Don’t miss HORIZON’s weekly roundtable where local reporters get a chance to review the week’s top stories.
>>>Ted Simons:
Tonight on Horizon, the governor says she can keep the state from shutting down if there's no budget by the end of the month. Sheriff Joe Arpaio was blasted at a county budget hearing and lawmakers try to spark Arizona's economy, that's next on horizon.
>>Announcer:
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>>>Ted Simons:
Hello, welcome to Horizon. I'm Ted Simons. Joining me this evening Mary Jo Pitzl of the Arizona Republic, Matt Benson of the Arizona Republic, and Howard Fischer of Capitol Media Services. July 1st is nearing and still no state budget, Matt, what's the latest?
>>Matt Benson:
Well, we're waiting. Basically we got a $2.2 billion shortfall for 2009. We got 10 days until the end of the year, and everybody's just sort of sitting on their hands waiting to see what comes next.
>>Ted Simons:
Who's meeting with whom?
>>Matt Benson:
Basically right now we've got Republicans meeting among themselves and Democrats meeting among themselves and there were no bipartisan talks at the end of the week. Hopefully they'll get back together Monday and move from there.
>>Ted Simons:
I seem to remember weren't talks supposed to resume yesterday? What happened?
>>Howard Fischer:
About once a week we come on the show and you say what's happening with the budget. We say talks are scheduled to resume. Part of the problem, and comes down to what Matt says, 10 days left. It's sort of a game of chicken. Who's going to blink first, the governor and many Democrats, not all, keep insisting, you know, the way to bridge what they see as a temporary gap is to borrow as much as possible. The governor's still got over a billion dollars of borrowing in her plan. Lawmakers say that's fiscally irresponsible. What happens if we're sitting here next Friday night, has anybody blinked by then? I think we may actually be working the following Monday night, you know, right up to the deadline.
>>Mary Jo Pitzel:
I think the indications though, there is a lot of finger pointing towards the end of the week, republicans saying they're waiting for detail back from the Democrats, Democrats saying we don't know what you're talking about, you dumped new demands on us, back and forth, hard to sort out who's really holding up the parade, but underneath all that almost everybody's confident they'll have a budget out by July 1, despite fears of course they're getting very close to the deadline.
>>Matt Benson:
You're right but the stakes are incredibly high here. If they don't come up with a deal by the end of the fiscal year we face at the least a partial state shutdown, tens of thousands of state employees are impacted and even those with agencies with money to continue operating on some level they may not have a way to get a paycheck because the Department of Administration and treasurer's office may be closed as well.
>>Howard Fischer:
This gets interesting because Senator Bob Burns, Senate Appropriations Committee, is crafting legislation, he's confident but he's not that confident he's willing to let things slip, preparing an emergency one month stripped down budget to keep basic services operating, Department of Administration to pay, the Corrections Department, D-P-S, Treasurer's Office, probably not Tourism, probably not Commerce, and somehow he's not that convinced that we're going to be there, you know, come 10 days from now.
>>Mary Jo Pitzel:
Certainly it's prudent to have a plan. When you're 10 days from falling off the edge of the cliff you should have some backup plan. But just looking at the politics and strategy of the situation, this is an election year. Early voting begins on July 31st. There are lawmakers particularly a healthy collection of Republicans in the Senate who have contested primaries. This he need to get back to their districts and campaign. We have the Senate President running for Congress. He doesn't have a primary but there's all these other time pressures, and I think that that the will serve to bring this together. Plus who wins if you shut down state government? Who looks good on this? You put state employees perhaps in a situation where they don't get pay and do any of the politicians look good in this?
>>Ted Simons:
Go back to the idea what Senator Burns is talking about with this short term budget. Is that the same as a continuing resolution back in Congress? Because from what I understand the state can't do that?
>>Howard Fischer:
No. Although depending on who you talk to, you know, there are people who believe that the current budget just simply extends over. There is no authority that any of us have seen for a continuing resolution where you just take the current spending and keep it running. You actually really can't take the current level of spending and keep it running because revenues next year are going to be less than we have this year, so it's not a question of we'll just keep things running. That's part of the reason he also wants a limited budget. He wants to keep the pressure off. He wants to show people there are real issues here if maybe M-V-D is not open you can't get your driver's license renewed he thinks that will put pressure on people. Back to Mary Jo's point--Who wins and who loses? Newt Gingrich tried this over a decade ago; show the President, you can see how well that worked for Newt. I don't know who people blame.
