Ted Simons: The Arizona state senate today approved putting a one-cent increase in the state sales tax on the May 18th ballot. The senate also voted for other measures to help close the state's budget gap, including borrowing, spending delays and a tax increase for non-residents.
Ted Simons: Also from the legislature -- a bipartisan budget plan is starting to make noise. It's being called the "orphan budget" because initially no one claimed credit for crafting the proposal. However, the orphan budget has been adopted, so to speak, by representative Bill Konopnicki, who is sponsoring the legislation. The proposal would have fewer cuts than leadership's budget and would do more to increase revenue. Here to talk about the alternative budget is Representative Bill Konopnicki and Representative Chad Campbell. Good to have you both on "Horizon."
Chad Campbell: Good to be here.
Ted Simons: Who is involved with this orphan budget? Are there cosponsors?
Bill Konopnicki: It's a bipartisan effort to deal with the real issues and at this point, I don't think we have cosponsors identified, but there will be some.
Ted Simons: In terms of numbers, how many involved?
Bill Konopnicki: Seven to 15 depending on which piece of the budget you're talking about.
Ted Simons: Understanding there's some local economists involved. Maybe some economists not even from Arizona, correct?
Chad Campbell: I think the key to the budget, as Bill and I talked about, it brings in a diverse viewpoint from different walks of life from the business community, from the legislature and community leaders and it's something that we've been lacking in terms of the process over the past year and it's a comprehensive approach to a difficult problem.
Ted Simons: It's six, eight, somewhere along these lines, bills would wind up out of this.
Chad Campbell: Bill would know better than I.
Bill Konopnicki: About eight bills.
Ted Simons: And a five-year plan, correct?
Bill Konopnicki: That's correct, a five-year plan with concise pieces to spell out what we need to do to get out of this situation.
Ted Simons: Let me tell what you I've heard. You tell me if I’ve heard wrong and maybe we can get some details behind it. It includes a healthcare tax and food tax.
Bill Konopnicki: That's correct, but the healthcare tax is what's called the bed tax. Other states do that. But we need a bed tax, a provider tax and those are federally matched dollars. Generates in the neighborhood of $1.2 billion for Arizona. The food tax is certainly one that brings a lot of grief to a lot of people, but there's no way to just work our way out of it without having a better tax base.
Ted Simons: Food tax would be difficult for Democrats to get behind.
Chad Campbell: Food tax is a tough one and there's a lot of tough choices in this package. I do want to point out, not saying we're going to have support for this. But built into the food tax is a $250 million offset for low-income individuals and any tax we're talking about has to have those offsets to get buy-in from both Democrats and Republicans.
Ted Simons: I was going to say on the Republican side, I'm guessing a call for the increase in the income tax is not going to go over well.
Bill Konopnicki: Any increase is not going to go over on the Republican side. We’ve already made decisions that have put us in a position that we’ve increased taxes we just haven't figured out how to pay for them.
Ted Simons: And you haven’t figured out how much of a income tax increase and these things? School tax credit, eliminate school tax credit?
Bill Konopnicki: It does. For the public and private school tax credits.
Ted Simons: And on the other side, something that the Democrats have to figure out how to support, reducing the corporate income tax starting in 2014.
Chap Campbell: Reducing business taxes is not a bad move as long as it's offset by other revenue increases somewhere else. The bills we voted on last week, were done in a vacuum. We can't go out and cut taxes and not find any other revenue. It's a comprehensive package.
Ted Simons: The speaker has said that you show him a budget and put it in bill form, he'll allow it to be heard. This sounds like it's close to or in bill form. Think it will get heard?
Bill Konopnicki: It's not in bill form yet. We're working on that. And I believe the speaker. We’re going to move forward and hopefully he'll hear the bills.
Ted Simons: We have Kavanagh saying he's not going to hear it.
Bill Konopnicki: His job is to be the keeper of the guard and that's probably a natural reaction and he hasn’t looked into the bill and it's something that needs a hearing.
Ted Simons: The concept has been talked about for a while. We've heard rumbling last week and maybe earlier. Was the initial plan to keep it quiet, so it couldn't get any opposition brewing or to keep it quiet so everyone knew something was happening, you best get your act in order?
Chad Campbell: I'm not sure we were that organized. I think the key was trying to get a variety of viewpoints into a process that wasn't going to be politicized and that's our goal and what we're dealing is with a political element. We need to set aside election year politics and look at the $4 billion deficit we're dealing with in the state and deal with what’s right for Arizona and not for our elections and I think that was the goal of the package.
Ted Simons: How do you convince the fellow Democrats to do that?
Chad Campbell: What I just said, we have to convince everybody. Democrats and Republicans. We have to set aside politics and do what’s right.
Ted Simons: How do you convince fellow Republicans that this needs to be looked at seriously and taken care of?
Bill Konopnicki: We need to come together as Arizonans and deal with the issues and quit pretending we have solved the problems when really we've delayed the decisions.
Ted Simons: Is there a way to do that? We've had special sessions and nothing has been done. How can this get past that hurdle?
Bill Konopnicki: It may not. The interesting thing is that this budget is fluid and we're willing to work with anyone. The goal is to have a balanced built which we don’t have now and if you want to change things then change this but at the end it has to be a balanced budget.
Ted Simons: Let's be honest here. Are you optimistic this is going to get anywhere?
Chad Campbell: I'm optimistic this will start a conversation. It may not be this exact bill but starts the conversation towards the comprehensive package we can all get behind. It's a long run, but I'm an optimistic.
Ted Simons: Sounds encouraging. Thanks for joining us.
Chad Campbell: Thanks, Ted.