SUPERIOR — The Arizona Auditor General’s Office has found the towns of Mammoth and Superior have not followed guidelines to bring them back into compliance with state laws on the use of Pinal County Transportation Excise Tax monies and may have inappropriately borrowed state Highway User Revenue Funds.
The office is recommending that the state withhold both cities’ shares of the transportation excise tax funds until they can show that the funds will be used appropriately.
During a 2016 audit of the Pinal County Transportation Excise Tax, the auditor general found that both towns had inappropriately loaned money from their share of the transportation tax to cover other expenses. At that time, the Auditor General’s Office made 11 recommendations to the towns that required them to pay the money back, examine their use of the tax money, create and implement policies to govern the use of the money, complete a transportation study and create a planning process to prioritize road projects.
According to a letter sent to the Joint Legislative Audit Committee, a follow-up on the towns’ compliance with the recommendations shows that the towns have completed four of the 11 recommendations. It also states that in 2019, the towns inappropriately loaned money from their share of the state’s HURF funds to other projects.
According to the auditor general’s follow-up report, in June 2019, Superior loaned $1,755,679 of HURF dollars to other funds and Mammoth loaned $695,427.
Stephen Cooper, an attorney who represents both towns, said he was not aware of the auditor general’s follow-up report and could not comment on it.
“Both towns are undergoing audits which will discuss the HURF obligations and will address the compliance issues,” he stated in an email. “The audits, when completed, will be public records subject to review and inspection.”
Calls to the town managers of both towns were not returned.
The auditor general’s follow-up report does state that both towns have made some progress on paying back the transportation excise tax they loaned to other city funds in 2016. According to the report, Superior inappropriately loaned $549,054 of excise tax monies in 2016. It had paid back $292,255 of the funds over the last few years but stopped making payments in 2019.
Superior also followed auditor general recommendations on examining its expenditures of excise tax money between 2011 and 2015, developed policies to guide the use of the funds and developed a planning process for road projects.
In 2016, Mammoth inappropriately loaned $413,690 of excise tax funds. It has paid back $197,275 but stopped making payments in 2019.
Mammoth did not follow auditor general recommendations on examining its expenditures of excise tax money between 2011 and 2015, it has not developed policies to guide the use of the funds, and it hasn’t completed a study of its roadway needs or a plan to meet those needs.
EDITOR’S NOTE — Stephen Cooper is the attorney for Casa Grande Valley Newspapers Inc.