Arizona House of Representatives
House Majority Research
MEMORANDUM
Kitty Decl<er
Senior EconomistlLegislative Research Analyst
(602) 926-4587
To: JOINT LEGISLATIVE AUDIT COMMITTEE
Representative Laura Knaperek, Chairman
Senator Robert Blendu, Vice Chairman
Re: Sunset Review of the Property Tax Oversight Commission
Date: December 14,2006
1700 W. Washington
Phoenix, A2 85007
~(602)417~3098
Attached is the final report ofthe sunset review ofthe Property Tax Oversight Commission,
which was conducted the House Ways and Means and Senate Finance Committee of Reference.
The report has been distributed to the following individuals and agencies:
Governor ofthe State of Arizona
The Honorable Janet Napolitano
President ofthe Senate
Senator Ken Bennett
Senate Members
Senator Dean Martin, Co-Chair
Senator Ken Cheuvront
Senator Jorge Garcia
Senator Jack Harper
Senator Jay Tibshraeny
Speaker ofthe House
Representative Jim Weiers
House Members
Representative Steve Huffman, Co-Chair
Representative Jack Brown
Representative Ann Kirkpatrick
Representative Michele Reagan
Representative Steven Yarbrough
Gale Garriott, Chairman, Property Tax Oversight Commission
Arizona State Library, Archives & Public Records
Office ofthe Auditor General
Senate Majority Staff
Senate Research Staff
Senate Minority Staff
Senate Resource Center
House Majority Staff
House Research Staff
House Minority Staff
Chief Clerk
Arizona House ofRepresentatives Ways and Means
And
Senate Finance
COMMITTEE OFREFERENCE FINAL REPORT
Property Tax Oversight Commission
Pursuant to Arizona Revised Statutes 41-2953 the Joint Legislative Audit committee
(JLAC) assigned the sunset review of the Property Tax Oversight Commission to the
House of Representatives Ways and Means and the Senate Finance Committee of
Reference for review.
Background:
Laws 1987, Chapter 204, established the Property Tax Oversight Commission (PTOC)
to:
../ further the public confidence in property tax limitations,
../ provide a uniform method for determining property tax limitations,
../ provide a continuing review of practices for ensuring a fair and equitable
administration of the laws.
The PTOC began in January 1988. The PTOC consist of five members, including the
Director of the Department of Revenue (DOR), who serves as the Chairman. The rest of
the Commission is made up of four persons who are knowledgeable in the area of
property tax assessment and levy and they serve a three-year term. One person is
appointed by the Governor and the three other members are appointed jointly by the
President of the Senate and the Speaker of the House of Representatives. DOR provides
staff for the PTOC and meets once a year. More meetings may be called if necessary.
Private members of the PTOC receive $50 per day for the performance of their duties.
The current members of the PTOC are:
Gale Garriott, DOR Director who serves as the Chairman
Lester Abrams, Property Tax Agent (and Chairman of the State Board of
Appraisal)
Jim Broadnax, B&G Property Tax Associates
Kevin McCarthy, President, Arizona Tax Research Association
Alan Maguire, The Maguire Company.
Committee ofReference Sunset Review Procedures
The Committee of Reference held one public hearing on December 7, 2006 to
review the Property Tax Oversight Commission response to the 12 sunset factors as well
as the four additional questions, as required by ARS 41-2954, subsections D and F and to
take public testimony. The Committee of Reference heard the findings of the staff report
and there was no public testimony.
Committee ofReference Recommendations
The Committee of Reference recommends that the Property Tax Oversight
Commission be continued for another ten years.
Sunset Report Requirement Pursuant to ARS 41-2954
1. An identification of the problem or the needs that the commission is intended to
address .
The establishment of the PTOC is to further the public confidence in property tax
limitations, to provide a uniform methodology for determining property tax limitations
and to provide a continuing review of practices for ensuring a fair and equitable
administration of the property tax laws.
2. Statement of the objectives of such commission and its anticipated
accomplishments
The PTOC reviews the valuations, calculations, and the levy limit amount imposed by
every taxing jurisdiction. Each jurisdiction then receives a letter from the PTOC
informing them of the results of the review. In cases of non-compliance, the jurisdiction
is informed of the required measures it must take to be compliant in its capacity. All
truth-in-taxation requirements are monitored as well.
Since its creation, the PTOC has brought the process of levy limit review to a noncontroversial
function, usually accomplished with one meeting annually. The PIOC has
successfully interacted with the political subdivisions by maintaining open
communications and establishing a positive working relationship. At this point, any levy
limit violations are generally minor and handled with the jurisdictions easily. There have
been no hearing issues since 2000 and no legislation that the PTOC has been compelled
to seek since 1999.
