Gov. gets hot potato

Mohave Daily News
Wednesday, April 9, 2008
Paul Davenport

PHOENIX - The Arizona Legislature has tossed a political hot potato - the possible return of a suspended state property tax - to Democratic Gov. Janet Napolitano.

A House-passed bill to repeal a suspended state property tax cleared the Arizona Senate with no votes to spare Tuesday as one Democrat joined all but two Republicans in voting for the bill.

The bill (HB2220) would permanently repeal a state property tax to avoid having it automatically take effect again.

Allowing the levy to take effect again in 2009 would produce an estimated $250 million annually for the state and raise the property tax on a $250,000 home by about $100 a year.

‘‘As homeowners struggle to pay their mortgage and property taxes, the state shouldn't add to their burden,'' said House Speaker Jim Weiers, R-Phoenix.

According to the business-backed Arizona Tax Research Association, savings from the repeal would be split roughly 50-50 between owner-occupied homes and all other types of property. The largest individual benefactors of the repeal would be businesses that own major properties, such as utilities.

If the tax takes effect again, ‘‘it will be seen as a tax increase because they will not have been paying it for the three year of time,'' said Sen. President Tim Bee, R-Tucson.

The bill is supported by numerous business groups but opposed by major schools groups who argue that repeal would sacrifice tax dollars needed for public schools and other priorities.

Napolitano has voiced reservations about the repeal, citing the state's fiscal troubles and saying that lawmakers don't have to - and shouldn't - take up the issue yet.

Napolitano hasn't said whether she'd sign or veto the bill. However, she still has the concerns she voiced earlier, spokeswoman Jeanine L'Ecuyer said Tuesday.

The property tax was suspended in 2006 for three years as part of a budget agreement hammered out before the current economic slowdown touched off a fiscal slide that has put the state budget in the red.

Republicans had wanted to repeal it outright. They settled for a three-year suspension as a budget compromise with Napolitano and legislative Democrats.

The Senate vote Tuesday was 16-13, with 16 being the bare minimum needed for passage by the 30-member Senate. Three senators crossed party lines.

Heated opposition from Republican Sens. Carolyn Allen of Scottsdale and Tom O'Halleran of Sedona forced repeal supporters to delay the vote for weeks until Democratic Sen. Ken Cheuvront of Phoenix agreed to provide the needed 16th vote.