Republican Corporation Commission Candidates

GROE NOTE: Choosing your Arizona Corporation Commissioners is an important decision that impacts your utility rates. If you would like my input or assistance in making this important decision, please call or email me before voting on September 2nd.

AZ Federation for Taxpayers/Americans for Prosperity Ratings for ACC Candidates:

Candidate *Party *Previous Office *Year *Score *Scorecard Designation

John Allen R State Representative 2006 72% Friend of the Taxpayer
John Allen R State Representative 2005 82% Champion of the Taxpayer

Rick Fowlkes R None recorded n/a n/a No record available

Joseph Hobbs R None recorded n/a n/a No record available

Marian McClure R State Representative 2008 72% Friend of the Taxpayer
Marian McClure R State Representative 2007 40% Friend of Big Government

Bob Robson R State Representative 2008 77% Friend of the Taxpayer
Bob Robson R State Representative 2007 58% Needs Improvement

Bob Stump R State Representative 2008 82% Champion of the Taxpayer
Bob Stump R State Representative 2007 69% Ally of the Taxpayer

Keith Swapp R None recorded n/a n/a No record available

Barry Wong R State Representative 2000 14% Big Spender
Barry Wong R State Representative 1999 24% Big Spender

Note: AFP Arizona does not endorse or oppose any candidates for public office. Also, past performance is no guarantee of future performance. Further, the policy matters decided by the ACC may be different from legislative or local government matters.

TIME'S UP!

GROE NOTE: Hooray! I just received this email about the demise of the TIME Initiative and a "dragon-slaying" party to celebrate the good news. Please take a moment, as Tom suggests, to send a note to those who fought on your behalf to kill this tax increase.

Dear Arizona Taxpayer,

You are invited to a Dragon Slaying Party this Friday evening, August 29th, at the George and Dragon Pub in Phoenix. The occasion for the festivities is the demise of the TIME Ballot Initiative, which was thrown off the ballot today by the Arizona Supreme Court:

http://www.bizjournals.com/phoenix/stories/2008/08/25/daily27.html

The TIME Initiative would have increased the state sales tax by 18 percent, and thrown $42 billion at unspecified transportation projects, including projects—such as light rail—that have very little to do with transportation. The government largess for rail projects would have been doled out by the members of a “Passenger Rail Projects Committee,” a majority of whose members would have been appointees serving at the pleasure of the Governor.

To learn about the many disastrous provisions of the TIME Initiative, read this analysis by transportation expert John Semmens:

http://www.americansforprosperity.org/includes/filemanager/files/az/timeinitiativeanalysis.pdf
And please send a note of thanks to Steve Voeller of the Arizona Free Enterprise Club (http://www.azfec.org/), for the work AZFEC did to oppose the TIME Initiative on the legal front. Steve’s email is steve@AZFreeEnterpriseClub.org.

If anyone is interested in organizing festivities outside of the Valley, let me know, and I will help.

For Liberty,
--Tom

Tom Jenney
Arizona Director
Americans for Prosperity
(Arizona Federation of Taxpayers)
http://www.aztaxpayers.org/
tjenney@afphq.org
(602) 478-0146

Easy Ways to Stay Informed

The Arizona Free Enterprise Club is an fiscally conservative organization that sends out email updates during the Arizona Legislative Session discussing the pros & cons of proposed legislation. I am almost always in agreement with their position. If you click on the red circled envelope at the bottom right corner of their website, you can sign up for their email updates.

Americans For Prosperity or, as the Arizona Chapter is known, Arizona Federation of Taxpayers, is also a great source of information during the legislative session. Tom Jenney, the ATF’s president, sends out email updates on budget issues & legislative proposals that effect the taxpayer. Some of his emails serve as “action alerts” so that you can organize a group of like-minded folks to call or email legislators.

The Goldwater Institute sends emails almost daily during session about all types of legislative proposals, weighing in on both fiscal & social proposals. They also rate legislators each year & compile a scorecard, much like Americans for Prosperity/Arizona Federation of Taxpayers.

Groe Named Top Champion of the Taxpayer

Groe Note: WOW!!!! After catching your breath and regaining your balance, make sure you check out the complete scorecard. You might be quite surprised at the scores of some fellow republicans.

Arizona’s FY 2008-2009 state budget, which is more than a billion dollars over budget, produced sharp divisions in legislators’ scores on the 24th annual “Friend of the Taxpayer” Legislative Scorecard, sponsored by the Arizona chapter of Americans for Prosperity (AFP), formerly the Arizona Federation of Taxpayers. Legislators voting against the budget bills scored an average of 82 percent, while legislators voting in favor scored an average of 10 percent.