>>Ted Simons:
Not only that, we're hearing talk of bringing out the national guard to guard prisoners, is that bluster or is that part service a contingency plan?
>>Matt Benson:
That's certainly part of what people are talking about, granted not what the governor's talking about, folks like Senator Jack Harper talking about, so take it for what it's worth. It's out there. If this happens and we see state agencies no matter how many closing down, that is going to be politically disastrous come this election when all 90 legislative seats are up for grabs. And the governor, she's going to take heat on this too, but she's not on the ballot. So.
>>Howard Fischer:
Well, we keep talking state agencies. Let's understand here that also includes the university system here. That clouds this ASU's campus that includes July 1st, you know, hey, folks, you turn on the TV and turn to Channel Eight, it's maybe not there. I'm being a little facetious but that's the truth, even with money there, there's no authority to spend it.
>>Ted Simons:
That brings back to what essential services are, what defines an essential service, a, and b, what power does the governor have in an emergency situation?
>>Howard Fischer:
Well, to talk to her, you know, she says she has a secret plan, you know, we're all up at her press conference Wednesday. I have a plan. We have a contingency plan but I'm not going to detail it for you. I'm of the age I remember Dick Nixon and his secret plan to end the War in Vietnam. I think we pulled out and that was his secret plan. She says she has authority to keep essential services running. I don't see that in statute. I'm sure her lawyer will come up with something because that what lawyers are paid to do.
>>Ted Simons:
Bottom line, are lawmakers prepared for a worst case scenario? What do you this I?
>>Matt Benson:
Impossible to gauge. Obviously they're holding their discussions away from us sequestered in some inside of a volcano somewhere or something. So, you know, I'm assuming they're making preparations, keeping a brave face that they're going to have a budget deal. And I have to assume because of the political ramifications we outlined, they're going to have one because they have to have one. And frankly if we get to, you know this time next week and there's no deal, and then all bets are off, you know, we'll be setting a new course.
>>Ted Simons:
All right.
>>Mary Jo Pitzel:
Tune in next week.
>>Ted Simons:
Yeah, and while all this goes on, other things are happening, including the idea Mary Jo of a four in one, economic stimulus plan, that takes four ideas floating around and shoves them all together?
>>Mary Jo Pitzel:
Yeah actually it started off as a five in one plan, it's moving fast. Monday representative Michelle Reagan, chairwoman of the House Congress Committee, pulled together lawmakers and lobbyists and said let's put together a job stimulus program and she did pull together some ideas that have been floating around at the Capitol. Some like her research and development tax credit, that idea's been around for several sessions, she wants to extend that and throw in improvements to Cactus League and allow entertainment district downtown phoenix to happen and while we're at it how about solar tax credits. And in the early go there was also the University Stimulus Plan, which the governor first unveiled in her state of the state speech which got a big hearing back in April in the state senate, and it has now gone nowhere, that would allow a lot of construction projects on university campuses. They pulled that one off, and allegedly that's being discussed in the budget talks inside the volcano someplace. So this plan is rolling. It has the language for the bill just came out in mid-afternoon today, it's 81 pages, and if you want to talk about legislative vetting, I guess that begins Tuesday when Reagan's committee holds a hear on it.
>>Howard Fischer:
One of the interesting things about this, I think the belief was if you put in a little something for everyone, the Christmas tree as we've been calling it, oh, that will be wonderful. But I think what they're finding out is there's something in there for everyone to hate, the Pima baseball tax, idea of a Cactus League tax similar to what's occurring here, Pima county lawmakers hate it because it also includes restaurant taxes which hits local residents, not just people from out of town. You have a number of lawmakers who say why aren't we granting broad based tax relief rather than saying for a specific downtown district or any area that we're going to do that? The idea of solar credits, I love the fact that Barry Groom came in and said it's the next big they know. Two years ago Biotech was the next big thing and before that I think Optics was the next big thing, so a lot of folks are wondering do we just keep chasing the next big thing.
>>Ted Simons:
Is this the kind of thing where there's an opportunity for horse trading? We'll get to the state property tax permanent repeal eventually here, but that always seems like that is thrown out there. Well, yes, but maybe if we can do a permanent -- is opportunity there at all?
>>Mary Jo Pitzel:
Oh I think it's a wide open invitation for it. I mean, again, Reagan says she's trying to pull together some things. Looking for things she can pull together that can get enough votes to pass so the nature of it, there's probably been horse trading to get to this point. It's bringing up, look, if you really want to provide a boost to the economy, then permanently repeal this property tax, which I will note is currently on hold, I don't know how much it's helping our economy right now, but the belief is that if this were to stay off the books in perpetuity Arizona would be better off for it and that might lead to some trading on that.
