Horizon Roundup: State of the State, 2018 legislative session and Gallego challenger emerges

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Local journalists – Arizona’s Republic’s Dianna Náñez, Capitol Media Services’ Howard Fischer and Arizona Capitol Times’ Luige del Puerto – discuss expectations for next week’s Arizona Legislature session.

Governor’s State of Address

Arizona Gov. Doug Ducey will set the tone for the legislative session, says del Puerto. The governor is expected to focus on the economy, and all three journalists agree there would be no surprise if Ducey steers the session towards a reelection campaign.

In regards to improving education in the state, Náñez says in the past the governor made clear there would be no tax increases. However, Náñez believes it raises the question of funding for other items on the legislative agenda. Fischer says there’s a chance that regulations will begin to diminish in an effort to save money.

Sexual Harassment at the Capitol

As long as the “greater national conversation,” as Náñez describes it, continues regarding sexual harassment, a similar conversation will also be one of the main topics of discussion on for the state. There have been multiple Arizona government officials, including Rep. Don Shooter, who has been accused of harassment. The conversations on specific individuals can only go so far if there isn’t public access to their report, del Puerto says.

Educators Propose Funding Plan

Another hot topic on the legislative agenda is education. With not enough revenue flowing in, del Puerto says a tax raise would be necessary to fund the kind of education system the state needs. Education leaders joined Arizona Horizon to discuss education funding for the state earlier this week.

Voter Initiative Restrictions

Less was discussed on restrictions, but Náñez emphasized that this topic will receive traction among voters. Fischer says when the legislature limits themselves to a single subject, they will attract more votes.

Cap on School Tax Credits

Arizona State Senate President Steve Yarbrough has “seen the light,” says Fischer. Yarbrough changed his stance on the corporate tuition tax-credit program he once supported. The funding of private schools through corporate income taxes is being argued during the session, and Fischer says the combination of taxes and education will make any resolution difficult.

Gallego Faces Primary Challenge

Arizona State Senator Catherine Miranda will run against Rep. Ruben Gallego for a seat in Congress. By publicly addressing his opponent as an “anti-choice, corporate-sponsored politician,” Gallego has set the tone for the race, Náñez says.


TED SIMONS: COMING UP NEXT ON "ARIZONA HORIZON" JOURNALIST ROUND TABLE, WE'LL DISCOVER THE GOVERNOR'S STATE OF THE STATE ADDRESS AND START OF THE LEGISLATIVE SESSION. WE'LL LOOK AT HOW THE SESSION COULD BE IMPACTED BY SEXUAL ALLEGATIONS AT THE CAPITOL. THOSE STORIES AND MORE NEXT ON THE JOURNALIST ROUND TABLE.

TED SIMONS: GOOD EVENING. WELCOME TO "ARIZONA HORIZON'S" JOURNALIST ROUND TABLE. I'M TED SIMONS. JOINING US TONIGHT, DIANNA NANEZ OF THE ARIZONA REPUBLIC, HOWARD FISHER OF CAPITOL MEDIA, AND LUIGE DEL PUERTO OF THE ARIZONA CAPITOL TIMES. THE 2018 LEGISLATIVE SESSION SET FOR MONDAY WITH THE GOVERNOR'S STATE OF THE STATE ADDRESS. WHAT ARE WE EXPECTING? LET'S START WITH THE GOVERNOR. WHAT DO WE EXPECT TO HEAR THIS GO AROUND?

DIANNA NANEZ: THE GOVERNOR IS GOING TO WANT TO TALK ABOUT THE ECONOMY. IT'S PAIRED UP WITH THINGS HE'S ALREADY SAYING ALREADY HINTING AT. HE'S GOING TO TALK ABOUT EDUCATION. I DON'T KNOW IF THE WORD WANT THERE IS NECESSARILY THE SAME. HE'S GOING TO TALK ABOUT EDUCATION. HE’S MADE CERTAIN COMMITMENTS AND PEOPLE ARE HOLDING HIS FEET TO THE FIRE. AS A MATTER OF FACT, WE TALKED ABOUT THIS EARLIER, HUGE RALLY, CARNIVAL BOUNCE HOUSES WITH AN EDUCATION RALLY SAYING YOU NEED TO PUT MORE FUNDING IN. THE GOVERNOR HAS TO ADDRESS IT.

TED SIMONS: WE ARE GOING TO TALK EDUCATION PARTICULARLY HERE. IN GENERAL, WILL THIS BE CELEBRATORY, WILL THIS BE THE BEGINNING OF HIS REELECTION CAMPAIGN?

HOWARD FISCHER: I WOULD BE WILLING TO BET YOU LUNCH, DINNER AND A GOOD NIGHT DRINK THAT SOMEWHERE IN THERE WE WILL HEAR HOW HE INHERITED THE DEFICIT, WE’RE IN THE BLACK, EVERYTHING IS WONDERFUL, IMPROVED IN EDUCATION, WE ARE DOING MUCH, COMPANIES ARE COMING TO THE STATE, JOB GROWTH. IT'S THE START OF THE DUCEY ELECTION CAMPAIGN.

TED SIMONS: WHAT DO YOU SAY LUIGI?

LUIGI DEL PUERTO: OH, YEAH. THE STATE OF THE STATE IS THE GOVERNOR’S BIGGEST PLATFORM IN GENERAL. IT'S A CHANCE TO SET THE TONE NOT JUST FOR THE LEGISLATIVE SESSION, BECAUSE HE WILL SET THE TONE FOR THE LEGISLATIVE SESSION, BUT FOR HIS REELECTION CAMPAIGN.

