FY2020 Budget & #AZLeg Session Wrap-Up: What Just Happened? (video)

Arizona House

Drama, rumors, secrecy, backroom deals, coup attempts, flexible rules, and a bit of chaos are commonplace during the waning days of each session of the Arizona Legislature.  This is the atmosphere in which our state’s budget is crafted each year.

The First Session of the 54th Legislature ended in the wee hours of May 28, 2019. The new budget took effect on July 1, 2019. New laws that had “emergency clauses” are already in place. All other laws take effect 90 days after the end of the session, which is August 27, 2019.

Here is a peak behind the curtain during the last days of the session and some high and low points in the legislation that was passed.

The Game Plan

In 2019, secrecy and chaos reigned supreme as the Republicans desperately clung to their standard game plan: hear and pass primarily Republican-sponsored bills; ignore all Democratic ideas, bills and constituents; make enough pork barrel deals with their members to get 100% of them on one budget; and ram the budget through in the middle of the night when voters are asleep and Legislators want to be.

The Chaos

There was more chaos than usual in 2019 because a few Republicans realized that the slim D-R margins in both the Senate and the House gave each R a lot of power. (Rep. Kelly Townsend showed the Republican leadership her power back in March when she starting voting “no” on every bill one day. Here’s the blog post and video.)

The chaos was amplified by totally random floor schedules…

Under past Speaker J.D. Mesnard, the House ran like clockwork. (OK, sometimes it felt like Clockwork Orange, but there was a level of efficiency that was palpable.) Floor started at 1:15 p.m.– unless there was a special occasion or lots of bills to hear. If we started early– like 10 a.m.– it meant that Mesnard had an enormous amount of bills ready to work through. Ten Committee of the Whole (COW) agendas– each with five to 10 bills on it– was not an uncommon workload for a heavy day under Mesnard.

In 2019, under Speaker Rusty Bowers, there were a few weeks in April and May when it was common to start at 10 a.m. and be done by noon… or earlier. Some days we would debate or vote on only one bill, and other days there was no work beyond the opening formalities of prayer, pledge and points of personal privilege. Why the difference? Because unless we were hearing simple, likely unanimously supported bills or bills he didn’t care about, Bowers wouldn’t hold any debates or votes without all 31 of his members in their chairs and ready to be compliant with the party line in their votes. Marathon committee meetings, dinner plans with visiting dignitaries, sporting events, some lobbyist events (like the ALEC dinner), high school graduations, vacations and legislative junkets– all got in the way of doing the people’s work and dramatically dragged out the session.

The Secrecy

Arizona House
Republican huddle on the House Floor includes (left to right) Reps. Tim Dunn, Mark Finchem, and John Allen, Senate President Pro Tempore Eddie Farnsworth, GOP Chief of Staff Michael Hunter, and House Speaker Rusty Bowers.

What were people doing all those afternoons when the House knocked off early? It was eerie how empty the lobby was in the afternoons during the last six weeks of session. In past years, during budget time, there was a lot of hustle and bustle. The lobbies would be crawling with serious-looking people in suits. Everyone knew that at one point there were at least five budgets: the Governor’s budget plus House and Senate Democrat and Republican versions. We were told the Republicans were holding small group meetings on the budget, but often the parking lot was empty. Who knows where those meetings were held, who was there, and what was discussed?

This is where the rumors enter the scene. In the final weeks of the session, the best leads on what was happening behind closed doors were found in the Yellow Sheet. H/T to Hank Stephenson and his crew for telling us the behind-the-scenes news.

For the record, during that time frame, I had meetings with other Democratic colleagues, lobbyists, and constituents– in addition to doing my homework on the budget and the remaining bills. Also, there were many press conferences, stakeholder meetings, rallies and public events.

The Drama

The Arizona Legislature ended the 2019 session just after midnight on May 28. After dragging the budget process on for an extra ~30 days past Legislature’s arbitrary deadline goal of 100 days, the Republicans crammed the budget and several miscellaneous bills through both houses in the last few days.

Even though the Arizona Senate had no budget agreement, House leadership forced House members into a 48-hour hurry-up-and-wait budget marathon that lasted from 8 a.m. Thursday through 5 a.m. on Saturday, with only about five hours to rest in the early morning hours of Friday.

With at least three Republican Senators not in agreement with the Republican budget, the Senate process dragged out over the weekend and into Memorial Day. The budget was stuck between intransigent Senators and planned vacations. The big sticking point was Senator Paul Boyer’s child sexual assault bill. He said that he wouldn’t agree to the budget unless the Republicans agreed to hear his bill and allow a vote in both houses. With all of the Democrats in agreement that the statute of limitations to file child sexual assault complaints should be lengthened, Boyer likely believed some version of his bill would pass if he could get it past the Republican leadership. (Read my original blog post and see my video about Boyer’s bill here.) Senator Heather Carter stood with Boyer and backed his demands. Senator J.D. Mesnard didn’t like the Governor’s compromise budget with Republican Legislators because it wasn’t extreme enough. During closed door meetings, Mesnard got his way on increased tax cuts for the rich and on neutralizing $386 million in new revenue that would have gone to the General Fund. Even with that massive tax cut– which will cost the state $4 billion in revenue over the next 10 years– Mesnard called the Republican budget “progressive” and said he couldn’t back it.

