PHOENIXย โ Pinal County residents might get a $300 check from the state.
The Senate Finance Committee voted 3-2 late Monday to divide up among county residents what's left from an illegally imposed Pinal County sales tax. The measure, House Bill 2273, already approved by the House, now goes to the full Senate.
Rep. Teresa Martinez
But Rep. Teresa Martinez, who wrote the legislation, said it's not really what she wants to have happen.
The Casa Grande Republican would prefer the $45 million to $50 million still in the account be used for its intended purpose: Constructing roads and improvements in Pinal County. But her proposal to spend the money that way was defeated last week in the House.
The issue goes back to 2017 when Pinal County voters approved Propositions 416 and 417. The first was a regional transportation plan; the second was a sales tax to pay for it.
There was a legal challenge to the half-cent sales tax based on the fact that it applied only to the first $10,000 of anything purchased, with no additional levy for anything above that. The Arizona Supreme Court voided the tax in 2022, calling the two-tiered system illegal.
Under normal circumstances, that would have required a refund of the more than $80 million collectedย โ but sitting in an account while the case went to courtย โ to those who paid the taxes.
However, Arizona does not have a "sales tax'' owed by the buyer. Instead, it has a "transaction privilege tax,'' owed by the merchant.
And that required the state to offer refunds not to the purchasersย โ to whom the cost likely was passed onย โ but to the businesses that collected the tax between April 2018 and March 2022.
The deadline for businesses to seek refunds from the Arizona Department of Revenue is this coming month.
But Martinez said many businesses have not sought their share. She said some may have decided the hassle isn't worth the money, while other firms just may not be around anymore.
And that leaves somewhere between $45 million and $50 million unrefundedย โ and sitting in the state treasury, which collected the tax for the county.
So the legislation now awaiting action by the full Senate says anyone whose primary residence was in Pinal County in 2018 through 2024 and who files an income tax return in 2026 is entitled to get a $300 check. Ifย the taxpayer is dead, the money would go to a surviving spouse or the estate.
Not everyone is happy with the plan.
Sen. Vince Leach said the reason people voted for the levy was "it wasn't going to someone taking a vacation to Hawaii. It wasn't going to send their kids to day camp for five weeks.''
"Anybody that's been in Pinal County lately, you will know, and you will admit, that we still have a road problem," said Leach, a Republican who, while he has a Tucson mailing address, lives in southern Pinal County.
That's also the assessment of Florence Mayor Keith Eaton. "We continue to have, as the senator alluded to, tremendous transportation needs,'' he said.
And given the county's location in central Arizona, the condition of its roads affects the state as a whole, said Eaton, who also serves on the Pinal Regional Transportation Authority.
So he wants remaining funds used for transportation projects in the county.
That's not currently an option, due to the defeat of Martinez's original bill.
Despite that, Leach said there are ongoing discussions to try to find a way to resurrect that plan.
But he said that, for the moment, this is the only proposal on the table. And that means he has to support it to keep the issue aliveย โ and ensure that Pinal residents get something, Leach said.
"One in the hand is worth two in the bush,'' he said.
That's also been Martinez's position.
Still, even if the rebate is ultimately what becomes law, eligible residents shouldn't stand by the mailbox waiting for a check.
The legislation says the earliest the funds could go out is Oct. 15, 2027; all the money would be distributed within a month after that.ย
