Lake Havasu City, AZ – Supervisor Buster Johnson would like to make the public aware that the Treasurer’s Office has decided not to open the two satellite offices in Lake Havasu and Bullhead City as previously planned for collection of tax payments. Mohave County Attorney Bill Ekstrom advised Treasurer Cindy Cox that not accepting cash payments at the satellite offices was a violation of 1 U.S. Code § 5103 that states that United States coins and currency are legal tender for all debts, public charges, taxes, and dues. “Cash payments have been accepted in the past with only one staff personnel at each location,” Supervisor Johnson said. According to Treasurer Cox, an additional $200,000 of needed security and personnel would be needed at each satellite office before cash payments could be allowed. “While different options were laid out for ways residents could still pay their tax payment in person without having to drive to Kingman or mail it in, the Treasurer still decided to shut down both locations for the time being,” Johnson continued. According to Johnson, there are solutions out there that should be looked in to. “We are here to serve the people, and if they want to pay their property tax bill in person they should be allowed to,” Johnson stated. “An example of a no cost solution for county taxpayers is to mirror what Maricopa County Treasurer’s Office has done for over 10 years and that is partner with a bank branch,” Johnson suggested. “Maricopa County partners with Chase Bank to allow constituents who want to pay with a check the option of going to any Chase branch in the state with a check and their tax payment coupon. With Chase’s system, the bank is able to directly import the tax payer’s data and payment information to the Maricopa County Treasurer’s Office electronically with very little paperwork and no risk of information getting lost in the mail,” Johnson explained. “They have partnered with Chase specifically for the past five years with no cost to county taxpayers. This is just one example of a solution for local residents. We need to be looking for solutions not just closing the doors,” Johnson continued. Johnson suggested a low cost solution the Treasurer could consider is to partner with another county department already located in Lake Havasu and Bullhead. “The Treasurer could agree to pay half of an employee’s salary and benefits from that department, and along with that employee’s everyday duties, they could also be available to constituents year round who want to pay their taxes in person,” Johnson said. Supervisor Johnson stated that prior to 2014 his office collected payments year round from residents who wanted to pay with cash or money order. “I have never heard of an issue arising regarding security and the collection of tax payments at the satellite offices,” Johnson said. “My office gladly accepted the payments until we were told we were no longer allowed to,” Johnson continued. Johnson also stated that a … Continue Reading →
Law Would Have Cost County Taxpayers Thousands Lake Havasu City, AZ – Reconsideration of SB1071 failed 28 to 31 yesterday in the Arizona House of Representatives. The bill, originally sponsored by Arizona State Senator Steve Smith, would have put a $500 cap on fees that a county treasurer may charge for a tax lien deed where ten or more parcels are involved. Supervisor Buster Johnson, Chair of the Arizona Association of Counties (AACo) Legislative Committee, reached out in opposition to the bill. “This was special legislation aimed at helping a private investor in Pinal County,” Supervisor Johnson stated. “I want to thank Representative Cobb for voting against this bill and for recognizing that this was poorly written and would have harmed Arizona’s counties,” Johnson continued. According to AACo, the majority of the treasurer’s in Arizona were against SB1071 stating that if passed it would have set a president for future tax liens that would have cost county taxpayers hundreds of thousands of dollars. “If this bill would have passed a million dollar investor would have end up paying a little over .17 cents per parcel in tax lien deed fees while regular county taxpayers are still paying $50,” Johnson explained. The bill was originally brought about after Phoenix area attorney and multi-million dollar investor Wayne Howard purchased 2,922 tax lien properties in Pinal County resulting in him having to pay a fee of $146,100 to get them deeded through the Pinal County Treasurer’s Office. “Anyone who buys a lien knows the costs when bidding and they make a business decision at that time as to the worth and their investment,” Johnson stated. Current state law allows third parties to purchase properties through tax lien sales after a property owner is delinquent on their taxes for three years. The owners of the lien may then initiate foreclosure proceedings if the landowner does not pay what they owe plus penalties. If the third party obtains a court-ordered judgment on the foreclosure, the third party is then required to obtain a deed transferring the property from the debtor to the third party. The current fee for the issuance of each deed is $50 according. According to Johnson, the current fee only covers half of what it costs the treasurer’s office to transfer the deed. “A breakdown of the actual cost to process these deeds amounts to $97 per deed,” Johnson explained. “At the $50 level we can process them and it still costs the county taxpayers some money,” Johnson continued. “If we put a $500 cap on deeds of ten or more, regular citizens are still being forced to pay the $50 fee while multi-million dollar investors are getting over a 90% reduction,” Johnson stated. Johnson also believes that the language of the bill would not have held up in court. “Legally you cannot bundle multiple deeds. They need to be done individually,” Johnson stated. “If it is a subdivision for example with multiple lots it cannot be put back as one piece … Continue Reading →
