- $4.1 Million revents to the GF (general fund) from the State Lake Improvement Fund
- $18.1 Million revents to the GF from the State Aviation Fund
- $1 Million from the FY 07 Appropriation for the Yuma Welcome Center reverts to the GF
- $1.5 Million from the 2006 conditional appropriation for the Yuma Welcome Center reverts to the GF
- $42 Million appropriated from the State Highway Fund to the Statewide Transportation Acceleration Needs Account (STAN) is now transferred to the Department of Public Safety for Highway Patrol costs.
Showing posts with label spending. Show all posts
Showing posts with label spending. Show all posts
Friday, July 25, 2008
New Law: HB 2620 Budget Adjustments; FY 2007-2008
This bill is NOT the most recently enacted budget but the budget changes/fixes that we voted on earlier this year to address the $1.8 Billion Dollar shortfall for the fiscal year that ended this past June. This bill revises the FY 2007-2008 budget.
Monday, June 30, 2008
2008 Session Worst In Memory
Americans For Prosperity
FOR IMMEDIATE RELEASE
June 30, 2008
AFP AZ calls '08 Session “worst in memory”
PHOENIX—The Arizona chapter of Americans for Prosperity (AFP Arizona) said today that the Legislative Session that ended Friday was the “worst in memory” for fiscal conservatives.
"This is a $10.9 billion budget masquerading as a $9.9 billion budget," said AFP Arizona director Tom Jenney. "And it comes at a time when general fund revenues are about $9.1 billion." Because the budget uses debt and accounting gimmicks to push spending commitments off the books, the Legislature and Governor in January will face a cash deficit carry-forward of over a billion dollars, something Jenney said is unconstitutional. Combined with the impact of automatic voter-mandated spending increases, the deficit in January could be more than $1.5 billion.
"This Legislative Session was a near-total disaster for fiscal conservatives," said AFP Arizona chairman Chad Kirkpatrick, citing the failure to pass measures that would permanently repeal the state equalization property tax rate. That failure leaves open the possibility that Arizona politicians will attempt to impose a $250 million property tax increase on homeowners and businesses next year.
AFP Arizona also condemned other measures adopted last week by the Governor and majorities of legislators, including a scheme to finance a billion dollars in new debt for university capital projects by expanding the Arizona lottery, and a scheme to grant the special privileges of issuing tax-free bonds and levying taxes to the developer of a rock and roll theme park in Eloy.
The group did cite several small victories, such as blocking the passage of special tax breaks for solar companies and for an entertainment district in downtown Phoenix, and preventing the creation of a new taxing district for baseball stadiums in Pima County. Also, fiscal conservatives in the Legislature prevented the referral of a transportation sales tax to the November ballot, forcing the TIME Coalition to raise private funds for its ballot initiative.
Here is the Senate vote on the main FY2009 Budget bill (a “Y” indicates a vote in favor of massive debt spending and accounting gimmicks):
http://www.azleg.gov/FormatDocument.aspinDoc=/legtext/48leg/2r/bills/hb2209.sthird.1.asp
Here is the House vote on the main FY2009 Budget bill (a “Y” indicates a vote in favor of massive debt spending and accounting gimmicks):
http://www.azleg.gov/FormatDocument.aspinDoc=/legtext/48leg/2r/bills/hb2209.hfinal.1.asp
Here is the House vote on HCR2072 (a “Y” indicates a vote in favor of permanent repeal of the state equalization property tax):
http://www.azleg.gov/FormatDocument.aspinDoc=/legtext/48leg/2r/bills/hcr2072.hthird.1.asp
Here is the Senate vote on HB2220 (a “Y” indicates a vote in favor of permanent repeal of the state equalization property tax):
http://www.azleg.gov/FormatDocument.aspinDoc=/legtext/48leg/2r/bills/hb2220.sthird.1.asp
Here is the Senate vote on SB1450 (a “Y” indicates a vote in favor of granting special taxing and bonding privileges to the Eloy theme park):
http://www.azleg.gov/FormatDocument.asp?inDoc=/legtext/48leg/2r/bills/sb1450.sfinal.1.asp
Here is the House vote on SB1450 (a “Y” indicates a vote in favor of granting special taxing and bonding privileges to the Eloy theme park):
http://www.azleg.gov/FormatDocument.aspinDoc=/legtext/48leg/2r/bills/sb1450.hthird.1.asp
Here is the House vote on SB1084 (a “Y” indicates a vote in favor of giving taxing authority to baseball stadiums in Pima County):
http://www.azleg.gov/FormatDocument.aspinDoc=/legtext/48leg/2r/bills/sb1084.hthird.1.asp
Contact: Tom Jenney, Arizona state director, Americans for Prosperity
tjenney@afphq.org (602) 478-0146
FOR IMMEDIATE RELEASE
June 30, 2008
AFP AZ calls '08 Session “worst in memory”
PHOENIX—The Arizona chapter of Americans for Prosperity (AFP Arizona) said today that the Legislative Session that ended Friday was the “worst in memory” for fiscal conservatives.
