Horizon, Host: Ted Simons

May 20, 2009


Host: Ted Simons

Legislative Update


  • Jim Small from Arizona Capitol Times reports on the latest from the state capitol.
Guests:
  • Jim Small - Arizona Capitol Times
Category: Legislature

View Transcript
Ted Simons:
Good evening, and welcome to Horizon, I'm Ted Simons. Earlier today the senate appropriations committee consider aid new plan to balance next year's budget. Joining me to talk about that and other legislative news is Arizona Capitol Times reporter Jim Small. Jim, always good to have you here, thanks for joining us.

Jim Small:
Thanks for having me, Ted.

Ted Simons:
The package, how does this compare and contrast with what moved through the house out of committee I should say in the house.

Jim Small:
Last week the house heard a budget package, and this one is basically seems like it's based off of that one. Couple of the republican leaders we spoke with said that, you know, they took that package that came out of the house, went into some negotiations between the house and senate to try to figure out where they could, you know, kind of expound on it to address some things that had changed. One of the major things that had changed was a portion of education money they were proposing some excess balances they were going to sweep to make up some money in the upcoming year's budget; they ended up doing last week as a way to solve the current year's budget problem. So they had a hole to fill there. The economy got a little worse, the numbers, the deficit number grew a little larger, and so some of the major differences include, you know, privatizing a couple of prisons, they think that they can do -- take two or three prisons, have a management company basically pay a fee up front to take over these prisons and then they'd save some money every year in the annual cost of running the prison. Another area which brings in about $200 million in the plan is to take money, the taxes that people pay to register their cars. A portion of that gets distributed to cities and counties. They want to take about $200 million of that, put it in the state general fund, and instead let cities go ahead and give them access to impact development impact fees to offset the cost.

Ted Simons:
I was going to say, that sounds curious, because the VLT isn't that specifically targeted for certain things? Can they just use that money for whatever they want?

Jim Small:
A lot of that money does get thrown into the highway user revenue fund, which is basically for transportation construction and maintenance, things like that, and a lot of the money gets also shared with cities and counties as just kind of a revenue sharing way. It's similar to the idea that the state shares its income tax income with cities and towns, and so they just basically want to take a portion of that back.

Ted Simons:
Wasn't the idea that you can replace the vehicle license taxes with impact fees but again impact fees are I thought they were supposed to be targeted?

Jim Small:
Yeah, it's a bit of a change from what the house plan had, and the house plan also went after impact fees and instead what it did was basically asked cities to pay the state back some of that income tax shared revenue, and instead they could go ahead and access these impact fees and you're right, these impact fees are very specific in law. They're targeted they have to be collected for a specific purpose to absorb growth and they have to be spent for that purpose. If they're spent for things like sewers and libraries and police and fire coverage and streets and things of that nature, so certainly taking these restrictions off would be a significant departure in policy.

Ted Simons:
You mentioned privatizing three state prisons. Is that viable? Is it doable?

Jim Small:
You know, that's still remains to be seen. The department of corrections yesterday when I called over there, they hadn't heard about the plan yet, the bills were not out yet, so they were still looking into it. You know, the state had other prisons that it operates that are privatized. Nothing quite like this, where they've taken a state run prison and turned it into a private prison. They've generally contracted to build private prisons so it's a little different.

Ted Simons:
Is this the kind of thing that has enough votes to pass the senate, because I know president Burns was saying he didn't want anything coming out of committee unless he was sure it was going to make it the whole way? Is he sure?

Jim Small:
No, he's not. They had not shopped this to all their members yet. They haven't gone around and tried to tally votes. He said yesterday that he was departing from that strategy and, you know, I think the idea's really just to get something out and get things moving and hopefully facilitate some more negotiations with governor Brewer.

Ted Simons:
Has that worked in the house? Because that was the same plan of action in the house, get something out there, talk about it, and get things going. Seems like things in the house stagnated a bit.

Jim Small:
They did, and this was kind of always what was destined to happen, you get the bill out of committee and don't see a whole lot of action taking place on the surface. But when that budget came out, I think the next day daily meetings started with governor Brewer between the speaker, the president, and the governor which to that point hadn't occurred with that kind of frequency, you know, so I don't know what's actually going to happen, what's going to come from this. But certainly the intent is to try to, you know, delineate to the governor and say look, here's where we stand, here what's we're looking at doing, we want you to weigh in on it.

Ted Simons:
The fix of the '09 budget came not long after the house decided to get things rolling too, correct?

Jim Small:
Correct. Within a week they'd gone ahead and what they'd been meeting about was about the '09 problem.

Ted Simons:
The governor I don't think I saw anything regarding raising taxes, anything along those lines. Are they still on different tracks here? I know they're meeting, but is there a sense down there that there's still a lot of disconnect going on?

Jim Small:
There definitely is. Each side seems to have dug their heels in on this particular issue and the governor today made a speech in Tucson, variation of the speech she's been giving for the past couple months and called for a tax increase for increasing revenue by a billion dollars and republicans in the legislature are still holding firm to the idea that they don't want to do that on the grounds it's going to hurt the economy and, you know, typically not a republican stance.

Ted Simons:
So with that being said and the idea both in the house and senate there's still some work to do, where do Democrats come into all this? Is there a little power broking going on there? Or still in the hinterlands.

Jim Small:
Still in the hinterlands I think. We'll see if things change next week. Tuesday they're planning on releasing a joint house and senate budget proposal they say will address the entire problem and they feel will have almost unanimous support within their own caucuses and in fact the statement that was made at a press briefing earlier this week was if they get anywhere near 12 votes in the senate and 25 in the house on the democratic budget, then they're going to have more votes than either of the republican plans have. Whether they use that to shop around and try to pull republicans on board remains to be seen. The last budget proposal they put out, they used merely a menu of options, some suggestions they hoped to kind of use to start discussions with republicans.

Ted Simons:
Last point real quickly, senate plan deferring payments to access, deferring payments to universities, deferring payments to D.E.S., weren't these the kind of things that were considered budgeting gimmicks and maneuvers in years past?

Jim Small:
They were, and in fact a couple of the items were included in the first house democratic budget proposal, as well. And they already did defender payment to the universities once last week. To solve the current year's budget problem. And, you know, that question's been raised to speaker or to speaker Adams and president Burns, and the answer that we get is something along the lines of, well, yeah, it was gimmicky back then when we had the ability to do other things. But now we don't have any other ability, and we're doing everything we can to avoid raising taxes.

Ted Simons:
All right. Jim, thank you for joining us, we appreciate it.

Jim Small:
Thanks for having me.

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