Journalists’ Roundtable

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Three local journalists will discuss the week’s big stories.

TED SIMONS: Coming up next on "Arizona Horizon's" "Journalists' Roundtable," Governor Doug Ducey announced plans to boost education funding. And the Secretary of State's fight with the Clean Elections Commission ramps up. The "Journalists' Roundtable" is next on "Arizona Horizon."

VIDEO: "Arizona Horizon" is made possible by contributions from the Friends of Eight, members of your Arizona PBS station. Thank you.

TED SIMONS: Good evening and welcome to "Arizona Horizon's" "Journalists' Roundtable." I'm Ted Simons. Joining us tonight Steve Goldstein of KJZZ-FM Radio, Bob Christie of the Associated Press, and Luige del Puerto of the "Arizona Capitol Times." Governor Ducey this week announced a plan to increase funding for education. Steve, give us an overview of what's going on here and we'll try to pick through the weeds a little later on. What's happening here?

STEVE GOLDSTEIN: Ted, a lot of Arizonans probably in the last 24 hours have learned what the state land trust is, they have probably never heard of it before. Governor Doug Ducey has decided to take a higher percentage than has been going to education, moving it from 2.5% up to 10% of that endowment for the next five years of this plan. I believe it goes back down to 5% from there. Governor Ducey has heard the cries, Arizona is 50th on state spending on education. This plan would allow him to raise money without raising taxes at this time.

BOB CHRISTIE: This will increase school funding per student by about $300. He's tapped into the $5.1 billion cash value of the state land trust. He is essentially going to draw down about $2 billion of that, $2.2 billion over the 10-year period. They say after five years it'll be about the same, instead of $7 billion. It's been there for 102 years, to create a dedicating funding stream for schools. The Governor says we need the money now, we need to quicken the pace of payouts.

LUIGE DEL PUERTO: As Tom pointed out, this proposal would need the approval of both the legislature, and because it's going to be an amendment to the state constitution it would need voters' approval, as well. This will happen, will start, assuming the voters approve it next year in between, funding starts in the next fiscal year.

TED SIMONS: Right now we're taking 2.5% out of the state land trust and that's kind of ebbed and flowed but that was steadied by Doug Ducey.

STEVE GOLDSTEIN: When he was state treasurer, exactly. I want to go back to the criticism of this. But it hasn't been that loud yet. Education pressed some concerns, we don't know what's in the plan yet. Peterson led the fight to get the sales tax made permanent. She says it's smoke and mirrors and he's touching this trust that shouldn't have been touched. It's just his way again of not raising taxes.

TED SIMONS: This touches principle, not the 4% rule we hear about taking out of trust funds. This is 10% for five years, a lot of money.

BOB CHRISTIE: It's like your 401(k) fund, consider it as that. You can start to pull 4 or 5% out of your 401(k) fund and the principle remains. It's the same principle with the trust land fund. It's supposed to finish off a certain amount of money every year that goes to schools. It's been about $80 million a year. The Governor wants to boost that between $320 and $375 million each of those five years, and draw down about $2 billion of the five.

LUIGE DEL PUERTO: That is why there are critics to the proposal and also why it is temporary. A five-year drawdown of that 10% goes to 5%, and at the end of the 10th year goes back to 2.5%. The presumption is that this trust fund cannot sustain a 10% drawdown in perpetuity every year.

BOB CHRISTIE: The first five years they are drawing down 10%, then they draw down enough principal that it's only going to be about $100 million more a year. The excess funding for schools is not that great once the Governor has been in office about seven years.

TED SIMONS: Supporters of this, including the Governor obviously, say that this is -- this money is just sitting there, obviously it's working but it is there, it's available. It makes no sense when the state is so strapped in terms of education -- and apparently we are not going to raise taxes -- it's makes no sense, let's use it.

STEVE GOLDSTEIN: As Bob said, this has been in effect for nearly 103 years now and it's supposed to be living for another century or so. You're not really supposed to risk it. A lot of people didn't really think about the state land trust. Doug Ducey knew about this, having been the state treasurer.

TED SIMONS: That's a good point. My question is, folks are saying that is a brilliant political move. You aren't raising taxes, you've got all this money and they are praising the Governor for this. Why didn't previous governors do this?

BOB CHRISTIE: It's been talked about for the last year and a half or so by several people I've talked to in my reporting. A big Jan Brewer supporter for many years, Chuck Coughlin, five, six years ago there was only $2.5 billion in funds. They lost value in property and equities and they were hit as badly as everybody else. They are now at $5.1 billion, projected to grow to $7 billion within five years. It's really come back and is ready to be able to -- ripe for picking in the Governor's view.

