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.
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…
The Equal Rights Amendment (ERA) needs only one more state to ratify it before it can become an amendment to the US Constitution. Although State Senator Sandra Day O’Connor and Arizona State Rep. Sister Claire Dunn proposed ratification, Arizona is one of the laggard states that never ratified the ERA in the 1970s.
Both Senator Victoria Steele and I proposed ERA ratification in 2019 and in past years. Now, HBO Commentator John Oliver has jumped on the ERA bandwagon. Below, you can watch his segment on the history of the ERA and why it should be ratified. Steele has a cameo appearance talking about Arizona’s opportunity to move out of laggard status and move into the history books as the 38th and final state to ratify the ERA.
Where do the mayoral candidates stand on affordable housing, low-income housing, and homelessness?
I think that’s a great question, and I hope to find the answers at the upcoming Mayor and Ward 1 City Council Candidate Forum on Saturday, June 22. The event will be held at El Rio Center, from 12 noon – 2:30 p.m. and will moderated by Nancy Montoya from Arizona Public Media. According to the Blog for Arizona Calendar, the three Democrats running for Mayor and the four running for Romero’s Ward 1 seat are expected to participate.
What is the state of housing in Arizona?
Arizona’s Housing Crisis: Has the Legislature Done Its Part?
As rents and evictions increase, housing has become a huge issue across Arizona. Housing– like prison reform and charter school reform– got a lot of lip service in the Arizona Legislature in 2019. During the session, there were many opportunities to tackle the housing crisis in a meaningful way, but those bills died.
On a high note, the Legislature allocated $10 million for the Housing Trust Fund in the FY2020 budget, which begins in a few weeks. The Housing Trust Fund used to be $40 million per year until the Tea Party Reign of Terror swept the funds and left only ~$2.5 million in it. (Of course, back then, tax cuts were far more important than helping people keep roofs over their heads.)
I published this original blog post and video on March 30, 2019– back when I thought the Arizona Legislature would take some serious steps toward solving the state’s housing crisis.
The original article focused on five housing-related bills that passed the Senate and passed through my committees (SB1471, SB1336, SB1539, SB1383, and SB1098) and on the issue of restoring full funding to the Housing Trust Fund.
Early last Tuesday morning, May 28, 2019, was sine die, the last day of the session. The Housing Trust Fund was not restored to full pre-recession funding ($40 million of designated funds from unclaimed property), but it did get $10 million. The only bill from the above list that made it to the Floor of the House was SB1539, but it was changed dramatically, which resulted in a party line vote.
I really regret the demise of SB1471 (help for homeless youth and families) and SB1383 (property tax assistance for widows and the elderly). The community groups backing SB1471 came up with a procedure to collect capitol gains tax on sales of Arizona property by out-of-state sellers. The Legislature said “thanks for the collection idea”. That procedure was adopted and put into the budget, but the earmark for homeless youth and families was eliminated. (Grrr…) SB1383 is a Maricopa County only program that helps widows and the elderly pay their property taxes; I think it should be expanded to statewide to help these people age in place. Instead, it was no heard in House Appropriations or Rules. On a bright note, the affordable housing tax credit bill– which would have costs the state over $90 million in the coming years– died again.
One of the prevailing messages from the grassroots in 2018 was: no more tax giveaways until the schools are fully funded. Republicans didn’t get that message. They also didn’t get the Invest In Ed message that we — the people– think the rich could pay more in taxes to help fund education.
The Republican budget cuts income taxes, TPT and fees by $386 million and leaves education and other needs underfunded (or unfunded).
We started the year with a $1 billion surplus to invest in the People’s To-Do List: education, infrastructure, healthcare and safety and security. The Republicans have added bits of money to these areas — just enough to make it look like they’re doing something— but the need is much greater.
Republicans are ignoring multiple crises that are brewing in our state including unnecessary maternal and child death; rock bottom education funding; crumbling roads, bridges and school buildings; lack affordable and low-income housing; the shortage of teachers, doctors and nurses; too many people living in poverty; lack of access to affordable healthcare… need I go on?
Is it a coincidence that Charter School Week is the same week as the landmark Supreme Court Decision Brown vs the Board of Education?
If you have read “Democracy in Chains,” you know the links between the Brown decision, Southern pushback against desegregation, taxpayer-funded private school vouchers, racial disparities across school districts, and the rise of the “public choice” movement in education.
The popularity of customized charter schools and tax-funded vouchers for private education — and the related budget cuts to public education — have led to white flight from public schools and increased segregation in our schools overall. Charter schools that cherry pick high-performing students and weed out others exacerbate the equity problems.
Many constituents have asked me where the budget is and what’s going on– after all, it is May. On the budget, the status quo of the past month still exists. All of the budget action continues to be behind closed doors, among a closed group of Republicans.