An ultra conservative minority of the Republican caucus, led by Senator Eddie Farnsworth, worked hard to protect child predators by fighting every version of Boyer’s bill. In an unprecidented move, Farnsworth even came to the House Appropriations Committee to testify against lengthening the the statute of limitations to report past abuse. In the last days of the session, a negotiated compromise raised the age for reporting past child sexual abuse from 20 years old to 30 years. The big sticking point for Farnsworth and other Republicans was a window of opportunity for reporting past abuses, for which the statute of limitations had passed. Boyer settled for a one-time fixed window, which is better than no window. Child abusers have an average of 150 victims. We have seen with recent high-profile child sexual abuse cases– like the case of Dr. Larry Nassar who assaulted several young female gymnasts– that once one or two victims come forward, the flood gates of past abuse reports start flowing. Carter and Boyer hopped on the budget after the child abuse bill settlement was negotiated. Mesnard was left out in the snow. The Republicans didn’t need his vote.

Finally… the End of Session!

Rep. Pamela Powers Hannley
Here I am on budget night 2019.

The FY2020 budget is not as bad as the last two budgets that have passed since I joined the Legislature in 2017. In 2018, I went back to my apartment and sobbed after sine die. This year, we didn’t get everything we wanted in the budget, but because we had additional revenue, it is not bare bones. The video below gives some highlights of the budget and the final days of negotiations. Here are a few high and low points regarding the budget and the final days of the session.

High Points:

Public education got significantly more money than in previous years. The teachers got another installment on the promised 20×2020 raise, and they have one more installment after this. School districts got $136 million in additional assistance which can be used for “soft capital” like desks, books, computers, software, etc. This can also be used for raises for staff.  Schools also got some money for building maintenance and new schools. Lastly, schools got $10 million for school resource officers (SRO) or counselors.

Childcare subsidies from the federal government were allocated in the budget. You’ll remember that in 2018– thanks to Republican Legislators– Arizona was the only state to refuse the $56 million in federal childcare subsidies. The $56 million is in the FY 2020 budget, but increased reimbursement for high-quality childcare was defeated in the Arizona Senate. (State childcare subsidies of $80 million per year were never restored after they were cut in the early Tea Party days. )

The Housing Trust Fund got more money. Before the Tea Party takeover in 2011, the Housing Trust Fund (HTF) received $40 million per year from unclaimed property and spent it on a variety of programs to related to affordable housing, low-income housing, homelessness and helping seniors age in place. The HTF could do anything from build housing units to offer rental or mortgage assistance. After multiple annual sweeps of the HTC, its balance has been $2.5 million per year. (No wonder we have a housing crisis. Bad Legislative decisions helped to create it!) The FY2020 budget gives the HTF $10 million.

Funding for Crisis Pregnancy Centers was defeated. In a sneak attack in the waning days of the session, Republicans waived the rules to allow late introduction of a bill to provide $2.5 million in one-time funding to create a Crisis Pregnancy Center program. The center’s information line would steer pregnant women away from abortion services and toward decisions and services that are aligned with the powerful anti-abortion group Center for Arizona Policy headed by lobbyist Cathi Herrod. House Republicans voted in lock step for this ruse to trick women by providing selective and sometimes false information about their legal choices. In the Senate, Senators Heather Carter and Kate Brophy-McGee both voted no and explained their votes. Carter chided her colleagues for their funding choices by juxtaposing the decisions to fund $2.5 million for crisis pregnancy centers, while refusing to fund $180,000 to provide dental care to pregnancy women on the state’s Medicaid system.

Cannabis testing and lowered medical marijuana card costs both passed. Arizona has the third largest medical marijuana program, the most expensive medical marijuana card in the country, and no quality control testing… up until 2019. For years, I have been pushing for quality control testing for marijuana plant material and cannabis edibles and concentrates. Cannabis testing went down at the end of 2018. In 2019, there was a knock-down-drag-out fight between the Arizona Department of Health Services, the medical marijuana dispensaries, testing laboratories, and patient advocates to get testing over the finish line. For a few weeks, my seatmate, Dr. Randy Friese, and I were on different sides of the issue. We both wanted testing and lowered card costs, but there were competing versions of bills.  Thanks to a session that dragged on for an extra three weeks, cannabis testing was passed. (Now, we’re talking about strategies the Legislature could take to legalize recreational marijuana in 2020. Stay tuned.)

And a few more bullets…

  • The Drought Contingency Plan passed, and other bad water bills failed.
  • The discriminatory $7.25/hour minimum wage was defeated.
  • Most of the voter suppression bills were defeated.
  • Expansion of Empowerment Scholarship Awards (ESA) was defeated.
  • Further restrictions on the Citizens Clean Elections Commission was defeated.