TED SIMONS: AS FAR AS THE TONE IS CONCERNED, ARE THEY GOING TO GET ALONG? THE FACT THAT THIS IS AN ELECTION YEAR, YOU KNOW THESE PEOPLE WANT TO GET IN AND OUT OF THERE AS SOON AS POSSIBLE. THEY WANT TO GET OUT OF THERE AND RUN FOR GOODNESS KNOWS HOW MANY SEATS. IS THERE GOING TO BE A STREAMLINING PROCESS OR A LOT OF YELLING AND FUSSING AND FIGHTING?

LUIGI DEL PUERTO: WELL THE WAY IT HAS HAPPENED IN THE LAST COUPLE OF YEARS, THE LEGISLATURE, AND THE GOVERNOR HAS GONE ALONG ON THE MAJOR ISSUES. FOR EXAMPLE, LAST YEAR, WE WERE TALKING ABOUT MORE MONEY FOR K-12 EDUCATION. THE GOVERNOR WANTED A SMALLER PAY RAISE FOR TEACHERS. THE LEGISLATURE SAID “NU UH” WE ARE GIVING A BIGGER PAY RAISE TO TEACHERS. AT THE END OF THE DAY, THE GOVERNOR SAID YES WE’RE GOING TO GIVE YOU A BIGGER PAY RAISE.

HOWARD FISCHER: THIS IS GOING TO BE CRUCIAL BECAUSE THE LAWMAKERS ARE THE PEOPLE THAT HAVE TO GO HOME EVERY WEEKEND, SOMETIMES EVERY NIGHT AND LISTEN TO THEIR CONSTITUENTS, MANY OF THOSE THAT LOOKED AT THEIR SCHOOL SYSTEMS, LOOKED AT THE FUNDING, 2,000 VACANCIES IN CLASSROOMS FOUR MONTHS INTO THE SCHOOL YEAR AND SAY WE CAN'T DO IT ON THE CURRENT MONEY. THE GOVERNOR'S STATE OF THE STATE AND BUDGET IS BUILT ON WHAT KATY HOBBES CALLS THE COINS IN THE COUCH, AND WE ARE GOING TO FIX IT ALL. IF YOU BELIEVE WE ARE 40 OR 50 SOMETHING IN TEACHER SALARIES AND PER STUDENT FUNDING, WHILE MONEY DOESN'T SOLVE THE PROBLEMS, YOU CAN'T SOLVE THE PROBLEMS WITHOUT MONEY. AND I THINK A LOT OF LAWMAKERS, EVEN ON THE REPUBLICAN SIDE, WILL LOOK FOR WAYS TO FIND TO PUT INTO EDUCATION THAT THE GOVERNOR WANTS.

TED SIMONS: THE ECONOMIC DEVELOPMENT, HELPING WITH EDUCATION AND HELPING WITH ALL ASPECTS OF GOVERNMENT AND GOVERNMENT SPENDING AND THE GENERAL WELL BEING, ARE WE GOING TO SEE MORE TAX CUTS, ARE WE GOING TO SEE MORE PRO BUSINESS LEGISLATION? WHAT ARE WE GOING TO SEE?

DIANNA NANEZ: THE GOVERNOR HAS MADE IT VERY CLEAR THAT HE'S NOT GOING TO RAISE TAXES. WE KNOW THIS. WE HAVE PEOPLE CALLING ON HIM TO DO THIS. WE KNOW IT’S NOT REALISTIC WITH THIS LEGISLATURE. WE KNOW IT'S NOT REALISTIC WITH THIS GOVERNOR. IF THERE ARE MORE CUTS, YOU HAVE TO BE ABLE TO MATCH THAT WITH THE IDEA THAT HOWIE IS SAYING, WHERE WILL WE GET THE FUNDING? THAT TRANSLATES TO ESTIMATED 60,000 STUDENTS. THAT'S WHAT WE CAN'T GET AWAY FROM.

LUIGI DEL PUERTO: HERE'S THE BIG PICTURE. THE BIG PICTURE IN THIS UPCOMING FISCAL YEAR, WE ARE LOOKING AT A $24 MILLION CASH DEFICIT. NEXT YEAR, FISCAL YEAR '19, WE’RE LOOKING AT $80 MILLION. THAT'S NOT COUNTING THE FACT THAT IF THIS LEGISLATURE WANTED TO CONTINUE $90 MILLION IN ONE TIME EXPENDITURE, OUR SITUATION WILL GET WORSE. SO YEAH. PEOPLE ARE SKEPTICAL ABOUT WHERE THE GOVERNOR IS GOING TO FIND THE MONEY TO FUND THE KIND OF K-12 SPENDING THAT HE SAYS HE WANTS TO SPEND.

TED SIMONS: TO FUND ANYTHING, WHAT'S GOING ON HERE?

