Legislative Update

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An Arizona Capitol Times reporter provides a mid-week legislative update.

Ted Simons: GOOD EVENING AND WELCOME TO "HORIZON" I'M TED SIMONS. LAWMAKERS CONTINUE THEIR SPECIAL SESSION FOR FINDING SOLUTIONS TO THE STATE'S BUDGET CRISIS. JOINING ME NOW WITH THE LATEST IS ARIZONA CAPITOL TIMES REPORTER JIM SMALL. JIM, THANK YOU FOR BEING HERE.

Jim Small: THANK YOU FOR HAVING ME.

Ted Simons: BOY, SALES TO THE SPENDING?

Jim Small: LAWMAKERS SPENT NINE MONTHS OF THE YEAR BICKERING ABOUT IT WE HAD A HANDFUL, THREE OR FOUR MAYBE VOTES WHERE IT LOOKED LIKE SOMETHING MIGHT GET THROUGH AND IT DIDN'T. THINGS FELL APART.

Ted Simons: WHAT HAPPENED DIFFERENTLY THIS TIME?

Jim Small: THE MAIN THINGS THAT HAPPENED DIFFERENTLY TO TIME IS DEMOCRATS, ESPECIALLY IN THE SENATE, HAD SAID FOR A GOOD SIX MONTHS PROBABLY IF WE'RE GOING TO DO THE SALES TAX INCREASE AND PUT IT ON THE BALLOT, WE WANT THAT TO BE ALL THAT'S IN THIS PACKAGE. WE DON'T WANT IT TO BE TIED TO SPENDING CUTS, TAX CUTS OR THINGS LIKE VOTER INITIATIVE REFORM OR VOTER CONSTITUTIONAL PROTECTION REFORM. AND THAT'S WHAT THEY GOT THIS TIME. THEY GOT -- I MEAN, THIS IS -- THERE'S SOME -- THERE'S SOME OTHER MEASURES THAT ARE BORROWING RELATED BUT FOR THE CURRENT FISCAL YEAR, IT'S TO FIX THE DEFICIT WE HAVE RIGHT NOW. AND THE ONLY THING FOR THE UPCOMING BUDGET THAT'S INCLUDED IN THE SPECIAL SESSION IS THIS SALES TAX REFERRAL. SO ESSENTIALLY, THEY GOT -- IT'S NOT MUCH BUT THEY DID GET ONE OF THE THINGS THEY WERE ASKING FOR.

Ted Simons: IT SOUNDS LIKE THEY ALSO WERE PART OF THE NEGOTIATIONS. NOW, A, IS THAT TRUE? AND B, HOW MUCH A PART?

Jim Small: I THINK IT'S CLEAR THAT SENATE DEMOCRATS WERE AT LEAST CONSULTED IN SOME WAY ABOUT WHAT WAS HAPPENING OR THEY AT THE VERY LEAST TOLD THE GOVERNOR'S OFFICE AND SENATE PRESIDENT BOB BURNS, LOOK, THIS IS WHAT WE WANT, AND IF YOU CAN DO THIS, WE WILL WORK WITH YOU GUYS. AND OBVIOUSLY THEY MET THEIR REQUIREMENTS AND THEY VOTED IT OUT. THE DEMOCRATS WERE SPONSORS. DEMOCRATIC LEADERSHIP WERE SPONSORS ON EVERY ONE OF THE BILLS.

Ted Simons: EARMARKED AGAIN SOME OF THIS MONEY NOW EARMARKED FOR EDUCATION, HEALTH, WELFARE, SAFETY, THESE SORTS OF THINGS AND THEY WANTED THAT IN THERE AS WELL?

Jim Small: YEAH, AND THAT CERTAINLY WAS ONE OF THE THINGS THAT GOVERNOR BREWER HAD BEEN LOOKING FOR AND HAD BEEN TALKING ABOUT, YOU KNOW, AS A WAY TO SELL IT TO VOTERS, I THINK, MAINLY.

Ted Simons: A STATE LOTTERY ALSO REAUTHORIZED?

Jim Small: YEAH, THAT'S ANOTHER ONE OF THE BILLS. IT'S NOT EVEN REALLY TECHNICALLY REAUTHORIZED. IT'S LIKE IT CREATES A NEW LOTTERY. CURRENT LOTTERY IS SET TO EXPIRE IN I THINK A YEAR OR A YEAR AND A HALF AND THIS ONE, INSTEAD OF GOING THROUGH THE PROCESS OF DOING WHAT IS CALLED A SUNSET REVIEW WHERE YOU REAUTHORIZE THAT PROGRAM FOR ANOTHER 10 YEARS, THIS CREATES A NEW ONE. AND THE WHOLE REASON FOR DOING THAT IS THAT IT ALLOWS THEM TO BORROW AGAINST FUTURE LOTTERY REVENUES NOW. THE PROBLEM WITH HAVING TO GO THROUGH A REAUTHORIZATION PERIOD YOU CAN'T BORROW FOR REVENUE YOU'LL GET THREE OR FOUR OR FIVE YEARS FROM NOW BECAUSE A FINANCIAL INSTITUTION IS GOING TO LOOK AT IT AND GO, WELL, YOU SAY IT'S A SURE THING IT'LL BE HERE BUT WE DON'T KNOW THAT FOR SURE THIS BASICALLY LETS THE LOTTERY CONTINUE IN ITS CURRENT FORM EVEN THOUGH IT'LL TECHNICALLY BE A NEW LOTTERY.