"This is a $10.9 billion budget masquerading as a $9.9 billion budget," said AFP Arizona director Tom Jenney. "And it comes at a time when general fund revenues are about $9.1 billion." Because the budget uses debt and accounting gimmicks to push spending commitments off the books, the Legislature and Governor in January will face a cash deficit carry-forward of over a billion dollars, something Jenney said is unconstitutional. Combined with the impact of automatic voter-mandated spending increases, the deficit in January could be more than $1.5 billion.
"This Legislative Session was a near-total disaster for fiscal conservatives," said AFP Arizona chairman Chad Kirkpatrick, citing the failure to pass measures that would permanently repeal the state equalization property tax rate. That failure leaves open the possibility that Arizona politicians will attempt to impose a $250 million property tax increase on homeowners and businesses next year.
AFP Arizona also condemned other measures adopted last week by the Governor and majorities of legislators, including a scheme to finance a billion dollars in new debt for university capital projects by expanding the Arizona lottery, and a scheme to grant the special privileges of issuing tax-free bonds and levying taxes to the developer of a rock and roll theme park in Eloy.
The group did cite several small victories, such as blocking the passage of special tax breaks for solar companies and for an entertainment district in downtown Phoenix, and preventing the creation of a new taxing district for baseball stadiums in Pima County. Also, fiscal conservatives in the Legislature prevented the referral of a transportation sales tax to the November ballot, forcing the TIME Coalition to raise private funds for its ballot initiative.
Here is the Senate vote on the main FY2009 Budget bill (a “Y” indicates a vote in favor of massive debt spending and accounting gimmicks):
http://www.azleg.gov/FormatDocument.aspinDoc=/legtext/48leg/2r/bills/hb2209.sthird.1.asp
Here is the House vote on the main FY2009 Budget bill (a “Y” indicates a vote in favor of massive debt spending and accounting gimmicks):
http://www.azleg.gov/FormatDocument.aspinDoc=/legtext/48leg/2r/bills/hb2209.hfinal.1.asp
Here is the House vote on HCR2072 (a “Y” indicates a vote in favor of permanent repeal of the state equalization property tax):
http://www.azleg.gov/FormatDocument.aspinDoc=/legtext/48leg/2r/bills/hcr2072.hthird.1.asp
Here is the Senate vote on HB2220 (a “Y” indicates a vote in favor of permanent repeal of the state equalization property tax):
http://www.azleg.gov/FormatDocument.aspinDoc=/legtext/48leg/2r/bills/hb2220.sthird.1.asp
Here is the Senate vote on SB1450 (a “Y” indicates a vote in favor of granting special taxing and bonding privileges to the Eloy theme park):
http://www.azleg.gov/FormatDocument.asp?inDoc=/legtext/48leg/2r/bills/sb1450.sfinal.1.asp
Here is the House vote on SB1450 (a “Y” indicates a vote in favor of granting special taxing and bonding privileges to the Eloy theme park):
http://www.azleg.gov/FormatDocument.aspinDoc=/legtext/48leg/2r/bills/sb1450.hthird.1.asp
Here is the House vote on SB1084 (a “Y” indicates a vote in favor of giving taxing authority to baseball stadiums in Pima County):
http://www.azleg.gov/FormatDocument.aspinDoc=/legtext/48leg/2r/bills/sb1084.hthird.1.asp
Contact: Tom Jenney, Arizona state director, Americans for Prosperity
tjenney@afphq.org (602) 478-0146
Friday, June 27, 2008
Legislature Breaks Law
Robert Robb claims, in this recent column, that the Arizona Legislature is breaking the law by using a budget gimmick commonly called the "K-12 Rollover". Personally, I abhor the rollover. During my first or second session, we paid back the $191 Million Dollars owed to the school districts from a session prior to my election. I was proud that we accomplished this and never expected that this deceptive practice to be used again while the Republicans held the majority. Unfortunately I was wrong...dead wrong. Hats off to Mr. Robb for shedding some light on this practice.