HOWARD FISCHER: YOU CAN GET REALLY CREATIVE WITH REVENUE ESTIMATES AND WORRY ABOUT IT MID YEAR, PERHAPS AFTER A CERTAIN NOVEMBER ELECTION. GEE, I'M GOVERNOR AGAIN. IN TERMS OF THE QUESTION OF TAX CUTS, THIS GOVERNOR GOT ELECTED ON THE PROMISE TO TAKE THE INCOME TAX RATE TO AS CLOSE TO ZERO AS POSSIBLE. INDEXING, THINGS LIKE THAT, THERE WILL BE SOMETHING IN THERE TO DO SOMETHING TO THE INCOME TAX EVEN IF IT’S .001%, THERE WILL BE SOMETHING IN THERE THAT WILL MAKE A CHANGE TO THAT. THE OTHER WAY HE CAN APPEAL TO HIS BUSINESS COMMUNITY FRIENDS IS DEREGULATION. LOOK FOR MORE REGULATIONS TO GO AWAY. HE WILL SAY WE DON'T NEED THESE ENVIRONMENTAL REGULATIONS. WE DON'T NEED THESE SAFETY REGULATIONS. AS LONG AS NOBODY GETS HURT, THAT'S FINE. IT'S LIKE WITH THE DRIVERLESS CARS. EVERYTHING IS FINE UNTIL THE FIRST PERSON GETS RUN OVER BY A DRIVERLESS CAR BECAUSE THE STATE HAS NO REGULATIONS.

TED SIMONS: YOU HEAR THEY ARE TAKING THIS MUCH OUT OF REVENUE, THIS MUCH OUT OF REVENUE. ANYONE EVEN GOING TO LOOK TWICE AT THOSE THINGS?

DIANNA NANEZ: I THINK THERE’S GOING TO BE A LARGE DISCUSSION ABOUT IT THEY SEE IT FALL OFF THE CLIFF, THERE’S NO END TO IT. BUT NO, NOT THIS YEAR.

HOWARD FISCHER: WHAT’S GOING TO HAPPEN STEVE YARBOROUGH RUNS ONE OF THESE TUITION ORGANIZATIONS THAT ALLOWS PEOPLE TO GIVE MONEY ON A DOLLAR FOR DOLLAR BASIS AGAINST THEIR STATE TAXES TO GROUPS THAT HELP KIDS ATTEND PRIVATE PAROCHIAL SCHOOLS. THE PRIVATE SIDE WAS NEVER MAKING ENOUGH SO THEY ALLOWED CORPORATIONS TO DO SO TOO. WITH A 20% PERCENT OVER YEAR OVER YEAR OVER YEAR. WELL AT A CERTAIN POINT, THE 20% COMPUNDS WHERE IT’S MORE THAN THE 300 MILLION WE’RE COLLECTING.

TED SIMONS: WE'LL GET TO THAT LATER ON.

LUIGI DEL PUERTO YOUR QUESTION IS, ARE THEY -- IS THERE A DISCUSSION OVER CORPORATE INCOME TAX? YOU WILL SEE THAT DISCUSSION COMING FROM DEMOCRATS. SOME REPUBLICANS WILL SAY, YEAH MAYBE WE NEED TO TAKE A LOOK AT IT. AND SOME OF THEM WILL BE SERIOUS ABOUT TAKING A LOOK AT THOSE CORPORATE INCOME TAXES AT THE TAX CUTS THAT HAVEN'T BEEN MADE OVER THE YEARS. I DON'T SEE THIS LEGISLATURE TAKING AWAY THOSE TAXES.

HOWARD FISCHER: I'LL GO A STEP FARTHER. ONE OF THE THINGS THE GOVERNOR SAID, I'M NOT GOING TO PULL THE RUG OUT FROM UNDER PEOPLE.” SO THE FACT THAT CORPORATIONS WERE COUNTING ON THIS WHICH THEY’RE PHASING IN THIS YEAR, HE SAID NO WE’RE NOT GONNA DO THAT PLUS IT WOULD TAKE A 2/3 VOTE TO END THE CREDIT.

LUIGI DEL PUERTO: THAT'S NOT TO SAY IT'S NOT A PROBLEM FOR THE STATE. IT HAS BEEN A PROBLEM FOR THE STATE. CORPORATE INCOME TAXES, FOR EXAMPLE, FISCAL YEAR '17, CAME IN AT $50 MILLION LESS THAN THE BUDGET FORECAST WAS. THEY HAD BEEN WRONG THE LAST SEVERAL YEARS ABOUT THE BUDGET FORECAST. THEY ALWAYS COME IN, THE CORPORATE INCOME TAXES HAVE COME IN A LOT SMALLER THAN THE FORECAST. SO YES IT IS A PROBLEM.

HOWARD FISCHER: THE OTHER THING WE FOUND OUT, DID RESEARCH ON, THREE OUT OF EVERY FOUR CORPORATIONS IN THIS STATE PAY NO MORE THAN $50 IN CORPORATE INCOME TAX. IF I COULD GET AWAY WITH $50 IN STATE INCOME TAX, I WOULD BE A HAPPY CAMPER, BUT I'M NOT A CORPORATION.

TED SIMONS: ALRIGHT THIS IS THE GENERAL TONE OF WHAT WE CAN EXPECT. STARTING MONDAY WITH THE STATE OF THE STATE ADDRESS AND LEGISLATIVE SESSION, AS FAR AS THE LEGISLATIVE SESSION IS CONCERNED, THERE IS A SEXUAL HARASSMENT INVESTIGATION OUT THERE. WE DON’T KNOW WHO’S INVOLVED. WE KNOW TWO PEOPLE INVOLVED FOR SURE BUT WE DON'T KNOW WHAT ELSE WILL BE FOUND, WHAT WILL BE DISCUSSED, THOSE SORTS OF THINGS. THE IMPACT OF THAT INVESTIGATION, AND ITS RESULTS, ON THE SESSION?

