Maricopa County Treasurer John Allen has accused his predecessor of making a $15.8 million error in the investment portfolio that generates interest earnings for Maricopa County, school districts, and other taxing districts.
Allen, in a press release, claimed that the error led the Treasurer’s Office to over-distribute money to these districts during the past three years.
Allen argued that in keeping with A.R.S. § 11-504, his office “must correct the error immediately,” and the “planned 3rd quarter distribution of $18.7 million will be reduced to $2.9 million.”
However, according to his predecessor Royce Flora, Allen is wrong.
In fact, insiders say it is Allen, who “simply does not even understand the job.”
According to former staff, “the money is from an over payment of taxes by Western Pipeline. The Department of Revenue lost the lawsuit and its appeal. As a result, that meant the schools received too much money and it needed to be reversed. The Treasurer’s Office is unique in that it earned closed to $100 million a year in interest. Flora decided to take the money out of the next year’s distribution rather than pull it retroactively from the schools. The end result is the same. The Pipeline got its money back and the schools were not harmed. It just too complex for Allen to understand.”
Allen claims that Flora overstated “income earned from interest reflected a narrative that served their political purposes.” Contrary to Allen’s claims, say former staff, “politics were the last thing on Flora’s mind.”
The Maricopa County Treasurer’s Office receives an annual property tax levy of approximately $5 billion from the country’s fourth most populous county. The office invests in a conservative portfolio that earns millions of dollars in interest that is then distributed to schools and other entities that participate in the investment pool.