The top award stayed in Lake Havasu City, with Rep. Trish Groe narrowly beating out Sen. Ron Gould, who earned the top spot the last three years in a row. Joining Groe and Gould in the category “Hero of the Taxpayer” were Gilbert Reps. Andy Biggs and Eddie Farnsworth, scoring 90 percent or higher.
To view the complete Scorecard, visit http://www.americansforprosperity.org/includes/filemanager/files/az/2008azlegislativescorecard.pdf.

With their combined high scores, Mohave County legislators Groe, Gould, and McLain made Legislative District 3 the highest-scoring district in the state. In second place was LD 22 (Gilbert), and in third place was LD 9 (Glendale/Peoria/Sun City). The average Republican legislator scored 70 percent (Friend of the Taxpayer), while the average Democratic legislator scored 9 percent (Hero of Big Government). Last year’s Party averages were 65 percent and 32 percent, respectively.

Widening the divide in scores were the failure of the Governor and legislative majorities to prevent a possible $300 million increase in property taxes next year, advance school choice legislation, allow for private enterprise to provide for Arizona’s transportation infrastructure, or enact budget reforms that would help to rein in runaway spending.

For AFP-AZ, the brightest spot in the 2008 Legislative Session was the passage of transparency legislation that will allow Arizona taxpayers to go online and view all state expenditures made to all vendors. AFP-AZ hopes the 2009 Session will extend transparency to the county and city levels.

For the second year in a row, Rep. Steve Farley (R-Tucson) was at the bottom of the scorecard, this time with a score of 3 percent. Farley, who received last year’s Empty Wallet Award, secured his spot at the bottom by casting the lone vote against the transparency legislation.

Contact: Tom Jenney, (602) 478-0146, or Phil Kerpen (202) 349-5796

Big Boondoggle Bill of 2008

The latest attempt to garner good press at the expense of good public policy, otherwise known as the Big Boondoggle Bill of 2008 is now posted on the AZLEG website in the form of an 81-page amendment to Senate Bill 1433. If you do not have the fortitude to read the entire amendment, I will touch on the 4 main ideas:

Solar Tax Credits - This would offer incentives for qualifying new businesses that manufacture solar energy components in Arizona.
Research and Development Tax Credits - This would enhance current corporate and income tax credits for new research and development projects.
Cactus League Baseball - This would allow Pima County voters to approve targeted taxes, proposed by a private Tucson-area group, to pay for improvements to new and existing Cactus League ballpark facilities, and is targeted at keeping teams in their southern Arizona location.
Urban Redevelopment Project - This would establish new entertainment districts, targeted at urban downtown areas.

Though these proposals may sound innocuous, the devil is in the details. The list of organizations opposed to this measure is growing and now includes:

Arizona Federation of Taxpayers

The Arizona Free Enterprise Club

Arizona Restaurant Association

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

AFT 2007 Legislative Ranking

Finally made it to CHAMPION OF THE TAXPAYER!

I would love to be recognized as HERO but it is a tough year for that, budget-wise. That is not going to stop me from trying though.

ATF 2006 Legislative Ranking

With the election coming up, I thought things like this chart of rankings from the Arizona Federation of Taxypayers might help you rate your legislators.

AFT 2005 Legislative Rankings

My first year in office, greener than green, and I still manage to rank as "FRIEND OF THE TAXPAYER". Click the title of the post to see how other legislators rank.

Letter from Americans for Prosperity Director Tom Jenny

April 16, 2008

Dear Legislative District 3 Taxpayer:

The bad news is that Gov. Janet Napolitano’s veto today of House Bill 2220 will likely result in the return of a $250 million property tax, for an average property tax increase of $100 per year for the Arizona homeowner. Combined with likely increases by city, county, and local special taxing districts, the Governor’s tax increase may contribute to significant increases in the overall property tax bills of home and business owners.

The silver lining in the cloud created by Napolitano is that there is still a small chance of repealing the $250 million state-imposed education equalization property tax, as a part of budget negotiations later in the legislative session.

And the really good news is that all of your LD 3 Legislators—Sen. Ron Gould, Rep. Trish Groe, and Rep. Nancy McLain—are part of the slim majority in the Arizona Senate that wants to help Arizona property taxpayers by repealing the tax.

In the House in March, 32 Arizona Representatives (31 Republicans and 1 Democrat) voted for the HB 2220 property tax relief bill. We have listed the names and districts of the House Good Guys here:
http://www.americansforprosperity.org/includes/filemanager/files/az/goodguyshb2220.pdf

At the same time, 28 Representatives (26 Democrats and 2 Republicans) voted against HB 2220. We have listed the names and districts of the House Bad Guys here: http://www.americansforprosperity.org/includes/filemanager/files/az/badguyshb2220.pdf

Last week, 16 Arizona Representatives (15 Republicans and 1 Democrat) voted for HB 2220. 14 Arizona Representatives (12 Democrats and 2 Republicans) failed to vote to protect property taxpayers. Here is the list of Good Guys and Bad Guys for the Senate:
http://includes/filemanager/files/az/hb2220senategoodbad.pdf

Stay tuned—we will keep you posted on property tax reforms and other taxpayer-related action as the legislative session goes on.