DIANNA NANEZ: I THINK THE IMPACT IS TIED TO A GREATER NATIONAL CONVERSATION. WE HAVE ONE DONE, WE HAVE RIOS DONE. WE ONLY HAVE THESE TWO. IT WILL BE FINE. WE ARE WRAPPING IT UP, BUT I THINK THE REALITY IS THE NATIONAL CONVERSATION ISN'T ENDING, WHICH IS GOING TO PUSH OUR STATE CONVERSATION. THE BIGGER REALITY, YOU DON'T HAVE TO TALK TO VERY MANY PEOPLE AROUND THE CAPITOL TO HEAR THERE ARE MORE SHOES TO DROP.

HOWARD FISCHER: BUT LET’S TALK ABOUT THE ONE THAT’S OUT THERE NOW, WHICH IS DON SHOOTER. I BELIEVE THIS IS NOT GOING AWAY QUICKLY. I BELIEVE SOME OF THE ALLEGATIONS WILL PROVE UNFOUNDED, THIS WHOLE SERIES OF THINGS AND LOBBYISTS. I THINK THE INVESTIGATION WILL COME OUT SOME UNFOUNDED. I ALSO BELIEVE THAT SHOOTER IS NOT GOING TO GO QUIETLY. HE’S GOING TO FIGHT EVERYTHING, HE IS GOING TO ASK FOR A FULL ETHICS HEARING, HE’S GOING TO ASK FOR A FULL VOTE, THIS WILL BLEED WEEKS IF NOT MONTHS INTO THE SESSION.
LUIGI DEL PUERTO: THIS ALL HINGES, I THINK IN MY MIND, ON WHAT THE SPECIAL COUNCIL COMES UP WITH. WHAT DOES THE REPORT LOOK LIKE? IF IT LOOKS VERY BAD FOR REPRESENTATIVE DON SHOOTER, SPEAKER MESNARD CAN CONTROL HIS OWN ACTIONS, THE LEADERSHIP ACTIONS. THERE ARE MEMBERS WHO MAY WANT TO GO BEYOND WHATEVER IS RECOMMENDED WITH THE REPORT AND CALL FOR HIS EXPULSION FOR EXAMPLE, THAT'S AN OPTION FOR ANY MEMBER.

TED SIMONS: AND THAT’S HIM. THAT'S ONE PERSON WE KNOW. THERE COULD BE OTHER PEOPLE MENTIONED IN THAT INVESTIGATION.

DIANNA NANEZ: THAT'S KEY.

TED SIMONS: LOTS OF HORSE TRADING GOING ON AT THE CAPITOL. DOES THIS INVOLVE THAT?

DIANNA NANEZ: WE ARE NOT GOING TO KNOW ANYTHING, LUIGE’S RIGHT, UNTIL WE SEE THIS REPORT. EVERYBODY KNOWS THAT THERE ARE MAYBE MORE NAMES. THAT'S WITHIN ONE. THAT'S KEY HERE. THAT'S WHAT EVERYBODY IS REMEMBERING. EVERYBODY KNOWS HOW DO YOU CONTAIN SOMETHING KNOWING WHAT COULD BE THE NEXT ALLEGATION? THEN IT STARTS THEN.

LUIGI DEL PUERTO: IT'S GOING TO BE A CLOUD HANGING OVER THEIR HEADS FOR SURE. THE FACT OF THE MATTER IS, THESE ARE FOLKS THAT CAN WALK AND CHEW GUM AT THE SAME TIME. THIS INVESTIGATION COULD DRAG ON. THE WHOLE ISSUE COULD DRAG ON. I DON'T SEE THEM NOT BEING ABLE TO DO THE THINGS THEY HAVE ALWAYS DONE.

HOWARD FISCHER: THEY CAN, AND AT SOME POINT, AT SOME POINT IT BECOMES SO ALL-CONSUMING IN TERMS OF RUMORS AND QUESTIONS AND HEARINGS AND NEWS CYCLES.

TED SIMONS: AND THE FRACTURES THAT ARE MADE.

HOWARD FISCHER: AND AS PEOPLE LINE UP BEHIND DIFFERENT FOLKS. MR. SHOOTER HAS PEOPLE THAT BACK HIM UP. THEY SAY, HE'S A CLOWN. HE'S A BIG MOUTH. HE'S PROBABLY GOT THE BEST JUDGMENT IN THE WORLD. THE GUY SHOWS UP WITH SERAPPE AND A COUPLE OF BOTTLES OF TEQUILA IN THE SENATE, YEAH. BUT BY THE SAME TOKEN, IT’S JUST ODD. BUT THE QUESTION FOR THEM HAS TO BECOME, IF WE START TALKING ABOUT PEOPLE BEING A SMART ASS, WHAT ARE WE OPENING THE DOOR FOR?

DIANNA NANEZ: LET'S TAKE A STEP BACK HERE AND TALK ABOUT HOW IT'S JUST -- AND FILL IN THE NAME. IT'S NOT WORKING.


HOWARD FISCHER: UNDERSTOOD, BUT THAT COMES DOWN TO MY BELIEF THAT SOME OF THE STUFF WILL PROVE UNFOUNDED. HAS HE PROBABLY SAID THINGS ABOUT WOMEN? I DON'T QUESTION THAT, BUT I KNOW THERE ARE OTHER LAWMAKERS THAT PROBABLY MADE THE SAME COMMENTS BEHIND WOMEN'S BACKS AND EVERYTHING ELSE.

