Journalists Roundtable

June 16, 2006

Transcript:

Michael Grant:
It's Friday, June 16, 2006. In the headlines this week, first lady Laura Bush in the valley today to help raise money for senator Jon Kyl's re-election bid. Secretary of state's office busy this week as candidates rushed to beat the deadline to file for the upcoming primary election. With just a couple of weeks to go before the end of the current fiscal year, a tentative agreement has been found between the governor and the legislative leadership. That's next on Horizon.

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Michael Grant:
Good evening. I'm Michael Grant. This is the journalists' roundtable. Joining me to talk about these and other stories are Mike Sunnucks of the Business Journal, Howie Fischer of Capitol Media Services and Mary Jo Pitzl will is back from the "Arizona Republic."

Michael Grant:
Arizona's senate race continues to attract high profile names for fundraisers. This afternoon first lady Laura Bush made a stop in Phoenix on be half of senator Jon Kyl.

Video/Laura Bush:
Jon Kyl has been a passionate advocate for Arizona families in his 11-years in the U.S. Senate. As senator he's helped improve our country's healthcare system so that more American families can have access to good medical treatment. Here in Phoenix he was able to secure $2.6 million for the Translational Jeanopicts Institute where they are working to find course for melanoma, pancreatic cancer, diabetes and other devastating diseases. He has also shown a commitment to women's health by co-sponsoring the breast cancer research stamp authorization act. The act extended the stamp's expiration date by two years allowing more money to be raised for breast cancer.

Michael Grant:
Mike, you were at the fundraiser this afternoon. What else did the first lady have to say?

Mike Sunnucks:
She hailed Kyl's commitment to tax cuts, kind of a core Republican issue. He brought up the estate tax something he's trying to repeal. That brought up the most applause from the audience. She also brought up Iraq. Not the top issue for Bush. But some of the recent progress there. She and Kyl were will to go talk about that. That was kind of a change. They brought in about $500,000.

Michael Grant:
So the estimate's $500,000. Incidentally, we've had obviously a spate. The vice-president in for Kyl recently, Bill Clinton in for Jim Pederson, now the first lady. Is that it for a while or have we got any other --

Mike Sunnucks:
Kyl's been aggressive in his fundraising because Pederson's thrown in about 3.2 million of his own money. Kyl's had Schwarzenhegger and McCain helping him as well. I think Kyl's ready to fund raise as much as he needs to match Pederson.

Howard Fischer:
Of course. It's like bringing up the estate tax. You have fat cat Republicans willing to shell out $500 for rubber chicken to listen to rather are Bush.

Mike Sunnucks:
It was rubber salmon.

Howard Fischer:
Excuse me. Of course he's going to get a cheer on the estate tax. Come on.

Mike Sunnucks:
It's a debate, an issue Kyl's worked on. Pederson differs with him on the estate tax.

Howard Fischer:
Of course they differ. It's the 1 half of 1% of people who are affected by this million-dollar estate --

Mike Sunnucks:
All fairness, arguments on both sides, small business and fib are big pushers of getting rid of the estate tax, at least scaling it back to where you can pass your family business on to your kids if you want. I'm sorry, Howie, you don't approve of the estate tax.

Mary Jo Pitzl:
Or rubber salmon.

Howard Fischer:
Or rubber salmon. I'll tell you.

Michael Grant:
A combination of culinary, political sort of thing. Obviously both Jon Kyl and Jim Pederson finally nominating positions this week. The person who didn't was John Verkamp.

Mike Sunnucks:
Yes. Still couldn't get him. They were out there trying to get him and he was the anti-war candidate. One interesting thing about the Laura Bush fundraiser there really weren't that many protestors out there. They tried to get a fair amount of people but it seemed like the same folks that come out for that. Kind of a mixed bag what Verkamp would have on Pederson. Whether it's in the middle, a moderate Democrat which appeals in this state or bring up the angry left wing of the Democratic Party.

Howard Fischer:
One thing I found about Verkamp is, here's a guy who entered the race with five weeks out.

Michael Grant:
45 minutes ago, actually.