3. An identification of any other agencies having similar, conflicting or duplicate
objectives and an explanation of the manner in which the agency avoids duplication
or conflict with other such agencies, commissions or boards
There is no other agency or commission that has similar objectives. The PIOC provides
the only oversight of the levy limit process.
4. An assessment of the consequences of eliminating the commission or of
consolidating it with another agency or commission
Eliminating the PTOC could result in the use of inconsistent methods and practices in
levying property taxes.
Consolidating the PTOC with another agency or commission would not facilitate the
performance of its functions. The PTOC should be a stand-alone body or the integrity of
the levy limit review could be called into question. The PTOC does work with the
Department of Revenue, which eases information exchange of property values and levy
limits.
Attachments:
Meeting Notice
Minutes
Interim agendas can be obtained via the Internet at http://www.azleg.state.az.usllnterimCommittees.asp
ARIZONA STATE LEGISLATURE
INTERIM MEETING NOTICE
OPEN TO THE PUBLIC
SENATE FINANCE AND HOUSE OF REPRESENTATIVES WAYS AND MEANS
COMMITTEE OF REFERENCE FOR THE SUNSET HEARING OF
THE PROPERTY TAX OVERSIGHT COMMISSION
Date:
Time:
Place:
Thursday, December 7, 2006
1:00 p.m.
HHR4
AGENDA
1. Call to Order
2. Opening Remarks
3. Presentation on the Committee of Reference Report
4. Public Testimony
5. Discussion
6. Recommendations by the Committee of Reference
7. Adjourn
Members:
Senator Dean Martin, Co-Chair
Senator Ken Cheuvront
Senator Jorge Garcia
Senator Jack Harper
Senator Jay Tibshraeny
11/8/06
jmb
Representative Steve Huffman, Co-Chair
Representative Jack Brown
Representative Ann Kirkpatrick
Representative Michele Reagan
Representative Steven Yarbrough
People with disabilities may request reasonable accommodations such as interpreters,
alternative formats, or assistance with physical accessibility. If you require accommodations,
please contact the Chief Clerk's Office at (602) 926-3032, TOO (602) 926-3241.
Page 1 of 1
ARIZONA STATE LEGISLATURE
SENATE FINANCE AND HOUSE OF REPRESENTATIVES WAYS AND MEANS
COMMITTEE OF REFERENCE FOR THE SUNSET HEARING OF THE PROPERTY
TAX OVERSIGHT COMMISSION
Minutes of the Meeting
Thursday, December 7,2006
1:00 p.m., House Hearing Room 4
Members Present:
Senator Ken Cheuvront
Senator Jorge Garcia
Senator Jack Harper
Senator Jay Tibshraeny
Representative Steve Huffman, Co-Chair
Representative Jack Brown
Representative Michele Reagan
Representative Steven Yarbrough
Members Absent:
Senator Dean Martin, Co-Chair
Staff:
Kitty Decker, House Committee Analyst
Sean Laux, Senate Committee Analyst
Justin Weaver, Senate Committee Assistant Analyst
Representative Ann Kirkpatrick
Co-chairman Huffman called the meeting to order at 1:08 p.m. and attendance was
noted.
Committee of Reference Report
Kitty Decker, Committee Analyst, distributed the Committee of Reference Report
(Attachment A) and explained what the Property Tax Oversight Commission (PTOC) is
and it's purpose.
Senator Cheuvront questioned the number of public entities not following the truth-intaxation
laws.
Ms. Decker stated that there were a few instances, but it was notification procedures
that were not followed correctly. She stated that PTOC notified the entities and the
problems were rectified.
Senator Tibshraeny questioned the main objective of the Commission and if they make
recommendations to the Legislature on ways to improve the system.
Ms. Decker explained that it is the only commission that really monitors compliance with
the levy limit. If the commission was not continued there would be no oversight of the
levy limit calculations. She said that they can make recommendations, but there are
none at this time.
Representative Huffman opened the floor for public testimony or questions from the
Committee.
Representative Yarbrough moved that the Property Tax Oversight
Commission be continued for a period of ten years. The motion
CARRIED by roll call vote of 8-0-2 (Attachment 1).
There being no further business, the meeting was adjourned at 1:15 p.m.
Respectfully submitted,
Shelley Ponce
Committee Secretary
(Tapes and attachments on file in the Secretary of the Senate's Office/Resource Center, Room 115.)
Senate Finance and House of Representatives
Ways and Means Committee of Reference For
The Sunset Hearing of the Property Tax
Oversight Commission
December 7, 2006
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