Horizon, Host: Ted Simons

June 3, 2005


Host: Michael Grant

Journalists Roundtable


  • Don't miss HORIZON's weekly roundtable where local reporters get a chance to review the week's top stories.
Guests:
  • Howard Fischer - of "Capitol Media Services"
Category: Journalists Roundtable

View Transcript
>> Michael Grant:
It's Friday, June 3rd, 2005. In the headlines this week, Governor Janet Napolitano says she's working on a proposal to resolve a federal court case regarding English learning. Meanwhile, Republican lawmakers are continuing their criticism of the Governor for her recent vetoes and say they may take the issue of tuition tax credits directly to the voters. A bankruptcy judge has opened a 30-day window for other parties to make bids for U.S. Airways prior to its merger with America West Airlines. That's next on "Horizon."


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>> Michael Grant:
Good evening. I'm Michael Grant, and this is the Journalists' Roundtable. Joining me to talk about these and other stories are Howie Fischer of "Capitol Media Services." Mike Sunnucks of the "Business Journal." And Bob Robb of the "The Arizona Republic."


>> Michael Grant:
It's been three weeks since the Arizona legislature adjourned for the year and it's been two weeks since Governor Janet Napolitano used her veto stamp on several high profile bills. This week, the sniping continued at the State Capitol as Republican leaders continued to blast the Governor for her vetoes on such things as the Flores case and tuition tax credits. Last night, Governor Napolitano made her monthly appearance on "Horizon" and had this to say about the Republican criticism of her.


>> Janet Napolitano:
What I'm trying to do is not get into the personal attacks and there have been a lot, well, you know --


>> Michael Grant
: Like the bumper sticker?


>> Janet Napolitano:
Yeah, you know, come on. This is -- you know, this is an agreement that was reached. We had obviously miscommunication on both sides. It happens. You are a lawyer. I'm a lawyer. We've both dealt with this a million times. We have a duty to the people of Arizona to put that behind us and sit down and see if we can work out these issues. I will give them a proposal on how to do that in the near future.


>> Michael Grant:
How we, on a scale of A to Z, how do you rank the relationship between the 9th floor and the legislature at the state capitol


>> Howard Fischer:
Well, a few of them were wearing a tee-shirt that I will be happy to show off here. If this gives you any idea of their feelings, it's going to get ugly before it gets better.


>> Michael Grant:
Last weekend we had the bumper sticker. Are we going to move to baseball caps next?


>> Howard Fischer:
We've got coffee cups printed off and you can wear a little button, and as I say, it blinks at night also.


>> Michael Grant:
Now, they did have discussions, I think, in both caucuses this week about whether or not they wanted to do anything. What was the upshot of that?


>> Howard Fischer.
Well, it comes down to she broke it, let her fix it. The Republicans believe that on tuition tax credits, that they gave her exactly what she asked for, which was a $5 million program, for five years, with a legislative review at the end of it. Now, she insists that it was always understood it was going to be a sunset which would require actual legislative action to come back and redo it. The problem becomes that the bill which has been out there for weeks always had the word "review" in it, never had the word "sunset. George Cunningham, who reviewed the bill and its various amendments, signed off on it and said it was fine. Now, George's explanation, for what it's worth is, look, we always understood this was the deal. It's much like going in and negotiating for a new house. And you are told the mortgage rate is 6\%, and you are given a stack of papers when you go in for the closing, and you are looking at all of the things, you are not looking at the mortgage because in fact you were told it's 6\%. He said, I didn't look for it, so I don't know.


>> Michael Grant:
Bob, you know, I've got to tell you when I get a stack of mortgage papers in front of me, the very first thing I go looking for is the interest rate.


>> Bob Robb:
You bet. I think -- although there's the intensity of feeling that's being expressed over having been misled by the Governor, I think what really irritates them is the way this she managed the incident, because it's not uncommon in political deal-making for there to be subsequent disagreements over what the deal was and arguments about that. But what really irritates the Republicans, I think, is that she managed the process in a way that she never clearly told them that this was a deal breaker. So they sent the entire package to her. She pocketed everything she got out of the deal, then denied the Republicans the one thing that she knew was the cement that enabled them to round up the votes to get those things she wanted to her in the first place. And she's never offered, in my judgment, an adequate explanation, as to why, if this was a deal breaker, during the week that existed between the time that she found out that the sunset clause wasn't there and they transmitted the bills to her, she did not in good faith inform the senate president and the house speaker this is a deal breaker and give them a chance to decide how to respond before they gave her everything she --


>> Mike Sunnucks:
they gave her all-day K. They gave her funding for the med school, which is really not adequately planned right now.


