Legislative Update

June 17, 2009

Transcript:

Ted Simons: Good evening, welcome to "Horizon." I'm Ted Simons. Plenty of drama at the state capitol this week, most of it related the to the state budget. Yesterday the governor took the battle with lawmakers to the Arizona supreme court. Here with the latest is Jim Small from the Arizona Capitol Times, a lot has happened since Wednesday. Any developments today on all this stuff?

Jim Small: The only real development today is that the governor's staff and legislative staff kept the meeting on the budget and the house speaker and senate president were scheduled to meet with the governor this afternoon. Just to kind of get, excuse me, get an update and figure out where, you know, what staff had talked about and what agreements had been reached.

Ted Simons: Ok, so we've got the governor basically taking this legal action. Is this -- how's this playing down at the capitol? Is she changing any minds with this at all?

Jim Small: I don't think she is at all, if anything it's making republican lawmakers rank and file lawmakers stand even firmer behind their leadership in this issue. I mean, they supported the budget that is a question here, and they support their leadership in not sending those bills to the governor, and instead using it to negotiate, you know, some kind of a compromise agreement with her. So, you know, it hasn't really done much. I think if anything though it has probably has maybe, you know, solidified some opposition to the way she's approached this issue.

Ted Simons: Now, how about her idea of a concession of sorts regarding the sales tax increase, not for 2010, get the vote in there and use it for 2011. A bit of a concession there by the governor, again, changing any minds at all?

Jim Small: Well, you know, that's something actually I think we talked about last week, you know, and it was the thing that leaked out last week when senate president Bob Burns said we have a tentative agreement on part of the budget. That's what this was all about, and really what happened this week was governor B
Brewer kind of confirmed that that was something that they'd talked about and that was a concession that they'd reached and house speaker Kirk Adams talked about it yesterday and acknowledged that, you know, they had talked about this idea of not including a sales tax, any revenue from a sales tax in the upcoming year and 2010, but putting something possibly on the ballot in the fall and using any money you collect from that to then fund the upcoming year in 2011. So it's something that I think is still being kind of shopped around within republican circles and they're trying to figure out a way, you know, for some of the republicans to save face by putting something on the ballot that raises taxes which is an issue most have diametrically opposed too.

Ted Simons: Within the governor's circle, how is it justified ok, we can wait another year for the one cent sales tax increase, this billion dollar revenue, how does that justify, when you still have got a billion dollars difference, according to the governor's office, between her numbers and their numbers?

Jim Small: It's important to note the billion dollar difference is a $4 billion deficit in the governor's plan versus a $3 billion deficit in the republican legislative plan. A lot of that depends on where you start, it's kind of an apples and oranges comparison. The governor doesn't include any of the cuts made in January. The republican budget includes those in the baseline so you add the cuts back in and you add som of the caseload the differences together and realistically they come to the same place, anticipating close to the same amount of revenue and expenditures are both in the same ballpark. So, you know, even though there's this talk about a difference of a billion dollars it's really kind of an accounting mechanism more than anything. But as far as how the governor would propose to make up this billion dollars not from no sales tax in the 2010 fiscal year, I think that's really part of the negotiation and part of what we've seen happening between the two sides here and obviously what's happened has been that there's been some kind of agreement regarding, you know, how can we make up this extra money, you know, the republican plan doesn't include any extra taxes, so they believe that they can certainly go out and pass a budget that doesn't have to include additional revenue, so my guess is that they reached a compromise on some of those issues and decided to move forward.

Ted Simons: Interesting, all right. The concept of a government shutdown. How serious is this talk around the capitol?

Jim Small: It's something that I think every day on the calendar ticks by it's becoming a little bit more serious, people are certainly looking at it, the governor's brought the issue up with reporters, mentioned it to reporters and mentioned it to other lawmakers, the Democrat lawmakers, and she's even directed the department of administration to start doing some of the legwork to figure out exactly what would happen if government shut down and what services would be affected, what would be mandated to stay operational and kind of how the entire procedure would work.

Ted Simons: Continuing resolutions likely to keep things going, month to month or by week? I mean, for however long it got?

Jim Small: That could be an option. I know the governor's office and house and senate are all independently examining their potential options should it come down to June 30th and there isn't a budget in place so my guess is that, you know, if another week goes by and we haven't seen any meaningful progress on this budget between the budget negotiation that we'll start to hear some of the actual procedural ways this will be implemented.

Ted Simons: But the talk is there are agency heads looking at this and at least initial preparations are under way.

Jim Small: Yeah, absolutely. And, you know, frankly they probably have to be. We only have two weeks left. You can't put off some of the early plannings. You can't do this all in a span of 12 hours once you get down to right at the very end, so they're doing some of the preliminary work and then trying to get ready and hopefully it won't be necessary and everyone involved says they don't expect it to be necessary. They expect to have a deal done in place but there is a contingency.

Ted Simons: Democrats in all of this, obviously on the sidelines, they don't want to be on the sidelines, but they are. Is there a chance, it sounds like the governor's ignoring them, legislative leaders are ignoring them, are they just waiting for someone to come and say we want you to play, or are they just going to be on the sidelines for the whole thing?

Jim Small: I think they're waiting for someone to say come play but I talked to the house majority leader David Lujan today and he said it's clear they're not getting an invitation. They only have two weeks left and the governor already told them she doesn't plan on inviting them to the table and republican lawmakers have yet toreally invite them seriously to any kind of talks so I think there's a little bit of a resignation that ok, well, this is the way it's going to work. They're just going for republican votes and we'll be here when and if they need something, but in order for that to happen they need to make some concessions to meet our needs and meet the priorities of the democratic caucus.

Ted Simons: Sounds like both sides between the republican legislature and republican governor figure that they're going to get what they need without democratic help, huh?

Jim Small: That's certainly seems to be the strategy so far, and I mean, has been up to this point. I don't think it's changed.

Ted Simon: We have a court date what, next Tuesday, to figure out the supreme court's even going to look at this thing?

Jim Small: Yeah, for the lawsuit over whether the legislature needs to send those budget bills they passed on June 4th up to her. Supreme court's going to hear arguments and decide whether it's worth -- whether it's their role I guess step in and really rule on the issue.

Ted Simon: And until then with all this going on, they're still meeting, aren't they?

Jim Small: They are still meeting. In fact when governor brewer held her press conference to announce negotiations had broken down, staff was meeting at that point. You know when she went and filed the lawsuit yesterday, staff was meeting. So it's been kind of odd to see these things happening on the surface but then underneath you still have, you know, the normal negotiations going on.

Ted Simons: All right. Good stuff, Jim, thanks for joining us, we appreciate it.

Jim Small: Thank you.