Transportation Authority OKs plan for $87 million in Prop. 417 tax refunds

The Pinal Regional Transportation Authority Board of Directors on Nov. 1 approved a plan to work with Pinal County businesses and entities and the Arizona Department of Revenue to recover transportation excise taxes collected from 2018 to 2022 in Pinal County.

The Arizona Supreme Court ruled this year the structure of the transportation excise tax approved by Pinal County voters in 2017 was not valid, resulting in approximately $87 million in tax receipts that must be refunded.

Businesses and other entities in Pinal County paid the taxes to the Department of Revenue for four years, but no funds were ever made available to the Regional Transportation Authority due to the lawsuit brought by Valley conservative group Goldwater Institute that lasted more than three years.

Under the plan approved by the transportation authority’s Board of Directors, businesses and entities that paid the taxes to the state would have the option of requesting refunds from the Department of Revenue and then donating that money to a Central Arizona Governments fund for capital-improvement transportation projects and other programs in Pinal County.

The taxpaying entities would avoid tax consequences by donating the funds to CAG, a non-profit 501(3)(c). The plan also would allow tax refunds to best satisfy the original transportation-project purpose for the tax while keeping the money in Pinal County.

It would also allow the Pinal Regional Transportation Authority to assist Arizona Department of Revenue in its efforts to refund the tax money.