Howard Fischer:
With no real financial backing, with two criminal convictions under his belt. And the guy came within 90% of what he needed. Which suggests that there are folks out there looking for an alternative to Jon Kyl who is your pro-business chamber of commerce type and Jim Pederson who they see as just slick. So there are enough folks out there --

Mike Sunnucks:
They're not going to get Verkamp on the ballot.

Howard Fischer:
You try to do some of that in five weeks. S we talk about Don Goldwater it took him months.

Mike Sunnucks:
It's a problem with that kind of left wing air America Michael Moore kind of the Democratic party. They have a lot of enthusiasm and anger but not a lot of organization and probably not savvy.

Michael Grant:
On the Republican governor's side, Mary Jo, no surprises there. And the two candidates figured to play most heavily in the primary filing nominating petitions.

Mary Jo Pitzl:
No surprises although for all the talk you'd think there were only go to be two candidates but Gary Tupper, Mike Harris, Don Goldwater and Len Munsil who earlier filed, they constitute the field if their signatures are valid. That's a crowded field for the governor's race.

Howard Fischer:
An interesting race. Because you have Munsil and Goldwater, who Munsil filed for his public funding, Goldwater hopes to.

Michael Grant:
I'm getting mixed signals on that issue, on whether or not he's going to file enough sometime.

Howard Fischer:
Well, because you don't have the same deadline, that same mid-June deadline you can file right up to right before the primary and get your primary money. Unfortunately you need that money for the primary process.

Michael Grant:
If I recall correctly, Carol Springer --

Mike Sunnucks:
She got the big check --

Michael Grant:
The weekend right before the primary.

Howard Fischer:
You notice how far Carol Springer went in that race. Of course, Goldwater insists he can do it. Then you have Mike Harris who's committed to spending a quarter million of his own money. He said in the court hearing related to stuff with his ex-wife he's already put in $100,000.

Mike Sunnucks:
That's good when you're sitting in a court hearing related to your ex-wife.

Howard Fischer:
Then you have Gary Tupper who months ago sitting around the table I said he's one of those people throwing his name in. One of his issues was whether his kid was being medicated. He managed to qualify. He's not going to use public money. He doesn't have any personal wealth. He's dependent on the fact that he's qualified that all of us will have to give him equal treatment. The interesting thing about Tupper is out of the four Republicans he's the only pro-choice Republican in the race. Now, in primaries that's not a real good position when you're Republican but it does present an interesting position for pro-choice Republicans. Do you vote for a Munsil or Harris who only believes in abortion in the cases of saving the life of the mother, you've got Goldwater who says, well, there's rape and incest exception or do you have an Tupper?

Mike Sunnucks:
The reality of the Republican Party is it's a pro-life party and the pro-lifers dominate the primary. Whoever's the most pro-life wins. Munsil is kind of the insider candidate, has the social conservatives with him but gold water is banking on his name.

Howard Fischer:
And it's worked. Look at the polls. Here's the guy whose main qualification for office is he set up bleachers working for the department of administration and yet he's out polling Munsil.

Mary Jo Pitzl:
It worked. Where are the $5 contributions why is that difficult with the marquis name like Goldwater to raise that where as --

Mike Sunnucks:
Organization with Munsil, kind of the money guys, consultants. Don has East valley lawmakers with him.

Howard Fischer:
He's got Russell Pearce. What more could you want in the campaign?

Michael Grant:
Let's zip down to southeast Arizona. Jim Colby retiring. A lot of ballot activity on both sides, although five names probably playing most prominently in the primary. The -- R and D primary.

Mike Sunnucks:
Both parties are going to pull a lot of national attention. The senate couldn't decide who pulls the house. On the Republican side you have Steve had Youman whose house ways and means chairman at the legislature.

Mike Sunnucks:
Endorsed by Jim Colby. And Jim click a big money guy down there, auto dealer and big fundraiser. Mike Kellen, the ex-husband of a state senator, Ray Carroll moderate Pima county supervisor with him and then Randy Graph, the pro-life candidate.

Michael Grant:
And who polled 43% against Jim Colby in the primary a couple of years ago. I guess the possibility there is do had Youman and Helen difficult up the moderate vote -- to Huffman -- Leaving Randy Graph to win?

Mary Jo Pitzl:
I may add the hope among the Democratic candidates.

