Richard Ruelas: Good evening, welcome to "Horizon." I'm Richard Ruelas, filling in this week for Ted Simons. Arizona's system of 31 state parks is in poor financial shape as experts explained on a recent edition of "Horizon."
Bill Scalzo: We're 43rd in the nation. This is one of those Arizona at the bottom of the list stories. 43rd in the nation in the percent of our state budget we spend on state parks. We spend .09% of the state budget, and that's before the latest cuts.
Renee Bahl: We're in a dire situation. We have parks closed, parks that reduced hours, we are not awarding grant money to communities to build up their recreation. We're in a pretty dire fiscal straits.
Bill Scalzo: The general fund budgeting for that department has been cut back to a level of zero now. And we started this past year with about $30 million budget. This past fiscal year, not this one, by the end of the year we were $21 million for the money taken away. And we're starting this year with 19 million. So you can't operate a system that needs in excess of $30 million with 19.
Grady Gammage, Jr.: We found when we started doing the research for our report, we found that the state parks department has really been sort of starved, in good times and in bad, in bad times their money has been swept and taken into the general fund and they don't get to keep all of the revenues they earn at the parks. In good times, state parks never quite gets to the top of the priority list. And ahead of it in priority are education funding and other things, but also cutting taxes. So they don't get the money they should get even when times are good, and when times are bad, we wind up not taking care of hard assets that we as a state own.
Richard Ruelas: A report released this month by ASU's Morrison institute for public policy suggests a variety of options to generate revenue for state parks. At the top of the list is a surcharge on vehicle license plates. Here to talk about that and some of the other options is chairman of the house appropriations committee, state representative John Kavanagh, and Rich Dozer, chairman of the governor's sustainable state parks task force. And as we hit the World Series, we should mention former president of the Arizona Diamondbacks. The world champion Arizona Diamondbacks in 2001. Rich, the state task force is going to take the Morrison institute's report and present it to the governor, or present recommendations to the governor on how to fund state parks. How important is this vehicle license surcharge in your mind?
Rich Dozer: Well, we examined a whole bunch of different options to try to fix the state park system, funding of the state park system. Literally dozens and dozens of different options. Our report to the governor, which will come out this week, at the end of the week, will say we think one of the best options, and there's no great option, but we think the best option we've come up with, we have a very broad diverse group on our task force, that thinks vehicle license surcharge is the best answer.
Richard Ruelas: That would work practically when we sign up to get our car registered, we pay a little more and have access to the state parks?
Rich Dozer: Exactly. It would be a $14-15 charge on all noncommercial vehicles. That's our recommendation, at least. Every resident can opt out if they do not want to pay that charge. So a family that has two cars could say, you know, we'll pay that on one car, but we won't pay it on the other car. Some other states have done it throughout the union. We're not the first state to come up with this idea. Three or four states are ahead of us. Maybe not the perfect idea, but we think it's a good idea. But it gives the taxpayer the chance to opt out and not do it.
Richard Ruelas: Representative Kavanagh, were you quoted as being opposed to this. I don't know if they called a bunch of lawmakers and you're. First one who returned their call, or you were a champion or set yourself up as champion against the idea. But you used the word "scam" to describe this possible tax.
John Kavanagh: Yeah. Well, let me first say, everybody is looking for funds. These are tough times. And there's a temptation, and I understand that it's hard to resist, to kind of go on a scavenger hunt statewide looking for funds. And then first one who finds it claims those funds. And -- but that's not good tax policy. I think when you do taxing, you should have principles. I have five standards that I look to in terms of whether a tax is reasonable or not. One is, is it fair? The second is, if it doesn't serve a general purpose, like public safety, is it related to the people being taxed who -- it's being taken from --
Richard Ruelas: Like a tobacco tax affecting health care kind of thing?
John Kavanagh: Right. Is it stable, is it flexible, and finally, is it economically wise? By my analysis, this particular option fails three½ -- 3½ to four of those, particularly on the fairness issue.
Richard Ruelas: You discussed being troubled by the opt-out provision, meaning -- it sounds like you saw a lot of people who would want to be opting out would be scammed into paying?
