The Maricopa County Community College District (MCCCD) has filed suit against Maricopa County and County Treasurer John Allen over a tax dispute that could raise tuition or cut programs.
MCCCD is trying to resolve a $45 million tax bill it now owes, with interest, stemming from a 2016 lawsuit and property tax error it didn’t cause.
“The filing is in response to the County’s years of miscalculations and lack of resolution related to the Qasimyar v. Maricopa County class action lawsuit,” MCCCD wrote in an open letter to Maricopa County.
In the 2016 lawsuit, Qasimyar v. Maricopa County, a tax court ruled in favor of property owners who sued the county, alleging they were improperly and erroneously assessed when their properties went from a primary resident to a rental or secondary home or vice versa. Therefore, property owners should have seen lower property tax bills because of what’s known as a “change of use.”
The Arizona Court of Appeals upheld the ruling and agreed some property owners were overtaxed, forcing hundreds of thousands of homes to be reassessed, resulting in property tax refunds from 2015 to 2021. As a result, the county needs to pay back $329 million in property tax refunds.
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MCCCD now owes the county nearly $45 million, with interest, which the college district said is already being withdrawn from its bank accounts.
“The District was not involved in the Qasimyer Action, as a party or otherwise, nor was it notified during the Qasimyar Action that it would be expected to bear the financial responsibility resulting therefrom,” the district noted in its filing.
“The County’s failure to disclose its intentions is critical because, in June 2024, the District’s Governing Board had approved its budget for the fiscal year 2024-2025,” the suit continues. “The District therefore had no ability to plan or budget for the unanticipated expense associated with the removal by the Treasurer of nearly $45,000,000 from the District’s accounts.”
In a 2024 interview with ABC15, MCCCD’s Governing Board President, Susan Bitter Smith, said the county’s failure to notify MCCCD has left the district with few options.
“Extremely frustrating. There’s been a great deal of angst, a great deal of fear on the board’s part,” she said.
MCCCD filed a Notice of Claim against the County in September 2024. The County had 60 days to respond before further legal action was taken.
ABC15 reached out to Maricopa County for a comment. A county spokesperson said they do not comment on current litigation.
In August 2024, the Board of Supervisors approved funding that will help certain taxing districts cover their tax bill stemming from the lawsuit.
The county said $10 million will go to fire districts that respond to emergencies. The other $4 million will go to lighting districts and maintenance improvement districts not associated with a city or town, but also impacted by the court decision.
The Board of Supervisors said funding was only approved for taxing districts with no available source of revenue other than property taxes, and no other governing body to seek assistance.