Thursday, June 26, 2008
Edwards’s 2-to-1 Budget Law
From Chris Edwards, the Director of Tax Policy Studies at the Cato Institute:
How should government officials decide on whether to fund big projects such as fighter aircraft, highways, bridges, and other types of infrastructure? First, they should check the Constitution to see whether they are legally allowed to spend on the object in consideration. Second, they should assume that the item will cost at least twice as much as initial estimates indicate.
There should be a 2-to-1 hurdle when the price tag of a project is being considered.
Government purchases of military hardware, highways, energy projects, space equipment, and other items often cost 50% or 100%, or more (see here and here), above what politicians originally promise.
Let’s be conservative and say that a 50% cost overrun is typical, such that we can expect a new $1 billion project to actually cost taxpayers $1.5 billion. But as economists often point out, paying for $1.5 billion in government spending will cost taxpayers much more than $1.5 billion because of the “deadweight losses” or inefficiency costs created by extracting taxes from the private sector with a complex and high-rate system.
How much more? Harvard’s Martin Feldstein thinks deadweight losses might be $1 for each added dollar of taxes. But let’s be conservative and say it’s only 50 cents on the dollar. So government projects impose deadweight losses of 50% on costs that are likely to balloon at least 50%.
The bottom line is that when America’s taxpayers hear that politicians want to spend, say, $10 billion on a new scheme, they should assume that they will face an ultimate financial hit of $22.5 billion. And that’s conservative!"
How should government officials decide on whether to fund big projects such as fighter aircraft, highways, bridges, and other types of infrastructure? First, they should check the Constitution to see whether they are legally allowed to spend on the object in consideration. Second, they should assume that the item will cost at least twice as much as initial estimates indicate.
There should be a 2-to-1 hurdle when the price tag of a project is being considered.
Government purchases of military hardware, highways, energy projects, space equipment, and other items often cost 50% or 100%, or more (see here and here), above what politicians originally promise.
Let’s be conservative and say that a 50% cost overrun is typical, such that we can expect a new $1 billion project to actually cost taxpayers $1.5 billion. But as economists often point out, paying for $1.5 billion in government spending will cost taxpayers much more than $1.5 billion because of the “deadweight losses” or inefficiency costs created by extracting taxes from the private sector with a complex and high-rate system.
How much more? Harvard’s Martin Feldstein thinks deadweight losses might be $1 for each added dollar of taxes. But let’s be conservative and say it’s only 50 cents on the dollar. So government projects impose deadweight losses of 50% on costs that are likely to balloon at least 50%.
The bottom line is that when America’s taxpayers hear that politicians want to spend, say, $10 billion on a new scheme, they should assume that they will face an ultimate financial hit of $22.5 billion. And that’s conservative!"
Monday, June 23, 2008
Hold on to Your Wallet!
UPDATE: Alright, I've had a bit of ice cream to soothe my nerves and refocus my perspective. I thought I would take a moment to mention that I am thankful we have not only one budget proposal (the House) but two, as the Senate just announced their bipartisan budget plan. As much as I might detest both of these measures I just wanted to acknowledge that at least there is a plan. And that ladies and gentlemen, is what you call an attitude adjustment!
A budget solution that robs from cities, counties, almost every designated fund, and still consists of more debt (borrowing) without real reform, without trimming any of the government waste and without addressing the $2.2 BILLION DOLLAR SHORTFALL and then the news that Jerry Weiers stink'n OHV bill passed out of the Senate today...can the day get any worse? Oy vay! What next...the passage of the GOP Economic Stimulus package? Tell me it isn't so!