LUIGE DEL PUERTO: I've talked to several leaders, public education advocates. They are cautiously welcoming this proposal. They see the need for more K-12 funding and this is what it does. It'll bring in more money. The criticisms I'm hearing are essentially twofold. One, it's temporary. Which means it's not a long-term fix for the problems in K-12 and higher education funding. And two, you're facing cuts. I talked to one superintendent from Phoenix this afternoon and she said, this is great but we have to plan really carefully. 90% of our budget goes to people and those people help our schools -- make our schools better. If we're cutting by going down to $100 million by the fifth year, what are we going to do? How are we going to pull back our spending at that point?

BOB CHRISTIE: The Governor's office does craft -- or describe this plan as in their view a long-term plan, a 10-year plan. Well a new governor after 10 years could renew it. The economy will probably be better, taxes will be back up. Next, Governor Ducey has pledged to cut taxes every year of his term. Whether those moneys really show up and are there, we'll have to wait and see.

STEVE GOLDSTEIN: It puts down the K-12 education commitment. When is the state going to pay that money as in fact it has to. As Bob said, it's a temporary plan but still makes people wonder, you're not going to raise taxes at all. Things get more expensive as years go by.

TED SIMONS: This is separate and apart from the funding.

BOB CHRISTIE: He mentioned the K-12 lawsuit. This could be a pathway to settlement of the K-12 law enforcement, the Court has ordered the state to pay $336 million this year and starting June 6th another $334 million. We're talking about a billion and a half dollars that are owed, ordered to the judge, they have been in mediation. Whether the governor thinks offering money two and a half years from now will settle it, I don't know.

LUIGE DEL PUERTO: And that's a key point you mentioned. The education community doesn't want this money to be supplanting money that's supposed to be owed to the schools to begin with. And you know, it's funny because all obviously the education community need this money, they want this money. They want to see details. I talked to a school finance expert and it's really technical but he's saying we also want to see how this is going to be distributed. Will it be the usual formula or will there be strings attached to it? Are there going to be mandates?

TED SIMONS: I think Diane Douglas' office came out with some of those same questions, especially distribution.

BOB CHRISTIE: And Andrew Morrow who has the education association, the Governor has a reform agenda for education outside of this funding plan. He wants to funnel more money into high performing schools, replicate them. He wanted to remove principals of low-performing schools. If you distribute it to winners and there's losers, that's what this is concerning it. So that there aren't winners and losers.

STEVE GOLDSTEIN: I think this is a Crossroads to the business community to some extent. They have come out really enthusiastic for this. Glen Hammer says this is a terrific plan. Ed from Chambers loves it too. If you're just treading water, does it look like that to other states and other businesses?

TED SIMONS: You started by saying people have learned more about the state land trust procedures than ever. A quick overview: How does it work, how long has been it been in place, what is it designed to do.

BOB CHRISTIE: The federal gift is one out of every 35 parcels to the state to fund schools and a bunch of other smaller things. That's been around for 102 years. When the parcels are sold the cash goes into the permanent land trust. The interest from that money goes to the beneficiaries. 93% of that goes to the K-12 schools.

TED SIMONS: The Governor thinks it'll increase to $5.1 billion.

BOB CHRISTIE: But it would be $7 billion if he didn't.

TED SIMONS: There's always that "if" in there.

TED SIMONS: Steve, Michele Reagan is the Secretary of State. And she was kind of a crusader against dark money as a lawmaker. Seems like she's changing positions quite a bit. What's going on here?

STEVE GOLDSTEIN: She apparently has decided Clean Elections Commission is overstepping its bounds, in terms of how it's determining what expenditure groups can spend. One group has had issues with the Clean Elections Commission is a group that spent some money to go against then gubernatorial candidate Scott Smith a former mayor of Mesa. A lawsuit said what they did was okay, collections is appealing this. We don't think you can appeal, we think you're overstepping your bounds.

So there's a lot of fighting right there.

TED SIMONS: Again, they ran this anti-Scott Smith ad very late. Clean Elections says no, that's an example. And they fined them.

LUIGE DEL PUERTO: Because collections included was an issue. The timing of the, the content of the ad, the way it went after Scott Smith, this was an electioneering campaign. They taxed Scott Smith for being the head of the U.S. conference of mayors. But it was so close to his announcing that he was running for governor and, you know, the test is what would a reasonable voter think once that person sees that ad? Is it really issued advocacy? Well, Clean Elections Commission said it is electioneering and not advocacy.

TED SIMONS: The Secretary of State agreed, he thought it was advocacy and dismissed all of this. Clean Elections Commissions says no and they are fighting all this.

BOB CHRISTIE: Now, the -- this fight between Clean Elections Commission in the broader sense, goes back about three years now. Clean Elections used to have a matching fund provision to where, if you were a Clean Elections candidate and you were running against a non-Clean Elections candidate and they spent more, you would get matching funds. That was struck down by the Supreme Court. Clean Elections looked at the law that created them and said, we have authority to approve all election laws, not just these ones about matching funds. That's what this fight is all about. The secretary of state's office says we're the ones that should be cleaning capable.

