Apache Junction Sewer District can’t use higher nonprofit status to save money

By Richard Dyer
Mail | X: @RHDyer

There would be no sales tax benefit derived from the Apache Junction Sewer District obtaining 501(c) tax-exempt status for the nonprofit utility, the five-member volunteer board was told recently.

Board Member Roy Starr made the suggestion during an Aug. 26 meeting that the district’s qualification for tax-exempt status as a utility and not-for-profit organization be discussed, according to the meeting’s minutes.

District Manager Darron Anglin and District Counsel Jason Cassidy separately researched the benefits in seeking 501(c) tax-exempt status for the utility such as not paying sales taxes on items needed to construct new facilities. They updated the board Sept. 23 about their progress and then on Oct. 28 to say it was not possible.

“A little more research done... 501(c)(3)s in Arizona are still required to pay sales tax. In other states they are not required to — in Arizona they are,” Anglin said Oct. 28.

“Essentially because in Arizona we don’t really have a sales tax — it is a use tax,” Cassidy said Oct. 28 of the state’s transaction privilege tax. “It’s a tax on the person doing the selling. So if the district became a charity it has to pay sales tax.”

The sewer district is an independent, public, nonprofit entity developed solely for the benefit of its customers and the Apache Junction community to operate and maintain a regional system for the collection, transport and treatment of sewage from the properties existing within its boundaries.

Board members to the sewer district are appointed by the Apache Junction City Council.

Members of the district board serve as volunteers who are responsible for setting policy and rates, adopting a budget and other high-level decision making regarding all aspects of the district’s operation and on-going business affairs.

By state law, board members cannot own 40 acres in the district, cannot be an employee or agent of a landowner who owns 40 acres or more in the district, cannot be an employee of the city or the county and cannot be an elected official of the city or county.

Richard H. Dyer can be reached at rdyer@iniusa.org, or on X @rhdyer. Please submit comments at yourvalley.net/letters or email them to AzOpinions@iniusa.org. We are committed to publishing a wide variety of reader opinions, as long as they meet our Civility Guidelines, https://www.yourvalley.net/civility-checklist/.

Richard Dyer
Managing Editor | East Valley

rdyer@iniusa.org

Meet Richard
Richard Dyer has worked at Independent Newsmedia Inc. USA since 1987, starting his career in Apache Junction as a copy editor and being promoted over the years to work as the editor of the Mesa Independent, news services editor for the East Valley office in Apache Junction, managing editor for the East Valley office, news services editor for the East Valley office and eventually also for the newspapers at INI’s then-Chandler office, managing editor again and as a news editor covering Apache Junction/Gold Canyon and Queen Creek. He helped start the Florence Independent while the news editor covering Apache Junction and Mesa news. In January 2023, he became associate managing editor for the East Valley newspapers and in August 2023 became managing editor for the East Valley newspapers of Chandler/Tempe, Gilbert, Queen Creek, Florence, Mesa and Apache Junction/Gold Canyon, while also reporting on Mesa and Apache Junction/Gold Canyon.  

Community: Since 2009, he has worked as a volunteer to design The Blue Guitar Magazine, Blue Guitar Jr. magazine and Unstrung magazine, which are projects of The Arizona Consortium for the Arts; and since 2014, has been overseeing the art submissions. 

Education: University of Arizona with a master of arts in journalism and a bachelor of science in agricultural communication. Also continuing education at Mesa Community College in welding in a metal art sculpture class.

Random fact: Saw his first tornado on May 31, 2010, which was classified as an EF-2, as part of a stormchasing tour group.

Hobbies: He is an artist of welded-steel sculptures, selling his artwork at juried and non-juried art shows.