John Kavanagh: It's kind of like book of the month club. They send you the form and if you forget to opt out, you wind up with the book. I've got a lot of extra books in my house when I used to be a member. The problem is, if you don't read the fine print, or if you just write the bill real quick, you don't realize what you're doing. That's exactly what happened in Washington state when they did this. Washington has a program to get fees for parks from registration fees. The program began as opt-in. You got your form, and if you didn't do anything you didn't pay the extra amount. But if you wanted to donate, I think they're $5, you checked a box. That went on for five, six months, and 1.4% of the people opted in. They realized they weren't getting enough money, so they then switched to opt-out, where you were assumed to donate unless you checked a box. Participation miraculously skyrocketed to 50%. And that basically says, 49% of the people if you have an opt-out box, are not going to see it and they're going to be donating when they wouldn't ordinarily do that. And it's not fair.
Richard Ruelas: Did you discuss on the task force that opt-in, opt-out --
Rich Dozer: We did. We had a very diverse group -- conservatives, liberals, throughout the state of Arizona. They looked at dozens of options. We zero the in on this option. But one thing we really wanted to do is have an opt-out provision. So you didn't automatically get it and you couldn't get out. We think a lot of people in the state will stay in. They will pay the $14 or $15 a year and to get a parks pass it costs more than that. We think it's a good value. There's no perfect answer with what's going on. It was the best answer that we came up with, and we think it makes sense. We think it's worth a try. We think it's worth a try to save our park system. The recently completed Gallup poll, that Lattie Coor’s groupd did, there was six important points people raised. The biggest public opinion poll in the state of Arizona's history, I believe. And they said, one of the six things, outdoor recreation is important. State parks are important. So we're trying to come up with a way to save our system. Because the last 10 years it's been starved financially by the state.
Richard Ruelas: To the representative's point, if that was the case and it's important to people, did you study the idea of people opting in rather than having to take an active step to opt out?
Rich Dozer: We studied both. We think the best answer is to opt out, but we're not trying to be a scam. It's disappointing and an insult to our committee that we're trying to do a scam.
Richard Ruelas: Do you think more people -- do you think the results would be the same whether you had opt-in or opt-out?
Rich Dozer: Probably not. We're not exactly sure. This is just our recommendation. The governor can do what she wants and the legislature can too.
Richard Ruelas: Representative, when you get to the state capitol, do you a lot of things with our tax dollars that are not completely transparent. This would seem fairly transparent. It's been discussed in newspapers, it's being discussed on television, I imagine if this goes to the governor there would be a lot of discussion over a box you can check that would charge you extra money, and would give you essentially a state parks pass. Do you think that would not be adequate notification to people?
John Kavanagh: It's not. Washington shows it's not. When you had to check a box to not pay, in that case -- I'm sorry, when you had to check a box to donate only 1.4% of the people checked the box. If you didn't do anything, you donated, 54% of the people gave the money. That's because they didn't see the check box. It's just not fair. But there's other problems too. I believe that when it's a service that is not general, like law enforcement, it's not fair to make people who don't use the Service or who rarely use the service pay. You're making every licensed -- registered vehicle owner pay. There are no state parks in Maricopa County, so much of the use is out of county. But beyond that, an elderly woman who rarely leaves her home is going to be paying, even though she's not using parks. It's not -- there's no nexus or connection between use and fee.
Richard Ruelas: I guess there's an idea that if essentially you were mailed a state parks pass, or if you had the idea of using one, these are our lands, these are our properties, our natural and historical sites, that would encourage people to use it if they had a pass, if they even had the idea of paying $15 that they might use it -- tend go to the parks more, want to donate more?
John Kavanagh: What encourages people to use parks, it's something they want to do. Not everyone wants to do it. Some people want to stay in their own neighborhood, go to a movie. Couch potato. You don't charge everybody for something a small number of people do.
Richard Ruelas: What about that 80-year-old woman who --
Rich Dozer: That 80-year-old woman hopefully, she will opt out. Hopefully she'll think it's a good value for our state. We need state parks, we would be the only state in the union if we didn't have a state park system. We should be supporting with general fund dollars, but there's a lot of other uses of the general fund dollars that are taking that away now.
Richard Ruelas: Is there an idea of this -- did you discuss this as being something that would boost tourism to state parks, people would see this as a bargain?
