Gila Community College will soon receive about one-half of the $1 million-plus that was erroneously withheld by the state for out-of-county tuition reimbursements.
District 1 Supervisor Ron Christensen learned about the money being returned in a copy of a letter he received from state Deputy Treasurer Blaine Vance to Joint Legislative Budget Committee Director Richard Stavneak.
"About Aug. 17, 2004 distribute $523,711.59 to Gila County from funds previously scheduled to be paid to other counties on behalf of Gila County," Vance wrote.
The money will be a blessing for Gila Community College.
"It's money we can really use. There's a lot that can be done with it," GCC President Barbara Ganz said.
The other half of the money, which already has been dispersed by the state treasurer to community colleges outside of Gila County, is forthcoming.
Vance proposed two ways to recover the additional $523,711.59. One would be to repay the money in a lump sum. The other, is to offset fiscal year 2005 payments to all community colleges, until the fiscal year 2004 overpayments are fully repaid to Gila County.
Gila County Manager John Nelson and Christensen immediately penned a response to Vance proposing a third way of retrieving the funds.
"The money should be deducted, with interest, from the next payment (the community colleges) receive from the state," Christensen said. "That should speed the process up."
Christensen also admonished the community colleges that received the money.
"It was taken illegally. Those schools didn't deserve to have it," he said. "They have to be fully aware of that."
The schools that profited most from the Gila County's overpayments were Maricopa County community colleges and Eastern Arizona College, Christensen said.
When Gila County receives the final payment from the state treasurer it will cap a controversy that began in November 2002 when voters approved the formation of a provisional community college district.
Legislative Liaison Lionel Martinez, Christensen and Nelson have since contended that formation of the district meant the county was not obligated to pay out-of-county tuition beginning July 1, 2003.
The Office of the State Treasurer, however, continued to withhold tuition reimbursement payments from the county's Transaction Privilege Tax through April 2004.
A June 21 ruling by Attorney General Terry Goddard and an earlier one by Gila County Attorney Daisy Flores agreed with Christensen and Nelson that payments should have ceased July 1, 2003. While the county awaited a ruling from Goddard, Christensen challenged the state's educational hierarchy.
"The Gila County Community College system is somewhat treated like the hemorrhoid on the colon of the education system of Arizona," he said. "They don't even give us back the dollars we put into the system."
After Goddard's ruling, a debate heated over how to recoup the county's money.
"We don't have the statute authority to go in and get the money," Vance said. "We are waiting for the JLBC to tell us how to rectify this."
"We would advise you to seek the counsel of the attorney general," Stavneak countered.
Martinez, who was in the thick of the battle to have the money returned, chided the state treasurer, saying he should ask the colleges to return the money.
In a letter to the editor of the Payson Roundup, State Treasurer John Nelson defended his office saying it is only "a bank which acts upon instructions from rule-making bodies and agencies."
He wrote the JLBC is the agency with authority to determine out-of-county payments and is responsible for calculating and informing counties of payments. Peterson assured Gila County that "the State Treasurer's Office does not act unilaterally or capriciously. We act in accordance to instructions provided by the laws of the State of Arizona."
A return of all the tax money will represent a huge triumph for the fledgling GCC that is struggling to gain equal footing with the other community colleges around the state.