>> Michael Grant:
That was the legislators' chief concern with the funding was I don't think they were all that worried, Mike about $9 million, but they couldn't figure out where we're going.


>> Bob Robb:
Yeah. They took vouchers off the table. They scaled down the tuition tax credit. They put a $5 million cap on it instead of letting go up to 50-55 million. They promised the review and she comes up with the veto and they end up with nothing.


>> Howard Fischer:
There is one more piece to this. The understanding to the Republicans, everything else we've agreed to and all of a sudden the budget takes up and the budget comes up, she takes a pen, line item, line item, the use of federal funds, the use of the rainy day fund, and again, they believed they had a deal. Now --


>> Bob Robb:
but those things they would have accepted. It's the fact that she pocketed all of the big things she got out of the deal while denying them the single big thing they got out of it.


>> Mike Sunnucks:
There were a lot of Republicans that didn't want to give her the property tax cuts. They didn't want to give her all-day K, thinking about next year's election, they did that as part of the deal with the tuition tax credits and now they have nothing.


>> Howard Fischer:
That leads to where do we go now, which is where you started this.


>> Michael Grant: Right.


>> Howard Fischer:
The feelings are so hot at the legislature -- I mean, the Governor has said on the Flores case, the English language learner case, she is going to prepare her own deal. Well, house majority Steve Tully said, well, (A) it's about time, because she hasn't done anything on this for the last six months, and (B), it doesn't matter. It's too late. We don't trust her. So it's going to be real hard to get any trust here. I mean, the joke is that we're now going to start inviting reporters to the negotiating so somebody can take notes because the trust is just gone. You cannot negotiate unless you believe that when you shake your hands on something that there is a deal.


>> Bob Robb:
If Republican legislators are saying they trust reporters more than the Governor, we really know that we fit --


>> Michael Grant:
A couple of follow-up questions on that angle, Bob. I mean, obviously, tempers mostly at the legislature running very high. Is this the kind of thing that cools off? I shouldn't be asking that in June in Arizona. Is this the kind of thing that goes away or not?


>> Bob Robb:
Well, there are certain political realities. She's the Governor. Things are going to be done interstate without her approval. The Republicans have demonstrated the ability to keep a far more conservative caucus together and intact and accomplish tough things, which means that even if they don't trust each other, they are going to have to figure out a way to arrive ultimately at the same conclusion. I do believe that the Governor has seriously and for this leadership permanently created an unwillingness to simply sit across the table and accept what's represented. There is going to be a lot of show me first on your side of the equation. But ultimately, they will have to arrive at the same point and will figure out some way politically to achieve that.


>> Howard Fischer:
Well, and something else that's waiting in the wings. The Flores case, you have a judge's order that told the lawmakers by the time you adjourn, sign and die, you will have a plan for funding. Now, lawmakers come back and say, well we had a plan and the Governor vetoed it. The judge doesn't care. Judge Collins is going to say sometime later this month or in early July, my Order has been violated and have to decide what to do. It's up to lawmakers --


>> Bob Robb:
but they have to be asked --


>> Howard Fischer:
and he will be.


>> Bob Robb:
The lawyer has said that he will show some patience, but he prefers an outcome rather than going back -- legislative outcome rather than going back to court. One of the things being missed in this whole English learner debate, is this isn't only over the amount of money. There is a fundamental difference in the methodology that the Republicans wants to see used to teach children English, the same methodology that the voters approved in 2000, which was immersion, as opposed to the Democrats that don't like that approach, and prefer to see simply additional funding provided for the current prevailing practice, which is English as a second language, where the children spend most of their day in regular classrooms --


>> Mike Sunnucks:
look, I think one thing, the fact that she doesn't have a plan, hasn't had a planet, kind of fuels the Republican anger that this veto was coming all along, and they are more angry because they felt that she wasn't bargaining in good faith from the get-go. It wasn't a last minute -- they didn't include the sunset or the right language in there.