Mike Sunnucks:
They're trying to get Helen out of the race and clear it for a Huffman-Graph race which Huffman has the advantage. If not Graph has a really good chance of winning the primary and then a tough go again Gabby Woodward or -- on the other side of the aisle.

Howard Fischer:
Yes. But the wild card we've been talking about all year is immigration. He is anti-immigration, secure the border, send them home candidate. That district takes in a lot of Cochise County, a place where Larry Deavor who the -- Deavor has a real problem there. It includes much of Santa Cruz County, certainly on the east side of Pima County. You never know with that district.

Michael Grant:
Dynamics may have changed considerably in the past couple of years.

Mike Sunnucks:
Look at what happened in San Diego with Bill -- winning Cunningham's former seat. He ran on immigration and won that seat. So Howie's right. That could be a big wild card and Graph could actually win that seat.

Michael Grant:
Here's a familiar name, Mary Jo. David Bernell Smith.

Mary Jo Pitzl:
Mr. Smith who is the first lawmaker in the nation to be removed from a publicly funded process. That happened earlier this year and he has now gathered signatures on a petition and he's going to run again for his seat because he feels he was denied his right. And we'll see what the voters in northeast Phoenix Cave Creek do. He will be facing among others Nancy Bardo who was selected to be his replacement. And has taken a more moderate tone than Smith. She's been very low profile since she joined the legislature.

Michael Grant:
Those races out there have been fun to watch the past couple, three cycles. I guess this one will be no exception. This was weird. Senator Chuck Gray gets the primary date wrong on his nominating petitions?

Howard Fischer:
Well, you have to remember that the general election is the first Tuesday in November. Somebody probably had been pulling this together saying the primary must be the first Tuesday in September. Well, no, never has been in Arizona. Has all of his petitions ready, saying September 5. Primary's September 12. Now, courts have sometimes said, look. Wouldn't have changed where the voters would have signed the thing. But Chuck rather than worry about a legal challenge and spending a lot of money on a legal challenge got all of his friends, all of his relatives, every Republican lawmaker signed and went out and essentially in 24 hours went out and redid his whole petition drive with the right date.

Michael Grant:
That is no small logistical undertaking in that kind of time frame.

Howard Fischer:
In the middle of June when it's hot. I mean, going door to door, you know, you had Tim Dewhose the senate majority leader out in Mesa knocking on doors saying my good friend Chuck Gray needs your signature.

Mary Jo Pitzl:
Isn't it funny people at the -- at home will come to the door.

Mike Sunnucks:
It doesn't hurt go to go out and help your co-horse.

Michael Grant:
Last night top legislative leaders and Governor Janet Napolitano reached a tentative agreement on a new state budget. We'll get into the details of what we know where a minute but where are we now?

Howard Fischer:
The good news is the Governor, House Speaker Jim Weiers; Senate President Ken Bennett reached a deal. Working out these reconciliation bills. The bad news is that just because your leadership signs off doesn't mean your rank and file does. The real problem in this hour is in the house. Jim Weiers promised at the beginning of the session, I will not put out a budget without at least 31 of my 39 Republicans signed on to it. Last I checked we're about up to 22, 23 Republicans. Some people will never be on it. I mean, you probably have the Eddie Farnsworth's of the world who say this is a $10.1 billion spending package, a double-digit increase in spending.

Michael Grant:
Too much money to spend. I'm not signing off.

Mike Sunnucks:
How many Democrats would they get, anyway? Folks on the left that are totally against the tax cuts.

Howard Fischer:
You will get Democrats.

Mike Sunnucks: How many will they be able to get?

Howard Fischer:
You could probably get out of 21 Democrats I'm thinking 10 or is 11. So you could get the 31 if Weiss is willing to do that. The political danger to him is having promised to put out a budget with only 31 Republicans and saying I'll put out a budget with 25 Republicans and 6 Democrats. He's actually only got 28 to choose from.

Michael Grant:
If push comes to shove, I says suspect they might arrange emergency medical transport.

Howard Fischer:
He will be wheeled. In I've been out there long enough to watch people wheeled in for votes. That wouldn't surprise me.

Mike Sunnucks:
Wouldn't you take a bigger hit if you can't get the votes at all? Isn't it better to get the budget out and get this big huge tax cut they might not be able to use next time if Janet wins?