Lake Havasu City, AZ – On Monday March 23rd, HB2128 was signed into law allowing state assessment ratios on property leased to churches or religious organizations to be reduced by 95%. According to Supervisor Buster Johnson, the reduction will only further impact the state’s troubled financial situation. “This bill will result in property tax losses for local governments as well as cost the state upwards to $2.1 million by fiscal year 2016,” Johnson stated. The Joint Legislative Budget Committee (JLBC) currently predicts that by the end of the fiscal year state expenditures will be $257 million more than state revenue. The courts have also ruled that the state owes $1.3 billion to the schools for inflation back payments which lawmakers have not paid nor included in their current budget. “With the financial situation of both the state and counties, instead of legislators looking to close up loop holes they are adding more exemptions,” Johnson stated. “This reduction with also further hurt other taxing jurisdictions within the counties such as schools and fire districts,” Johnson continued. According to Supervisor Johnson, this legislation is both costly and unnecessary. “Some commercial property owners help with lease payments for churches. The county’s libraries and senior centers are also available to all non-profits if they need space until they can afford to get their own building. We currently have one church who holds their Sunday service at the library for this very reason,” Johnson explained. Under current Arizona law, buildings owned by churches or religious entities already receive a significant tax break. This bill will allow the landlords who rent to these organizations to receive the same break. According to Mohave County Assessor Ron Nicholson this is a significant reduction. “Instead of a commercial property owner paying taxes based on 18% of the property’s value, they will now pay 1% of that value,” Nicholson explained. An amendment added HB2128 would require the churches to sign an affidavit stating the savings was passed onto them. “With the passage of this bill, more of the state budget is being funded on the backs of homeowners,” Johnson stated. In 2011, state lawmakers passed a corporate income tax reduction of 0.5 percentage points a year, settling at 4.9% in 2018 along with a 10% reduction in various business property-tax category assessments. Supervisor Johnson feels this tax break makes an unequal playing field among non-profits and takes taxable property off the tax rolls. “By offering this tax break to property that is being leased we are doing unforeseen harm to the housing market by removing property that would otherwise bring in revenue for counties and the state,” Johnson said. “With other non-profits not getting this break, it could also open the door for more tax breaks in coming years for other types of organizations. This is bad legislation and will cost the state a considerable amount of revenue and hurt local taxpayers over time,” Johnson ended. The bill passed the House on a 33-25 vote … Continue Reading →
Lake Havasu City, AZ – Mohave County Supervisor Buster Johnson is urging the Arizona Congressional delegation to support municipal bonds and to oppose proposals that would eliminate or cap the deduction on tax-exempt municipal bonds in the President’s Fiscal Year 2016 Budget Proposal. “Municipal bonds are a primary funding source for infrastructure projects in cities and counties throughout the United States,” Supervisor Johnson said. “These projects create numerous jobs and economic growth, and it is imperative that their tax-exempt status remain unchanged,” Johnson continued. Tax-exempt bonds were written in the first tax code in 1913 and are a well-established financing tool for state and local government. They are mainly issued for governmental infrastructure and capital needs purposes. “Mohave County does not use municipal bonds for its improvement projects, however; the incorporated cities within the county use them to help taxpayers save on the debt issued for capital projects such as the construction or improvement of city roads, water and sewer systems and other public works projects,” Johnson explained. According to a report by the National Association of Counties (NACo), over the last decade municipal bonds have saved local governments in Arizona roughly $36.1 billion. If signed into law, President Obama’s Fiscal Year 2016 Budget would place a 28% limit on the value of specified deductions or exclusions from adjusted gross income and all itemized deductions; the limit would apply on interest earned for new and outstanding state and local tax exempt bonds. NACo’s report estimates a 28% cap would cost Arizona taxpayers roughly $3.8 billion. “This cap would increase borrowing costs to public entities and could potentially shift these costs to local residents through tax or rate increases,” Johnson said. Through the use of tax-exempt municipal bonds, state and local governments invested 2.5 times more in infrastructure than the federal government over the last decade. NACo reported that local governments saved roughly $1.9 million in infrastructure construction in the last decade alone by funding millions of infrastructure projects with the help of municipal bonds. “Placing a cap on municipal bonds would have a dire effect on Mohave County’s economic and financial future,” Johnson stated. “These tax-exempt bonds have and can continue to save the taxpayers money by offering lower interest rates on infrastructure projects throughout the county,” Johnson ended.
Washington, D.C. – Supervisor Buster Johnson was among nearly 30 elected officials from around the country who were asked by the National Association of Counties (NACo) to participate in their Washington D.C. Leadership Fly-In. As President of the Arizona Association of Counties (AACo), Supervisor Johnson represented all fifteen counties in Arizona when he met with congressional leaders and officials from the U.S. Department of Interior and the U.S. Department of Agriculture to highlight the importance of the Payments in Lieu of Taxes (PILT) program and what it means for Arizona counties. “Federal lands in Arizona make up roughly 42.1% of the state,” Supervisor Johnson stated. “Without PILT funding, Arizona counties would be forced to shift federal responsibilities to local tax payers or drastically cut essential services such as education, law enforcement, and road maintenance,” Johnson continued. During the Fly-In, Supervisor Johnson and Supervisor Liz Archuleta from Coconino County met with some of Arizona’s Congressional delegation along with Speaker of the House John Boehner and Congressional leaders from Arkansas and Mississippi to give testimony and real life examples of why PILT is so important for Arizona. “Several counties, such as Greenlee County where PILT represents one-third of their general fund, require these funds to balance their budget. Without it they would essentially go bankrupt,” Johnson stated. Federal regulations require counties to provide services in the form of road maintenance, law enforcement and search and rescue on federal lands. “Because counties are not allowed to collect property taxes on these lands nor allowed to let private economic development occur, the PILT payments help counties offset those loses,” Johnson explained. During fiscal year 2014, which is set to end September 30, Arizona counties received over $34 million in PILT revenue. Supervisor Johnson encouraged Congressional leaders during the fly-in to include a reauthorization for PILT in the 2015 Appropriation Bill, while at the same time expressed the need that a permanent funding source for PILT must be found. “Counties shouldn’t have to plead with Washington every year to ensure these funds are continued,” Johnson said. According to Johnson, Senator Ron Wyden from Oregon has proposed a plan to NACo to permanently fund PILT, but no legislation has been officially introduced.