>>Matt Benson:
At first blush this is one of these exceptionally complex packages you look at and think they can't possibly put this thing together and get the votes for it to get it out this late in the session. On the other hand, at this point in the session is when this stuff tends to happen, for good and bad, as we've seen in the past.
>>Howard Fischer:
Except when it goes to the Senate and if it ends up something there where it's going to have to go to a committee or something, or to go the floor for committee, the whole, I can see Ron Gould with 42 amendments for each special thing that he doesn't like. I can see Jack Harper, Pamela Gorman, each trying to tear it apart. So a lot of it's going to depend on what we started talking about. If the budget is done, everything else falls apart. They will be out of here so quick it will make your head spin. If the budget's not done, well, we got time to play with this bill.
>>Mary Jo Pitzel:
But as Howie said, it might be in its early go looks like it's coming out to be something with a little something for everyone to dislike, because most of the comment on it has been negative from people who either are just generally opposed to any kind of tax increases, there's not tax increases but tax credits, which sort of picks winners and losers, people who think this is not broad based. So there's a lot of opposition there, and the proponents are the people who are behind each one of the individual projects, called the greater Phoenix Chamber, state chamber, well, they don't know. They haven't had time to take a look at these things.
>>Ted Simons:
I want to get back to the permanent repeal of the state property tax because now we've got an idea that this could be headed for the ballot. Talk to us about that aspect of this, and how it just seems like this is a pretty big bargaining chip in a variety of ways.
>>Matt Benson:
You're talking about the education equalization tax, amounts to $250 million a year for the state. It's been suspended, supposed to come back on the books in 2009. And there was a measure to permanently repeal it earlier this session, the governor vetoed it. This has been percolating and percolating, lawmakers, GOP wants to do this, and looks like they're going to try to get it on the ballot again, and just bypass the governor, take it straight to voters where property taxes are about as unpopular a thing as can you pick.
>>Mary Jo Pitzel:
What's interesting is how they try to get it on the ballot, first idea, straight up repeal, actually the legislature passed that earlier this year only to have the governor veto it. If that doesn't work, to do the same thing again, there's talk about why don't we continue its temporary suspension for another three years and that allegedly has some traction and I think we might see some, well, if we don't see something next week we're not going to see it.
>>Ted Simons:
Going to get out of the legislature do you think?
>>Howard Fischer:
I don't think there's any question some version, it may end up the suspension, for example, we know Senator Tom O'Halloran said when this first came up as a bill, I don't think it's responsible to permanently give up a source of revenue. Once you get rid of it, it takes a two thirds vote to get it back, which you'll never have, however, extending suspension one, two, three years and see if we need it in 2012 is much more politically acceptable. The votes are there. I mean the bill to repeal it outright got out of there, including a couple of Democrats like Senator Ken Chevrons.
>>>Ted Simons:
Alright let's continue with the economy and a sense here jobless rate, big-time jump in numbers, and half a point?
>>Howard Fischer:
Half a point. We haven't had half a point jump since 1991 in the state jobless rate. Now, the number is not that high. We're still lower than the national jobless rate. But for us it's a big jump, and it shows what's been going on which gets back to the budget here. Companies are not hiring. They're laying off people. They don't need people. Retail is laying off people, because of the fact folks are not buying and people are spending the money on gasoline. Research will tell you if you spend more on gas that's less money for something else. Retailers are losing money, construction industry continues to tank. They are down 30,000 jobs from the same period a year earlier. And there's no sign of them hitting bottom just yet.
>>Ted Simons:
I was going to say, is there any look tote future saying this could, especially construction is so seasonal and just seems so volatile. But the retail I think is a real warning sign.
>>Mary Jo Pitzel:
There's the Job Stimulus Bill, Ted, that's, you know.
>>Ted Simons:
Oh that's right.
>>Mary Jo Pitzel:
If that passes, I mean, and premise is that without trying to be snarky, it will put people to work in construction, the problem is there's no numbers, they can't tell you how many jobs, but they think there will be lots of jobs.
>>Howard Fischer:
You get into the larger issue. This goes back to the new deal of does government spending and government tax credits, is that the way to stimulate the economy's opposed to use the other extreme from Russell Pearce statement, "let people keep more of their own money," and that's going to be the big fight.