A budget solution that robs from cities, counties, almost every designated fund, and still consists of more debt (borrowing) without real reform, without trimming any of the government waste and without addressing the $2.2 BILLION DOLLAR SHORTFALL and then the news that Jerry Weiers stink'n OHV bill passed out of the Senate today...can the day get any worse? Oy vay! What next...the passage of the GOP Economic Stimulus package? Tell me it isn't so!
Wednesday, May 7, 2008
Voters Can Trump Spending
By Tom Jenney
You play the hand you’ve been dealt, and in this year’s fiscal-policy poker game, fiscal conservatives in Arizona have a lot of bad cards.
Instead of an ace in the executive branch of state government, fiscal conservatives have a two.
Back in the fall, when Fiscal Year (FY) 2008 revenues began falling below the revenues for FY 2007, a fiscally conservative Governor would have made modest reductions in agency spending to bring expenditures in line with revenue. Instead, Gov. Janet Napolitano continued to spend FY 2008 money as if there were no shortage of revenue. She also failed to call the Legislature into a mid-year special session to correct the over-optimistic FY 2008 budget passed in June.
For the FY 2009 budget, Napolitano will likely continue doing what she has done for the last five years, which is to bargain shrewdly so as to maximize government spending. According to her budget office, state government spending now takes up 7.01 percent of the state’s economy—the biggest slice for government since 1980.
Napolitano’s deficit plan involves financing current spending levels with huge amounts of (unconstitutional) debt. And with her recent veto of House Bill 2220, she has promoted the fiction that a property tax increase is necessary to close the budget deficit.
Instead of an ace in the judicial branch, fiscal conservatives have a three. The Arizona Supreme Court in past years has refused to enforce the constitutional prohibition on state debt, and it is unlikely to start doing so now.
A third ace would be a solid majority of fiscal conservatives in the Legislature, but instead, fiscal conservatives have a seven (in other words, less than half). Most of the time, they do not have the votes to get fiscally conservative bills onto the Governor’s desk, or to send those bills to the ballot via referenda (a move that bypasses the Governor’s veto pen). (GROE NOTE: Remember this when election time comes around in the fall!)
With a solid majority of fiscal conservatives in the Legislature, Arizona would not have overspent during the last five years, and we would not have the largest budget deficit in the nation. In any case, a fiscally conservative majority (with some cooperation from the Governor) would make short work of current deficits, holding FY 2008 and FY 2009 spending constant at FY 2007 levels ($9.8 billion). Modest transfers of cash from the Rainy Day Fund could easily balance those budgets—without accounting gimmicks, and without taking on debt.
Although most of Arizona’s fiscally profligate legislators are Democrats, this is not a strictly partisan problem. In the recent Senate battle over HB 2220, Republicans Carolyn Allen of Scottsdale and Tom O’Halleran of Prescott voted to increase property taxes, while Democrat Ken Cheuvront of Phoenix provided the 16th vote to get tax relief out of the Senate. In the House, Democrat Mark DeSimone crossed party lines to vote for property tax relief, while Republicans Pete Hershberger and Jennifer Burns chose to snub homeowners and businesses.
A fourth ace would be legislative leadership strong enough to bargain hard with the Governor and put petty bills on hold until the budget crisis is resolved. Individually, some of our legislative leaders are face cards, but collectively, they’re more like a six—easily beaten by the Queen of Spending.
The only good card fiscal conservatives hold this year is the wild card of grassroots taxpayer activism. Taxpayer activists must work hard to push to balance the FY 2009 budget without tax increases, accounting gimmicks or debt, put strong property tax and budget reforms on the November ballot, and support fiscally conservative candidates in September and November. If they do those things, the grassroots wild card could turn out to be the missing ace fiscal conservatives need to play a winning hand this year.
The stakes of the fiscal-policy poker match are high. Arizona can choose the path of strong economic growth and prosperity, or it can slide into high-tax, high-spending sluggishness. Grassroots taxpayer activists will decide.
--Tom Jenney is the Arizona director of Americans for Prosperity (https://owa.azleg.state.az.us/exchweb/bin/redir.asp?URL=http://www.aztaxpayers.org)
You play the hand you’ve been dealt, and in this year’s fiscal-policy poker game, fiscal conservatives in Arizona have a lot of bad cards.
Instead of an ace in the executive branch of state government, fiscal conservatives have a two.
