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ARIZONA STATE LEGISLATURE
Forty-seventh Legislature – Second Regular Session
SENATE TRANSPORTATION AND HOUSE OF REPRESENTATIVES
TRANSPORTATION COMMITTEE OF REFERENCE FOR THE
SUNSET HEARING OF THE ARIZONA AUTOMOBILE THEFT
AUTHORITY AND THE PERFORMANCE AUDIT OF THE
PINAL COUNTY TRANSPORTATION EXCISE TAX
Minutes of Meeting
House Hearing Room 3 -- 9:30 a.m.
Chairman Gorman called the meeting to order at 9:35 a.m. and attendance was noted by the secretary.
Senator Chuck Gray Representative John Nelson
Senator Rebecca Rios Representative Pamela Gorman, Cochair
Senator Victor Soltero
Senator Thayer Verschoor, Cochair
Senator Carolyn Allen Representative Meg Burton Cahill
Representative Russ Jones
Representative Tom Prezelski
Rene Guillen, Assistant Majority Research Analyst
Anne Hunter, Office of the Auditor General (AG)
Shannon Ortiz, Town Clerk, Town of Mammoth
Terry Doolittle, Manager, Pinal County
Enrique Cantu, Executive Director, Arizona Automobile Theft Authority (AATA)
Mikel Longman, Chief, Criminal Investigations, Department of Public Safety (DPS)
Don Isaacson, representing State Farm Insurance Company
Brian Salata, Prosecuting Attorney, Pinal County
John Wintersteen, Chief, Paradise Valley Police Department
Ralph Ogden, Sheriff, Yuma County
Names of persons who did not speak (pages 5 and 7)
Chairman Gorman announced that the Committee will hear discussion on the Arizona Automobile Theft Authority. In addition, the Office of the Auditor General will give a presentation on the Pinal Excise Tax audit. She announced that no action will be taken on the Pinal County Transportation Excise Tax.
PRESENTATIONS:
Rene Guillen, Assistant Majority Research Analyst, advised that the purpose of today’s meeting is to review the Arizona Automobile Theft Authority (AATA). The Committee has the option to either terminate the agency, continue the agency for a number of years, or to continue the agency with additional recommendations. In addition, in June of this year, the Office of the Auditor General conducted an audit of the Pinal County Transportation Excise Tax. A performance audit is required of every transportation excise tax in the State. The first audit occurs after the first ten years and then subsequently every five years. With the Office of the Auditor General Performance Audit, the Committee is not required to take any action.
PERFORMANCE AUDIT OF THE PINAL COUNTY TRANSPORTATION EXCISE TAX:
Anne Hunter, Office of the Auditor General (AG), presented information from the Auditor General’s performance audit of the Pinal County transportation excise tax which was completed in June, 2006 (Attachment 1). A copy of the performance audit was distributed as well as report highlights of the audit (Attachments 2 and 3). Statute requires that the Auditor General conduct a performance audit in the tenth year that a transportation excise tax is in effect and then every five years thereafter. The AG is required to determine whether the excise tax revenues are used for street and highway purposes or transportation projects, review past and future planned expenditures, and determine the impact of those expenditures on solving transportation problems. The one-half cent excise tax was established in 1987 by the voters and has generated more than $107 million dollars. The tax is shared with the 10 incorporated cities and towns in Pinal County and distribution is based on population. The excise tax was re-authorized in a special election held in November, 2005, and will remain in effect until 2026. It is expected to generate approximately $951 million in the next 20 years. The excise tax has allowed Pinal County and the cities and towns to address a variety of transportation needs.
The audit identified the following findings:
Ms. Hunter advised that the audit showed that although the incorporated cities and towns in Pinal County rely on a variety of mechanisms to help ensure that excise tax monies are used appropriately, all the cities and towns lack written policies and procedures that specifically address the expenditure of statutorily restricted road monies, including excise tax monies. She said this may have contributed to the inappropriate, unsupported and incorrectly recorded expenditures identified by the AG’s office. It was recommended that all cities and towns develop and implement written policies and procedures that specifically address restricted road monies. It was further recommended that when policies and procedures are adopted, they be provided to public works officials and others who are responsible for approving expenditures.
Shannon Ortiz, Town Clerk, Town of Mammoth, advised that the Town of Mammoth is in the process of implementing all the recommendations made by the audit team. The Auditor General’s Office is working with the Town to address the issues raised by the audit.
