Vote 2014: No on Proposition 480

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The Arizona Tax Research Association says a proposition to provide nearly $1 Billion to the Maricopa Integrated Health System should not be approved. The pro side of the argument recently discussed Proposition 480 on Arizona Horizon. Kevin McCarthy, President of the Arizona Tax Research Association, will talk about why Maricopa County voters should not approve the measure.

Richard Ruelas: The Arizona Tax Research Association says a proposition to provide nearly $1 billion to the Maricopa Integrated Health System should not be approved. The pro side of the argument discussed proposition 480 last week here on "Arizona Horizon." Kevin McCarthy, President of the Arizona Tax Research Association is here to tell us why Maricopa County voters should not approve the measure. Thanks for joining us.

Kevin McCarthy: Thank you, Richard.

Richard Ruelas: Last week when the pro side was on there was a discussion that there was really no organized opposition to it. Are you the organized opposition to the proposition?

Kevin McCarthy: That might have been premature on their part to say that. We've organized a campaign to try to defeat proposition 480. I think there's widespread opposition to that. I doubt we will have the financing that they have, but we will give it our best effort.

Richard Ruelas: And tell us what the no argument is.

Kevin McCarthy: You know, there's a lot of reasons why we think this is a particularly bad idea. I think the top one is that this is an extraordinarily large tax increase that the Maricopa Integrated Health System is asking for. Quite frankly, it's coming from an entity we think ought to be looking aggressively at downsizing. Operation is not dramatically expanding it. For voters that have been around a while, they might note the $930 million request sounds like a lot of money. It is. It is the third largest bond request in the history of the state of Arizona. Compare that with entities with rather comprehensive requests in terms of taking care of the citizen City of Phoenix, Tucson, Maricopa County. This is a special district with a narrow public purpose asking for $935 million, $1.4 billion over the next 30 years. We think they ought to be, instead of expanding their spray, ought to be looking aggressively to narrow that and working with private hospitals who don't support this, to try to work in conjunction with taxpayers so we don't duplex indicate funding. We've been through a lot with health care in recent months with the expansion of Medicaid in Arizona, and my organization being a taxpayer organization surprised some folks that we supported Medicaid expansion. We didn't think there was any other choice associated with that with the propositions that we were asked to live by. However, it's an extraordinarily expensive undertaking. We're spending billions of dollars to deliver health care funding to the poor. We shouldn't duplicate any of those expenditures if we can avoid it. That's where we continue to, with a hospital that in many respects is sort of a relic of the old days, where the county was the payer of last resort.

Richard Ruelas: The county deals a lot with uninsured patients. One of your arguments is we should expect fewer uninsured patients?

Kevin McCarthy: Not only do we think that's the case, that's the case now. Since Medicaid expansion was put into place there were 300,000 more Arizonans on AHCCCHS since January 1st, a full 25% of the Arizona population is on AHCCCHS. We can argue whether that's good or bad or if it's going to change over time. I don't think it's going to. I think this role the government is going to play in providing health care for the poor isn't going reverse itself. All we've seen since AHCCCHS was created is a steady growth of that. We think that's also another clear argument that what the future holds for delivering shaky for the poor is going to be through the private hospitals that already do that. There are significant concerns that this proposal committee unnecessarily so in that space.

Richard Ruelas: There is a private hospital that wants to take over or do that type of care?

Kevin McCarthy: We're not getting an opportunity to debate that. We're getting an opportunity to debate just what the Maricopa Integrated Health System wants, which is $935 million to expand their operation.

Richard Ruelas: But if private hospitals want to compete with this or get some of this, it would seem like -- because obviously the medical center they say will be right-sized -- I take to mean down sized. I don't know a private hospital that wants to do that.

Kevin McCarthy: Saint Luke's has already begun to do that, and there's a burn center over there. I don't know whether or not -- if that could be transferred in its entirety over there I don't believe that's the singular question here. It is brought up a lot, that the burn center is the most comprehensive burn center, not only in Arizona but in the southwest. And I might add, what Maricopa County taxpayers, in addition to questioning the size of this, ought to question in the total framework for delivery of health care what, role they are playing and why are they playing the role they are playing. Why is it Maricopa County taxpayers fund an entity that looks very much like a statewide entity. Pima County taxpayers are encouraging us to pass this. I find that curious. But Maricopa County taxpayers are being asked to important something that clearly is no long and are county responsibility.

Richard Ruelas: Right. And the opposition -- I mean, the organized opposition, are you getting funding from private hospitals you mentioned they are against this. Are they funding you.

Kevin McCarthy: We're going to try to get funding from under every rock we can find it. The private providers that fund at least 80% of all the private care in the Valley have come out in public statements and possessing -- hopefully we'll do everything we can to try to secure funding from them and taxpayers alike to spread the message we need to spread, which is that this is -- if this was a good idea, chits not, it's horribly timed -- the taxpayers of Maricopa County had just come out of the worst period in my career, and maybe the history of the state of Arizona, where we lost incredible amounts of property value, the effective tax rates on property tax payers is much higher today than it was in 2009 before we went into the recession. This is loading on them an extraordinary responsibility the property tax base isn't prepared to handle.

Richard Ruelas: Again, as we wrap up, have hospitals written a check to you?

Kevin McCarthy: I'm not sure how many -- what this -- we're going to do everything we can to secure all the funding we can from everybody.

Richard Ruelas: Excellent. Kevin, I'm sure we'll have you back as the campaign continues. Appreciate you joining us tonight.

Kevin McCarthy: Thank you.

Richard Ruelas: Thank you.

Kevin McCarthy:President, Arizona Tax Research Association;

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