>>Ted Simons:
All right. No real fight Mary Jo regarding C-P-S. Accountability bills, and it looks to me like these things, a bunch of them have passed. Can we talk more about that?
>>Mary Jo Pitzel:
Yeah, the House passed the final passage on this was four C-P-S Bills that aimed to open up records and provide more accountability. This is an agency that does a lot of its work in secrecy. I think there was a last minute glitch where based on the misunderstanding reading an earlier version of the bill but the sponsors overcame that so no no no we fixed that and opposition fell away.
>>Matt Benson:
This came out of a series of deaths in Tucson area, children killed. They were in the C-P-S System at one time or another. They were left with parents, guardians, who in one way or another ended up killing these kids. This really spurred the whole look at the whole system. Opening up the records, trying to shine a light into a system where there's really been criticism for a long time that it's hard to know what's going on. It's hard to know if cases are being mishandled.
>>Ted Simons:
Are there going to be tangible results because of these bills?
>>Howard Fischer:
Hard to say, for example, the public records now only deals with if it's a death or a near fatality. So it's not like all C-P-S Cases are going to be open to us, we're going to get to see it. Court hearings will be open so you can find out when C-P-S is trying to take a child. It's hard to know. I mean, on one hand everyone admits including the sponsor of the bills, that accountability absent adequate funding doesn't do everything. You need the best and the brightest. This is also a job I would never want. No matter what you do, we have watched the legislature in all the years I've been on the show; on one hand you have lawmakers saying the goal is to preserve the family. Do that at all costs, and then we go to the other extreme. The goal is to remove the child at the first sign of anything that might be wrong. And you swing back and forth and the social workers are stuck in the middle trying to figure out am I better off trying to preserve the family or do I error on the side of taking the child, who may not be in danger.
>>Ted Simons:
Regardless, these bills more than likely are going to be signed by the governor, this is something she's been pushing for as well?
>>Matt Benson:
It looks like it's possible, you know, I think the governor's office has had some issue with the personnel records, state employees, opening those up. If any of them get rejected I would put my money on that one, but frankly I think these may get approved and we'll see.
>>Ted Simons:
Ok. Real quickly, the governor did sign the real I-D Opting out of the real I-D Plan, even though she was in support of the idea and in concept. What happened here?
>>Matt Benson:
Basically with this Arizona more than roughly a dozen states opted out of real I-D The issue for the governor, it's an unfunded federal mandate, basically costing the states $4 billion to implement the system and hardly any federal money to pay for it. Also a lot of criticism is related to government intrusion, that it's a, you know, identity theft, all kinds of problems. This is that rare issue that has brought together Republicans and Democrats at the legislature, because everybody seemed to hate real I-D.
>>Howard Fischer:
In fact talk about, you know, unusual bedfellows this issue then the related issue of the governor's three in one license had the john birch society along with the A-C-L-U in the same room. Now, if you don't think that that caused some sort of weird dizziness, you know, you're wrong.
>>Ted Simons:
All right. Well, speaking of weird dizziness and a lot of people in the same room, we had hundreds of protestors showing up, more people probably than ever showed up to watch a county figure out its budget. Protesting Sheriff Arpaio, quite the show Thursday night. Mary Jo, without getting too specific on this kind of business, this county can give the sheriff -- they approved the budget, correct?
>>Mary Jo Pitzel:
Correct.
>>Ted Simons:
But they can't tell him what to do with the money.
>>Mary Jo Pitzel:
No, they can't. They can control the purse strings and protestors wanted county supervisors to pull in the reins and not give him much to work with because they object to the sweeps for illegal immigration.
>>Ted Simons:
Basically are they scoring points with the loud protests during these things?
>>Mary Jo Pitzel:
I think that budget got approved. I don't think there were any cuts beyond what was already planned to the sheriff's budget.
>>Howard Fischer:
That's part of the problem, see, unlike, for example, the state budget, you can give money to D-P-S and say I want to spend it only on gang enforcement or only spend it on more photo radar. It's harder since he's an elected official to tell him exactly how to spend it. You can put some strings on it, would result in a lawsuit. But if they were to cut his budget sharply, he would probably cut back on let's say road patrols or something else and he'd say, you know, you call Mary Rose and tell her this is because of her, and no supervisor want test get those calls.
>>Ted Simons:
Is that Broderick Crawford you were doing there?
>>Howard Fischer:
Hard to know. I don't do a good Joe.
