Prop. 480 is investment in economy, supporters say

AZ Republic
Thursday, October 16, 2014
Michelle Ye Hee Lee

A study commissioned by the Maricopa Integrated Health System says that approving a $935 million bond to renovate and expand the county health-care system would generate state revenues.

A key opponent of the bond proposal, which is on the Nov. 4 ballot as Proposition 480, on Thursday accused MIHS of producing a taxpayer-financed campaign piece by paying for the study. The opposition campaign announced Wednesday that 26 state lawmakers have come out against the bond proposal.

The L. William Seidman Research Institute at Arizona State University's W. P. Carey School of Business conducted a study on what the economic impact of MIHS and the bond would be if the voters approved it next month.

The property-tax increase for Maricopa County residents — about $14 per $100,000 of assessed valuation — would cost taxpayers some of their disposable income and result in a loss to the local economy, according to the study.

Researchers said they also found that the bond would create jobs in health care, construction and other sectors, increasing the gross state product and real disposable personal income.

The study estimated Prop. 480 would generate $36.8 billion in goods and services and $2.5 billion in sales-tax revenues for the state over the 30-year life of the bond.

The report was released last month as the second of three parts. Yes on 480 advertised the findings Thursday as a campaign announcement and posted the study on its campaign website.

The third part will look at the social return on investment associated with health care provided by MIHS, said Anthony Evans, senior researcher at the Seidman Research Institute.

MIHS commissioned the study for $45,980 earlier this year, after its bond advisory committee recommended placing the measure on the 2014 general-election ballot. The committee also recommended MIHS complete an economic-impact study to demonstrate the return on investment of changes proposed in the bond measure.

Arizona Tax Research Association President Kevin McCarthy, who is leading the campaign against Prop. 480, said releasing the study is a diversion and a "cover for a policy proposal that simply falls flat."

McCarthy and other opponents argue that the measure is unnecessary and comes at the wrong time. Taxpayers have been burdened by Medicaid expansion and have not recovered from the recession, they say, and should not be asked to invest more money in the county's public hospital system.

The opposition also has criticized MIHS for an education campaign launched in June. MIHS spent nearly $570,000 between June 19 and Aug. 15 for print, radio, television, billboard and online ads promoting the services offered by MIHS and its various medical centers, records show.
"This is absolutely ridiculous that they are asking taxpayers of the county to pretend all the money that they're spending — to convince Maricopa County taxpayers that this (MIHS) is all a good idea — isn't related to the 480 campaign," McCarthy said.

MIHS officials have maintained the marketing campaign is unrelated to Prop. 480. It would be illegal for MIHS to use public funds to advocate for the campaign.

Mike Robertson, MIHS senior vice president of marketing and public affairs, said he launched the campaign after realizing when hired earlier this year that the public was not aware of services provided by MIHS.

"We really haven't had a voice in the community," he said. "What we're doing has nothing to do with Prop. 480. I'm completely separated from that."

Prop. 480 asks Maricopa County voters to approve the bonds, tabbed at $1.6 billion with interest over 30 years, for the county's special health-care district. The measure proposes to expand behavioral-health facilities and replace the aging county hospital at 24th and Roosevelt streets with a new building.

Early voting began last week.

Prop. 480 has strong support from MIHS and its non-profit physicians group, District Medical Group. MIHS officials and hospital employees actively are campaigning for Prop. 480.

Changes outlined in the measure are necessary, and Prop. 480 is the fiscally responsible solution, MIHS Board Chairman Mark Dewane said. He pointed to the ASU study's findings and called Prop. 480 a boon to the state and Maricopa County.

On Wednesday, the Vote No on 480 campaign released the names of 26 state lawmakers opposing the measure, including Senate President Andy Biggs, R-Gilbert, who said his main concern was the cost of the proposal.