In addition to the Democrats, there are a significant number of House Republicans who are not part of the budget process, and they’re grumbling about it. This is a state budget– not the budget for a small town church. The deacons and the pastor don’t get to decide the budget on their own in the back room. The budget should be negotiated with all parties at the table– not just a handful of those close to power. Democrats make up 48 percent of the Arizona House. When more than 50 percent of the Legislature is kept in the dark and has to rely on rumors, that is not a fair process, and it ultimately hurts the people of Arizona.
Except for the Governor’s budget, which has been public for months, and some leaked details about the Senate Republican budget, little is known about the budget, beyond a few trial balloons. What we do know is that the Senate Republican budget is far more conservative and not even close to Governor Doug Ducey’s budget.
This chasm in the GOP has left an opening for Democrats. The House Democrats will unveil our balanced budget ideas on Wednesday morning at 9:30 a.m. We have been saying since January that we agreed with parts of the governor’s budget– like full tax conformity and more money for P-20 education. [Stay tuned for details.]
On the right, Senator J.D. Mesnard and other tax cut fans still want to zero-out the money the state could bring in from tax conformity (~$150 million) and Wayfair (~$85 million). There are multiple trial balloons about making the income tax rates flatter. One proposal is to have only two personal income tax brackets. This is a horrible idea– unless, of course, your goal is to return to austerity and Draconian budget cuts, while making your rich donors happy. Under the Republican proposals to eliminate or lower tax brackets, rich people would pay less, and the rest of us could pay more. (Think of the Republican tax bracket plan as Arizona’s mini-Me to the Trump Tax Cut and Jobs Act. Both significantly lower taxes for the wealthy by reducing the top tax rate.)
Although we had a short floor calendar on May 1, we had some rousing debates. The highlight was a two-hour debate on SB1085, association health plans. (Watch the action here, beginning at 19:32 min.)
The Republicans have had three bills this year to lower healthcare insurance costs by encouraging people to leave the healthcare marketplace. I agree that the Affordable Care Act is too expensive, particularly for sole proprietors (like my husband who was offered a silver ACA plan for more than $1000 per month just for him.) This is why I voted for direct care contracts. I believe those are a better deal for sole proprietors than association health plans.)
I get that costs are too high, but the association health plans are not the way to go. They could, indeed, lower costs for business owners, but they could be risky due to limited coverage. There are reasons why these plans will likely be cheaper. Remember the old adage “you get what you pay for”. If sole proprietor business owners want to take a risk with their own insurance and their own health, I have a mind to let them take their own risk. (Just don’t ask me to help you later with a Go Fund Me Request if it turns out I was right on limited coverage under cheap junk insurance plans.)
Where I object is when businesses are making these risky insurance decisions for their employees— just to save money.
The budget is still being negotiated behind closed doors. The Republicans have passed several tax cut bills, but not all of them have been heard in Committee of the Whole (COW, where the real debates happen).
We also have not heard the “Wayfair Bill” in COW because it is stalled in House Rules (with several other bills). HB2702 passed House Ways and Means unanimously several weeks ago but never got to the Floor for debate or a vote.
South Dakota vs Wayfair Inc. is the supreme court case that said states can charge sales tax on online sales. States, local governments, and brick and mortar businesses have been losing trillions of dollars to online retailers. Just look around town, and you will see fewer local businesses, less stock on the shelves, and many vacant store fronts. Taxing in-person purchases but not online purchases is unfair to local small businesses, hurts our local economy, reduces the General Fund (thus reducing education funding), and ultimately reduces consumer choice.
Arizona residents made $1.7 trillion worth of online purchases in 2018. That is how much Arizona businesses lost in sales. On those purchases, the state lost $85 million in sales tax (TPT). Cities and counties lost more than $45 million. Prop 301 (the education sales tax) lost $10.2 million.
If you often scratch your head at the bad bills that the Republicans pass in Congress and in the state legislatures and wonder what their end game is, you should read Democracy in Chains by Nancy McClean.
What you may think are random bad ideas that have somehow gotten into law are actually part of a grand scheme that has been playing out since Brown versus the Board of Education attempted to desegregate public schools in the United States.
An academic, McClean has studied the articles, books and letters of James Buchanan, the economist not the former president. Buchanan was the primary theorist of public choice theory. In the 1950s, public choice theory was used as a rationale to close all of the public schools in the state of Virginia (rather than comply with desegregation) and is being used today to support state-funded vouchers for private and religious schools. In Virginia in the 1950s, the state gave money to white parents for private school vouchers and allowed hundreds of black children to go uneducated for years. Needless to say, this was a travesty of justice.