Tax transparency bills enable public to see data

This year, several transparency-related tax bills have been signed into law, each aiming to make tax issues more accessible to the public.  

Sean McCarthy, senior research analyst at the Arizona Tax Research Association, said these bills were designed to improve tax law by increasing accountability. 

Many transparency-focused bills are created in response to changing times or circumstances that require continued work on laws, or things legislators didn’t know were a problem, McCarthy said.  

“You’ll say, ‘Hey, what if we change this part of the law,’ and then all of a sudden you’ll get 100 people raising their hand to say, ‘Yeah, we’ve been struggling with that for years, thank you for finally addressing it,’” he said. “Sometimes people will sit on their problems for years, and if you’re not the type of person who knows how to call their lawmaker, then the event might not get addressed.” 

McCarthy said the bottom line for transparency-related bills is making sure tax information is easily accessible online and that it is presented in a way that is useful to the general public.  

In some ways, the pandemic has made tax policy more accessible to the public than it was before, allowing the public to attend legislative meetings online, and it’s not hard for people to get involved in jurisdictions they’re interested in when the information is out there, he said. 

“It’s very common for there to be special district meetings, fire district meetings or some water board where no one is paying attention,” McCarthy said. “And that’s not healthy, you know. It’s better if people are paying attention, and so we totally understand that people are busy, but we try to encourage the general public to get involved where you can … because it definitely makes a big difference when people know that the public’s watching.” 

This session, there may have been more transparency-related bills than usual, but that is likely because last year’s session was cut short, McCarthy said. Most of the time, those bills see good support in the Legislature. 

“Arizona in our mind has done a lot of good things to improve the transparency of government,” McCarthy said. “There’s always room for improvement, but when we talk to some of our partners in other states that don’t have a lot of these budget tax and audit transparency laws, we’re sometimes surprised to hear what goes on in other states. So we’re pretty pleased generally where Arizona’s at and our ability to improve it at the margins.” 

House Bill 2018 — schools; audits; financial records; budgets 

HB2018, sponsored by Rep. Michelle Udall, R-Mesa, requires school districts and charter schools to send audit reports to the county school superintendent and Arizona Department of Education, which posts the reports to its website. Governing boards are required to publicly accept all audits and compliance questionnaires by roll call vote and the auditor general is to report any districts’ failures – to maintain a uniform system of financial records – to the State Board of Education and ADE. The bill had full bipartisan support and was signed into law February 12.  

McCarthy said while budget audits are performed annually by a third party, those audits are only useful if the public is paying attention. Audits weren’t always being presented to governing boards and school districts and weren’t being addressed in public meetings, he said. 

House Bill 2112— truth in taxation; press releases 

HB2112, sponsored by Rep. Ben Toma, R-Peoria, requires increased transparency and accessibility of information about tax increases to the general public. When proposed property tax levies are greater than the amount levied the previous year, district governing boards are required to publish two notices in a generally circulated newspaper and post a press release that includes the name of the newspaper where the truth in taxation notice will be published on the website of the county, city or town. 

The bill had full bipartisan support and was signed into law March 24. McCarthy said the bill was a result of tax increase information being published in newspapers that few people read. 

“The part about putting it in a newspaper wasn’t working,” he said. “So we had to have a bill that tried to improve that.” 

House Bill 2391— county property tax information; worksheet 

HB2391, introduced by Rep. Steve Kaiser, R-Phoenix, will require county boards of supervisors to put property tax information for all taxing jurisdictions in the county on a public worksheet like a Google or Excel sheet. The worksheets should be located in a prominent area of the county website.  

McCarthy said historically, the Arizona Tax Research Association has compiled property tax information from each county into one manual and was one of the only entities that had that information in one source, and wanted to make that information more democratized on something like a Google sheet. 

“That’s just not right for people to have to rely on a private organization like us to do that, so it’s just a weird part of law where people were kind of dependent on experts who were able to comb the data, and then distill it into something useful,” McCarthy said. 

The bill was signed into law March 24 after having full bipartisan support. 

House Bill 2442 — county treasurers; reports; posting; website 

HB2442, introduced by Rep. Becky Nutt, R-Clifton, requires county treasurers to post all annual and monthly reports of collection, custody and disbursement of public revenue on the treasurer’s website within five days of submitting the report to the board of supervisors. 

The bill was signed into law March 24 after receiving near unanimous approval from the House and Senate.