Terry Doolittle, Manager, Pinal County, testified that in 2005 the voters reauthorized the extension of the transportation excise tax for another 20 years. The County has been able to convert many miles of dirt roads to paved roads with the extension of the excise tax.
Senator Verschoor queried whether the County is doing anything to ensure that the monies are being properly used. Mr. Doolittle related that the countywide policies are being developed.
SUNSET HEARING OF THE ARIZONA AUTOMOBILE THEFT AUTHORITY:
Enrique Cantu, Executive Director, Arizona Automobile Theft Authority (AATA), provided background information on the Arizona Automobile Theft Authority (AATA) for its sunset review (Attachment 4). He related that the AATA provides vital information to the citizens of Arizona. Since its creation in 1992, it has been very successful in combating vehicle theft. In 1997 the Legislature established the AATA in its present form which consists of a twelve-member board of directors. The purpose of the Authority is to combat vehicle theft throughout the State. The AATA is funded by revenues collected by the insurance industry; it does not receive any General Fund monies. The Authority supports programs that effectively deter and prevent vehicle theft:
Mr. Cantu provided 2005 statistics. He advised that 90 percent of Arizona thefts occurred in Maricopa and Pima Counties, which supports the national trend of automobile thefts occurring in major metropolitan areas. The Phoenix Metropolitan area ranked sixth in the top ten of U.S. metropolitan areas with the highest vehicle theft rate; approximately 150 vehicles are stolen every day in the State. About 65 percent of stolen vehicles are recovered. Those not recovered are often shipped overseas; driven across U.S. borders; stripped by chop shops and resold as parts; or hidden or destroyed by owners to collect an insurance settlement. Stolen vehicles are frequently used to commit other criminal acts, including robberies, illegal drug and human trafficking and drive-by shootings. He asked the Committee of Reference to support a five-year continuance of the Arizona Automobile Theft Authority.
Senator Soltero asked the number of people employed by ATA. Mr. Cantu advised that the AATA has six staff employees. He said there are 50 full-time employees on the task force.
In response to Senator Soltero, Mr. Cantu related that the task force is administered by the Department of Public Safety and is fully funded by the AATA.
Senator Verschoor questioned the length of time the 131 individuals who have been prosecuted involving the use of bait cars stay in jail. Mr. Cantu replied that he is not sure; however, stiff sentences are being asked for. Senator Verschoor asked whether any of these individuals have been caught more than once. Mr. Cantu said he does not know.
Senator Verschoor asked about license plate scanners. Mr. Cantu noted that they are manufactured to be either placed in vehicles so they are mobile or placed at fixed sites.
Senator Gray wondered whether insurance rates have gone down as a result of the work of the AATA. Mr. Cantu answered that is a complex question. He explained that the majority of money paid for insurance goes for liability. Comprehensive coverage is a small portion of rates.
Senator Gray stated that the Authority has the opportunity to be a resource to the Legislature to address issues that will help lower insurance rates. He said he would like to see how the task force’s work in reducing and deterring theft is affecting rates.
Mikel Longman, Chief, Criminal Investigations, Department of Public Safety (DPS), advised that the Department of Public Safety (DPS) administers the task force through grants that come from the Arizona Automobile Theft Authority. The task force began limited operations in January, 1998 and has grown substantially since that time. Along with other programs, he stated it is seriously making a dent on auto theft. The task force consists of approximately 50 people from 16 to 22 agencies statewide. He related that vehicle theft is a tough crime to fight because the theft may occur in one jurisdiction and the person may go to a different jurisdiction to commit another crime. Stolen vehicles are used in facilitating other crimes, such as smuggling drugs and people. He noted that Arizona is a major smuggling port.
Senator Soltero said he has heard that vehicle theft is a low priority for law enforcement. He asked what happens when a car is stolen. Chief Longman advised that when a person informs the local jurisdiction of a theft, the information is entered into both a statewide and national computer system. He revealed that 54,000 cars are stolen in Arizona annually.
Senator Soltero again said he has heard that the priority given to stolen vehicles is not what it should be. Chief Longman responded that law enforcement has to prioritize calls. Violent crimes receive the highest level of response. He said that automobile theft is a major crime and it is given significant attention by law enforcement.
Senator Gray asked for suggestions that the Legislature can do, using the AATA as a resource, to help deter vehicle theft. Chief Longman recommended enhanced penalties, making a concerted effort to track down predators, and coming up with a statewide strategy to address this problem. He mentioned hiring more DPS officers, a greater prosecutorial effort and placing more attention on insurance fraud.
