SB 1450 Decades Theme Park Bill

It is will great saddness that I report the passage today of SB 1450 in the House of Representatives. The bill, which grants taxing authority to private enterprise, goes back to the Senate so perhaps we have another chance to stop this bad bill still.

Will the Right Sit It Out? - HUMAN EVENTS

Will the Right Sit It Out? - HUMAN EVENTS

I read this article and it expresses so many frustrations I have with the McCain campaign. Don't misunderstand me, I will be voting for McCain...I could never vote for a Democrat and our right to vote is too precious to me to ever stay home. It is just that as a Conservative, as a true believer in the U.S Constitution, I have a desire to see someone in the White House with a passion that mirrors that of our Founding Fathers.

A “Crisis” of Their Own Making

A National Conference of State Legislatures report released today is sparking gloom-and-doom headlines about states in fiscal crises. Conspicuously absent from the news stories is any mention of the root cause of the “shortfalls” supposedly wrecking havoc in state capitols. Over the last few years, state lawmakers forgot the lessons of the 1990s, and decided to add new programs and significantly expand general fund spending on existing programs.
Now, according to NCSL:
Current state fiscal conditions are being driven by weak revenue performance. State officials expected revenue growth to slow in FY 2008, but not as dramatically as it has. […] Because most FY 2008 budgets were built on revenue forecasts that are not materializing as expected, budget gaps have grown.

HB 2017~A Sound Start to State Policy on Greenhouse Gas Emission

HB 2017 (S/E on greenhouse gases; fuel economy) ensures that the Legislature determines Arizona's policy on greenhouse gas emissions.

It would provide critical session law that prescribes a clear and certain process, whereby the ADEQ Director submits recommendations to the Legislature, the Arizona Corporation Commission and the Governor. The bill specifies that no state agency (e.g. DEQ, Commerce) could proceed with rulemaking for a greenhouse gas or motor vehicle fuel economy program without explicit legislative authorization enacted in the future.

This legislation reflects the Constitutional requirement that there is a separation of powers between the responsibilities of the Legislature to determine public policy, and the responsibilities of the Executive to implement that policy. Because of the magnitude of this policy proposal, and the cross-over into jurisdiction of the elected members of the Arizona Corporation Commission, it is especially important that this legislation be enacted.

BACKGROUND: The Western Climate Initiative ("WCI") is a group of several western and Mexican states, and Canadian provinces that have committed to reducing the emission of greenhouse gases ("GHG"). The WCI is divided into two groups: partners who have, by agreement, committed to specific GHG reductions and; observers who are monitoring the process.

The committed partners are Arizona, British Columbia, California, Manitoba, Montana, New Mexico, Oregon, Utah and Washington. These states are in the process of developing an economy-wide regional cap-and-trade program. A cap-and-trade program is a market mechanism in which carbon emissions are capped and entities participating can trade allowances to meet the emissions limit or to grow. The observers are Alaska, Colorado, Idaho, Kansas, Nevada, Wyoming, Ontario, Quebec, Saskatchewan, Baja California, Chihuahua, Coahuila, Nuevo Leon, Sonora and Tamaulipas.

WCI has been meeting since October with a goal of making design recommendations for a regional cap-and-trade program by August of this year. Each state would then be eligible to implement its own cap-and-trade program consistent with those recommendations.

The Director of ADEQ has stated that the recommendations for a cap-and-trade program can be implemented without additional legislative authorization. In contrast, other states such as Washington have recently enacted legislation requiring their lead agency to obtain authority from their legislature to implement the WCI recommendations.

Such a program will have a significant impact on Arizona's economy and could worsen the State's budget crisis.

A policy proposal of such magnitude is complicated. Determining the regulatory structure of a cap-and-trade program requires detailed decisions, including determinations as to which state agency is most qualified to oversee/regulate the market trades that would occur, should allowances be auctioned to entities or distributed for free, if they are auctioned, how the significant amounts of money collected from auctions will be spent, how do you mitigate the costs impacts of such a program to low income families and whether sources of carbon not currently included in the WCI's scope of regulations (e.g. agriculture) should be eligible to provide credits to offset required reductions. These are just a few of the many policy decisions that are the responsibility of the Legislature to determine. A number of parties are concerned that bypassing the legislature on such an important policy question is wrong.