Rich Dozer: Yes. We really think that would be the case. We think also in the economic times right now, people are not traveling quite as far. So this would be something that would be good for our state, because people want to stay in the state because it's cheaper.
Richard Ruelas: I guess if we were -- you mentioned no parks being in Maricopa County. I guess if we were talking about the white tanks or closing off the Mcdowell mountains, there would be more Phoenix or urban interest, but these are far flung. There's probably not a lot of representatives who have a state park in their district. Is that the problem?
John Kavanagh: No. It's just fairness. You don't charge people the same when only a small number of people use the Service. But it goes beyond that. I don't think we should assume the only way to raise money is through this somewhat unfair method. There are other ways to raise money for parks. You can raise the fees, so users pay more. You can do more privatization, you can do more concessions. You can do more economies. You can get private donations. But in these tough, difficult times, parks are going to have to tighten their belt like everybody else.
Richard Ruelas: You looked at other options --
Rich Dozer: We looked at every single one of those openings. Let's talk about privatization. You can't do that, it's been tried in a couple states, it's failed. Every parks system in the United States is not in that situation. Also, if you try to privatize the parks, there are deals with the federal government where some of these parks, many of these parks revert back to the federal government. Picacho Peak, Red rocks state park in Sedona, Lake Havasu, those and many others will go back to the federal government and they'll cease to be parks.
Richard Ruelas: Is there a worry of a Starbucks --
John Kavanagh: No, I'm not saying sell the parks. I'm saying privatize the operations. Arizona currently has a company recreation resource management, which runs some of the concessions, this company has offered to actually take over operations of the parks, the state would still own it, but they would run it. This company already runs national parks and other state parks.
Richard Ruelas: I guess you guys -- we're in a very odd economic time where you guys are talking about a lease-back of the capitol building. How -- to the issue of priorities, where does this fall in the budget --
John Kavanagh: this is not a lease-back. We would say, we own the park -- the private --
Richard Ruelas: In the state budget overall, how much does state parks come up as far as increasing funding rather than sweeping away funds?
John Kavanagh: I guess that's the third point. There are priorities. There's education, there's health care. There's public safety, there's keeping prisoners in prisons. We have to sit down and look at the entire picture. And while I think parks are valuable and I don't want them to go away, when I have to allocate funds, I have to give more preference to education and health care and keeping criminals off the streets.
Richard Ruelas: What do you think the public response to this --
Rich Dozer: right now the general fund of the state of Arizona is giving zero dollars to the state parks system. Zero dollars. OK? Now, the NAU reports, economic impact report done in the last year shows more than a quarter of a billion dollar of economic impact to the state of Arizona from the park system. And direct taxes of approximately $25 million. So zero money coming from the general fund, and we know the state and the municipalities get most of those taxes. So most of those taxes, a big portion are going to the state government. So just look at it from a business standpoint. No money coming from the general fund, but driving $25 million of state and local taxes. Seems like it's pretty easy to try to keep these things afloat.
Richard Ruelas: Two last questions for you -- do you agree the state parks do need a dedicated or steady source of revenue? Is the current system unmanageable?
John Kavanagh: I believe that they do, but the problem that we have is, even if we had dedicated sources, the money wouldn't be there. State revenues from all of our funding sources are way down.
Richard Ruelas: And lastly, would you be more comfortable if this did go to a vote of the people? With the idea of the opt-in phrase, would you be more comfortable if the voters passed this?
John Kavanagh: No, because -- you don't send -- if you want to send every issue, we'll spend three issues in the ballot box. There are certain decisions elected officials will make.
Richard Ruelas: Do you get the sense the public --
Richard Ruelas: the public would have to vote on this, we think. We don't think it's right. I agree, you should be making the decisions. But the public we think would have to do it. Because probably it would be considered a tax, and probably we'd have to have a two-thirds vote --
John Kavanagh: That raises one of the questions, then we have one more source of dedicated funds that in a time of economic downturn, the legislature can't touch. We have $350 million in an early childhood development fund that we can't touch that we'd like to use for early childhood development.
Richard Ruelas: I'm sure this will be --
John Kavanagh: this will just be one more fund that's untouchable.
Richard Ruelas: We have to wrap it up now. We should have you both back as this goes through the process. Thank you both for joining us.
Rich Dozer: Thank you.
John Kavanagh: My pleasure.