PHOENIX (AP) — Arizona’s most populous county is cracking down on medical-marijuana dispensaries and growth operations that aren’t paying property taxes on their business equipment.

Medical-marijuana businesses are evading as much as $1.5 million in property taxes each year by failing to report the value of the equipment they use, Maricopa County Assessor Paul Petersen said on Thursday.

Just 11 of the 109 dispensaries and growth operations that were sent business personal property tax forms responded by an April 1 deadline, Petersen said.

ADVERTISEMENT

The Assessor’s Office has calculated a value for the 98 business that failed to respond and has hit them with a 10 percent penalty for failing to report, he said.

The businesses are encouraged to meet with Petersen’s staff to correct the record if necessary, he said.

“The point of this is to tell you all that I will pledge to work with (medical marijuana business owners),” Petersen said. “Even if they received a value they believe is incorrect, I encourage them to come in and meet with my staff. I would like to see their facilities so we can see what kind of property is there.”

Kevin DeMenna, lobbyist for the Arizona Dispensaries Association, said there is no conspiracy by businesses to avoid paying taxes. DeManna blamed the lack of response on the confusion that comes with starting a new industry.

Most dispensary owners have been unaware that they owe taxes on business personal property, DeManna said.