employees in the tax collector’s office have left since Matthews won office. One opted for retirement, one left to take another job and one transferred to an open position in another county department.

Francis was narrowly ousted as tax collector by 250 votes. The upset was a surprise. Matthews ran on the Republican ticket at the behest of Republican Party operatives in a quest to find candidates from their party to round out the ballot.

Matthews was considered a long shot in the race. The 35-year-old has limited experience for the job, which oversees $39 million in tax collections annually.

SEE ALSO: The magic number: is the tax collector’s higher bond prudent or punitive?

Matthews can’t take office until he secures a personal liability bond. At least one national bonding company has denied his application so far.

Tax collectors must be bonded per state statute. In the event of poor job performance or malfeasance, the bond would kick in to cover losses incurred by the county — up to the amount of the bond. The personal performance bonds are common for those in the financial industry and act like an insurance policy.

It’s up to county commissioners to set the tax collector’s bond. For Francis, it had been $100,000. But for Matthews, commissioners set it at $410,000.

It is not known why Matthews hasn’t been able to get bonded yet, although public records indicate his credit rating might not be good. Matthews has indicated to the county that he simply needs more time to come up with an underwriter willing to bond him. 

But it certainly created a hitch during the swearing in ceremony for local officials held Monday morning in the historic courthouse. After several elected officials were sworn in — including commissioners, the register of deeds, and the sheriff — the ceremony was put on pause.

County Attorney Chip Killian, who had been in the hallway on his cell phone, walked in and whispered something to Commissioner Chairman Mark Swanger. Swanger then signaled to County Manager Ira Dove.

“We need to take a moment to confer with counsel before we proceed,” Dove said.

Killian then spoke up, saying he just got off the phone with a local insurance agent engaged by Matthews to shop around for a bond underwriter.

“He feels like he is able to get the bond but he has not gotten it at this time,” Killian said. 

Killian said the bond is a “prerequisite” for Matthews to take office. If and when it comes through, Matthews can be sworn in, Killian said, but not before.

“We will cooperate with the insurance agent to try to get the bond in place so Mr. Matthews can be sworn in,” Killian said. 

That could be “Later today or next week or whenever Mr. Matthews secures a bond,” Swanger said.

Swanger then made a motion that Francis be sworn in as the interim tax collector in the meantime.

It’s unclear what will happen if Matthews simply can’t get bonded at the $410,000 amount. 

At least one bonding firm has declined to underwrite a $410,000 bond for Matthews. Matthews was denied due to “information found during our underwriting review,” according to an email the county received from Marsh, a national insurance broker. 

The broker said she couldn’t disclose the details, beyond informing the county that Matthews didn’t qualify.

“I will not be able to place the $410,000 bond in his position of tax collector due to items that became apparent during our underwriting,” a surety bond underwriter with Marsh wrote in an email to the county finance officer over the weekend. 

Marsh is the go-to brokerage firm used by the county for other employees who are bonded.

Matthews is still trying other channels. He told a crowd of supporters at a meet-and-greet reception Monday night that he was hopeful he would be able to get bonded.

However, Matthews would not comment directly for this article. Matthews also would not say on the record whether the amount of the bond was the hang up, although he has told supporters he could get bonded at a lower amount with no problem.

Normally, the county handles the bonding process on behalf of any employees that have to be bonded for their job. The employee fills out an application and returns it to the county, which in turn uses Marsh as an underwriter to shop for a policy.

Matthews apparently sent his bond application directly to Marsh instead of going through the county as a medium. The county would pay the annual premium on the bond policy, if and when Matthews obtains it. 

There has been some talk among Matthews’ supporters of raising the money themselves to guarantee his bond. But bonding agencies don’t allow private individuals to put up the money for underwriting.

Waynesville Attorney Rusty McLean was at Monday’s swearing in meeting and seen speaking with Matthews, but McLean would not say at this time whether he is representing Matthews.

Receive our FREE SMN Xtra newsletter

Go to top