Howard Fischer:
That's the logical thing. We're talking legislature. Logically you want to say, I'm the leader. I will put together the votes. Jim Weiers is -- jumps every time he sees his shadow. One shadow on his right side is Andy Biggs from Gilbert who would like to be the house speaker and Bill Stafford who would like to be the speaker and Jim fears that somehow if they will see this as a sign of weakness and challenge him.

Michael Grant:
Internal political, not a public political thing.

Howard Fischer:
As the house speaker, at some point -- and I go back to the 80's where we did have by party san government and you'd find a bird in the bar and say, look. The majority of the body is to do this. Most of the Republicans support, it some of the Democrats do. Now, to go back to your question on the Democrats, they're very dividend, too. We're going to be talking about the tax package. There are some Democrats who think the tax cuts, permanent tax cuts are unacceptable. House minority leader Phil Lobes said he will not vote for the tax cuts.

Mike Sunnucks:
Once you cut them that's it. Need two-thirds to raise it. That's never going to happen.

Michael Grant:
Mary Jo, has Ken Bennett got the votes in the senate?

Mary Jo Pitzl:
Well, so we're told that he has the votes to get the budget out. But he may be losing senator Jack Harper because the money is allegedly not in the budget for a highway project in Harper's district, affectionately dubbed the Harper highway? That money's not there which may cost them Harper's vote.

Howard Fischer:
Then you have the Ron Gould's. Ron will never vote for that. It's hard to say.

Michael Grant:
But a more stable situation perhaps in the -- or a closer situation in the senate than in the house?

Mary Jo Pitzl:
As of when we left the prep cease a while ago. -- Premises.

Howard Fischer:
Anything is possible. So this gets into where are you going to go next, Mary Jo is talking about the specifics. You have in here such a massive tax cut, the largest single tax cut in state history. The question for Republicans is, why not just take the damn tax cut, go home, campaign for re-election on it and forget the spending. This is the best deal that's going to happen with a Democratic governor.

Mike Sunnucks:
And point out the governor signed on to this tax cut, which she talked against throughout the session but she's going for it. That certainly helps her in the election, too.

Michael Grant:
Details of tax cut. Let's start with income, Mary Jo.

Mary Jo Pitzl:
That's the biggest part of the package. 310, 320 million. It would cut individual tax rates by 5% for next year for '07 and another 5% for the following year so you get a 10% income tax reduction.

Michael Grant:
Was that on the governor's part, a give. Because she had been fairly rest lute a couple, three weeks ago that she only wanted a one-year tax cut.

Mary Jo Pitzl:
Well, it was a give on her part and also was it the house that had it all in one year?

Howard Fischer:
The media 10% cut which would have meant less money for her spending priorities. So you have to remember, this governor's come a long way. She started out with 100 million in tax cuts at the state-of-the-state. Health insurance tax credits, sales tax holiday, and things like that.

Michael Grant:
Keep in mind I think the budget surplus has gone up $500 million from the state-of-the-state, too.

Howard Fischer:
That's the interesting thing. I was talking to Steve Huffman the other day. He said you know where we made a mistake as Republicans? If we would have the day after governor proposed a budget adopted it and then said anything that is a tax break we would have had a budget 100 million, 200 million, maybe $1 billion less than we're adopted.

Mary Jo Pitzl:
Of course it didn't happen. The second component of the tax package is a property tax cut. This became quite a matter of contention among some members of the business community who felt that budget was about ready to go to bed and nobody was talking seriously about property tax reduction. The business community wants it because they make it feels for them anti-competitive. It's an across the board property tax cut. It would eliminate the county education rate. Anybody that owns property will benefit.

Mike Sunnucks:
What about the income tax also? That's across the board, too. You never heard from Janet the democrat to say let's gear it towards the middle class. She went along with an across the board cut.

Howard Fischer:
But see, in Arizona because of the fact the rates are so compressed you really hit that top 5% rate. Not much over maybe 20, $30,000 a year. This isn't like the federal rate where you have this expanded scale.

Mary Jo Pitzl:
The wrinkle on the property tax cut is that they're going to eliminate it or take it down to zero for three years and the impact will be felt first in this coming year. When you get your tax bill if this package flies you will realize that tax savings of '07. It will last for three years and then somewhat like the estate tax that congress is dealing with, it would revert back up its current level.