• Making cap-and-trade program decisions through State agency rulemaking, for example by ADEQ, is problematic:
  
  • Program choices must be based on consensus-driven, well-researched decisions and a process that includes all stakeholders.
    
  • ADEQ does not have the resources or expertise to administer a market-based program.
    
  • No state agency has the legal authority to adopt and administer a cap-and-trade program.
    
  • Agency rule-makers are at least a layer removed from accountability to elected officials.
    
  • Agency rulemaking excludes indispensable stakeholders – State Legislature, Corporation Commission.
    
  • If the cap-and-trade program includes the auctioning of allowances, revenue will be generated from the auction proceeds. The state legislature should determine how this revenue will be distributed.
    
• It is expected that the federal government will enact climate change legislation next Congress. All three presidential candidates support climate change legislation. Jumping the gun before there is national legislation with state or regional program has disadvantages including:
  
  • a limited number of market participants are available for trading;
    
  • California values will dominate the program;
    
  • risk of checkerboard of programs nationwide with no ability to move allowances between programs;
    
  • Arizona is more reliant upon coal based generation resources than other states and the design of the program could result in transfer of wealth to other states;
    
  • and Arizona companies will be at a competitive disadvantage if other states fail to participate.
    
• The WCI has just started the process of conducting an economic analysis of the proposals under consideration. But we know from analysis of similar programs at the federal level that economic impacts are significant. The economic estimates vary greatly depending upon the assumptions used, the reduction strategies employed and the available technology. Some examples of the potential costs are:
  
  • The Electric Power Research Institute (an independent, nonprofit center for public interest energy and environmental research) estimates that cost to reduce carbon emissions could result in electricity rate increases of 45% to 260%, depending on the strategies employed to reduce emissions and the available technologies.
    
  • EPA analysis of federal legislation to reduce GHG sponsored by Senators Lieberman-Warner also concluded electric utility rates could increase by as much as 44% by 2030.
    
  • Costs increases will be felt even more by lower income households. The Oregon Center for Public Policy recently noted that the cost of reducing carbon emissions by 15% would cost the poorest one-fifth of households $750 to $950 yearly. These are households where the average annual income is $13,000.
    
  • An EPA analysis of Lieberman-Warner concluded that it would reduce our nation's GDP in 2050 by 2.37%.
    

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THE FISCAL NOTE

An Examination of Tax and Fiscal Matters
By the Arizona Free Enterprise Club

Theme Park Legislation is Off Key

Senate Bill 1450 (Theme Park bill) is poor tax policy. One of the principles of sound tax policy is neutrality. Whenever possible, the tax code should be agnostic toward whatever business activity is taking place. The tax code should not micromanage the economy and should interfere as little as possible in the decisions being made in the marketplace. Private enterprise should be left to succeed or fail based on the merits of the product or service being sold, the quality of the business plan, and the execution of the plan. A private company’s ultimate success or failure should not hinge on preferential tax treatment.

On December 2, 2007, The Arizona Republic made the following additional points:

• Attendance: Decade's projections are extremely optimistic, with 6 million visitors in the first year. Only six U.S. theme parks, all in Florida, reached that level in 2006. "Nobody gets 6 million visitors their first year," says Dennis Speigel, president of International Theme Park Services.

• Market: The theme-park industry is mature, with little growth in attendance outside the Disney parks. Hard Rock Park, a similar project, is opening in Myrtle Beach, S.C., next spring. It should give an indication of whether a rock-themed park will draw crowds. Decades supporters are assuming that the $400 million S.C. park would be a complement, whetting people's appetite for a larger attraction in the West, and not a competitive threat. Meanwhile, there's competition from theme parks next door. "You've got the entire developed Southern California market just a few hours away, which markets aggressively," says Robert Niles, editor of the Theme Park Insider Web site.

Supporters point out that the new tax wouldn't replace the regular sales tax but be on top of it. They say taxpayers wouldn't be on the hook for repaying the bonds. But Kevin McCarthy of the Arizona Tax Research Association sees a risk if Decades flounders. "When bonds go bad," he says, "it reflects poorly on everyone that's involved." There could be pressure for a bailout.

McCarthy also testified in Ways and Means that the legislation is likely unconstitutional because it exempts certain taxpayers from paying property taxes.

Lawmakers continue to raise valid concerns about this bill and are on solid footing as they do.