Back in the fall, when Fiscal Year (FY) 2008 revenues began falling below the revenues for FY 2007, a fiscally conservative Governor would have made modest reductions in agency spending to bring expenditures in line with revenue. Instead, Gov. Janet Napolitano continued to spend FY 2008 money as if there were no shortage of revenue. She also failed to call the Legislature into a mid-year special session to correct the over-optimistic FY 2008 budget passed in June.
For the FY 2009 budget, Napolitano will likely continue doing what she has done for the last five years, which is to bargain shrewdly so as to maximize government spending. According to her budget office, state government spending now takes up 7.01 percent of the state’s economy—the biggest slice for government since 1980.
Napolitano’s deficit plan involves financing current spending levels with huge amounts of (unconstitutional) debt. And with her recent veto of House Bill 2220, she has promoted the fiction that a property tax increase is necessary to close the budget deficit.
Instead of an ace in the judicial branch, fiscal conservatives have a three. The Arizona Supreme Court in past years has refused to enforce the constitutional prohibition on state debt, and it is unlikely to start doing so now.
A third ace would be a solid majority of fiscal conservatives in the Legislature, but instead, fiscal conservatives have a seven (in other words, less than half). Most of the time, they do not have the votes to get fiscally conservative bills onto the Governor’s desk, or to send those bills to the ballot via referenda (a move that bypasses the Governor’s veto pen). (GROE NOTE: Remember this when election time comes around in the fall!)
With a solid majority of fiscal conservatives in the Legislature, Arizona would not have overspent during the last five years, and we would not have the largest budget deficit in the nation. In any case, a fiscally conservative majority (with some cooperation from the Governor) would make short work of current deficits, holding FY 2008 and FY 2009 spending constant at FY 2007 levels ($9.8 billion). Modest transfers of cash from the Rainy Day Fund could easily balance those budgets—without accounting gimmicks, and without taking on debt.
Although most of Arizona’s fiscally profligate legislators are Democrats, this is not a strictly partisan problem. In the recent Senate battle over HB 2220, Republicans Carolyn Allen of Scottsdale and Tom O’Halleran of Prescott voted to increase property taxes, while Democrat Ken Cheuvront of Phoenix provided the 16th vote to get tax relief out of the Senate. In the House, Democrat Mark DeSimone crossed party lines to vote for property tax relief, while Republicans Pete Hershberger and Jennifer Burns chose to snub homeowners and businesses.
A fourth ace would be legislative leadership strong enough to bargain hard with the Governor and put petty bills on hold until the budget crisis is resolved. Individually, some of our legislative leaders are face cards, but collectively, they’re more like a six—easily beaten by the Queen of Spending.
The only good card fiscal conservatives hold this year is the wild card of grassroots taxpayer activism. Taxpayer activists must work hard to push to balance the FY 2009 budget without tax increases, accounting gimmicks or debt, put strong property tax and budget reforms on the November ballot, and support fiscally conservative candidates in September and November. If they do those things, the grassroots wild card could turn out to be the missing ace fiscal conservatives need to play a winning hand this year.
The stakes of the fiscal-policy poker match are high. Arizona can choose the path of strong economic growth and prosperity, or it can slide into high-tax, high-spending sluggishness. Grassroots taxpayer activists will decide.
--Tom Jenney is the Arizona director of Americans for Prosperity (https://owa.azleg.state.az.us/exchweb/bin/redir.asp?URL=http://www.aztaxpayers.org)
Friday, February 29, 2008
AZ Auditor General's Report on Classroom Dollar Spending
The Arizona Office of the Auditor General recently released a report on the percentage of dollar spent on classroom costs. You can look up specific school districts and see how they compare to the national average. There is also information how many schools are in the district, the number of students in said district and the district's ranking within the 239 state school districts.
Comparative information includes the student/teacher ratio, the average teacher's salary, and a teacher's average years experience.
Interesting reading from the report:
Comparative information includes the student/teacher ratio, the average teacher's salary, and a teacher's average years experience.