>> Howard Fischer:
I appreciate what you are saying from the Republican perspective, but I think to write this off as a dispute between bilingual education and immersion sort of oversimplifies it. Part of what the problem with the Republican plan, at least from the Governor's perspective, is that beginning in the second year, each school had to come up with a plan that the State Board of Education found acceptable, figure out how much it's going to cost, identify any federal monies that they had laying around that could have been used for English instruction and then get approval. We're talking about over 200 school districts and a lot more individual schools and the bureaucracy created by this is insurmountable. The argument that we are identifying costs is one thing, but there was a way of doing this that was less convoluted than what the Republicans put together.


>>Bob Robb:
I think Howie, you are seriously underestimating the importance and ultimate stumbling block that the difference in philosophy over how kids should be taught English represents, because part of what was in the Republican bill was that all of these requests had to be for additional funding, had to be to implement an English immersion model as opposed to the Democratic approach, which is to simply add more money attached to the kids who have been designated as English learners and leave the school districts alone to continue doing what they are currently doing, which is to largely ignore that law.


>>Howard Fischer:
Now you are making an assumption that doesn't exist because after the passage of prop 203, there are exemptions that the voters approved to English immersion for certain kids who parents want them in different programs, but to somehow suggest that the law is being ignored, I think is a fallacy


>>Bob Robb:
Well, no, the study, which the legislature commissioned showed that without waivers, which were for bilingual instruction, kids, as the common practice in the school districts which the study looked at, was for these kids to be in traditional classrooms, and pulled out for part of the day for English instruction. The --


>> Bob Robb:
what was passed by the voters clearly calls for these kids to be in a separate classroom under the age of 10, taught intensive English acquisition, and only after passing a test showing proficiency to be returned to the traditional classroom. And that's not being done. That's not the prevailing practice in Arizona.


>> Howard Fischer:
I know that's not being done and you want to get off the subject, but what also is not being done is the $355 per student that the state is funding is not adequately funding even those kinds of programs, is not funding the special teachers you need, the instructional materials and everything else.


>>Bob Robb:
Where that bypass occurs --


>> Bob Robb:
Didn't work. Didn't cost out. The English immersion model. They dismissed it.


>> Mike Sunnuck:
For the Republicans to make any points off this, they have to keep it on she lied, she double crossed us. If it gets caught up in the court case and these different philosophies the voters aren't going to get into that.


>> Bob Robb:
I disagree with that as well.


>> Bob Robb:
That's my usual posture. The question of politicians lying to each other is inside politics, and the common assumption of the voters is that politicians lie to everybody all the time.


>> Mike Sunnuck:
I don't think most voters know what the Flores case is, but they know --


>> Howard Fischer:
but here's where I think you are off base, Mike. If there were somewhere else in the room who could testify to the truth or falsity of either side's statement, you've got something, something like I did not have sex with that woman when you've got a dress with a stain on it. But Janet and Jim Weiers and Ken Bennett saying each of them lied is meaningless.


>> Mike Sunnucks: The legislature has a big, big challenge because their poll numbers, their credibility with the public is not as high as the Governor. On other hand, the Governor has vetoed almost 60 bills, and she does have a reputation of being obstructionist and hardball in her negotiating.


>> Howard Fischer:
I think the voters have expressed a view on the method of instruction for English acquisition that should be the prevailing practice in Arizona, and if the Republicans stay on that point, I think they can gain the upper hand politically with respect to this dispute.


>> Michael Grant:
Okay. Well, at the risk of --


>>Howard Fischer:
do you want to talk about something else now?


>> Michael Grant:
At the risk of cutting this discussion off prematurely -- I'm sorry, we've run out of time. Speaking of political challenges, Jim Peterson maybe gearing up to take a shot at Jon Kyl next year?