>>Ted Simons:
And the question is, you know, they're thinking take the money away, don't let them do x, y, and z, up to and including what, going through Mayor Phil Gordon's email, all 10,000 pages of correspondence?
>>Howard Fischer:
You can't make the -- I love journalism because you can't make this stuff up. Phil Gordon made a comment that one of his staffers was profiled. And so Sheriff Joe says, well, I wonder if there's some conspiracy, something else going on here. I know, I will send down five sheriff's deputies with a scanner to stand there and get these documents, now copies of the documents would cost money. So I will stand there and I will have these five people at government expense standing there scanning it in, including several deputies to keep Ray Stern from the New Times from seeing what we're scanning in, I mean, you can't make this stuff up. I mean, the paranoia all around this is fascinating.
>>Ted Simons:
You can't make it up. Is it affecting Joe Arpaio's standing in the community at all?
>>Matt Benson:
We haven't seen it affecting it. And you mention he's an elected official, and he's immensely popular, more than any of the supervisors who are making the decisions on his budget. So he kind of gets to call the shots and --
>>Howard Fischer:
But part of what it's going to take is this is going to sound funny, it's going to take the mainstream media actually going and doing the kind of examination of what he's been doing with his money. New Times they've been doing their own job but a lot of people don't take it as seriously for a lot of reasons, but to the extent that the Trib. and Republic were to get in there and really take a look and do the proverbial --
>>Ted Simons:
Do you really think that would make a difference?
>>Howard Fischer:
I think it would make a difference. I think people see him on TV,Joe understands you go on T.V., stand there on the 10:00 news and you know, you shout back at Elias Bermudez, oh yeah, go get them, Joe. I believe, and maybe I'm putting too much faith in the media, after close to 40 years there, I'm probably guilty of that, but I believe that people don't fully understand how he's spending his money. They don't understand the money in Honduras. They don't understand the amount of money on lawsuits. They don't understand the amount of money and time spent gathering public records on the mayor. They see bits and pieces of it. They need somebody to pull that together.
>>Ted Simons:
High profile deaths in the county jails, high profile alien sweeps in the community, not enough?
>>Howard Fischer:
Not enough. That's the thing--You need to pull it together. You need to somehow, you know, you talk of -- Matt was talking about C-P-S and shining a light. Somebody needs to really shine a light on that agency, go through and find out where all the money's going
>>Ted Simons:
I want to leave tonight with a moment of silence for Copper Square. Arguably one of the worst area names in memory, Copper Square, which did anyone ever refer to downtown Phoenix as Copper Square?
>>Mary Jo Pitzel:
Yes, the Downtown Phoenix Partnership.
>>Ted Simons:
Yes the ones who coined the phrase. Anyone else?
>>Howard Fischer:
You know, it was - you cannot artificially put a name on something. You cannot suddenly decide that we're going to call it, you know, "No Jo," north of Jefferson or something.
>>Ted Simons:
Like someone giving themselves a nickname, call me "Kid," call me "The Ace."
>>Howard Fisher:
Has to be natural. You know, SoHo became south of Houston Street in New York because people called it that and SoSo became south of SoHo and Tribeca is the triangle below canal. It happens naturally. You cannot force it. You can spend hundreds of thousands of tax payer and business dollars; you cannot make it called Copper Square. There's no historical basis. Phelps Dodge now Freeport McMoRan having quarts there, does not make it Copper Square.
>>Ted Simons:
Any ideas for a new name?
>>Mary Jo Pitzel:
Hadn't thought about it. I'm wearing sort of a copper color.
>>Ted Simons:
I sort of that maybe this is the reason for this?
>>Howard Fischer:
How about downtown Phoenix? Going to go downtown?
>>Ted Simons:
Yeah, downtown. We can try that one. Do your Broderick Crawford again.
>>Howard Fischer:
I want you to know, I'm the most popular sheriff in the universe.
>>Ted Simons:
Good enough. I think we're going to leave it on that. Everyone thank you so much for joining us on Horizon. Monday on Horizon we begin a new four part series looking at things made in Arizona. Soleri wind bells made in Arizona, Monday on Horizon. Tuesday the latest results from the Cronkite-Eight poll. Wednesday we discuss the pros and cons of providing school districts and Thursday Matthew Whitaker will discuss African-American sports icons that are it for now. Thank you so much for joining us on horizon. I'm Ted Simons, you have a great weekend.
Mary Jo Pitzl:Arizona Republic;