Interesting reading from the report:
- In fiscal year 2007, Arizona’s state-wide percentage of dollars spent in the classroom decreased for the third consecutive year to 57.9 percent and remains more than 3 percentage points below the national average. More than half of the school districts’ classroom dollar percentages declined in 2007, but the biggest impact on the state average came from declines in the very large districts. With the infusion over the past several years of significant state-provided resources largely directed to the classroom, the State’s classroom dollar percentage could have been higher, but districts appear to be using these monies to supplant other monies, a violation of A.R.S. §15-977.
- Compared with the national average, Arizona districts spent a larger portion of their current dollars on student support services, plant operation and maintenance, and food service. However, on a positive note, Arizona districts spent much less on administration.
Simmering with Indignation
facing this deficit
the future before us bleak
painful cuts we have to make
so many troubling, so terribly deep
blindly borrowing against your future
she wants to grow and grow
greedy layers of government
gluttons fat and slow
spending your hard-earned money to excess
while my patience with her becomes less and less
Alright, you guessed it...tonight is amateur poetry night and, although it might hurt your ears if read aloud, it won't hurt your pocketbook
the future before us bleak
painful cuts we have to make
so many troubling, so terribly deep
blindly borrowing against your future
she wants to grow and grow
greedy layers of government
gluttons fat and slow
spending your hard-earned money to excess
while my patience with her becomes less and less
Alright, you guessed it...tonight is amateur poetry night and, although it might hurt your ears if read aloud, it won't hurt your pocketbook
Saturday, January 26, 2008
HCR 2038~Spending Limit for Arizona Government
A Proposed Floor Resolution to be made at the January 26, 2008 Republican State Committee:
Whereas, the Governor and her legislative allies have spent the state government into a billion-dollar budget deficit;
Whereas, some legislators are using the deficit to justify bringing back the state equalization property tax;
Whereas, in 2006 and 2007, state government spending as a portion of the state economy, as measured by personal income, exceeded 6.4 percent;
Whereas, fiscal moderation and fiscal conservatism both demand that government not be allowed to grow faster than the private economy;
Whereas, the existing Constitutional spending limit of 7.41 percent of state personal income was far too high to restrain recent spending binges;
Resolved, the Arizona Republican Party in Convention assembled on this 26th day of January 2008 does hereby declare that:
The Arizona Republican Party supports HCR 2038, a referendum bill introduced in the Second Session of the 48th Arizona Legislature, which would allow voters in November 2008 to amend Arizona’s Constitutional spending limit to cap spending by the state government at no more than 6.4 percent of state personal income;
Further, the following legislators are to be commended for sponsoring HCR 2038: from the Arizona House of Representatives, Russell Pearce, Mark Anderson, Ray Barnes, Andy Biggs, Judy Burges, Sam Crump, Eddie Farnsworth, Trish Groe, John Kavanagh, Rick Murphy, Bob Stump, House Speaker Jim Weiers, and Steven Yarbrough, and from the Arizona Senate, Robert “Bob” Burns, Ron Gould, Jack Harper, Sen. Karen Johnson, and Senate Majority Leader Thayer Verschoor.
Whereas, the Governor and her legislative allies have spent the state government into a billion-dollar budget deficit;
Whereas, some legislators are using the deficit to justify bringing back the state equalization property tax;
Whereas, in 2006 and 2007, state government spending as a portion of the state economy, as measured by personal income, exceeded 6.4 percent;
Whereas, fiscal moderation and fiscal conservatism both demand that government not be allowed to grow faster than the private economy;
Whereas, the existing Constitutional spending limit of 7.41 percent of state personal income was far too high to restrain recent spending binges;
Resolved, the Arizona Republican Party in Convention assembled on this 26th day of January 2008 does hereby declare that:
The Arizona Republican Party supports HCR 2038, a referendum bill introduced in the Second Session of the 48th Arizona Legislature, which would allow voters in November 2008 to amend Arizona’s Constitutional spending limit to cap spending by the state government at no more than 6.4 percent of state personal income;
Further, the following legislators are to be commended for sponsoring HCR 2038: from the Arizona House of Representatives, Russell Pearce, Mark Anderson, Ray Barnes, Andy Biggs, Judy Burges, Sam Crump, Eddie Farnsworth, Trish Groe, John Kavanagh, Rick Murphy, Bob Stump, House Speaker Jim Weiers, and Steven Yarbrough, and from the Arizona Senate, Robert “Bob” Burns, Ron Gould, Jack Harper, Sen. Karen Johnson, and Senate Majority Leader Thayer Verschoor.
