Why the Budget is Important
Contributed by Ruth Lambert, LD1 Legislative Liaison
A state budget must be approved by the end of the fiscal year, June 30. The Governor gives a list of his priorities in the state of the union speech in January and the legislature, near the end of session, puts together a fiscal package to present as a budget proposal. In Arizona, the majority party (Republican) excludes the minority party (Democrat) from any budget planning sessions. (This despite the fact that Dems are only one short of a tie with Republicans in the Senate and the House.)
The highlight of the budget proposal for Fiscal year 2022 is a massive tax cut. The form the cut takes is to reduce, over two years, state income tax to a flat tax rate of 2.5 per cent. The change is a $1.9 billion permanent yearly reduction in state revenue. People receiving the most benefit from the tax cut are high income earners, those who would have been targeted with paying a 3.5% surcharge to specifically fund public education with the passage of Prop. 208.
While budget negotiations are always messy this year is especially so. Not all Republican lawmakers are on board. Some, knowing cuts will be permanent, question rightly whether the state’s ongoing obligations can sustain the cuts. Some think the budget has too much spending for “social service” programs. (it does not!) Many are opposed to the budget in protest since their pet project bills were not passed this year. How are both chambers resolving the stalemate? By recessing! Both the House and Senate opted to recess until June 10th with the option to return earlier if the gridlock ends.
But, Friday, Governor Ducey pressed an angry thumb into legislators’ eyes. Pass a budget or I will not consider any other bills. He made his point by vetoing 22 bills that had landed on his desk.
Will this incent the lawmakers to cancel their recess and give him what he wants?
Is this temper tantrum a ploy to get his 2.5 percent flat tax and massive payout to the wealthiest individuals and corporations?
If it is, then his twitter statement is disingenuous at best:
“We have the opportunity to make responsible and significant investments in K-12 education, higher education, infrastructure and local communities, all while delivering historic tax relief to working families and small businesses.”
A flat tax would essentially gut Prop 208, the voter-passed initiative that would have invested heavily in public “K-12 education and higher education.”
It would also hinder any possible "investments in infrastructure and local communities.”
The ultimate gaslighting of Arizonans is his claim that such a budget would deliver “historic tax relief to working families and small businesses," when, in fact, it would save average wage earners modest sums and deliver a tax windfall to the wealthiest individuals and corporations.
We need you to send an email!
We hope to inundate our LD1 Legislators with tax cut comments.
Our LD1 Legislators need to know if you approve of the proposed tax cut or if you would prefer the temporary excess funds in the state’s coffers be used for needed services and costs.
A budget is a statement of values. Does giving a larger tax break to certain people, while depriving those in need align with your values?
Please, let them know how you feel. Silence is acceptance.
The proposed Republican budget was introduced without ANY input from any Democratic legislators. With Dems holding 14 seats out of 30 in the Senate and 29 out of 60 in the House, an argument can be made that the slim Republican majority is not representing a significant portion of their constituencies. To top it all off, all Democratic budget proposals have been ignored.
Use the chart to determine what YOU would receive as a tax cut with the proposed flat tax rate.
To help understand the chart from the state Legislative Budget Committee: If your adjusted gross income is $50,000-$75,000 you would currently pay $1,075. After YOUR big tax break, you would pay $978, a decrease of $97. That is an 8.9% reduction. Compare your savings to the bottom brackets on the chart. Equal? Equitable?
Your email should let all three LD1 legislators know you are their constituent, and where you live. You could simply tell them you would receive X amount of a tax cut with the budget as proposed. Tell them you would prefer to see the state use the state surplus funds for badly needed services. There is an unexpected $1.2 billion dollar surplus in state coffers in addition to the $1 billion rainy day fund. Please give an example of what you would like to see funded. Take an example from the list below or relate a funding need based on your passion and compassion.
Budget requests you can make:
Choose from these areas identified by Democratic legislators as current needs:
· Pay teachers competitive salaries. Our teachers are STILL the 48th lowest paid in the country.
· Fund Covid relief services which are missing in the proposed budget.
· Increase the money for special education services. The miniscule amount contained in the budget does not come close to meeting special education funding needs.
· Expand eligibility for KidsCare. KidsCare, Arizona’s version of Children’s Health Insurance Program or CHIP. Expanding eligibility would allow more lower income families to buy into Medicaid benefits.
· Restore funding to the Arizona Dept. of Veterans Services that lost some funding during the recession. We need more benefits counselors to service our veterans.
· Fund badly needed infrastructure such as highway repair and broadband. Highway deterioration is rampant and the lack of broadband exposed inequities for large swaths of students during the pandemic.
· Do NOT fund transportation of children to schools outside their home district. We need neighborhood schools to be funded to serve ALL children.
Check out the Democrat entire Democratic budget proposal.