Prop 417 Transportation Tax Contested

Pinal County Board of Supervisors applaud community help, hear reports from Housing

By Dana Trumbull

Addressing the Feb. 28, 2018, regular meeting of the Pinal County Board of Supervisors, County Manager Greg Stanley reported, “There was a press release that came out Monday from the Goldwater Institute that had what I would classify as misinformation. I think the current term is ‘fake news.’

“There was no change to what the voters approved [in Proposition 417] in the resolution that the [Pinal] Regional Transportation Authority (PRTA) passed last Thursday. It was simply what ADOR (Arizona Department of Revenue) requested we do, which was to transmit to them to start collecting the [transportation excise] tax on April 1st. The only new thing in there was that we asked that they escrow the funds, because of ongoing litigation that is, unfortunately, a waste of money.”

The PRTA resolutions Stanley mentioned, passed on Thur. Feb. 22, authorizing the ADOR to begin collecting the Prop 417 transportation excise (sales) tax as of April 1 and directed the opening of an escrow account for the deposit of tax monies, pending the outcome of litigation recently initiated by the Goldwater Institute, a conservative think tank that is challenging (as promised prior to the November 2017 election) the legality of Pinal County’s transportation excise tax.

The PRTA also reaffirmed the correctness of the variable or modified rate of the tax “as expressly described in the ballot prepared in connection with such election and the publicity pamphlet related thereto.”

Prop 417 Ballot Language:  
Do you favor the levy of a transportation excise (sales) tax including at a rate equal to one-half percent (0.5%) of the gross income from the business activity upon every person engaging or continuing in the business of selling tangible personal property at retail; provided that such rate shall become a variable or modified rate such that when applied in any case when the gross income from the sale of a single item of tangible personal property exceeds ten thousand dollars ($10,000), the one-half percent (0.5%) tax rate shall apply to the first ten thousand dollars ($10,000), and above ten thousand dollars ($10,000), the measure of tax shall be a rate of zero percent (0.0%), in Pinal County for twenty (20) years to provide funding for the transportation elements contained in the Pinal Regional Transportation Plan?

The tax is intended to fund the implementation of the regional transportation plan (Proposition 416), which was concurrently approved by voters.

The “fake news” referred to by Stanley is a statement released on the following Monday, February 26, by the Goldwater Institute. In the press release, Timothy Sandefur, vice-president for litigation at the Goldwater Institute’s Scharf-Norton Center for Constitutional Litigation, states, “Voters approved a tax on retail sales, but now the county has changed the law so that all sorts of things—everything from jet fuel to restaurants—are now subject to the tax.”

Goldwater’s motion for preliminary injunction contends that, although the publicity pamphlet provided a detailed list of the items that would be taxed (including jet fuel and restaurants), the only part of the tax that was approved by the voters is the more general description “tangible personal property at retail” that was printed on the actual ballot.

Furthermore, the litigation insists that the tax, as passed, exceeds the county’s statutory authority, because it does not include all classifications as required by A.R.S. § 42-6106. “Counties have no discretion to choose what to tax and what not to tax. Thus the tax on retail sales only, which was approved by the voters as Proposition 417, is unlawful…

“This discrepancy between, on one hand, the tax the voters approved, but which violates the statute—and, on the other, the tax described in the Election Materials, and which is required by A.R.S. § 42-6106, but which the voters did not approve, creates extraordinary confusion that renders it impossible for Plaintiffs to know what is and is not taxed.”

The injunction also claims that excluding amounts in excess of $10,000 from the tax does not constitute a “variable rate,” but rather creates a new tax classification at the county level, which, they say, also exceeds the county’s statutory authority. “Prop. 417’s $10,000 threshold does not exist to advance the County’s legitimate interest in infrastructure improvement, but instead was tailored to avoid political opposition from powerful businesses.”

Assistance to Advocacy Center Recognized

During the Board of Supervisors Meeting, County Attorney Ken Volkmer took the opportunity to formally recognize the assistance of many individuals and organizations who, in 2017, assisted in moving the San Tan Valley Family Advocacy Center from its previous home on Gantzel Rd. to its new location at the Pinal County Complex, 33622 N. Mountain Vista Blvd. San Tan Valley, AZ 85142.

Among those named were Archie Carrion and John Espinoza, Pinal County Facilities; Steve Frazier and Allen Harrison, Pinal County Information Technology and Mark Lamas, Florence Unified School District. Volkmer also credited Caliente Clowns, Quilting Angels, University of Phoenix, Rise Rehabilitation “and many more” for making the Advocacy Center both welcoming and effective in their work to assist abused children.

Last year, the San Tan Valley center serviced 800 children as primary victims of crime. “This is a tremendous service that helps these victims begin to heal,” said Volkmer. “We’re that first opportunity, where the kids can get services, and they can begin to trust and begin to understand that the world is not out to get them, and they can begin to move forward.”

Registrar Position Approved

Also at the February 28 meeting, the Board of Supervisors unanimously approved a motion to restore a second deputy registrar position in Early Voting.

After a previous employee left the position, the department left it unfilled due to budget cuts; however, Pinal County has since experienced a 45% increase in Permanent Early Voters.

Pinal County Recorder Virginia Ross requested that the new position be filled immediately in order to have adequate time for training prior to mid-term elections in August. According to Ross, there will be no impact to the 2017-18 budget, as the department will use cost savings to cover the salary; however, the 2018-19 budget will be increased by $62,793.

Grant Funds Anticipated

Angel Quintanar, Pinal County Housing, reported in a public hearing that the county is expected to receive approximately $139,241 in FY2018 federal Community Development Block Grants (CDBG) from the Arizona Department of Housing Regional Account. The county may also apply for $300,000 in FY2018 CDBG funds from the State Special Projects account.

CDBG funds must be used to benefit low-income persons and areas, alleviate slum and blight or address urgent need. Based on citizen input, as well as local and state planning objectives, only one potential project has been selected to be forwarded to the state of Arizona with a request for funding.

The goal of the program is to benefit very low, low and moderate income families living within Pinal County, but not within the incorporated limits of a city or town. Recipients of services are selected based on an income qualification process and a waiting list at the County Housing Department.

Contact 520-866-7218 for more information or go to:

Housing Dept. Improves

Rolanda Cephas, operations manager with the Pinal County Housing Department provided the Supervisors with an update on Public Housing and Housing Choice voucher programs. “Over the last 13 months, we have been working with HUD appointed technical support teams due to a status designation of ‘Troubled.’ We have taken the recommendations for improvements and put them into policies and processes that have led to increased efficiencies.”

Cephas reported the housing department has used 463 of the 584 available vouchers, resulting in a utilization rate of 79%, but accompanied by budget authority at 103.9%.

In a fiscal year assessment conducted December, 2017, “We received a score of 64 out of a possible 100 points, resulting in a ‘Substandard’ management designation, so we are no longer ‘Troubled.’ This report does show substantial improvement from the previous year’s ‘Troubled’ designation status.”

AJ Property Easement Abandoned

At the property owner Carl King’s request and after a mandatory public hearing, the Board of Supervisors approved the extinguishment of an easement in Apache Junction on West Moon Vista Street, between North Desert View Drive and North Warner Drive. King is proposing future building construction on the site.

Moon Vista is not a County maintained road. All adjoining property owners agreed to the request.

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