STEVE GOLDSTEIN: Coming back to Michele Reagan, now she's at least getting the reputation of one saying dark money is okay. It reminds me back with the head indicate. A group of Americans said they want to go with this.

LUIGE DEL PUERTO: Michele Reagan largely, as Bob pointed out, is really the authority of the clean elections commission. I think we have a two-pronged enforcement system in the state. Unless the court decides which one gets to enforce which laws we are going to have this clicks within the Clean Elections, and we should say the Secretary of State wants to intervene in the lawsuit.
TED SIMONS: Recently Michele Reagan announced they were going to stop enforcing certain election laws because they found them unconstitutional. Not a judgment, but they found them unconstitutional.

BOB CHRISTIE: That's correct. It's an unusual way to go about doing things. Usually if you think a job is unconstitutional, you go to the judge. In this case Michele Reagan and her chief election attorney looked at the law that required the second to inform candidates when they are staked out. Here's your in the and it gives them time to respond so they are not blindsiding two days before the election and have no time to respond. Michele Reagan looked at that, Eric Spenser, the elections director said no, we think that law is unconstitutional and we're just not going to do it anymore.

LUIGE DEL PUERTO: The immediate reaction from people is what is going on here? What is the authority? What makes the Secretary of State's office think or believe that they have the authority to suspend a law because they think it's not constitutional? And Tim Hogan said, we didnt elect a judge. We elected Michele Reagan.

TED SIMONS: Because of this, critics say candidates might not see the hit coming anymore, won't know who paid for it and won't have time to rebut. That's a triple whammy.

STEVE GOLDSTEIN: One thing that always strikes me about the election laws, in the case of Tom Horne when he was running for attorney general, we almost found out he would be penalized after he was defeated.

TED SIMONS: We should mention quickly the Behavior Research Center just released a poll regarding it, and the approval rating for the governor and the legislature, not good. Not atrocious but not good.

BOB CHRISTIE: You know, it's been a tough year for the governor and the legislature. The legislature isn't held in great regard anyway. We have a new governor. He had to make a lot of cuts. He had to cut Universities, that got a lot of press. The flat or negative spending to K-12 was a big factor.

TED SIMONS: But deeper down into the survey and transparency in government was listed as a very important factor for the respondents.

When you stalk about stuff like this, they thought the dark money issue in general, transparency is nowhere to be found.

LUIGE DEL PUERTO: Really, this is a big issue the state is grappling with. The issue is what do you do with nonprofits, some of them just printout weeks or months before an election and start to spend a whole lot of money. Then they turn around and claim we are not doing electioneering, we're doing issue advocacy, voter outreach, those kind of activities. The question is how do you enforce a law? And how do you go after it? How do you prove they are doing electioneering? That job initially fell on the Secretary of State's job to do. Now the Clean Elections Commission says we're part of that too. We can enforce the law and reporting and doing what's necessary.

BOB CHRISTIE: Which makes some sense. The Secretary of State's office is a partisan office. Clean Elections is split between both parties. There's a commission with five folks on it, an Independent, two Republicans and two Democrats. Maybe that takes some of the politics out of this.

TED SIMONS: Doctors suing over a new abortion law, telling patients of the possibility of a reverse abortion. Doctors are saying we're the doctors here, you're making us lie to our patients. What's going on here?

STEVE GOLDSTEIN: Planned Parenthood came out swinging, calling this junk science. There are not many studies that have said this is a fact. One doctor I have heard some said this is a two-step process if you can reverse it in the course between the two doses of progesterone at that point. It's very confusing. It does sound like a case where senators went to Doug Ducey and said, we like this, here's the science, follow through with this.

BOB CHRISTIE: One doctor said, I have one patient who came to me who took the drug, I gave her a big dose of progesterone, and she had the baby. This is the first doctor in the whole United States who's ever said anything like this. The legislature and Republicans who are antiabortion on the legislature embraced him and put that part of law. I think that stands a very good chance of having a federal judge agree with Planned Parenthood.

TED SIMONS: Patients are being told misleading, false information.

LUIGE DEL PUERTO: That's precisely the arguments against this law. It compels doctors to relay this information, they believe it is false. And two, it may potentially put them on the hook for medical malpractice. Because the things they are relaying, the information they are relaying, if it turns out to be false they are saying, what happens if we get sued?

TED SIMONS: And what happens to your board certification if you are giving out information that the board would think is not accurate.

STEVE GOLDSTEIN: This is a case where Arizona is a leader and probably shouldn't want to be based on what the medical community is saying.

TED SIMONS: Gentlemen, we have to stop there. Appreciate it.

Monday, three historians will join us for their unique and often quirky perspectives on Arizona's colorful past. Tuesday we'll update a national push for nonpartisan elections. Wednesday, hear about an offer of free summer schools to low-income students. Thursday we'll talk about a book that looks beyond the economic value of water. And Friday it's another edition of the "Journalists' Roundtable." That is it for now. I'm Ted Simons, thank you so much for joining us. You have a great evening and a great weekend.
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