PHOENIX -- Efforts to finally adopt a new state budget came to a screeching halt early today as several Republican senators refused to support the package.
 Sen. Al Melvin, R-Tucson, reviews elements of the budget package Thursday during a hearing of the Senate Appropriations Committee. Behind him is Sen. Russell Pearce, R-Mesa, who chairs the panel. (Capitol Media Services photo by Howard Fischer) |
``We talked about the circumstances that Arizona is in and we talked about philosophy and platform, and we talked about what was necessary to turn the state around and how we were going to get there,'' the governor said.
``And I said, 'Sen. Gorman, I need your help,' '' Brewer continued. ``And I felt that she listened, and I hope that she will.''
Gorman's continued opposition, at least at this point, is a major setback for Brewer and Republican legislative leaders who have worked to pick up votes one by one.
The package, including that sales tax referral, was approved early this morning by the House. And GOP leaders gained a key victory when Sen. Jack Harper, R-Surprise, agreed to support sending the measure to the ballot in exchange for additional spending reductions in the budget.
Harper had previously been opposed not only to the tax but even to giving that option to voters.
"As long as others are driving up the spending in state government, it's not my responsibility to provide them the revenues,'' he said.
But Harper relented after getting some changes to the plan, the most significant of which is a requirement to reduce the number of state and university workers by 5 percent by February. More than 2,600 positions would have to be eliminated.
How many actual workers will lose their jobs, though, remains uncertain.
Harper said agencies can meet the goals by eliminating positions that are currently vacant. But he said that still accomplishes his goal because it prevents those slots from being filled when the economy gets better.
"Businesses are cutting their workforce by 30, 40, 50 percent,'' he said, to deal with the economic slump. Now, Harper said, the state wants to raise sales taxes.
"We have to show them that we are tightening our belts in state government as well,'' he said.
And the provision is worded to ensure that the jobs really do disappear: It precludes agencies from trying to make up that 5 percent cut in payroll through furloughs, where the number of workers remains the same but they all take a certain number of days off without pay.
One potential glitch is that the provision is worded in a way that it could be read to also apply to public schools. Harper said that is not his intent and the language may need to be fixed.
Harper also succeeded in taking an extra $500,000 from the Arizona Automobile Theft Authority and curtailing the ability of Tucson to divert state sales tax revenues for its Rio Nuevo redevelopment project.
"You sold your vote for a tax referral for those four items?'' asked Sen. Rebecca Rios, D-Apache Junction.
That brought a sharp rebuke from Sen. Russell Pearce, R-Mesa, who chairs the Senate Health Committee.
"Negotiations go on all the time,'' he said. "He (ITALICS) negotiated (ROMAN) for some things that were important to him in order to support a budget deal.''
Rios, chastised, recrafted the question to ask Harper about the negotiation. Harper said it was a fair trade: providing the necessary vote for the sales tax referral in exchange for shrinking state government.
But even with Harper's backing, the plan still lacks the necessary 16 votes for Senate approval.
The deal seeks to ask voters to hike the current 5.6 percent state sales tax by a penny for two years beginning in January, dropping back to 6.1 percent in 2012 before returning the following year to the original rate. Brewer said the state needs the additional revenue -- estimated at up to $1 billion a year on the full penny increase -- to help get through the current deficit.
If approved, the same ballot measure would cap state spending at $10.2 billion for the next three years, the level that was originally approved for last budget year before lawmakers were forced to make mid-year spending cuts.
The package included sweeteners to get votes of GOP legislators, including an immediate repeal of the state property tax that was otherwise set to return later this year and generate $250 million. It also will lower corporate income taxes by 30 percent and individual income taxes by 6.6 percent beginning in 2011, measures that together will cut state revenues by $400 million a year.
That, however, wasn't enough to get the vote of Sen. Ron Gould, R-Lake Havasu City.
``Essentially what you're doing with this bill is shifting corporate income tax onto the backs of consumers through the sales tax,'' he said. ``That's something that I'm not willing to do.''
Other Republicans, however, were willing to make the trade-off of a vote to refer the sales tax hike to the ballot in exchange for guaranteed tax cuts. But Rep. Ray Barnes, R-Phoenix, pointed out that sending the issue to the ballot does not mean it will pass.
``I ... have confidence in the public who will ultimately determine if there actually is a tax increase,'' he said.
``I agree to put it on the ballot,'' Barnes continued. ``I also agree to vote against it at the poll and to urge everyone I know to vote against it also.''
Comments
Guitar Picker wrote on Aug 5, 2009 6:41 AM:
There is a brave group of teachers and other school employees that are protesting at the state capitol in Phoenix. They are trying to stop these Republican State Senators from passing such a terrible budget that will make things worse for students. "