Ted Simons: THE, UM, -- AND ALSO BORROWING AGAINST FUTURE LOTTERY PROCEEDS AND AGAIN FOR MORTGAGING THE STATE BUILDINGS AGAIN, WE'RE BACK AT THAT AS WELL MAKING IT OUT OF THE SENATE, WAS THE GOVERNOR INVOLVED MUCH IN HELPING SHEPHERD THIS STUFF THROUGH?

Jim Small: I THINK IT'S CLEAR THAT SHE DID DEFINITELY TALK TO DEMOCRATS, AT LEAST SOME OF THEM, AND TRY TO MAKE SURE THAT SHE WOULD HAVE THEIR VOTES AND THAT WE WOULDN'T END UP WITH SITUATIONS LIKE WE HAD LAST YEAR. I MEAN, YOU KNOW, WHAT ENDED UP HAPPENING IS YOU HAD ABOUT HALF THE DEMOCRATIC CAUCUS AND HALF THE REPUBLICAN CAUCUS WHO SUPPORTED THIS THING IN THE SENATE SO -- SO, YOU TRULY DID NEED BIPARTISAN SUPPORT TO GET THIS OUT AND THERE WAS BIPARTISAN OPPOSITION AS WELL.

Ted Simons: OK, OVER IN THE HOUSE, THINGS GOING AS SMOOTHLY?

Jim Small: THEY -- WELL, SO FAR THEY ARE BUT WE HAVEN'T REALLY GOTTEN TO THE BILLS YET. THEY'RE PLANNING ON DOING IT TOMORROW. DOESN'T LOOK LIKE THINGS ARE GOING TO GO AS SMOOTHLY. HOUSE REPUBLICANS ARE NOT NECESSARILY ON BOARD WITH THE WAY THAT THIS THING IS SET UP. THEY -- A NUMBER OF THEM THAT I TALKED WITH SAY THEY'D LIKE TO SEE BIGGER CHUNKS TAKEN OUT OF THE 2011 DEFICIT. IT'S ABOUT $3 BILLION OR SO RIGHT NOW. ALL OF THIS DOES IS PUT A SALES TAX ON THE BALLOT AND DOESN'T DEAL WITH ANY OF THE OTHER SPENDING MEASURES OR ANY OF THE OTHER BORROWING, ANYTHING ELSE. OTHER PEOPLE SAY, YOU KNOW, THE HOUSE JUST PASSED A JOBS CREATION PACKAGE LAST WEEK. WE REALLY WOULD LIKE TO SEE THE SENATE MOVE FORWARD ON THAT AND POSSIBLY GET THAT TO THE FLOOR AND VOTE IT. IF THAT HAPPENS, AT LEAST WE'RE GIVING BUSINESSES SOME IDEA OF TAX CUTS DOWN THE LINE SO THAT WOULD MAKE IT OK TO VOTE FOR A SALES TAX INCREASE.

Ted Simons: I WAS GOING TO SAY, BUT IF THAT HAPPENS, SOUNDS LIKE YOU CAN FORGET ABOUT ANY DEMOCRATS JUMPING ON BOARD, BECAUSE IT SOUNDS LIKE WHAT THEY DON'T WANT TO HAPPEN IS FOR THOSE -- YEAH, THE 1 CENT SALES TAX INCREASE BASICALLY BACK FILLING WHAT THEY SEE AS FUTURE TAX CUTS AND LOSS OF REVENUE.

Jim Small: THAT'S EXACTLY IS A NUMBER OF DEMOCRAT LEADERS SPOKE TO DAVID LUJAN YESTERDAY. HE SAID I'M WAITING TO SEE WHAT WILL HAPPEN WITH THE JOB TAX CUT BILL BECAUSE I HAVE A PROBLEM WITH PUTTING SOMETHING ON THE BALLOT AND ASKING VOTERS TO RAISE TAXES AND ONLY TO HAVE OTHER LAWMAKERS TURN AROUND AND TAKE MONEY AND ADD TO THE DEFICIT BY GIVING AWAY TAXES.