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The Arizona Free Enterprise Club is a 501(c)(4) non-profit organization whose mission is to advance policies that promote a strong and vibrant Arizona economy. The Club believes that entrepreneurs and private enterprise are the principle drivers of our economy. The Club lobbies Arizona lawmakers in support of policies that allow the market to flourish and vigorously opposes policies that hinder private industry. Visit us at www.azfec.org.

Catching Up

• Budget talks are still ongoing. Our group of Republican legislators meeting daily at JLBC is growing. Progress on finding responsible solutions to the $1.8 Billion dollar budget shortfall is slow going but at least progress is being made. I am unable to share the details at this point and frankly, it would be premature as nothing is set in stone, despite any apparent concensus by group members.

• The Governor vetoed HB 2395, a bill would have imposed tougher mandates and penalties against drunk boaters and drivers, but also halved to six months the requirement that first-time DUI offenders use ignition interlocks for a year. This bill contained important provisions such as: 1) a fix to a conflict in state law regarding jail time for people convicted of extreme DUI so that they must serve 30-day sentences, 2) required that first-time offenders convicted of operating a boat while intoxicated must generally serve 10 consecutive days in jail, 3) expanded circumstances in which a drunken driver's license is suspended for 90 days after a fatal accident.

Personally, I was very conflicted on this bill...MADD opposed this legislation because of the reduction of time required for the interlock device but like my colleagues, I agree of the importance of the remaining provisions. This one bill was a combination of three original bills; unfortunately the three bills were combined. Because the conflict in the statute will remain due to the Governor's veto, we will take up this issue again next session. Perhaps next year we will get this right.

• Tomorrow the House will vote on SB1450, the bill that basically gives taxing authority to a private corporation. On a voice vote today, the House agreed to let the developers create a special taxing district. In essence, SB1450 would give the board of this district one of the key powers of a city: impose sales taxes to finance construction of the park in Eloy...a horrible idea I oppose. Read about this further in my next post.

Robert A. Levy on Subprime Precedent on National Review Online

What ever happened to the sanctity of private contracts? Consider the bill now pending in Congress that would essentially wipe out existing mortgages — allowing their terms to be rewritten for the benefit of troubled homeowners.

Click the title to this post to read an article on this issue titled "Be Judicial in Your Compassion ~ How not to fix the subprime mortgage mess".

A Concert with Lindsay Rush

Saturday, May 10th

6-8 PM Lake Havasu High School

Lindsay Rush is a young singer and song writer who is a dedicated mental health advocate. Her songs tell stories about mental health challenges. She has reached young and old with her passion about her experiences and the issues of mental health.

Telephone: (928) 230-8784 for tickets (NO CHARGE)

Sponsored by:
MIKID,Lake Havasu Unified School District, #1Mohave Mental Health Clinic, & Northern Arizona Regional Behavioral Health Authority

NOTE: To sample some of Lindsay's music, click the title to this post and enjoy!

CAP Spring Dinner Event

The Center for Arizona Policy's Annual Spring Dinner event "Making Our Days Count ~An Evening with Tony Snow" is coming soon. Click on the title of this post for further details!

Budget Talks Resume

Budget talks have resumed; a large group of legislators including House and Senate Leadership, Russell Pearce and Bob Burns~the House and Senate Appropriations Chairmen, and about 10 or so rank and file Republican Members are meeting daily to grapple with the ways and means to address the $1.8 Billion Dollar deficit.

As appropriations Vice-Chair, I am participating in this process. I am somewhat comforted in knowing that Senator Gould, Representatives Biggs and Pearce, while included in the discussions, add to to mine their loud voices of reason and true constitutional conservatism.

Monday's meeting should begin with a discussion of the cost and value of welfare and social services provided by you, the Taxpayer, via the State of Arizona.

Let Them Eat Ethanol

Mona Charen on Food Fight on National Review Online:

• Five people are dead in Port Au Prince, Haiti after a week of food riots.
• Unions in Burkina Faso have called a general strike to protest the high cost of grain.
• Food riots have rocked Egypt, Cameroon, Indonesia, Ethiopia, and other nations.
• In Manila, police with M-16s have supervised the sale and distribution of subsidized grain.
• Hoarders have been threatened with life imprisonment.
• In Thailand and Pakistan, troops are guarding fields and warehouses.
• In Egypt, the army has been called out to bake bread.

"In our search for cleaner energy we jumped aboard the “biofuels” bandwagon. This debacle should be an object lesson. Fighting global warming (if there is global warming) is a tricky business and can only be undertaken after careful review of the costs and benefits."