LUIGI DEL PUERTO: THAT'S WHY IT’S VERY IMPORTANT WE NEED TO SEE WHAT THE REPORT SAYS. WHAT WE HAVE SEEN IN THE PAST, THERE IS A CONTROVERSY THAT’S BIG ENOUGH THAT HAS CONSUMED THE LEGISLATURE, THAT HAS CONSUMED ONE CHAMBER, SOMETHING HAS TO GIVE. WE HAVE SEEN IT IN THE CASE OF SCOTT BUNGAARD FOR EXAMPLE. SO SOMETHINGS GOING TO GIVE. IT DEPENDS ON WHAT THE SPECIAL COUNCIL FINDS OUT. AT THAT POINT, WE'LL HAVE A CLEAR UNDERSTANDING OF WHERE THINGS MIGHT BE.

HOWARD FISCHER: THERE IS ONE OTHER PIECE OF THAT. AS YOU KNOW, MR. SHOOTER LEVELED SOME COUNTER ALLEGATIONS AGAINST REPRESENTATIVE MICHELLE UGENTI-RITA. AND IF THE SPECIAL COUNCIL COMES UP WITH SOMETHING ON HER, AND TALK ABOUT FRACTURED, IN TERMS OF WHO ARE WE LINING UP BEHIND OR IS THIS JUST A PLAGUE ON BOTH YOUR HOUSES.

TED SIMONS: THAT'S JUST TWO PEOPLE. THAT'S THE ONLY TWO PEOPLE WE DON'T KNOW. EARLIER, WE TALKED ABOUT EDUCATION. WE HAVE EDUCATION LEADERS ON THE PROGRAM THIS WEEK AS WELL AS VARIETY OF LEADERS ON OTHER ISSUES. THE EDUCATION FOLKS ARE SAYING THE TIME IS NOW. WE HAVE TO DO SOMETHING REGARDING EDUCATION FUNDING. THERE WAS AN EVENT YESTERDAY AND THERE WILL BE AN EVENT, AS YOU MENTIONED, THIS WEEKEND. THEY ARE SAYING TIME TO FUND BETTER EDUCATION IN A BETTER MANNER, FIND A BETTER WAY. THAT TIME IS NOW. HERE'S WHAT THEY HAVE TO SAY.

JOE THOMAS: THERE ARE A LOT OF OPTIONS OUT THERE. THERE IS REVENUE THAT IS NOT TAXED INSIDE THE STATE. WE HAVE CUT A NUMBER OF TAXES OVER THE LAST 20 TO 25 YEARS. THE FIRST STEPS THAT WE REALLY NEED TO SEE IS RESTORING THE REVENUE, REINVESTING IN EDUCATION TO WHERE IT DOESN'T MATTER WHERE YOU LIVE IN THE STATE YOU GO TO A QUALITY SCHOOL.

CHRIS KOTTERMAN: WE HAVE BUSSES WITH 200 PLUS MILES ON THEM. THEY NEED TO BE REPLACED. WE HAVE SAFETY ISSUES THAT NEED TO BE ADDRESSED IN SCHOOLS. ALL OF THAT GOES BACK TO TEACHER PAY. THOSE THINGS HAVE TO BE ADDRESSED REGARDLESS. WHEN WE DON'T HAVE FUNDING FOR THOSE, THEY EAT INTO TEACHER SALARY. IF WE GOT MORE MONEY FOR THOSE TYPES OF THINGS WE CAN REASSIGN MORE MONEY INTO TEACHER PAY. SALARY INCREASES IS AT THE TOP OF THE PYRAMID. IT'S TIME TO GET DOWN TO WORK. THAT’S REALLY THE NAME OF THE GAME.


DICK FOREMAN: WE’RE LOOKING FOR A SIGNIFICANT DOWN PAYMENT. TEACHER SALARIES CERTAINTLY AT THE TOP OF THE PYRAMID AND THE PUBLIC HAS CERTAINTLY INDICATED THAT STRONGLY TO ALL OF US AND ELECTED LEADERS. IT’S TIME TO GET DOWN WOT WORK.

TED SIMONS: IT’S TIME TO GET DOWN TO WORK. COALITION OF EDUCATORS, PLAN OF $950 MILLION WITHOUT A SALES TAX HIKE. CORPORATIONS PAY AT LEAST $500 IN INCOME TAXES, WHICH MOST OF THEM DON'T.

HOWARD FISCHER: EXACTLY. THAT'S THE POINT. THE PROBLEM WITH MOST OF THESE THINGS BECOMES YOU NEED THE 2/3 VOTE WHICH BECAUSE IT IS TECHNICALLY AN INCREASE IN STATE REVENUE, WHICH IS WHY I THINK WE’RE GOING TO END UP GOING TO THE BALLOT WHERE YOU DON’T NEED LEGISLATURES TO BE REFERRED BY A SIMPLE MAJORITY OR PEOPLE GO OUT AND GET THE SIGNATURES. THESE ARE ALL IMPORTANT IDEAS. IT'S IMPORTANT TO REMEMBER THAT TEN YEARS AFTER THE BEGINNING OF THE RECESSION, WE FINALLY HAVE THE STATE BUDGET BACK TO WHERE IT WAS TEN YEARS AGO AND ADDED HALF A MILLION PEOPLE. ON A PER CAPITA BASIS, STUDENT FUNDING, ADJUSTED FOR INFLATION, IS LESS THAN IT WAS IN 2007.