Ted Simons: THAT'S GOING OUT OF THE HOUSE YESTERDAY ON "HORIZON." WE HAD REPRESENTATIVES KOPINICKI AND CAMPBELL. REPRESENTATIVE WAS A SPONSOR OF THE STEALTH BUDGET OR ORPHAN BUDGET. IT'S BASICALLY AN ATTEMPT -- AND WE HAD A DEMOCRAT AND REPUBLICAN TALK ABOUT IT, SEEMINGLY GETTING ALONG WITH THE IDEA OF A COMPROMISED BUDGET. HOW MUCH STEAM IS THIS GETTING DOWN THERE?

Jim Small: IT'S CERTAINLY GENERATING A LOT OF DISCUSSION. I THINK THAT'S ONE OF THE THINGS THAT'S REALLY A MAJOR PURPOSE OF THIS FROM EVERYONE I'VE TALKED TO THAT'S BEEN INVOLVED IN IT. I SPOKE WITH MR. KOPINICKI AND REPRESENTATIVE CAMPBELL AND NUMBER OFF PEOPLE. THE IDEA IS TO GENERATE DISCUSSION ABOUT ISSUES THEY FEEL HAVEN'T BEEN TALKED ABOUT ENOUGH, THINGS LIKE THE AMOUNT OF DEBT THAT THE STATE HAS ALREADY INCURRED AND WHAT IT'LL HAVE TO INCUR IN THE FUTURE. SHIFTING COSTS DOWN TO COUNTIES TO HEALTH CARE COSTS TO HOSPITALS AND WHAT SORT OF AN IMPACT THAT HAS. WHAT EDUCATION IS GOING TO LOOK LIKE IN THE NEXT FIVE OR 10 YEARS IF WE WITH THE CURRENT LEVEL OF CUTS AND IF FUTURE CUTS GO FORWARD. YOU KNOW, I KNOW MR. KOPINICKI TOLD ME TODAY HE'S GOING TO SPONSOR THAT LEGISLATION. THEY'RE WORKING ON GETTING IT DRAFTED. I TALKED TO ANOTHER DEMOCRAT FROM TUCSON NAMED MATT HEINZ WHO TOLD ME HE ALSO OFFERED HIS NAME UP TO BE THE DEMOCRAT CO-SPONSOR. HOUSE SPEAKER KIRK ADAMS PROMISED ANYONE WHO BRINGS FORWARD BUDGET BILLS WILL HAVE ABLE TO HAVE THEM HEARD AND GET DISCUSSED. THAT'S THE ULTIMATE GOAL.

Ted Simons: THAT'S NEWS BECAUSE OF LAST NIGHT, KOPINICKI SAID HE HADN'T FOUND A CO-SPONSOR AS OF YET BUT HE'S LOOKING. IT'S NICE HE FOUND ONE. CO-CHAIR KAVANAUGH WANTS NOTHING OF IT. IT DOES INCLUDE FOOD TAX, HEALTHCARE TAX, AND INCOME TAX HIKE, IT INCLUDES FUTURE CORPORATE TAX CUTS. THERE'S SOMETHING IN THERE FOR EVERYONE. KAVANAUGH SAYS I DON'T WANT TO SEE IT HEAR IT, KNOW ABOUT IT BUT IT SOUNDS LIKE THE SPEAKER SAYS YOU PUT IT IN BILL FORM AND WE'RE GOING TO HEAR IT.

Jim Small: WE'RE GOING TO HEAR IT. DOESN'T NECESSARILY MEAN IT HAS TO BE IN APPROPRIATIONS, I SUPPOSE. THERE'S CERTAINLY OTHER WAYS TO IT. THE PEOPLE THAT WERE SORT OF RESPONSIBLE FOR COMING UP WITH THESE IDEAS, THEY'RE NOT NAIVE. THEY DON'T THINK THIS'LL BE PASSED AND ADOPTED AND EVERYTHING WILL BE ROSY HERE IN THE NEXT MONTH. THEY UNDERSTAND THAT YOU KNOW, BILL KOPINICKI TOLD ME, LOOK, I KNOW THIS WON'T GET PASSED. IF THIS GETS PASSED AT PROBE, I'LL BE SHOCKED. WHATEVER COMES OUT, THE FINAL VERSION OF THE BUDGET WON'T LOOK LIKE THIS. IT'S NOT A FINAL VERSION, IT'S MEANT TO BRING FORWARD IDEAS AND GENERATE DISCUSSION.

Ted Simons: OK, NOT ONLY THAT BUT ALSO LET PEOPLE KNOW THERE'S SOMETHING ELSE BUBBLING AROUND THERE IN CASE EVERYTHING ELSE FALLS APART.

Jim Small: SURE. LET PEOPLE KNOW THE TWO SIDES CAN COME TO WORK TOGETHER GIVEN THE RIGHT CIRCUMSTANCES AND RIGHT APPROACH.

Ted Simons: UNBELIEVABLE. JIM, THANK YOU SO MUCH FOR JOINING US. WE APPRECIATE IT.

Jim Small: THANK YOU.

Jim Small:Arizona Capitol Times;

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