Red State Arizona: National and Pima County GOP funneling money (illegally?) to defeat conservative candidate in NM

More of the same from the National Republican Congressional Committee.

Hungry Like The Ethanol Wolf

From the Editors on Ethanol on The National Review Online:

The federal government can do something right now to provide relief to Americans facing higher food prices: Repeal the ethanol mandate.

The diversion of one-third of the American corn crop into ethanol production is a direct result of the 2005 law that required gasoline makers to buy 7.5 billion gallons of ethanol — a mandate that the 2007 energy bill President Bush signed in December increases to 36 billion gallons by 2022.We realize that a repeal is highly unlikely, given that the machinery of government is currently calibrated to move in the opposite direction on biofuels, but as food prices keep going up, pro-ethanol politicians will find it increasingly difficult to justify their position. Food riots in developing countries are becoming more frequent. Wal-Mart’s Sam’s Club has started limiting sales of rice because immigrants are buying all the rice they can and sending it to relatives in countries suffering from food shortages. In the U.S., the Labor Department reported this month that the price of bread is up 14.7 percent from last year. Milk prices are up 13.3 percent.

More insight from the article in the National Review:

* Congress has created an artificial demand for ethanol to satisfy the farm lobby, which is one of the most powerful in Washington.

* John McCain somehow made it through the early primary gauntlet without going back on his long-held opposition to ethanol subsidies. To be sure, he took a lower profile on the issue and made some comments about how ethanol "makes sense" now that oil prices are so high, but when questioned about these pro-ethanol comments he reiterated his opposition to the federal government’s meddling in the market.

FOXNews.com - Mexican Embassy: Official Fired After Getting Caught With White House BlackBerries - Politics | Republican Party | Democratic Party | Political Spectrum

FOXNews.com - Mexican Embassy: Official Fired After Getting Caught With White House BlackBerries

Economic stimulus pushed by universities gets support

Please, please read this and weep!

Economic stimulus pushed by universities gets support

"People will wonder how the state can be $1.9 billion in the hole next year and yet approve a plan for $1.4 billion in construction," said House Minority Leader Phil Lopes, D-Tucson.

www.windaction.org

Since Mohave County has approved wind generation facilities, I urge everyone to gather all of the facts they can related to this issue. I myself am going to be investigating this proposal and will bring the facts I learn to light.

From this website:

"It's also apparent the Federal government does NOT treat all renewables equally. Subsidies for wind far exceed those paid for Biomass, Geothermal, Hydro, and Landfill gas combined."

and

"Yet, given the unpredictable, intermittent nature of the fuel source, wind energy is the least able, of all renewables, to reliably supply generation during peak periods. Further, wind requires companion generation to address low or no winds conditions, and extensive, costly transmission upgrades to deliver power long distances to load centers."

FY09 Budget News

Today at 2:00 Representative Pearce, Biggs, and myself have a meeting with fellow colleagues in the Senate to begin working on a FY09 Budget that does not include borrowing. I am unsure that this can actually be accomplished, to say the least but I am now "at the table" so to speak, involved in budget talks. A wrong has been righted now that leadership is allowing, so far, the FY09 budget proposal to progress through the Appropriations committee, with input from appropriations committee members. Kudos to Appropriations Chairman Russell Pearce for standing his ground and going to bat for the proper process of developing a budget through the Approps commitee!

Debunking the "Tax Thee, But Not Me" Myth: Five Reasons Why Non-Smokers Should Oppose High Tobacco Taxes

"Whether or not an individual uses tobacco, tax hikes hurt everyone by encouraging the growth of government. As demonstrated in this Issue Brief, high cigarette taxes reflect a tendency to grow total tax burdens. Furthermore, tobacco tax hikes rarely precipitate tax relief elsewhere or even stave off future tax hikes. If tied to new spending, tobacco tax hikes can trigger future tax hikes once cigarette revenues decline. Finally, tobacco tax hikes don't correlate with economic growth.

While tobacco tax increases will assuredly come up as funding 'solutions' in the future, taxpayers – smokers and non-smokers alike – would be better served by extinguishing such a notion and instead focusing on cutting the size of government."

Virtual fence on Mexican border to be replaced

I could say "I told you so" but I won't. What a will tell you is that I am angry about the federal government wasting time and $20 Million Dollars of taxpayer money on a failed virtual fence. This administration's talk about national security is just that...talk.