Low Points:

The Republicans passed a $386 million tax cut. Throughout the session there were three extremely important financial questions that were hotly debated: tax conformity with the Trump Tax Cut and Jobs Act, which was projected to earn the state $150-200 million annually; “Way Fair” Bill (collecting TPT — sales tax — on digital purchases), which was projected to earn ~$80 million annually; and how much of the state’s $1 billion surplus should go into the rainy day fund. I am a member of the Ways and Means Committee, and the Democrats on that committee were in the thick of the debate fighting for using the revenue from tax conformity and Way Fair to restore funding to public education and other programs and services that have not been restored to 2008, pre-recession levels. In the end, the Republicans voted to give away all revenue generated from tax conformity and taxing online sales in a personal income tax cut, which will primarily help the wealthy. Under the Republican tax cut plan, the richest Arizonans will benefit the most, and the poorest Arizonans will see no change in their income taxes. In my opinion, it is particularly unfair to the people of Arizona to give away the Way Fair sales tax. All other TPT collected in Arizona goes into the General Fund; online sales tax should, too.

House Democrats on the Ways and Means Committee fought eloquently for fiscal responsibility in committee and on the floor. Pictured are Reps. Andres Cano, Pamela Powers Hannley, Mitzi Epstein, and Lorenzo Sierra

Rainy Day fund increased to $1 billion. As mentioned above, the Rainy Day Fund was a hot topic among the financial nerds in the Legislature. Pretty much everyone agreed that the Rainy Day Fund was under funded at the beginning of the session. The question was: how much is enough in another recession hits? One billion dollars seems like a lot when there are so many needs in this state, but with trade wars and other fiscal craziness happening at the federal level, Arizona needs a safety net.

Education is still not fully funded. So– education got more money than it has in many years, but it is not enough to bring public education funding back to 2008 levels (pre-Tea Party Reign of Terror and pre-Wall Street crash). Even with these sums, Arizona remains at the bottom in teacher pay and school funding. For example, as estimated $100 million is needed to bring Arizona schools in line with the rest of the country in terms of counseling support for students. Obviously the $10 million for SROs or counselors in the FY2020 budget is a paltry sum, but we’ll take it! Also, much of this education funding is “one time”– so the fight begins again in January to protect public education and expand funding.

We could have done more in the housing arena. The Democrats pushed for full restoration of the HTF to $40 because Arizona’s housing needs are so great.  Several other housing-related bills passed the Senate and passed through some House committees but never made it into law.

Several awful bills came back as Zombies in order to win Republican votes on the budget. As the budget negotiations dragged on for weeks, Republican leadership had to cut many deals to get their members to agree to the budget. Some bills that we had hoped were dead were revived and brought up for a vote in the waning days.

Maternal and child health remains in crisis. A modest bill to look at existing data regarding high rates of maternal death in the state of Arizona passed and was signed into law in 2019.  OK… it’s a good idea to look at data that has been sitting… since 2015, but still couldn’t other steps be taken to stem the tide of preventable maternal and child death, premature births and birth defects? There is great need, we had extra funds this year, and the only bill we passed was one to look at data? I think it is a travesty that we didn’t undertake and fund proven public health measures to help new Moms and babies get off to a healthy start. For example, why did the Republican kill the bill and the budget amendment to fund dental care for pregnant women on the state’s Medicaid system? Why aren’t we providing prenatal care to women? Why are we content to have several Arizona counties designated as maternal health deserts because there are no doctors? Why are we one of the stingiest states for TANF (cash assistance to the poor) and for childcare subsidies? Single Moms and their children are more likely to live in poverty than any other group. We can do more to help future generations start life healthy. (For more on this issue, check out this blog post and video.)

TANF vs Poverty
Only 6% of Arizonans who are eligible for TANF (cash assistance to the poor) actually receive it. Not even all of the people living in extreme poverty in Arizona receive the assistance they are eligible for.

What’s not done

Maternal and child health; affordable housing; charter school reform; prison and sentencing reform; cannabis sentencing and decriminalization for simple possession; and the Equal Rights Amendment– all could have passed in 2019 with bipartisan support if it weren’t for the entrenched Republican leadership.

Back in February, I posted Speaker Bowers: It’s Time to Hear the People’s Agenda. If you want to see that was left undone at the end of this session, check out that very detailed post and the videos attached.

The Republicans often say that government should be “run like a business.” Ignoring 48% of your customer base is not good business. Democrats control 48% of the seats in the Arizona House, and 43% of the Senate.  Despite record numbers of Democrats in the Arizona House, the Republican Leadership did everything they could to maintain business as usual– from changing the 47-year-old House Rules on Floor speaking time and rude enforcement of those arbitrary times to the backroom deals made between handfuls of powerful Republicans.

It’s time for transparency and fairness in government. I don’t know about you, but I am sick of having a government that is controlled by Big Money. Arizona would have a much better government– one that answered to the people and not to special interests– if Clean Elections was mandated. Let’s get Dirty Money out of politics. We’d all be better for it.

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