Thu, July 18

Senate Republicans craft $8.1 billion state budget

PHOENIX -- Rejecting Democratic protests, Senate Republicans voted Wednesday night to adopt an $8.1 billion budget for the coming fiscal year.

The party-line vote came after the GOP-controlled Senate spurned a series of changes sought by Democrats. That includes one to force state officials -- including legislators -- to give up their subsidized health care and instead use the cash to fund transplants and scale back plans to cut 280,000 people from the state's Medicaid program.

But the budget is far from a done deal, with Gov. Jan Brewer seeking an $8.8 billion spending plan. And one of the big differences is that the Senate proposes to cut close to $250 million from K-12 education, a portion of the budget Brewer told voters last year she would try to protect if they approved her one-cent hike in state sales taxes.

Senate Republicans, however, showed little interest in maintaining that education funding with borrowing and accounting maneuvers to balance the books, though she cuts other areas.

The state is spending more money than it collects. But Democrats contend both Brewer and the GOP majority ignoring another option.

Sen. Paula Aboud, D-Tucson, said there are exceptions to what is subject to the state sales tax which, if eliminated, could bring in $10 billion a year.

"The will is not here to close the loopholes that corporations have been able to hire expensive lobbyists to come here and to seek those exemptions,' she said.

But Republican Rick Murphy said some of that is because Arizona does not -- and never has -- taxed services.

"If we want to revisit that and advocate for the taxing of services, then that's a discussion we should have,' he said.

"But we should have it on that basis,' Murphy continued. "The word 'loophole' doesn't belong in the discussions.'

Earlier Wednesday a parade of witnesses came to the Appropriations Committee to complain about one element or another of the Senate plan.

"Schools have tightened their belts about as much as they can, especially in rural Arizona,' said Jennifer Laredo of the Arizona Education Association. She said that layoffs teachers and aides in some districts and the consolidation of classes have meant some students are sitting on the floor.

Murphy was unimpressed, saying education funding has far outpaced inflation.

"And yet the results have been stagnant at best,' he said.

"Money is not the core of the problem,' Murphy continued, saying there needs to be more innovation in education. "But the education establishment in this state and in this country does not want to innovate.'

He said the only thing that will make a difference is giving parents more ability to move their children between schools, including private ones.

But Senate Minority Leader David Schapira said funding does matter.

"When are we sacrificing the core mission of education?' he asked. At some point, Schapira said, money is needed to keep class sizes reasonable and attract good teachers.

David Martinez, lobbyist for the Arizona Students Association, objected to Senate plans to cut $235 million in state aid to universities.

He said the Board of Regents already is prepared to accept Brewer's $170 million funding cut, absorbing $100 million through reduced spending and making up the balance with higher tuition and reduced financial aid. Martinez said Senate plan would shift even more costs to students who have seen tuition jump 63 percent in the last three years.

Several county officials protested plans to shift the cost of housing some felons to them. And the Senate plan would require counties to pay half the cost of running the Department of Motor Vehicles which collects gasoline taxes and vehicle license fees.

"This budget proposal will have a catastrophic and unsustainable impact on many of Arizona's counties, all of which are already reeling under the same economic impact that has affected the state,' said Navajo County Supervisor David Tenney. He said while he understands the desire of lawmakers to bring expenses into line with revenues, this is not the way to do it.

"I submit there is nothing conservative about putting the state in the black by shifting some of the red to counties,' he said.

Tim Schmaltz, coordinator of the Protecting Arizona Families Coalition, decries cuts to social services. "We've gone from a war on poverty to a war on people,' he said.

Aboud urged colleagues to listen.

"I think the public is speaking through their right to speak,' she said. "And they are saying they do not want this budget.'

But Senate Majority Leader Andy Biggs, R-Gilbert, said the results of the last election disprove the Democrats' theory that Arizonans want more spending: 21 of 30 senators and 40 of 60 representatives are Republicans.

"They were elected because we went out and said we are tired of budgetary gimmicks and accounting gimmicks,' he said. "We want to get to a structurally balanced budget.'