Maricopa County Assessor Miscue Leading to a Scottsdale Schools Crisis

Former Maricopa County Assessor Paul Peterson

Mistakes from the past will sometimes come back and catch up to you; they do to all of us at some point. A lie in the past comes back to haunt you, credit card bills come due, poor lifestyle choices in the past turn into health problems today. But rarely is it a result of someone else’s mistakes, and rarely does it come in the form of a catastrophic dollar amount like this story does.

Back in 2017, the Maricopa County Assessor’s office under the leadership of Paul Peterson made a grave, grave mistake; it failed to recognize that homes that were not a primary owner-occupied home should be assessed at a higher property tax rate than secondary or vacation homes, and that when that classification changes the rate should drop with it. What seems like a relatively banal decision generated a massive ripple effect with a bill that is about to come due after a lawsuit worked its way through the courts.

That bill? A staggering $330 million countywide. And now the Scottsdale Unified School District has the largest bill due of any school district in the county, as it owes a nearly-as-staggering $23.7 million, generating the start of a lawsuit against the county. Meanwhile, it only has $10 million cash on hand.

Yikes.

Of course, the damage isn’t purely relegated to Scottsdale; the Maricopa County Community College District may be on the hook for $44 million, draining its surplus accounts and likely leading to significant budget cuts. Additionally, interest has accrued over that time period, which for eight years is a hefty additional burden. Over one-fifth of the amounts taken from MCCCD’s coffers to cover the deficit has been interest alone.

The path forward at the moment seems to be debt issuance; thankfully our municipalities and taxing jurisdictions nearly universally have good credit ratings and plenty of room left to borrow. However, if it will necessitate a specific bond override, that could set things up for an unfortunate political hot potato. And if it will necessitate a tax increase, watch out.

Neither of these should be such political hot-buttons. SUSD, MCCCD, and every other affected organization is entirely blameless in this situation, and Assessor Peterson was run out of the office after various scandals. But memories are short and the desire to blame others is a political birthright. We have to assume that at some point it will manifest itself into political finger-pointing, but not at the one person who deserves it: Paul Peterson.