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The Verde Independent | Cottonwood, Arizona

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11/4/2009 5:41:00 PM
Budget deal cuts state aid to K-12 education by about $144 million

Howard Fischer
Capitol Media Services

PHOENIX -- State lawmakers will meet later this month to cut state aid to education -- but not to give voters a chance to hike their own taxes to help balance the budget.

The deal worked out between Gov. Jan Brewer and Republican legislative leaders would reduce funding for K-12 education by about $144 million.

A similar amount would be slashed from the budgets of the programs run by the Department of Economic Security. And other budgetary changes could bring in or save another $160 million.

But there are not now the votes to put a measure on the ballot for a temporary hike in the state sales tax, a part of the budget-balancing plan Brewer continues to insist is necessary. That means the earliest lawmakers could vote refer the issue to voters would be in December, meaning an election could not happen before the middle of March.

At that point, though, there isn't enough time left in the state fiscal year to collect enough to make more than a small dent in the $2 billion gap that now exists between revenues and expenses: A one-cent hike in the state's 5.6 percent sales tax would generate only about $80 million a month.

House Speaker Kirk Adams, R-Mesa, said a delayed election also would mean that lawmakers, in trying to patch the current budget, would have to plan for the possibility that voters might reject higher taxes. He said that means the budget would have to include a contingency plan for cutting another $240 million or so in spending before the fiscal year ends June 30.

Getting the votes for a tax hike referral now, though, is just not in the cards.

"We want to do what's possible,' said House Majority Leader John McComish. He said there is an immediate need to start chipping away at that $2 billion deficit.

Brewer agreed to go along as the votes are not there for her tax hike plan.

"So we have no other choice but to go in and do further cuts as the revenues continued to decline, and carrying forward a deficit, we've got to go in and do more cutting,' the governor said. "However, I still am a proponent, and believe that the only way we're going to get the state turned around is to get additional revenue on top of more cuts.'

That $144 million to be taken from education would come by reducing what the state gives schools for what is known as "soft capital,' cash for things like computers, books and school buses.

That number was not chosen at random: It represents the maximum lawmakers can take from state aid to education without running afoul of an agreement Brewer signed with the federal government earlier this year to get education stimulus dollars. If the state violates this "maintenance of effort' provision, it has to refund more than $800 million to Washington.

Adams said the votes are there to make that cut.

He pointed out that the original budget lawmakers approved in June included $175 million in K-12 cuts. Brewer vetoed that as too much.

State School Superintendent Tom Horne said he believes it will not be much of a problem for schools to survive the $144 million cut. In fact, he said some school officials, noting the attempted $175 million cut lawmakers tried earlier this year, have purposely not spent all the money they were allocated because they believed -- apparently correctly -- that lawmakers would not let them keep it all.

"If that's all they take in 2010 and 2011, we'll be lucky,' Horne said. He said the contract with the federal government to get those stimulus dollars means that once lawmakers cut this $144 million there will be nothing that can be cut next fiscal year.

His fear, though, is that if the economy does not improve there will be pressure on Brewer and lawmakers to take more money out of state aid to education which now makes up close to half of the approximately $10 billion in spending. At that point, Horne said, there will be a lot of pressure on state officials to ask Washington for an exemption from the "maintenance of effort' requirement.

The session, tentatively set to begin Nov. 16, also would include some smaller changes.

One involves allowing the state to issue license plate renewals for up to five years, rather than just two. That would generate immediate up-front cash from motorists who are willing to pay five years' worth of fees now for the convenience.

That plan was part of the original budget approved by lawmakers earlier this year.

But they were included in legislation that also would have permanently repealed the state property tax. And the only way for Brewer to kill that repeal was by vetoing the entire bill.

The same is true for other budget-related changes that met the same fate. That includes allowing the Arizona Corporation Commission to use money it now collects in fees to run the division that files and review the papers of corporations. That, in turn, frees up the money that would otherwise come from state tax dollars.

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Reader Comments

Posted: Friday, November 6, 2009
Article comment by: We WILL REMEMBER THEIR VOTE!!!!!

I agree with the AEA we will not forget the legislatures when election time comes around. We WILL REMEMBER THEIR VOTE!!!!! How tragic sad and terribly null and void that legislators and the Governor continue to cut from the most important resources Education, and how dare they continue to use their power and tactics to take away the rights dignity and service in hard work dedication and continued learning of teacher rights.. What a disgrace and sad representing of the value they see in education as well as edducators. I too will remember their votes come re-election!!!

Posted: Wednesday, November 4, 2009
Article comment by: Education vs Sports?

Does anyone realize how much "Education" money is spent on school sports and transportation to these events? I think real education is tremendously more valuable than playing sports. Isn't that a place to cut instead of teaching? Really?

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