Tuesday, February 9, 2010

Farley Report: "Arizona Has Been Backed Into An Ugly, Dangerous, and Uncomfortable Corner"

Posted By on Tue, Feb 9, 2010 at 9:32 PM

The weekly briefing from the Capitol by Rep. Steve Farley:

Howdy, Friends O'Farley…

Let's cut to the chase.

As I'm sure you know, Governor Brewer's sales tax referral passed out of the Legislature last week. I voted no, for the reasons I detailed last week.

One of those reasons is that I think the Governor's tax will likely lose. In an ideal world, it ought to lose for many reasons from the way it hurts middle-class families more than the rich, to over-dependence on retail sales taxes in Arizona, to the huge and expensive corporate bailout bill Republican legislators are poised to enact, to the fact that it doesn't solve even a tiny bit of the problem, to the Governor proposing massive cuts to education, human services, and public safety even if it does pass.

However, it is extremely clear to those of you who regularly read the Farley Report that we Arizonans do not live in an ideal world.

In this world, there are people on the far right who lay in wait for the sales tax to fail on May 18 so that they may claim a popular mandate to slash and burn most government services, especially education, human services and public safety. And

they have the power to do so.

I feel that Arizona has been backed into an ugly, dangerous, and uncomfortable corner that is slightly preferable to the uglier, more dangerous, and horrifyingly uncomfortable corner that we will be pushed into if the tax does not pass.

I feel that Arizona has been suffering from a bad infection in our collective leg for the last year. The time has now passed when we could have administered preventive antibiotics to heal ourselves because Republican leadership believed that we could solve it by cutting off the leg entirely. Sad to say, they have the majority, and have had the majority for the last 44 years. Now the infection is spreading and the only medicine on offer from Republican leaders to solve part of the problem is the Governor's sales tax.

So despite my opposition to the tax and its referral, I feel I must swallow hard and vote yes at the ballot box, and I recommend that you do the same.

But we cannot stop there, despite what House Republicans are suggesting. Apparently, they believe the budget deficit is fixed now that we have sent the tax to the voters. Amazingly, the House Appropriations Committee is not meeting this week. Yes, that is the committee that is charged with developing the budget.

Luckily, the third-party budget I mentioned last week is gaining some momentum, although it currently has many fewer supporters than it has interested parties. At least it has started the discussion of other options. If you are feeling particularly wonkish tonight, you can download the powerpoint on that budget at:
http://strongerarizona.com/documents/3rd Party Budget.pdf


Two of the brightest economists in our state are at the U of A — Alberta Charney and Marshall Vest. They wrote an excellent article in the Star today that points out why we need to increase our state's revenues, and that the bulk of our problems are caused not by out-of-control spending, but by out-of-control tax giveaways to corporations and the rich that amount to $2.6 billion a year in lost money for our state to provide the services we need and stimulate the economy.

You can read their article here:

House Leadership isn't solving the budget crisis, but they are pushing through lots of Republican bills on other pressing issues, though, from free fishing licenses for Boy Scouts (HB2601 — nope, girls are not given this privilege — I will try to amend this week to include Girl Scouts), to a line on tax forms allowing Arizonans to pay what they wish to the state (HB2001), to the legalization of sparklers (HB2246), to the complete deregulation of the sale and use of guns made in Arizona (HB2307), to fixing the duration of yellow lights at intersections regardless of what local traffic engineers say is safe (HB2338).

This week the Ways and Means committee focused almost entirely on the expansion of state tax credits for private and religious schools — the STO program. You may remember the series of investigative articles published last summer by the East Valley Tribune and the Arizona Republic documenting serious abuses of these tax credits. The money ended up enriching private organizations that funneled the tax credits while kids from rich families got to go to private schools for free. Public schools meanwhile lost out on $350 million in funding.

People were also taking tax credits, bundling them with other friends or relatives' tax credits, and then designating that money to pay for their kids to go to private schools. Despite the statement by the program's founder, now-Congressman Trent Franks, that "the focus is entirely on low-income children", most of the beneficiaries have come from rich families.

The bill that passes this week in Ways & Means (HB2664) — over my vote that that of the other two Democrats — claimed to "reform" the program. In reality it does nothing of the kind. It made some half-hearted attempts at disallowing the designation of tax money for your own kid, but did not include funding or staffing for any regulation or enforcement. It refused to establish a priority for low-income kids. It did not deal with the issue of student tuition organizations enriching themselves. And rather than really reform the program, the sponsors decided to increase by 50% the amount of money people could claim as a tax credit, a move that will increase our deficit and further deplete resources for our public schools.

In my explanation of vote, I pointed out that we should not spend taxpayer money to benefit a few rich and connected people while cutting public education for the rest of our children. Why can't we agree to provide a great public education to every Arizona kid?

Unfortunately, we Democrats were outvoted 5-3. Let's hope the Arizona electorate decides they will outvote the current majority in November.

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