TED SIMONS: LUIGI, THE IDEA BEHIND THE EDUCATION PLAN FROM THESE EDUCATORS, YOU CAN HIRE BACK AUDITORS, YOU CAN HIRE BACK TAX COLLECTORS, YOU CAN DO THINGS WITHOUT TECHNICALLY RAISING A SALES TAX OR ANY TAX AND GET MONEY INTO EDUCATION. IS THAT A VIABLE IDEA?

LUIGI DEL PUERTO: WELL SOME OF THESE ARE VERY VIABLE IDEAS BECAUSE THE STATE HAS DONE THIS IN THE PAST. TALK ABOUT THE AUDITORS WE ARE NOT HAVING -- SOME CRITICIZED THE GOVERNOR'S OFFICE, DUR FOR NOT HAVING ENOUGH AUDITORS. FOR EXAMPLES. JOBC, BUDGET ARM AGREES WITH THIS ONE. IF YOU ADDED ONE AUDITOR FOR EVERY DOLLAR YOU SPEND, YOU BRING $12 TO THE STATE. THESE ARE THINGS THAT THEY CAN DO. DOR IS HIRING SIX MORE AUDITORS. THERE ARE CERTAINLY POLICIES THAT WE CAN IMPLEMENT THAT DON'T NEED A TAX INCREASE TO FUND EDUCATION.

HOWARD FISCHER: THOSE ARE THE NICKELS.

LUIGI DEL PUERTO: THE FACT OF THE MATTER IS, THERE IS NOT ENOUGH REVENUE WITHIN THE CURRENT FLOW OF REVENUE TO FUND THE KIND OF EDUCATIONAL SYSTEM WE WANT UNLESS WE WANT TO RAISE TAXES.

TED SIMONS: SOME KIND OF TAXES, CORPORATIONS PAYING $50 OR AREAS LIKE SUN CITY OR AREAS PAYING WHERE THERE ARE NO SCHOOLS FULL PROPERTY TAX. WHERE DO WE GO FROM HERE? IS IT JUST BASICALLY THE GOVERNOR GOING TO SAY, WE ARE GETTING BETTER?

DIANNA NANEZ: I THINK YOU’RE GOING TO HAVE THE GOVERNOR TALK ABOUT WHAT HOWIE WAS MENTIONING EARLIER, THE GOVERNOR TALK ABOUT CERTAIN STANDARDS, CERTAIN RATINGS. THERE ARE A HUGE RALLYING CRY, NOT JUST FROM TEACHERS, NOT JUST FROM PARENTS. YOU HAVE BUSINESSES THAT MOVED FORWARD. THIS IS A CIRCLING. THIS IS AN ELECTION YEAR. WE HAVE LEGISLATORS THAT WOULDN'T TRADITIONALLY HAVE THE CONVERSATION, BUT THEY ARE HAVING THEM NOW. EVERYONE IS COMING TOGETHER. BREWER EVEN SET A TONE FOR THIS IDEA THAT WE CAN TALK WHERE WE NEED TO BE FOR THE ECONOMIC REASONS FOR OUR SCHOOLS.
LUIGI DEL PUERTOIN FACT, THEY DO HAVE A VEHICLE IF THEY WANT TO EXTEND THE KIND OF FUNDING THEY DESIRE TO SEE FROM K-12 EDUCATION, THAT'S PROP 3-0-1 THAT’S COMING UP. THEY HAVE THE OPTION TO PUT IT IN THE BALLOT 2018. THEY HAVE THE OPTION TO KEEP IT AS IS, $607 MILLION, NOT CHANGING THE STATUS QUO. YOU HAVE THE OPTION TO EXPAND THAT. THEY CAN DO IT 18 OR 20, THAT'S ONE VEHICLE THAT COULD PROVIDE SOME MONEY.

HOWARD FISCHER: THAT COMES DOWN TO THE TIMING ISSUE. THAT TAX LUIGI IS TALKING ABOUT, SELF DESTRUCTION 2021, APPROVED BY VOTERS IN 2000. THERES A LOT OF PRESSURE BY A LOT OF GROUPS THAT SAY WE NEED TO DO IT THIS YEAR SO IF WE SCREW IT UP, WE HAVE ANOTHER SHOT AT IT. THE GOVERNOR, MANY OF THE LEGISLATORS, SAYING WE JUST COULDN’T POSSIBLY GET TO THAT THIS YEAR.

TED SIMONS: THE GOVERNOR ON THE BALLOT MAKES ALL OF THE DIFFERENCE IN THE WORLD.

HOWARD FISCHER: CERTAINLY, BUT HE DOESN'T WANT TO MAKE IT AN ISSUE. EVEN DIANE DOUGLAS HAS SAID WE NEED TO TAKE THAT SIX CENTS UP TO A FULL PENNY. AND HE DOESN’T WANT TO MAKE THAT AN ISSUE THIS YEAR. I THINK YOU CAN EASILY APPROVE IT IN THE SAME WAY MINIMUM WAGE WENT THROUGH EASILY FOR THE SIMPLE REASON THAT PEOPLE RECOGNIZE THE INHERENT FAIRNESS OF IT.

