The Arizona Republic recently published a series of articles containing misrepresentations about Ryan and our work in Arizona. Its sister newspaper, USA Today, published a follow-up to the series. Ryan held numerous post-publication discussions with The Arizona Republic to correct the record, but to date the newspaper has been unwilling to publish Ryan’s unfiltered response.
That is why we must set the record straight here.
The articles relied heavily on The Arizona Republic’s interviews of former Arizona Department of Revenue Director Carlton Woodruff and Former Deputy Director Grant Nülle. Woodruff and Nülle were terminated in December 2020 for what The Arizona Republic itself reported was for contradicting their boss, the Arizona Governor, on tax matters involving Proposition 208. Woodruff and Nülle later claimed their firings in fact arose because of friction between them and Ryan and used that to make untrue allegations about Ryan and to criticize our efforts to ensure our clients pay only the taxes they owe under the law.
This included Nülle’s fictional claim that 80 to 90% of Ryan’s tax refund requests were rejected by the Arizona Department of Revenue. In fact, almost the opposite is true. Seventy percent of the claims we filed during Woodruff’s and Nülle’s time at the Department successfully resulted in the Department recognizing excess tax was paid and refunds being issued to Ryan’s clients, either in whole or in part. We have the (confidential) data to prove it. And many of the claims that did not succeed were tied to the very case at issue in these articles—a case where the taxpayer won at the Tax Court level. The assertion that Ryan files baseless claims is—itself—baseless. This is just one example of this egregious attempt to unjustly tarnish our company’s outstanding reputation for being advocates of appropriate tax administration.
The Arizona Republic’s reporting also claims that Ryan tried to “keep legislators in the dark” about a tax refund request and its implications to “avoid scrutiny from lawmakers” and sneak through a refund that would have triggered a 100 million dollar “payout” to Ryan’s clients. The story falsely accuses Ryan of asking that the refund payments be spread out over three years to avoid the legislative scrutiny that a large lump sum would trigger. In fact, it was the Department of Revenue that proposed a structured payout because spreading payments out would be easier on the state budget than an immediate lump-sum full payment. The Arizona Republic neglected to report that, to provide this very benefit to the state, Arizona law expressly authorizes the Department of Revenue to spread out refund payments over as much as five years if the state chooses.
In The Arizona Republic’s podcast, The Gaggle, reporter Craig Harris falsely accused Ryan of hiring consultants who violated Arizona’s conflict of interest laws. According to Mr. Harris, these consultants, who were former state employees, were “supposed to wait a year, according to the state’s conflict of interest laws and a cooling off period law.” This statement lacks any factual basis and ignores material aspects of the law, which was noted in an op-ed column in The Arizona Republic by Paul Eckstein, an attorney with the firm Perkins Coie, who is one of the most renowned constitutional attorneys in Arizona. Arizona’s conflict-of-interest laws require three conditions to trigger a 12-month “cooling off period.” The person must have (1) been previously employed by the agency in question, (2) been “directly concerned” in the same matter in question, and (3) “personally participated” or exercised “substantial and material” discretion over the matter. The consultants we hired met none of these conditions. But what should concern readers most is The Arizona Republic failed in its reporting to even mention the existence of the second and third required conditions.
In its subsequent article, USA Today relied solely on information from Nülle to claim that the FBI’s public corruption unit was investigating. We don’t know if an investigation exists. We have not been contacted by the FBI and don’t know of any company that has. More than three months have passed since USA Today published its article, and we still have heard nothing. But we would be confident in the outcome. As noted above, there is no question our consultants acted ethically and lawfully.
Instead, the real question is: How did confidential taxpayer information appear in this newspaper when Arizona law expressly prohibits unauthorized disclosure by current or former employees of the Arizona Department of Revenue and renders it a felony? The taxpayers of Arizona deserve an answer.
There is also rich irony in The Arizona Republic criticizing us for hiring professionals to help with our tax reduction objectives, a main focus of the stories. The newspaper utilizes a well-connected lobbying firm, Ballard Spahr, and the Arizona Newspapers Association also employs lobbyists. They do so in an effort to influence policy and laws that impact their own businesses. And we don’t fault them for it, just as we don’t fault teachers, nurses, environmentalists, unions, and chambers of commerce for doing the same. That is the give and take of democracy. It is free speech. It is petitioning the government, and it is expressly protected by the Constitution.
But for us, it is more than that. We ethically and vigorously advocate for our clients’ interests to achieve a purpose in which we strongly believe. That purpose is not to avoid taxes but to ensure that taxes are properly administered under the law. As the Arizona Supreme Court has said, “An honorable government would not keep taxes to which it is not entitled . . . .”1
We are very proud of the more than 3,100 employees across the world that make our company a leader and innovator in our field. This includes our 114 Scottsdale-based team members who recently achieved recognition by azcentral as a Top Workplace in Arizona. And despite The Arizona Republic’s attempt to question our work, we will continue to lead and innovate while building trust and always operating with integrity.
1 Internal footnote: Pittsburgh & Midway Coal Min. Co. v. Ariz. Dep’t of Rev., 161 Ariz. 135, 139 (1989).
Ryan, an award-winning global tax services and software provider, is the largest Firm in the world dedicated exclusively to business taxes. The Firm provides an integrated suite of federal, provincial, and international tax services on a multijurisdictional basis, including tax recovery, consulting, advocacy, compliance, and technology services. Ryan is a nine-time recipient of the International Service Excellence Award from the Customer Service Institute of America (CSIA) for its commitment to world-class client service. Empowered by the dynamic myRyan work environment, which is widely recognized as the most innovative in the tax services industry, Ryan’s multidisciplinary team of more than 3,100 professionals and associates serves over 18,000 clients in more than 60 countries, including many of the world’s most prominent Global 5000 companies. More information about Ryan can be found at ryan.com/canada. “Ryan” and “Firm” refer to the global organizational network and may refer to one or more of the member firms of Ryan International, each of which is a separate legal entity.
Senior Manager, Content, Communications, and Public Relations