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Original Article

442 landlords pay Chandler thousands

Edythe Jensen The Arizona Republic Nov. 23, 2005 12:00 AM

CHANDLER - Six months of rental sleuthing has brought an extra $204,130 to Chandler coffers and ferreted out 442 landlords who weren't paying city sales taxes on rent.

That's enough to pay the salaries of four additional police officers for a year. Laurie Stevens, tax and utility services manager, said collections are exceeding estimates, but there are likely hundreds more real estate investors who aren't paying.

Stevens said her office is looking for more, using two part-time Arizona State University accounting interns paid $11.58 an hour to probe thousands of county property records for owners who don't live in their Chandler houses but who claim that they do.

Since the program started in April, Stevens said her office has mailed 4,276 letters to property owners whose mailing addresses didn't match the homes', received 2,742 responses and issued 442 rental tax licenses. The letters include a promise by the city to waive penalties, if landlords register and pay up within 30 days.

The tax on one house rented for $1,000 a month comes to $180 a year Chandler is one of the few Valley cities that charge sales tax on an investor's first rental house. Municipalities aren't the only governments losing to real estate investors who falsely claim their rental houses as "owner occupied." They are also likely draining millions out of the state treasury and could face criminal charges.

Maricopa County Attorney Andrew Thomas launched an investigation last week after an inquiry from The Arizona Republic.