The Arizona legislature has finally adjourned after passing a budget that again fails to support public education. With a fiscal surplus of about $2 billion, there was great hope that our legislators would use that money to fully fund public education and bring our state’s educational ranking up from 49th in the nation to at least midway.
Instead of using the surplus to fund increased teacher pay, decreased class sizes, all-day kindergarten, new school buses, school building repairs and updated curriculum materials, the Legislature squandered that surplus by massive tax cuts that aid primarily the wealthy.
The tax cuts are a direct attack on Proposition 208, the citizen’s initiative that passed last year. That proposition established a surtax on high income earners (individuals with taxable income of more than $250,000 and joint filers with taxable income of more than $500,000). The proceeds from that surtax go directly to fund public education. Because the surtax was passed by a vote of the people, the state Legislature is not legally allowed to reverse that legislation. So, the Republican members of the Legislature did an end run around this law—they passed three tax bills (Senate Bills 1827, 1828 and 1783) which reduce base tax rates. The net effect of these three bills is an estimated $1.8 billion decrease in revenue.
The new tax legislation is most beneficial to those in higher income categories. High income earners will now be paying even less in total taxes than they did before Proposition 208 was enacted. Taxpayers with incomes between $1 million to more than $5 million annually will receive average tax cuts between $47,000 to more than $350,000. However, Arizonans with median household incomes (about $62,000) will see their taxes cut by only $96, on average.
Those state legislators who voted for the tax cuts likely believe that lowering taxes will attract more business to Arizona. They ignore the reality that businesses need a well-educated workforce. Our state’s reputation and low ranking for education may actually deter businesses from relocating here, regardless of the tax structure.
Because tax increases require a two-thirds affirmative vote by the Legislature, it will be difficult to reverse the tax cuts. However, education advocates are in the process of filing a citizen’s initiative to place a referendum on the ballot to block the tax cuts.
Such an initiative will need to collect more than 100,000 signatures in the next 90 days. Please add your name to this petition to allow Arizona citizens the opportunity to voice their support for a fully funded public education system.