LUIGI DEL PUERTO: IN THE PAST, WE HAVE SEEN JOBS, K-12 EDUCATION IS THE NUMBER ONE ISSUE AMONG VOTERS. IN THE PAST WE’VE SEEN IMMIGRATION, WE’VE SEEN JOBS DURING THE RECESSION. NOW, K-12 EDUCATION, THE STATE OF OUR SCHOOLS, THAT FACT THAT WE’VE BEEN REPORTING YEAR IN, YEAR OUT, THE KINDS OF RANKINGS THAT WE HAVE FOR K-12, THE KINDS OF MATRICES WE HAVE FOR K-12, ARE QUITE FRANKLY HORRIBLE FOR THE STATE. THIS IS AN ISSUE THAT THE PUBLIC HAS BEEN CLAMORING FOR, MORE MONEY FOR SCHOOLS.


HOWARD FISCHER: IT GOES TO THE ISSUE OF WHAT ELSE GOES ON THE BALLOT, WHICH IS WHETHER WE WANT TO EXPAND VOUCHERS. IT’S FINE TO SAY THAT’S SCHOOL CHOICE AND THAT RINGS THE BELL IN SOME QUARTERS BUT THEN OTHERS ARE SEEING WE ARE USING PUBLIC MONEY TO HELP RICH PEOPLE SEND THEIR CHILDREN TO PRIVATE PAROCHIAL SCHOOLS? UH-UH.

TED SIMONS: REAL QUICKLY HERE, A COUPLE OF OTHER ISSUES, VOTER RESTRICTIONS HAVE BEEN KIND OF DE RIGUEUER LEGISLATIVE SESSION PAST COUPLE OF YEARS, SENATOR JOHN CAVANAUGH HAS THIS IDEA OF LIMITING THESE INITIATIVES TO ONE IDEA, VERY SIMILAR TO HOW LAWS ARE MADE. IS THIS GOING TO GET ANY TRACTION DOWN THERE?

DIANNA NANEZ: YOU HAVE LEGISLATORS THAT HAVE SEEN THE SUCCESS OF A MEDICAL MARIJUANA INITIATIVE, THE SCHOOL INITIATIVE, THE FUNDING. THERE’S THIS IDEA OF WELL WE WILL DO WHAT WE CAN DO. SO WHAT DID WE SEE? WE SAW RESTRICTIONS ON WHAT KIND OF SIGNATURES AND WAS THERE A TEAR ON THE PAPER. WILL THIS GET TRACTION? THIS WILL ABSOLUTELY GET TRACTION. HERE’S THE ISSUE. YOU HAVE TO CHANGE THE CONSTITUTION AND IN ARIZONA, PEOPLE LOVE THEIR INITIATIVES. SO TO GET THE IDEA THAT, WHAT WAS IT THAT GOT EVERYBODY UPSET, IT WAS THE MINIMUM WAGE AND AT THE SAME TIME, SICK PAY. THE REALITY IS THAT IT'S ALLOWED. I PERSONALLY DON'T KNOW HOW FAR THEY’RE GOING TO GET, BUT THEY ARE GOING TO PUSH HARD FOR THIS. THEY ARE GOING TO PUSH HARD.

HOWARD FISCHER: LET ME ALSO CALL B.S. ON THIS BECAUSE THE RULE SUPPOSEDLY APPLIES TO THE LEGISLATURE. I HAVE SEEN BILLS COME OUT OF THERE, THEY MAY NOT BE CHRISTMAS TREES, BUT THEY ARE CERTAINLY SMALL BUSHES WITH MANY DECORATIONS ON THEM. WHEN SOMEONE OBJECTS, NOT SINGLE SUBJECT, THEY BRING UP THE REPUBLICAN LAWYER SAYS BLESS YOU, IT'S FINE. I’M SORRY, WHEN THE LEGISLATURE IS WILLING TO HAVE A TRUE SINGLE SUBJECT, THEN I’LL VOTE FOR THIS.
LUIGI DEL PUERTO: IT’S THEM BY THE WAY, WHO DECIDE IF THIS IS A SINGLE SUBJECT.
TED SIMONS: WE'LL MOVE ON FROM THAT ONE, THEN. LET'S GET BACK TO WHAT YOU HAD REFERRED TO EARLIER, THE IDEA OF CAP ON SCHOOL TAX CREDITS THAT IS BEING PUSHED BY SENATE PRESIDENT STEVE YARBOROUGH WHO PUSHED THE ESCALATOR CLAUSE TAX CREDITS TO GO 20% PER YEAR FOREVER. I MEAN THIS HAS ALL FUELS WRITTEN ALL OVER IT.
HOWARD FISCHER: AT A CERTAIN POINT, THE GOOD NEWS IS, IT'S NOT A REFUNDABLE CREDIT. WE ARE COLLECTING PERHAPS 300 SOME MILLION A YEAR IN CORPORATE INCOME TAXES USED TO BE 600,000,000 BUT THAT’S THE OTHER PART OF THE STORY. WE ARE AT THE POINT OF HITTING 300,000,000 SOMETIME AROUND 2025 IF NOTHING STOPS. ALL OF THE CORPORATE INCOME TAX WILL GO AWAY.

