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Arizona Lawmakers Approve Education Sales Tax Extension

Arizona Lawmakers Approve Education Sales Tax Extension
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PHOENIX — The Arizona Legislature on Thursday overwhelmingly passed legislation extending a sales tax that provides more than $500 million a year for K-12 education, an unexpected move that averts a looming “fiscal cliff” that threatened more than 10 percent of the state’s school funding.

The legislation averts the need for a public vote expected in 2020 to avoid an expiration of the tax in mid-2021. Republican Gov. Doug Ducey plans to sign the bill, spokesman Daniel Scarpinato said.

Just 10 of 90 lawmakers, all majority Republicans, opposed the extension. That left a bipartisan group of Republicans and Democrats cheering the approval, although both sides acknowledged that the state’s woefully underfunded schools need more money, not just current funding levels.

“I’ve heard this called a Band-Aid,” said Republican Rep. Doug Coleman, the bill’s original sponsor. “This is $13 billion over the next 20 years that would have gone away. I agree much more needs to be done.”

“This is doing nothing to solve a crisis,” said Democratic Sen. Katie Hobbs. “It’s simply continuing the status quo, and we still have to do a lot to make sure our schools are still adequately funded.”

The measure required a 2/3 vote because it essentially raises taxes by keeping in place a tax that was set to expire. Republican lawmakers haven’t voted for a tax increase in recent memory.

Rep. Michelle Ugenti-Rita said she voted no simply because it was a “tax increase.”

GOP Rep. Travis Grantham said he opposed the measure because extending it without changes just continues restrictions on how the cash is spent.

“We’re not addressing what I believe to be one of the main issues of the bill – which is hey, there’s these buckets in the bill that money is dropped into them and the schools have to spend the money as the bill’s written,” he said. He said the money should be put into the state’s education budget so the boards and the districts can spend it accordingly.

“This is doing nothing to solve a crisis. It’s simply continuing the status quo, and we still have to do a lot to make sure our schools are still adequately funded” — Sen. Katie Hobbs

Theirs was a clear minority, however, as the proposals by Coleman and Republican Sen. Kate Brophy McGee were widely praised, even by fiscally-conservative Republicans.

Democrats worried the cash could be diverted to other uses by future legislatures, but Republican Senate President Steve Yarbrough said that shouldn’t cloud the victory.

“Rather than fretting, I would recommend celebrating,” Yarbrough said.

The proposals had been stalled since January but suddenly came back into play this week.

“Rather than fretting, I would recommend celebrating,” — Sen. Steve Yarbrough

The tax was originally approved in 2000 as Proposition 301 and levied an additional 6/10 of a cent on sales to fund education. The sales tax currently brings in about $670 million a year, with $511 million going to K-12 schools. The rest goes to colleges and universities and school construction debt.

The original extension proposal made the education sales tax permanent, but the Senate Education Committee amended the proposal Thursday to include just a 20 year extension.

The approved measure also takes $64 million now used to pay for school construction debt service and moves it into a fund used to boost teacher pay and school operations. That’s possible because the debt will soon be paid off.

That move will give the state’s teachers — who earn among the lowest pay in the nation and have been protesting for higher salaries — a 2 percent boost in 2021. That’s when the replacement measure approved Thursday takes effect.

The bills are HB2158 and SB1390 .



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