Legislative Update

March 4, 2015

Transcript:

Ted Simons: Good evening and welcome to "Arizona Horizon." I'm Ted Simons. A budget agreement is reached between the governor and republican legislative leaders. The question now is if leadership has the required votes to pass the plan. Here with more in our weekly legislative update is Jim Small, with the "Arizona Capitol Times." Jim, good to see you again. Thanks for being here. Busy day. Let's get right to it. Is this similar at all to the governor's plan? What are the differences?

Jim Small: Yeah, it is largely very similar to what governor Ducey had proposed in January. You know, revenue amounts are very similar. This deal has a little bit less than what the governor proposed, spending amounts basically almost identical. Some differences in where the money goes, kind of how that piece of pie is sliced up a little bit. You know, much like the governor's budget proposal, when it comes to K-12 funding, this doesn't address the issue going on in the courts in terms of these -- this $340 million increase that a trial court has said is required for K-12 funding. That is on appeal. Legislature things it should be closer to $74 million. That is what the governor said and what the legislative budget proposal would incorporate. Which in a lot of ways makes this whole thing a little bit, you know, this budget plan works for what it solves. If the deficit becomes bigger, things revert back to the drawing board.

Ted Simons: K-12, it looks like spending is actually up as opposed to a cut that the governor wanted. K-12, that's happening. But as far as universities are concerned, governor -- this one comes in at $104 --

Jim Small: Yeah, it does. Substantially larger cut to universities. Basically about 50% higher than what the governor was looking for. It is, however, not as high as a lot of republicans were actually looking to make the cuts. There was, you know, from what we have heard, a -- legislature had proposed about $140 million in cuts to the three universities. Compromise between the governor's office and GOP leadership, $104, $105 million. That is a lot of money. No doubt about it. Board of Regent president Eileen Klein took to Twitter actually today to decry the cuts and said this budget is bad and this should -- there comes a point where people who are negotiating the budget need to walk away from the table and this is a budget that should be really left on the table.

Ted Simons: Indeed. We had her on the show. She was saying that the 78 was not good and now we're up to $104. Is this a negotiating thing where we could wind up down to $90, and everyone will act like great things are happening?

Jim Small: You know, that's interesting. I know there is a lot of republicans. Republicans who we have heard are hold outs on the budget. As we sit filming the show, it doesn't look like they have the votes to pass this budget in either chamber. That is a very fluid situation. That is going to change. The goal is to try to pass the budget by the end of the week. Working Friday, Friday night, Saturday morning if necessary. A lot can happen down to the legislature between tonight and tomorrow morning, frankly, and, so, we will see how the votes stack up. There are a lot of republicans who don't like in particularly this higher ed cuts. They weren't happy with the $75 million, not happy with the number over $100 million. Whether they will be happy with a lower number, $90 million, whether they would be happy going back to $75 million, we have to wait to see.

Ted Simons: Community colleges, cut completely --

Jim Small: In terms of state funding it would be. Maricopa County and Pima county have a pretty large base of property taxes. Pinal county, I think may be less so. But this would eliminate all state funding. The governor had proposed eliminating half of the state funding that goes to the community colleges and essentially forcing them to more or less, I think pass that tax on to the property owners in the districts. You know, pass the difference on to -- in the form of a tax increase. This would do the same probably obviously at a larger rate.

Ted Simons: The discussions, do they ever include the idea that a tax increase is happening over here, a tuition increase might happen over here. Those de facto, if not realistic tax increases. I know this budget; they're excited that there are no tax increases.

Jim Small: You know, that is the beauty of the whole thing. They can claim Victory over -- we saw this three, four five years ago when we were going through the same issue with Governor Brewer. A lot of things handed down to counties and cities and the governor and legislature had the ability to say see, look, we didn't raise your taxes. We passed a budget that is balanced even though really at the end of the day, they push off a lot of, you know, unfunded mandates and pass some of these things on down to lower levels of government and say it is your problem now. You know, it is true what they say in a lot of ways. It does roll downhill, when you are at the state legislature, you are at the top of the hill.

Ted Simons: If you are a democrat at the state legislature, you are not on any hill at all. I would imagine they were not consulted much at all about the budget.

Jim Small: Correct. They had no input at all on this budget.

Ted Simons: Will they have input -- could a coalition form among those who aren't happy with certain, especially university cut aspects of the budget.

Jim Small: I think coalition is not the right word. I think you will see democrats, I think, I would be surprised if not universally. Always a chance you get one or two that get persuaded to vote for it. Most likely democrats are going to oppose this in mass. There is going to be a handful of republicans that will oppose it. If it is enough in the Senate, it only takes two republicans. We're hearing there is four, five, maybe six republicans in the Senate that are not on board. It takes two of them to stand against the leadership -- and the democrats would obviously be nos on the budget and that would stop it.

Ted Simons: Just your general thoughts, by the end of the week, do you think something will happen by the end of the week?

Jim Small: Right now, I'm probably a little pessimistic on that happening, but, again, you know, things change. These situations are very fluid and, you know, there is no doubt there will are be horse trading, arm twisting, a lot of stuff happening behind closed doors, someone steadfastly against the plan today come tomorrow morning or afternoon might be for it because the issue maybe they most objected to has changed or there is funding that is restored maybe for something in their neck of the woods. For the most part it seems like rural lawmakers largely at this point -- leadership is trying to make sure to find ways to get the rural lawmakers on board.

Ted Simons: Interesting. We will keep an eye on that. Good to have you here. Thank you for joining us.

Jim Small: Thank you.