>> Mike Sunnucks
:It's looking that way. He stepped down as president of his real estate development company. He is going to be chairman. He's also telling people privately that he's going to run. That would set up a very expensive, very high profile senate race between him and Kyl. The prevailing view is Kyl would be favored. They have a voter registration edge. He is a strong ally of bush, but Peterson is no slouch. He has put $8 million of his own money into the state Democratic party over the last two election cycles. He's a huge contributor. He's willing to spend. He's got some political experience, so it would be a tight race, but I think Kyl would be the favorite right now.


>> Michael Grant:
Interesting development, Bob, because I know that he was just downright depressed in November and December given the results, including but not limited to, given the results in light of what really was a very good Democrat ground effort here in the State of Arizona.


>> Bob Robb:
Peterson was spinning, and I think legitimately believed that the Napolitano victory in 2002 represented a -- the leading edge of a new trend in Arizona politics, in which Democrats were going to be far more competitive, if not on their way to being the -- having the upper hand in politics, and the results did palpably stun him and cause him to question those assumptions.

As I understand it, he's hired the people who helped Salazar's campaign in New Mexico, where a Democrat upset a favored Republican and successfully. But I think he made a serious mistake, which is when you are asking someone to assess a race, the first thing you ought to do is say and guess what you are not going to be the consultant if the race occurs, because a consultant can always find a way in which a race can be won, particularly by someone who has a practice of investing his own sums of money in campaign.


>> Mike Sunnucks:
He's been a lot more partisan than Napolitano has. He was very critical of the President Bush during the election, state party chairs are supposed to do. He appeared with Howard Dean when he came to Phoenix a couple weeks ago. Janet stayed clear of that as have a lot of Democratic governors throughout the country. He has had to associate himself with liberal and Ideological sides of the party where Napolitano has been very careful and effective at staying way from that.


>>Bob Robb:
He has identified himself also with the new Democrat movement, in particular saying the Democrats need to be more favorably inclined towards business, coming from his own business background that makes sense.


>> Mike Sunnucks:
Kyl doesn't have the name recognition or strength of McCain, but he doesn't have a lot of weaknesses. He is a good bush ally.


>> Michael Grant:
Politics at a different level, Colleen Connor stepping down as executive director of the Clean Elections Commission.


>> Howard Fischer:
She has been the staff director since voters approved this. I don't know if you can say it's a surprise. I mean, on the one hand, if you head an agency for a while and then you are a consultant to people fighting the agency, she is an attorney, she can do that, but she came under fire from a lot of folks for not coming before the legislature to deal with some of the bills that dealt with changes in the law. She also came under fire for not having penalties at the institute high enough against some of the people who violated the law, and then finally, she may have hurt the whole reputation of the Clean Elections concept through some of the things that happened during the salmon and Napolitano race, because of the fact that a lot of what was done against Matt Salmon was seen as very political. In fact, the guy who was her deputy director who was forced out said that it was very clear that they were aiming at Matt because he had the temerity to run as a privately funded candidate. So it wasn't a question of Democrat-Republican, it was a question of he wanted to use his own money. Even the commission's own auditors ultimately concluded that what Salmon might have overspent or failed to report was a fraction of what she announced at a very critical point in that campaign.


>> Michael Grant:
That's true.


>> Bob Robb:
I think the uproar over what happened in the last election with Salmon for Republicans has totally died down when they lost the court case over the ballot question. You are not seeing them really interested in pushing that next year.


>> Howard Fischer:
The Republican caucus has become much more dominated by social conservatives. In reality, the political force that has benefited them most from public campaign financing has been social conservatives.


>> Bob Robb:
With the matching funds and everything else, this is a better way to run. I can find 5,000 people to run for Governor, they'll raise my $5 donations.


>> Michael Grant:
The challenge is to understand the discreet difference between cash and accrual accounting, but we can't get into that at this moment.


>>Howard Fischer:
Why not?


>> Howard Fischer:
There were a couple of new developments this week in the proposed merger of America West Airlines and U.S. Airways. Mike, let's start with the ruling from the bankruptcy judge. He is soliciting or at least creating the process to solicit other officers for use airways?


>> Mike Sunnucks:
He is leaving the door open for other folks to come in and merge. That's what happened with AT airlines. Southwest came in and got gates in Chicago for them. So you could see other airlines come in and make offers or offers for specific U.S. Airways assets, gates, airplanes, et cetera.


