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Az Chamber weighs in on budget

Guest Writer
Guest Opinion

The legislative process is a mystery to many. Elected officials are pictured working in closed, smoke-filled rooms.

But while state leaders work to close the $3.3 billion budget deficit for fiscal 2010, the evidence is to the contrary.

That is not to say every detail is in the public domain, but outlines of legislative and executive proposals are widely available to the public.

A few weeks ago, Gov. Jan Brewer, Senate President Bob Burns and Speaker of the House Kirk Adams appeared before more than 800 people at an event organized by the Greater Phoenix Economic Council.

The purpose of this public meeting was to discuss the budget crisis. The media attention generated from this event elevated public consciousness of the severity of the deficit.

Additionally, our elected officials are actively touring the state, having participated in more than 28 public forums to discuss the fiscal 2009 budget fix and 2010 budget proposals.

Adams and Burns have traveled to Flagstaff, Yuma, Tucson, Bullhead City, Prescott, Safford and other cities since the legislative session began. Throughout their travels, both have met with business organizations such as the Arizona Chamber of Commerce & Industry.

They recently addressed the Arizona Chamber’s Public Affairs Committee. A few weeks prior, we heard from Eileen Klein, director of the Governor’s Office of Strategic Planning and Budget, on the seriousness of the structural deficit and the governor’s five-point plan.

As leadership continues to inform the public of the progress of budget negotiations, the Arizona Chamber recommends two reforms that will provide the Legislature and the public with accurate and accessible information regarding spending and debt.

House Appropriations Chairman John Kavanagh, R-Scottsdale, is sponsoring two pieces of legislation that would provide this transparency:

• HB 2279 would require the Department of Revenue to submit information addressing state debt and expenditures to the Joint Legislative Budget Committee for analysis and reporting.

To make fiscally prudent decisions, it is essential that the Legislature assess the potential impact of future debt on the state and its political subdivisions’ ability to afford new obligations.

• HB 2280 requires that each year the budget report, the governor’s Web site and the Economic Estimates Commission include a statement indicating whether state revenues will exceed the previous year’s.

Within a new budget are multiple bills and appropriations, which make it difficult for the public to understand its overall impact on total statewide spending.

An easily-accessible notice describing the extent to which the state is increasing spending more than inflation plus population growth adds transparency and improves public understanding of the growth in state government programs.

The Arizona Chamber also released its updated budget recommendations recently – calling for spending to be reined in, for lawmakers to have flexibility to adjust voter-approved initiatives on a prospective basis, for doubling the “rainy day fund” once revenues stabilize, and for implementing tools such as “reverse triggers” to adjust appropriations based on actual revenues.

A temporary tax hike should be considered if all other options have been exhausted, there is no other viable way of closing the deficit and only if coupled with significant long-term tax reductions that are passed this session (with a delayed effective date).

We remain committed to repealing the statewide equalization rate this session. Additionally, we support the privatization of certain government functions and call for an analysis of the revenue impact of expanded gaming as well as proposals to sell state assets.

Glenn Hamer is president & CEO of the Arizona Chamber of Commerce & Industry.

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