Friday, January 25, 2008
Critique of Napolitano's Proposed FY 2009 Budget
News Release
FOR IMMEDIATE RELEASE: Friday, January 25, 2008
CONTACT: Steve Voeller: (602) 346-5061
Arizona Free Enterprise Club Criticizes Napolitano’s Reckless Budget Proposal
Governor’s budget proposal adds $2.3 billion in debt, according to JLBC
Phoenix, AZ – Steve Voeller, president of the Arizona Free Enterprise Club, a pro-economic growth advocacy group, today criticized Governor Janet Napolitano’s proposed fiscal 2009 budget.
In response to a $1.7 billion 2009 budget deficit, the Governor’s plan calls for $2.3 billion in new debt, an early tax payment, an expansion of photo radar, increased taxes from the lottery, and $700 million in revenue figures above consensus forecasts.
“The Governor’s budget plan for 2009 is irresponsible and should be rejected,” Voeller said.
The Governor’s plan shifts from paying cash to borrowing money for the following items:
$864 million School construction (FY’08 and ’09)
$967 million University building and maintenance
$470 million Phoenix medical school
$50 million Public safety communications
$7 million Emergency operations center
TOTAL $2.358 billion (source: Joint Legislative Budget Cmte.)
To realize new revenue, the Governor asks businesses to pay their July estimated retail taxes in June, meaning businesses will have to pay both June and July payments in the same month. She also assumes $90 million in revenue from an expansion of photo radar. It is unclear how much it will cost to implement photo radar statewide or how many tickets will have to be issued to net $90 million.
The Governor plans to spend additional state money promoting the lottery in hopes that an increase in lottery participation will bring $10 million to state coffers.
The Governor’s plan also calls for a $60 million shift from the state’s balance book to county budgets by housing felons in county jails rather than state prisons.
Over the last five years, government spending increased 32 percent after adjusting for population and inflation.
“The most troubling aspect of the Governor’s budget is the total lack of fiscal discipline,” Voeller continued. “After years of overspending, she attempts to plug a $1.7 billion dollar budget gap with $2.3 billion in new debt.”
FOR IMMEDIATE RELEASE: Friday, January 25, 2008
CONTACT: Steve Voeller: (602) 346-5061
Arizona Free Enterprise Club Criticizes Napolitano’s Reckless Budget Proposal
Governor’s budget proposal adds $2.3 billion in debt, according to JLBC
Phoenix, AZ – Steve Voeller, president of the Arizona Free Enterprise Club, a pro-economic growth advocacy group, today criticized Governor Janet Napolitano’s proposed fiscal 2009 budget.
In response to a $1.7 billion 2009 budget deficit, the Governor’s plan calls for $2.3 billion in new debt, an early tax payment, an expansion of photo radar, increased taxes from the lottery, and $700 million in revenue figures above consensus forecasts.
“The Governor’s budget plan for 2009 is irresponsible and should be rejected,” Voeller said.
The Governor’s plan shifts from paying cash to borrowing money for the following items:
$864 million School construction (FY’08 and ’09)
$967 million University building and maintenance
$470 million Phoenix medical school
$50 million Public safety communications
$7 million Emergency operations center
TOTAL $2.358 billion (source: Joint Legislative Budget Cmte.)
To realize new revenue, the Governor asks businesses to pay their July estimated retail taxes in June, meaning businesses will have to pay both June and July payments in the same month. She also assumes $90 million in revenue from an expansion of photo radar. It is unclear how much it will cost to implement photo radar statewide or how many tickets will have to be issued to net $90 million.
The Governor plans to spend additional state money promoting the lottery in hopes that an increase in lottery participation will bring $10 million to state coffers.
The Governor’s plan also calls for a $60 million shift from the state’s balance book to county budgets by housing felons in county jails rather than state prisons.
Over the last five years, government spending increased 32 percent after adjusting for population and inflation.
“The most troubling aspect of the Governor’s budget is the total lack of fiscal discipline,” Voeller continued. “After years of overspending, she attempts to plug a $1.7 billion dollar budget gap with $2.3 billion in new debt.”
Tuesday, February 7, 2006
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.
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.
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