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Arizona coalition forms to urge budget options

PHOENIX – A newly formed advocacy coalition on Thursday offered suggestions to Arizona legislators on ways to protect education, health care and social services from spending cuts needed to balance the troubled state budget.

The coalition announced its formation on Thursday and released a menu of dozens of alternatives. They range from tax increases and accounting maneuvers to rehiring laid-off tax collectors and selling off Arizona Lottery revenue for upfront cash.

“We are here talking about hope and possibilities today,” Timothy J. Schmaltz, coordinator of the Protecting Arizona’s Family Coalition, said during a news conference.

Schmaltz’s group is among more than 20 organizations that announced formation of the Arizona Budget Coalition. Other member groups include the Arizona Education Association, the Children’s Action Alliance and the Service Employees International Union.

Arizona’s state budget has been battered by the recession in general and the housing industry’s collapse in particular, with tax collections going down and costs for social services going up.

The state faces a projected $3 billion shortfall in the next budget, and lawmakers have been struggling throughout their current regular session to agree on ways to fill the gap.

A Republican proposal includes spending cuts and raids on special-purpose funds throughout virtually all of state government to help close a projected $3 billion budget shortfall projected for the fiscal year that starts July 1.

House Appropriations Chairman John Kavanagh and other GOP budget-writers argue that the next budget must include significant spending cuts because the state’s budget troubles will continue into the following fiscal year.

If state spending isn’t reduced now, the budget for the 2010-2011 year will be even harder to keep in the black because one-time options will have been used up, Kavanagh contends.

Asked to respond to the Republicans’ assessment on what’s needed, a coalition leader said the group will urge Gov. Jan Brewer and lawmakers “to pick a combination of options that work for both the short term and the long term.”

“Many of those options are far better than the damage to families and our future that come from the alternative – budget cuts – and those are the choices we face,” said Dana Wolfe Naimark, Children’s Action Alliance president. “We have to pick and choose and set our priorities.”

Also Thursday, Brewer reaffirmed her commitment to “all of the components” of the budget approach she announced in March. It included a temporary tax increase, spending cuts, use of federal stimulus money, a large rainy day fund and changes to voter spending mandates.

“Now, more than ever, dramatic steps are necessary to protect our education system, sustain our critical public safety needs, and protect our state’s must vulnerable. Now, more than ever, all five points of my plan are necessary to get the job done, and to return the state of Arizona back to a path of prosperity,” she said.


Highlights of proposals

Arizona Budget Coalition: Newly formed coalition of 20-plus groups, including two labor unions, the Children’s Action Alliance and the Protecting Arizona’s Family Coalition.

Recommendations: Continue state property tax that is now suspended but proposed for repeal. Levy new property tax for school facilities. Raise corporate income tax. Suspend income tax credits for school contributions. Delay payment of some spending into next fiscal year. Budget for $35 million in revenue from speed cameras. Place nonviolent offenders on home arrest. Sell and lease back some state facilities. Hire laid-off tax collectors and auditors. Use federal stimulus money.

Quote: “The coalition is guided by a belief that a robust state budget for services is not just feasible, but necessary for building a prosperous 21st Century economy for Arizona.”

Web site: http://www.arizonabudgetcoalition.org

Arizona Chamber of Commerce and Industry

A statewide advocacy group for businesses.

Recommendations: Cut state spending. Loosen voter spending mandates. Approve tax cuts with delayed effective dates. Consider expanding off-reservation gambling. Consider a temporary tax increase only as last resort.

Quote: The chamber believes that, under these extraordinary circumstances, certain temporary tax increases, such as an increase to the sales tax, should be considered if all other options have been exhausted and there is no other viable way of closing the deficit.”

Web site: http://www.azchamber.com

Arizona Tax Research Association.

A business-backed advocacy group on tax and fiscal issues.

Recommendations: Adjust only school transportation costs, not basic state aid, for inflation. Cap or phase out local school district property taxes that are outside the public school equalization system but that trigger higher costs for state. Eliminate state funding for kindergarten students who turn 5 before Sept. 1. Eliminate extra funding for “rural” districts. Eliminate state aid for out-of-state university students.

Quote: “ATRA encourages the Legislature and the governor to view the difficult task of reducing spending as an opportunity to also improve the state’s fiscal management.”

Web site: http://www.arizonatax.org

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