Superior Town Government has come to an agreement with the Arizona Office of Auditor General (OAG) concerning charges that the town misdirected HURF (Highway User Revenue Funds) targeted for road, bridge and transportation projects to other municipal uses. The agreement was explained at the May 12 Superior Town Council meeting.
Rather than refund to the state the $2.8 million in HURF funds OAG says were used for non-road budgetary items over the years, OAG merely wants Superior to spend more than the HURF funds it receives each year for appropriate projects. Revenues spent on road projects in excess of HURF funds received would be deducted from what it owed until the deficit is erased.
However the agreement comes with a warning. Should Superior not spend the total HURF dollars received in the year they are provided, OAG could send auditors to the town and take over direction of road projects inside Superior
“In effect, the state auditors would set their own priorities on what road projects need to be done in Superior without town input,” said Superior Police Chief Dave Neuss, who earlier this year met with OAG on the HURF issue while serving as interim town co-manager.
To meet terms of the agreement, if Superior received $80,000 in HURF funds and spent $100,000 on road projects, $20,000 would be deducted from the $2.8 million owed. But if Superior only spent $60,000 of the HURF funds, the shortage would be added to the deficit and the town would risk OAG seizing control of road maintenance within the town, Neuss said.
“They rather we use the money to maintain and upgrade our roads than send the money back to the state,” he added. “And they are willing for Superior to pay at its own pace even if it takes 50 years.”
The agreement supplants an earlier agreement with OAG to pay back the misdirected HURF funds at a rate of $100 a month, for which Superior stopped paying in September 2013. The misdirection of funds was discovered in a 2011 audit, where OAG found that Superior has used HURF funds to plug holes in its budget targeted for other municipal projects. The repurposed HURF money was originally said to be a “loan” but due to a declining population and the 2008 economic downturn Superior found it impossible to repay these “loans” and for several years continued to “borrow” more.
There had been a threat by OAG to ask the Arizona Treasurer’s Office to withhold transportation excise tax revenue to the town for inappropriately spending earlier revenues.
During 2015, Superior received $203,338.61 in HURF revenues as allocated by the Arizona Department of Transportation (ADOT).
HURF revenues are derived from transportation taxes and fees, such as the motor fuel taxes, and the title, registration and driver licenses fees, and from local taxpayer-approved excise taxes. These are distributed to all counties based on population.
Arizona Statute 28-6392 limits the use of transportation excise tax revenues and HURF funds to street and highways purposes and for transportation projects. These can include right-of-way acquisitions, and the construction, reconstruction, maintenance and repair of roads, streets and bridges; and for roadside development. Excise revenues also can be used to pay principal and interest on highway and street bonds and personal costs, including salaries and benefits for employees working directly or indirectly on transportation projects.
During the Council Meeting, the Council unanimously approved a HURF-covered purchase of an air curtain burner for the Superior Transfer Station. The burner is used for the thorough but low-pollution burning a vegetative matter (including wood) removed from right-of-ways acquired for new road and road widening projects (such as the current U.S. 60 widening project running through the town). The cost is expected to be about $75,000.
Town Manager Todd Pryor noted before passage that the air curtain burner also could generate revenues for Superior as the ash from wood waste is a nutritious soil additive and can be sold a plant nurseries, farms, and as potting soil to homeowners. Councilman John Tameron wondered if Superior could charge firms working on highway projects outside of Superior to recycle the vegetative debris removed from around their projects.
In other business at the Council Meeting, Council members voted to request that ADOT include lighting in the Stone Avenue underpass as it rebuilds the U.S. 60 bridge over the road. The lights (not included in project specs) will provide better safety for residents using the underpass, thus reducing accidents. To hold down costs, it was proposed that LED lights be used.
Council members also directed Pryor to pursue a grant application to acquire a new ambulance serving the Gila River Indian Community. The ambulance would replace a 1997 model ambulance that has traveled more than 200,000 miles and is nearing the end of its useful life. It is hoped that if the grant (derived from Prop 2 gaming money) would cover the entire $196,000 price tag for the new ambulance.
Rates for reserving a public pool in Superior for parties was reduced from $75 to $50 per hour by a unanimous Council vote. It is hoped that the lower rates will bring in more pool party rentals and thus increase such revenues to the town. The number of party rentals dropped substantially when rates were earlier raised.
Proposed revisions in the Superior Sewer Code were tabled and sent to committee. The proposed change would make Superior responsible for more of the underground lines. At present, Superior is only responsible to repair problems in the mainline, with homeowners paying to correct all other lines leading to their home. The proposed change would make Superior responsible for repairs to sewer pipes up to property lines.
“Before we draft a new code, we should ask homeowners what they think,” Councilman Tameron said.
The Council voted to hold such hearings, and for Town Attorney Stephen Cooper to draft the Code revisions. It was noted that if Superior goes with property lines, the town may have to acquire new tools to verify who is responsible, such as a camera-equipped sewer snake. Superior Chamber of Commerce President Sue Anderson added that the town should be responsible for sewer lines under private property if the lines were installed wrong, as in her neighborhood the presence of 90-degree-turns in sewer pipes has resulted in costly clogs and effluent backups that residents have had to pay to undo.
During the Public Comment section, Nancy Vogler, co-owner of Superior Sweets, asked the Council to take another look at the local sales tax situation. With the Superior portion of the tax at 4%, when combined with the state and county levies, residents pay a 10.7% sales tax. This is hurting business in Superior, with some residents taking their business outside of Superior to escape the high tax, she said.
Council members indicated they would take the request under advisement.