Tom Jenney
Arizona Director
Americans for Prosperity
http://www.aztaxpayers.org/
tjenney@afphq.org

The Good, Bad, & The Ugly

Arizona Federation of Taxpayer's post details Tuesday's vote on the $250 Million Dollar Property Tax returning next year includes a list of the House Representatives who voted to repeal the tax and who voted against the bill. Both Representative McLain and I supported this legislation and I am confident that when Senator Gould has the opportunity to vote, he too will vote "YES".

SCR 1009~No Taxpayer Money for Lobbyists

Tough road ahead for ban on taxpayer-funded lobbying. Tell Sponor Senator Linda Gray to keep up the good fight!

In an effort to end the use of taxpayer funds for lobbying, Arizona Senator Linda Gray (R-Northwest Phoenix) introduced SCR 1009, a referendum bill also known as No Taxpayer Money for Lobbyists (NTML).

If passed during the current legislative session, NTML would allow Arizona voters in November to prohibit the use of public funds for lobbying, while safeguarding the ability of elected officials, public agencies, departments, boards, commissions, and political subdivisions to provide expert testimony and information to members of the Legislature.

Although it started off the session with more than a dozen sponsors, and earned the endorsement of the state GOP at its mandatory meeting on January 26th, NTML was held in the Senate’s Government Committee this week. The difficulties faced by the bill in that committee show just how tough it will be to get the reform through the Legislature.

One of the committee members, Sen. Meg Burton Cahill (D-Tempe), expressed the view that the democratic election of local government officials confers legitimacy on all of their decisions, including the decision to give public funds to lobbyists. That is a common view down at the Legislature, although it was not the view of the framers of the US and Arizona Constitutions, who believed that government should have limited powers.

Sen. Robert Blendu (R-Litchfield Park, Goodyear) expressed worries that a ban on taxpayer-funded lobbying would disrupt the information-providing function of the lobbying system. While he is correct that lobbying does facilitate the flow of information about policies, it does not follow that lobbyists should have access to public funds. Instead, elected officials and government employees should raise lobbying money the way other interest groups do—by means of private, voluntary contributions.

Sen. Jake Flake (R-Gila and Apache Counties) argued that there is no inherent big-government bias to taxpayer-funded lobbying. He is correct that we should not make blanket statements about the aims of all taxpayer-funded lobbying, but examples of big-government bias come readily to mind. In recent years, lobbyists in Arizona have used public funds to oppose popular efforts to end eminent domain abuse, reduce income and property taxes, and extend educational opportunities to children through school choice.

Sen. Flake also expressed some understandable concerns about geographical equity: the mayor of Snowflake will have more difficulty getting to legislative hearings than the mayor of Glendale. However, there is nothing in NTML that would prevent the Legislature from reimbursing city and county officials for travel expenses when they are invited to Phoenix to testify before legislative committees.

Facing opposition from the Committee’s majority—Senators Blendu, Burton Cahill, Flake, and the nearly silent Jorge Luis Garcia (D-Tucson)—Senator Gray held the bill.

From here, NTML faces a tough road. Perhaps an amended version of the bill can get out of committee and go to a vote before the full Senate. Or perhaps a House version of the bill can move forward. If the Legislature fails us, taxpayer activists will have to wait until next year to collect signatures and put a citizen initiative on the 2010 ballot.

Meanwhile, please send Senator Linda Gray an email (lgray@azleg.gov) or a phone message (602-926-3376) to thank her for her efforts to end taxpayer-funded lobbying. And please tell her to keep up the good fight!


URL for text of the January 26th state GOP resolution in favor of NTML:
http://www.americansforprosperity.org/index.php?id=4794&state=az

Contact: Tom Jenney, Arizona state director, Americans for Prosperity
tjenney@afphq.org (602) 478-0146

Taxpayer Appreciation and Investment Act

Top 10 Reasons to Support the TAIA
by Tom Jenney
Executive Director, Arizona Federation of Taxpayers
Testimony to House Ways and Means, February 6, 2006

10) The surplus is a clear sign that taxes are too high. Arizona has collected between $850 million and $1 billion in extra revenue over projections. The Taxpayer Appreciation and Investment Act would reduce personal and corporate income tax burdens for all Arizona taxpayers by about ten percent, providing much-needed tax relief for the working people and retirees of Arizona. The current package, which would be phased in over two years, will use up between a quarter and a fifth of the surplus.