HOWARD FISCHER: STEVE YARBOROUGH RUNS ONE OF THESE TUITION ORGANIZATIONS THAT TAKES SCHOLARSHIPS, NOT A VOUCHER, IT’S A SEPARATE PROGRAM, TO HELP KIDS ATTEND PRIVATE PAROCHIAL SCHOOLS. THEY WANTED SOME MORE CORPORATE MONEY. LET'S BOOST IT 20% A YEAR. IT WAS GOOD FOR HIM. HE RAN IT. HE HAS A $96,000 SALARY. IT WAS AFFIRMED THAT HE AND HIS WIFE OWN THE PROCESSING. IT'S NICE THERE'S MONEY. NOW HE’S LEAVING THE LEGISLATURE, NOW HE’S LEAVING THAT BUSINESS, AND OH, I HAVE SEEN THE LIGHT.
LUIGI DEL PUERTO: TRUE, HE HAS RECOGNIZED IT'S A PROBLEM. AT SOME POINT, IF IT KEEPS INCREASING 20%, ALL OF CORPORATE INCOME TAXES WILL GOT TO STOS. RIGHT NOW, IT’S ABOUT 70 PLUS MILLION DOLLARS. EVERY YEAR THAT CAP IS MET. YEAH, AT SOME POINT, WE ARE NOT GOING TO HAVE CORPORATE INCOME TAXES GOING TO THE STATE.

HOWARD FISCHER: FROM THE PERSPECTIVE OF SOME PEOPLE, THAT WOULD BE JUST FINE WITH THEM.

TED SIMONS: HE WANTS A 10% BOOST, IT’S NOT LIKE A COMPLETE CUT OFF.
DIANNA NANEZ: IT'S NOT REALLY SEEING THE LIGHT. IT'S SEEING HALF OF THE LIGHT. YOU USE THE WORD. PEOPLE WANT TO HAVE A DISCUSSION ABOUT THIS. I HAVE HEARD THAT IT'S NOT, OH, IT'S GOING TO BE FINE. PEOPLE WON'T EVEN UNDERSTAND WHAT'S HAPPENING, FUELED. AT FIRST WE HEARD PEOPLE WON'T EVEN UNDERSTAND WHAT'S HAPPENING, AND THEN THERE WAS A RECKONING.

LUIGI DEL PUERTO: IT'S IMPORTANT THAT IT'S COMING FROM SENATE PRESIDENT STEVE YARBOROUGH BECAUSE HE HAS BEEN ONE OF THE PRIME ADVOCATES OF THE SCHOOL TUITION ORGANIZATION. THE FACT THAT HE'S SAYING WE HAVE TO DO SOMETHING ABOUT IT, IT CAN'T CONTINUE MEANS HE WILL PROBABLY BE ABLE TO CHANGE THE LAW AND BRING DOWN THE ESCALATOR TO A MORE MODEST 2.5%.

TED SIMONS: YOU THINK THAT'S GOING TO HAPPEN?

LUIGI DEL PUERTO: I THINK SO, YES.

HOWARD FISCHER: AND I THINK IN THIS YEAR, YOU ALMOST NEED TO. YOU CAN'T GIVE UP ANOTHER 13, 14, $15 MILLION AND 20% REDUCTION IN CORPORATE INCOME TAXES. YOU JUST CAN’T DO IT.

TED SIMONS: ALRIGHT, WE’VE GOT LIKE 30 SECONDS HERE. CATHERINE MIRANDA IS GOING TO FACE RUEBEN GALLEGO IN CD-7 WHAT’S GOING ON HERE?
DIANNA NANEZ: MIRANDA VERSUS GALLEGO ROUND ONE. I WAS READING ON TWITTER, IT WAS IMMEDIATELY A BUZZ, WITH GALLEGO HE WAS CALLING HER A QUOTE "I WOULD LOVE TO FACE AN ANTIABORTION, CORPORATE . .

TED SIMONS: ENDORSED BY GOVERNOR DUCEY.

DIANNA NANEZ: SET THE TONE. SHE WAS ON THE TWITTER ACCOUNT SAYING I'LL BE AT THE EDUCATION RALLY TOMORROW AND SAW RESPONSES SAYING, SO WHAT ABOUT YOUR ENDORSEMENT OF DUCEY?

WE HAVE TO STOP IT RIGHT THERE. THAT IS SOMETHING WE WILL HAVE TO FOLLOW. THANK YOU ALL FOR JOINING US, WE APPRECIATE IT. MONDAY ON ARIZONA HORIZON, GOVERNOR DUCEY KICKS OFF THE 2018 LEGISLATIVE SESSION WITH THE STATE OF THE STATE ADDRESS. WATCH IT HERE ON "ARIZONA HORIZON." AND THEN STAY TUNED FOR A RECAP AND ANALYSIS WITH LOCAL POLITICAL PUNDITS. MONDAY, AT 5:00 AND 10:00 ON RIGHT HERE ON "ARIZONA HORIZON."
TUESDAY WE’LL HEAR FROM DEMOCRATIC LEADERS ON THE UPCOMING SESSION. WEDNESDAY, GOVERNOR DOUG DUCEY JOINS US TO TALK ABOUT THE STATE OF THE STATE ADDRESS AND HIS LEGISLATIVE AGENDA.
THURSDAY, WE’LL HEAR ABOUT THIS MONTH’S TUCSON JAZZ FESTIVAL 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 WEEKEND.

Dianna Nannez: Reporter, The Arizona Republic
Howard Fischer: Reporter, Capitol Media Services
Luige Del Puerto: Reporter, Arizona Capitol Times

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