April 6 , 2009

I promised an update on the budget, but there's really not much to report.  Since I serve on the Appropriations committee, I have a little more insight as to what we've been going through as we look at each department and agency; but it's still hard to grasp the enormity of the deficit.  We're still struggling with learning what the effects of the "stimulus" money will be, and how we can (and cannot) use these funds.  Now the feds are telling us we have to "give back" $160M to the universities in order to get new money from them.  While this additional money will help, returning money we'd already counted adds to the hole we're trying to fill.

The school districts are screaming about any further reductions to the money the state gives them.  The truth is that the '09 cuts were minimal, and any cuts agreed upon for 2010 will not be as devastating as you may be hearing about.  There are other factors in play as well, including declining enrollments and loss of funding from Prop 301 as sales tax revenues continue to fall.

I received an e-mail the other day that said the sender had finally figured out Republicans:  "You hate kids!"  Of course that's not true, but that's the word that the education establishment is trying to spread.  Spending on education has mushroomed in the past five years at levels that cannot be sustained.  Here's a rough guide to our education spending:  The districts get about $5 billion from the General Fund, plus about $4 billion from local taxes.  With approximately one million students in K-12, that equates to $9,000 per pupil.  That compares favorably with most other states, but you'll not hear this message from many people.  I'm posting as an "Issues and Answers" item a column received from the Goldwater Institute that reports on the actual spending level in our state.

We continue to meet in small groups and individually with House leadership to voice our concerns about particular areas.  There is talk of having the budget done by April 30, and I think that's doable.  Despite the Governor's call for a tax increase, we believe we can achieve a balanced budget without one. 

I was surprised that at a meeting I attended last weekend, when I asked who might favor a "temporary" tax increase about 50% of the people raised their hands.  Most thought a sales tax increase was the fairest of any, especially due to our tourist economy and influx of out of staters buying goods in our area.  Another view was that an increase in gasoline tax would also spread the burden to include our tourists.  But  the Obama administration has promised an increase in the federal gas tax, and who knows what that amount might be.  So do we really want to add a state increase as well?  These are all questions that deserve a thorough vetting, and that we're doing.  It may seem like we're not accomplishing anything -- but really, we are working hard on these issues.

Until next week,

Nancy

Rep. Nancy McLain
602-926-5051
nmclain@azleg.gov

Nancy McLain, District 3, Arizona House of Representatives
nmclain@azleg.gov or
nmclainbhc@aol.com