>> Michael Grant:
But they would be looking for chunks. There is not a lot of people beating down the door saying, no, no, no, I want to acquire the whole thing.


>> Mike Sunnucks:
You will not see people getting in line as a whole. There is a report about Alaska airways possibly making a bid. You could see some smaller regional airlines getting in there, but if southwest got in the picture, it would be for chunks and portions.


>> Michael Grant:
Howie, there was -- and this is fairly routine in these kind of deals, there was a breakup fee in this proposed merger and the judge said I'll go along with it?


>> Howard Fischer:
And that was real interesting. I mean, personally, I have a problem with break-up fees entirely because I think they are meant to be poison pills. They are set up in a way that two companies reach a sweetheart deal and they say if you want to go to someone else, in this case, there is a $15 million breakup fee. We saw this when -- in fact, just today when Le publishing completed it's sale of the Pulitzer empire which includes Flagstaff and the Tucson morning papers. And they had a break-up fee which was designed, basically to scare anyone else off


>> Michael Grant:
Keep other people away.


>> Howard Fischer:
So you've got in these situations cases where, you know, executives will get golden parachutes and all of this is negotiated in an arrangement. It's designed to keep everyone else out.


>> Mike Sunnucks:
The bankruptcy' charge is to get the best deal for the creditors and debtors. That includes general electric and the Alabama pension fund which are bank rolling that airline right now. So his obligation is to get the best deal for them. If it means merger that's it, if it means breaking them up to buy some gates in Philadelphia, Washington or New York, that's the way it will go.


>> Michael Grant:
Mike, has I got this straight, Donald trump heard the words "you're fired" and tried to pick up some land here in Tempe?


>> Mike Sunnucks:
Yeah, the city put out for bid about 20-some acres of land around Tempe Town Lake. The trump group was interested in that. He has been outbid. The highest was $40 million, and there were other bids, including Trump's which were lower than that. The city needs to sign off on who it is going to pick. It's usually the top bid, but not always, if somebody else has a project that see they see as better, they could go that route, but trump is obviously interested in the region. He's got the proposal up on the Biltmore area and it's a testament to the continued strength of our real estate market.


>> Michael Grant:
That's for darn sure, because Bob, there is a remarkable turnaround. Tempe has been trying to move this thing for a number of years, and not getting a lot of traction. It looks like things are looking up.


>> Bob Robb:
The original proposal, the one sold to the voters of Tempe to float the bonds to build the lake, was the development around the lake would more than pay for the maintenance of the lake, and in fact generate some profit for the city. And that has not happened. It does appear that we've got a market in which infill development, urban type projects are on the upswing. In addition to this property, ASU looks to be moving more aggressively towards marketing the large amount of land which it owns along the lake. So it does look like prospects for that particular development are much brighter.


>> Michael Grant:
Arizona Corporation Commission talking about renewable energy this week?


>> Howard Fischer:
Yes, this is one of those things Marc Spitzer points out, you don't like your broccoli but it's good for you so shut up and eat it. We're told that renewable energy is the way to go, solar, wind, bio, geothermal, but Arizona gets it's power with coal-fired plants. We have natural gas plants for peak loads, nuclear with Palo Verde and everything else. They want to tell utilities by the year 2025, 15\% of what you sell to your customers will have to be from renewable sources. Utilities aren't objecting, why? Because they get to pass on the higher costs. Solar is very expensive because the capital cost of installing these cells is very high and it's not even a current technology. The commission seems to be moving in that direction. I think when they vote on it next month it's 4 to 1 with only Mike Gleason saying we shouldn't be regulating that.


>> Michael Grant:
Panelists, we're out of time. If you would like to see a transcript of tonight's program, please visit the web site, you will find that at www.azpbs.org. When you get there, please click on the word "Horizon." That is going to lead you to transcripts, links and information on upcoming shows. And in that regard, I have no information for you on Monday and Tuesday of next week, because "Horizon" takes a break Monday and Tuesday for special programming. We will return on Wednesday. And on Thursday, we'll tell you about an exhibit in China by ASU's Mars research team. Thank you very much for joining us on this Friday edition of "Horizon." Hope you have a great weekend. I'm Michael Grant. Have a great one, good night.

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