Big Boondoggle Bill of 2008

Dear Arizona Taxpayer:

As I wrote yesterday, the Arizona Senate is considering SB1450, a bill that would award a private company the privilege of issuing $750 million in tax-free bonds, so that it can build a rock music theme park in Eloy.

Proponents of SB1450 have contacted me, arguing that the bill's language removes any legal obligation for taxpayers to bail out the theme park district in the event that it cannot attract enough visitors to pay back the bond creditors.

That appears to be true about the legal obligation, but the legislation does not remove the political obligation to bail out the theme park district. If the Eloy theme park turns out to be a flop, future legislatures will be under intense pressure to bail out the theme park. If they do not, the failure of the district to pay back creditors will hurt Arizona's bond ratings, effectively raising the interest rates for revenue bonds for traditional public-private partnerships, such as road construction projects.

Again, the economic downsides of the Decades Theme Park deal are not nearly as important as the question of principle at stake: Should the government give special taxing privileges to chosen companies? Again, the answer to that question is, "NO." The government should not be in the business of picking winners and losers in the economy.

Further, if we let the Eloy deal pass, it will only encourage the rest of the sharks, who are already pestering the Legislature to pass the Big Boondoggle Bill of 2008, which includes special tax breaks for entertainment districts, ballparks, and other politically-favored industries, all in the name of "economic stimulus." Remember that every dollar given to a favored industry in a tax credit is a dollar that cannot be cut from the taxes of ordinary individuals, families, and businesses. Somehow, that does not seem very stimulating...

For emerging details on the Big Boondoggle Bill of 2008, see this story in the Republic:

http://www.azcentral.com/news/articles/2008/06/18/20080618stimulus0618.html

The tax credit handouts in the Big Boondoggle Bill of 2008 make the Eloy deal look almost innocent. It seems that our politicians just can't break the habit of picking winners and losers in the Arizona economy-no matter how many losers they pick. We will keep you posted on developments related to the Big Boondoggle Bill.

For Liberty,

Tom Jenney
Arizona Director
Americans for Prosperity
(Arizona Federation of Taxpayers)
http://www.aztaxpayers.org/
tjenney@afphq.org