How the Government Spends Taxpayer's Money

by Phyllis Schlafly

Are you having a hard time paying your bills, making your mortgage payments, or putting your kids through college? You need to know how much of your hard-earned income the government is skimming off and diverting into handouts to immigrants and illegal aliens. You can read the depressing details in the new 70-page document called "The Economic and Fiscal Impact of Immigration" written by Edwin S. Rubenstein. A Manhattan Institute adjunct fellow with a mile-long scholarly resume, he has been doing financial analysis ever since he directed the studies of government waste for the prestigious Grace Commission of 1984.

The bottom line, which you need to know for your own bottom line, is that U.S. taxpayers are giving more than $9,000 a year in cash or benefits to each immigrant, a third of whom are illegal aliens. That's $36,000 for each immigrant household of four.

Since the U.S. has 37 million immigrants, legal and illegal, the national cost was more than $346 billion last year, which was twice our fiscal deficit. The cost of immigrants is so high because, as Rubenstein writes, "Immigrants are poorer, pay less tax and are more likely to receive public benefits than natives." Big Brother hasn't told you this bad news, perhaps because the government doesn't want you to know why your paychecks are shortchanged. Even the huge amnesty bill that was defeated last year didn't contain one word about its budgetary consequences.

The financial burden that immigrants impose on education starts with the 3.8 million K-to-12 students enrolled in more-expensive classes for the non-English-speaking. When we add up the costs of hiring specialized teachers, training regular teachers, student identification and assessment, and administration costs, the total amounts to an estimated $1,030 per pupil, or $3.9 billion. Of the 48.4 million pre-K through 12 public school children, 9.2 million or 19 percent are immigrants or the children of immigrants. In the next few years, immigration will account for virtually all the increase in public school spending.

Look at the $1.5 billion cost of incarcerating 267,000 criminal aliens in federal prisons. That's not the worst of it; prison capacity is limited, so 80,000 to 100,000 other criminal aliens have been prematurely released to prowl our streets. Criminals also impose heavy private costs on their victims. Rubenstein estimates the losses of income and property, hospital bills, and emotional suffering at $1.6 million per assault- or property-crime offender.

Rubenstein's report includes all sorts of costs that other observers conveniently ignore, such as the Earned Income Tax Credit. EITC gives an average cash payment of $1,700 per year to 1 in 4 immigrant households.

The emergency medical treatment given free to illegal aliens is another enormous cost, causing some hospitals and emergency rooms to close. Emergency means any complaint from hangovers to hangnails, gunshot wounds to AIDS.

Even after some restrictions were imposed in 1996, 24.2 percent of immigrant households receive Medicaid, whereas the figure for native-born Americans is 14.8 percent. Rubenstein calculates that Hispanics account for 19.2 percent of Medicaid enrollment, while they are 13.7 percent of the U.S. population.

The FHA has had a policy of increasing home ownership among low-income immigrants and therefore approved FHA mortgages on homes with a down payment of only $200 to $300 and marginal income. Since mortgagors have so little invested in the house, they can walk away from it when they can't meet the payments, and this has resulted in neighborhoods of abandoned, boarded-up housing.

Refugees are a large and growing fiscal burden because they become immediately eligible for generous taxpayer-paid benefits. Evidence shows they stay dependent on these programs and start chain-migrating relatives under the "family reunification" law.

The Interior Department spends millions of dollars to clean up the mountains of trash discarded by illegal aliens crossing into California, Arizona, New Mexico and Texas.

Some immigration advocates peddle the notion that immigration will solve the future financial burdens of Social Security. Rubenstein shows how foolish is this prediction because today's low-wage workers will surely become tomorrow's expensive retirees.

Another cost that few talk about is that immigrant workers depress the wages received by native-born Americans, and that causes a $100 billion shortfall in federal tax revenue. Harvard University Professor George Borjas found that each 10 percent increase in the U.S. labor force from immigration reduces wages of native-born Americans by 5.25 percent.

Some liberals are trying to tell us to fight a recession by bringing in more immigrants, but that would only raid the pockets of U.S. taxpayers to support more millions of non-taxpayers. It's hard to say which is more outrageous: the diversion of Americans' personal income into cash handouts to foreigners, or the federal government's policy of concealing the fiscal impact of immigration.