Senator Gray asked about working with the tribes on the reservations to address crossing jurisdictions. Chief Longman said he has had no experience with that. Senator Gray queried whether the tribes have representation on the task force. Chief Longman replied in the negative.
Persons in support of the continuation of the AATA who did not speak:
Rares Almasan, Arizona Automobile Theft Authority (AATA)
Eric Hitchcock, Arizona Automobile Theft Authority (AATA)
Robert Ticer, Arizona Department of Public Safety (DPS)
Matt Reed, State Farm Insurance Company
Joe Brocus, Arizona Automobile Theft Authority (AATA)
Don Isaacson, representing State Farm Insurance Company, expressed support of the Arizona Automobile Theft Authority (AATA). He stated that over the years, State Farm has come to recognize that states that have an Automobile Theft Authority are three times more effective in the reduction of vehicle thefts. He advised that auto theft is under the comprehensive coverage of insurance coverage. Any time there is a decrease in the incidence of theft, there is a decrease in the overall rate component of comprehensive coverage, and that helps reduce rates.
In response to Senator Gray, Mr. Cantu reviewed the membership of the Authority: two police chiefs, two sheriffs, two county attorneys, two employees of insurers, two members of the general public, the assistant director of the Motor Vehicle Division, and the Director of the Department of Public Safety. The task force is comprised mainly of representatives of 18 different law enforcement agencies.
Brian Salata, Prosecuting Attorney, Pinal County, spoke about the Vertical Prosecution Program. Under this program, a single prosecutor is involved in the case all the way through sentencing. 70 percent of the cases are prosecuted and the conviction rate is over 95 percent. He related that about 35 percent of stolen vehicles are not recovered; they are exported out of the country or chopped up and sold for parts. Approximately 90 percent of the stolen vehicles in Pinal County are mob-related and are used in the commission of other crimes, such as drug or human smuggling.
Senator Verschoor moved that the Committee of Reference make the recommendation to continue the Arizona Automobile Theft Authority for five years. The motion carried by a roll call vote of 6-0-0-4 (Attachment 5).
Senator Soltero wondered whether automobile manufacturers can do anything to reduce auto theft. Mr. Salata pointed out that they have come up with the STAR technology to make recovery easier and quicker. He advised that other countries are using microdot technology to identify specific parts as a means of tracing stolen parts. He also brought up the use of bait cars and the license plate reader.
Senator Gray asked the percentage of auto theft prosecutions that are vertical. Mr. Salata answered that 100 percent of cases in Pinal County are vertical prosecutions. Senator Gray wondered whether vertical-type prosecution would be successful in other areas of crime. Mr. Salata said that is his belief.
John Wintersteen, Chief, Paradise Valley Police Department, spoke about the prevention component of automobile thefts. He related that theft in Paradise Valley has been reduced by 70 percent since the Arizona Automobile Theft Authority’s participation. Without the AATA, this reduction could not have been accomplished. He advised that the Paradise Valley Police Department is involved in Vehicle Identification Number (VIN) etching. He stated that VIN etching is requested by communities.
Chairman Gorman asked whether communities can request VIN etching. Chief Wintersteen answered that Phoenix is funded to do VIN etching. Chairman Gorman queried whether Home Owners Associations can request VIN etching or whether the request must go through a police department. Chief Wintersteen stated that it is better to go through law enforcement.
Ralph Ogden, Sheriff, Yuma County, stated that the Arizona Automobile Theft Authority is a great program. All law enforcement agencies work together so these cases can be prosecuted. He said the program is very effective.
In response to Senator Gray’s question concerning recommendations to the Legislature, Sheriff Ogden asked the Legislature to continue to support the program, require both front and back license plates on vehicles and have the vehicle license plate stay on the vehicle. He pointed out that Yuma County works closely with law enforcement counterparts in Mexico to recover stolen vehicles and with law enforcement counterparts in other states.
Persons in support of the continuation of the AATA who did not speak:
Mel Kogal, Paradise Valley
Ellen Poole, Board Member, Arizona Automobile Theft Authority (AATA)
Without objection, the meeting adjourned at 11:13 a.m.
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Joanne Bell, Committee Secretary
July 6, 2016
(Original minutes, attachments and tape on file in the Chief Clerk’s Office)
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2
Senate Transportation and House
of Representatives Transportation
Committee of Reference
December 12, 2006
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