Michael Grant:
In contrast to the income tax being discussed, it is not permanent but they figure, well, we'll take that issue up in three years.

Mary Jo Pitzl:
That will be fought down the road.

Howard Fischer:
The other piece of, it the reason the Republicans are willing to buy off on that, their contention is that you get so much economic stimulus by reducing property taxes. That plus other things they'll try to put on the ballot to compress county and city tax rates that we'll bring in so much more money at the end of three years we'll see we don't need this money. It's not a lot of money for the state. It's a fair amount of money to homeowners on a 200,000-dollar home talking $86 a year. For businesses, which may a much higher rate, 2 1/2 times of what a homeowner pace, this is real money.

Mary Jo Pitzl: Also it gives them some cover. Everybody expects there will be a bit of a taxpayer, maybe a lot of the taxpayer revolt when property tax bills come out given what's happened to home valuation. So the belief is by being able to tell voters, we cut this tax.

Michael Grant: We did what we could.

Mary Jo Pitzl: Exactly.

Michael Grant: It was your county assessor who really ouched you.

Mary Jo Pitzl: The education tax held dear by many voters, the money will be held by the state fund so no cut to the schools on.

Michael Grant: The spending side what were the large items in dispute? All day k.

Howie Fischer: All day kindergarten has been a hot issue. Remember essentially two years ago the legislature did the first batch. This was schools where 90% of the kids were from homes, which qualified for free or reduced lunch programs. The poorest kids became 80% it. Was supposed to be phased in over 5-years. The governor said at the beginning of the year, there's enough money there even before the latest revenue figures we can go ahead and finish it. Well, there were a lot of lawmakers who balked at it. They said some schools don't want kindergarten. A lot of lawmakers see it as basically daycare. Well, as the money kept rolling in and the governor said, you want me to sign off on this massive tax cut I didn't particularly want, they gave in. Now, here's the curious thing what. Used to cost 107 million to fully implement. Now it costs 160 million. That doesn't count maybe 90 million in capital for the new classrooms you'll need.

Michael Grant:
Was this a massive error in January or was there really $50 million in slush here?

Howard Fischer:
I think it's actually a -- they played a little fast and loose in January. I think when they threw out the 105 they recognized it wouldn't quite get every kid up to full funding for the state, but once we had quote unquote full funding then we could make the math corrections later and nobody would notice. Obviously that caught up with them. The other big issue, which is also in education, has to do with teacher salaries. There is about 100 million in there. The big section of that is 45 million just because the pension costs are going up, this will hold them so they don't lose pay also a $35,000 starting salary. Most school districts start at about $30,000. The other piece is across the board salary hike. We don't have the numbers in terms of what that means.

Mike Sunnucks:
Don't you think the looks pretty good from this budget? She got all day k, got teacher pay.

Howard Fischer:
She's going to take credit for the tax cut.

Mike Sunnucks:
Yes.

Michael Grant:
Just about out of time, Mary Jo. But I guess continue to work through the weekend to try to assemble the votes? Do we know? They can take a break? Come back Monday?

Mary Jo Pitzl:
A lot of people want to hit the road, I think, and give it a break.

Howard Fischer:
I think because they know they're going to have to be back next week anyway with other bills up in the session, if they can't pull the deal together tonight they might as well come back Monday and hope they have the penal.

Michael Grant:
Panelists, thank you very much. We are out of time.

Larry Lemons:
He was at the side of Mexican president Vicente Fox when he served in his cabinet. Now he's written a book on America and immigrants from Mexico. Doctor Juan Hernandez joins Michael Grant with his unique insight into the U.S. illegal immigration debate. That's Monday at 7 on horizon.

Michael Grant:
Tuesday the results of the latest Cronkite eight poll which will include how Arizonans feel about governor Napolitano's veto of that immigration bill. Wednesday we'll discuss a new PBS series about pediatric end of life issues. The show is called "Lion in the house." Thursday hear from local comedian Chris Bliss on his effort to get that bill of rights monument built. Thank you very much for joining us on a Friday. I'm Michael Grant. Have a great weekend. Good night.

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