9) Arizona already spends far too much. Arizona’s FY 2006 budget is $1.3 billion, or almost 18 percent, over what it would have been had the state limited its budget growth to the rate of population plus inflation. The ten-year average for the rate of population growth plus inflation in Arizona has been 4.8 percent. But the average growth in general fund spending has been 6.7 percent. Anecdotally, the year of greatest infamy was FY 2005, when the Governor and her Big Spender friends teamed up to increase total expenditures by 17.4 percent, or $1.2 billion. That was an outrageous increase. Most taxpayers haven’t seen anything like 17-percent annual increases in their incomes. Even the relatively restrained FY 2006 budget grew faster (7.2 percent) than the 12-year average growth in personal income of 6.8 percent and more than twice as fast as the increase of wages.


8) There is plenty of room in the surplus if the Big Spenders don’t blow it on new spending. Without new spending, we could have the full TAIA as it was introduced, and the Martin-Huffman property tax cut package.

7) There is even more room in the surplus if the Big Borrowers don’t blow it on repaying the raided funds and the K-12 rollover. If there’s any conflict between tax cuts and repaying the funds, cut taxes. The raided funds should be reimbursed out of the general fund, through savings in current programs. Otherwise, we’re setting up what the insurers call “moral hazard.” If the taxpayers bail out the Big Borrowers every time there’s a surplus, the Big Borrowers will never learn to control themselves.

6) This is a tiny tax cut, in the big scheme of things. In Figure 2, which uses simple trendlines, we can see how the TAIA compares with trendline revenue growth (6.4 percent) and with a proposal to eliminate the income tax over 20 years. Notice the difference between the mythical static trendlines (labeled “Stat”) and the one-third dynamic-scoring feedback for both taxes (labeled “Dyn”). AFT supports the 20-year phase-out of the income tax, because it would reduce revenue to a level consistent with budgets that are limited in growth to the rate of population plus inflation. But that’s another matter for another committee. The point here is how modest the TAIA is.

5) Arizona’s “three-legged stool” is unbalanced. The average combined burden of personal and corporate income taxes as a portion of state tax revenue for the past twelve years has been over 40 percent. By cutting ten percent off that 40 percent, we would get closer to reducing income taxes to one-third of state tax revenues.

4) Arizona should rely more heavily on consumption taxes. Here are four reasons:
A) Sales taxes are highly visible, which makes it harder for the government to raise them. Sales taxes are visible in every purchase we make, especially the larger ones. But many folks do not keep a close eye on their income taxes because they are withheld by their employers.
B) Consumption taxes are among the least damaging of taxes to economic growth (their marginal excess burden is lower than that for other taxes).
C) Reducing Arizona’s income taxes would not increase the volatility of general fund revenue sources—and it might even decrease that volatility. Arizona’s sales tax revenue has been much more stable than Arizona’s income revenue.
D) Sales taxes are not necessarily regressive. First, lifetime income mobility means that only a tiny fraction of persons is poor for longer than a few years. Most people are poor when they’re 22 years old, but those same people are not poor when they’re 42 years old.

3) Americans vote with their feet, and they vote for low taxes and strong business climates. According to Arizona Republic columnist Robert Robb, there are 19 states with lower personal income tax rates than Arizona, and the Tax Foundation lists ten states with lower personal income taxes in per-capita terms. [This just in: a new Tax and Budget Bulletin from the Cato Institute shows that 14 states have lower state and local tax burdens than Arizona, measured as a percent of income.] The TAIA would reduce Arizona’s highest rate to 4.64 percent, even with Colorado’s flat income tax rate. That’s not as good as the zero-percent rates of Nevada and Texas, but it’s a good start.


2) Arizona needs to dramatically reduce—if not abolish—its corporate income tax. It is especially important to reduce corporate income taxes as part of the overall package. Corporate income taxes are far and away the most volatile of Arizona’s large taxes. And they are perhaps the most destructive taxes on a dollar for dollar basis when it comes to retarding employment growth. As any economist will tell you, corporations do not pay taxes. Workers pay part of those taxes through lower wages, customers pay part of them through higher prices, and shareholders—including retirees—pay part through lower dividends.
(Link to Slivinski report: http://www.goldwaterinstitute.org/pdf/materials/292.pdf)

And the number one reason (drum roll, please)…

1) Income taxes are especially destructive because they are taxes on capital and taxes on savings. In the jargon of economics, they have very high marginal excess burdens. A dollar of revenue raised through income taxes destroys more economic activity than a dollar of revenue raised through almost any other kind of tax. As economist Richard Vedder explained in a survey of various state taxes, “The income tax is the champion of bad taxes, in terms of its destructive effect on people, prosperity, and their economic well-being.” Arizona’s destructive, growth-harming income taxes have not been cut in ten years. We are asking you to give us relief from these taxes. Do it now. Please.

--Tom Jenney is executive director of the Arizona Federation of Taxpayers. To view AFT’s 2005 Legislative Scorecard, visit www.aztaxpayers.org.