Déjà vu: Brewer expresses possible support for another K-12 tax hike

Arizona Capitol Times
Friday, December 9, 2011
Jeremy Duda

A coalition seeking a voter-approved tax hike for education may have an ally in Gov. Jan Brewer, who gave her strongest signals yet that she may support the group’s proposed ballot measure.

The governor has been hesitant to take a position on the education coalition’s ballot initiative plans, which are tentative, at best.

But she opened the door a little wider this week, saying she is aware of the revenue drop-off the state will face when a billion-dollar-a-year tax expires in less than two years, and believes a new solution is necessary.

If the governor throws her support behind another tax hike for education, it may once again pit her against Republican legislators who fought for a year against her proposed sales tax increase in 2010. Brewer promised the public that Proposition 100 would be temporary and would phase out after three years — the expiration is actually written into the Arizona Constitution.

But while Brewer led the charge for Prop. 100, she indicated that others will have to carry the banner for education funding in 2012 or beyond.

“We’re going to hit that cliff and it’s going to be the responsibility of those that are involved in education and the citizens of Arizona to determine just exactly how we are going to address that issue, because it in fact is going to be a cliff,” Brewer told reporters on Dec. 5 after speaking to the Arizona Ready Education Council.

“It’s my understanding there are a lot of people in the state that are working on different solutions to that issue. And we’re willing to look at all of them. And I hope that I, in some way, can be supportive.”

The bipartisan education coalition is looking to remedy the looming fiscal cliff the state is facing in fiscal year 2014, when the temporary 1-cent sales tax voters approved in May 2010 expires.

The coalition was organized by BASIS Charter Schools President Craig Barrett and former Superintendent of Public Instruction Lisa Graham Keegan, and includes Democratic-aligned groups such as the Arizona Education Association and Arizona Education Network. The group is trying to find common ground on issues that will appeal to both the left and the right, such as performance-based pay and teacher accountability components to go along with the proposed tax hike.

Brewer recently named Barrett, former CEO of Intel, as the new chairman of her education council, formerly known as the P-20 Education Council.

Matthew Benson, a spokesman for the governor, said Brewer’s decision to appoint Barrett as the head of her education council isn’t a sign of support for the fledgling ballot measure. He emphasized that any such initiative won’t come from the governor.

“If voters want to pursue a new tax that would go to the ballot and be approved, that’s up to them. And the governor will judge that proposal on its merits when she sees it,” Benson said. “She’s not closing any doors. But whatever that proposal is, that will be a new proposal that will have to go to voters. It will not be Proposition 100.”

Any proposed tax hike for education, whether it comes from Barrett’s coalition or another group, is likely to receive a chilly reception at the Legislature, where Republican lawmakers resisted Brewer’s sales tax plan for nearly a year.

Rep. John Kavanagh, a Fountain Hills Republican who chairs the House Appropriations Committee, said a tax increase for education isn’t necessary. The Legislature will not cut education funding again in 2012, he said, and state revenue growth will be high enough by 2013 to offset the expiration of Prop. 100.

“In as much as we don’t intend to cut education funding, I don’t know why they need to do that unless they want to increase education funding by $1 billion and make it non-supplantable,” Kavanagh said. “We can fund increases in K-12, Corrections and (state Medicaid), and solve the ’14 revenue cliff when the sales tax goes away, without raising a penny in taxes.”

Kavanagh said he’d be especially opposed to a tax hike that earmarks money for a specific purpose because it would strip the Legislature of some of its budgeting authority.

While Republican legislative leaders are acutely aware of the looming fiscal crisis, they’re loath to extend Prop. 100 or support a new, targeted tax. The state now has a projected surplus, and lawmakers are already discussing plans to put that money away, pay off debt at a faster clip or do a combination of both to ease the future budget woes.

“We are going to make that a temporary tax because we believe you just cannot fall back on extending taxes (or) increasing taxes to justify the spending of money we don’t have,” incoming Senate President Steve Pierce said at last month’s legislative outlook conference sponsored by the Arizona Tax Research Association.

Nevertheless, Republican voters may be more inclined to support another tax hike than GOP legislators, according to consultant Chip Scutari, who worked on the Prop. 100 campaign.

Scutari predicted that if the coalition can maintain the involvement of business groups, the AEA and others — which is similar to the alliance forged during the Prop. 100 campaign — the initiative would have a strong chance of passage next November.

“If the right initiative is put together, I think it can definitely be sold to the Arizona voters as a wise and judicious investment for the future,” Scutari said.

Meanwhile, coalition members were tight-lipped about their progress. The group does not yet have a draft of its plans and is still trying to determine exactly what will be included in the initiative.

Ann-Eve Pedersen, president of the Arizona Education Network, said she couldn’t discuss the group’s progress.