The Farley Report from Phoenix #240: 2-17-16

JTED FUNDING IS RESTORED AT LAST!

More after this brief Farley Report pledge break…

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—> Yes, the long self-inflicted nightmare is finally over. The road to saving the state’s hugely successful public JTED/CTE programs from draconian cuts inflicted by the legislative majority in last year’s budget has successfully reached its goal. Today it passed out of both houses of the legislature and is now on the Governor’s desk awaiting his signature, something he promised last week that he would do. 

Most of the process has been surreal, with the people who proposed and voted for the cuts in the first place fighting each other for credit for the revocation of those cuts. The most jaw-dropping development was the unprecedented inclusion in the statutory language of Title 15 an “intent clause” crafted by House majority leadership, casting in concrete their preferred version of the history of JTED restoration — one which firmly places all credit in the hands of the House, but without mentioning that the idea for the original cuts came from the House. 

I know they say that sausage is like the law so you don’t want to know in too much detail how each is made, but you have to see this to believe it. Here is the intent clause, in its entirety. 

Sec. 8.  House of Representatives; findings and intent
A.  The Arizona House of Representatives finds that:
1.  Joint Technical Education Districts, known as JTEDs, are an important component of a well-rounded education system by providing access to Career and Technical Education programs that offer training to students to equip them with the tools needed to enter the workforce after high school in jobs that demand highly-skilled employees.
2.  Restoring funding to JTEDs and implementing accountability measures to the programs was an important priority of members of the Arizona House of Representatives, including Representatives Ackerley, Allen, Alston, Andrade, Barton, Benally, Bolding, Borrelli, Bowers, Boyer, Brophy McGee, Campbell, Cardenas, Carter, Clark, Cobb, Coleman, Espinoza, Fann, Farnsworth E, Fernandez, Finchem, Friese, Gabaldón, Gonzales, Gowan, Gray, Hale, Kern, Kopec, Larkin, Lawrence, Leach, Livingston, Lovas, Mendez, Mesnard, Meyer, Mitchell, Montenegro, Norgaard, Olson, Otondo, Petersen, Plumlee, Pratt, Rios, Rivero, Robson, Saldate, Shope, Stevens, Thorpe, Townsend, Velasquez and Weninger.
3.  To accomplish the goal of swift and efficient enactment of funding and reforms to JTEDs, House and Senate members and staff worked with stakeholders to develop an agreement which culminated in the introduction of House Bill 2642 on February 4, 2016.  House Bill 2642 was heard in a Special Education Committee on February 8, 2016 and passed by the House and transmitted to the Senate on February 9, 2016, with the understanding that a motion would be made in the Senate pursuant to Senate Rule 11 to substitute House Bill 2642 on Third Reading and send the bill to the Governor.
4.  The Senate introduced Senate Bill 1525, identical to House Bill 2642, and amended Senate Bill 1525 in Committee of the Whole, which caused the bills to no longer be identical, and passed Senate Bill 1525 on Third Reading and transmitted it to the House on February 11, 2016.
B.  It is the intent of the Arizona House of Representatives to ensure that these vital JTED programs are funded to meet the needs of both Arizona's students and businesses.  The Arizona House of Representatives urges the Arizona State Senate to immediately concur in the House amendments to Senate Bill 1525, pass the bill on Final Passage, and transmit the bill to the Governor.

You can read an excellent account of what President Biggs himself called a “bizarro” turn of events from reporter Howie Fischer here.

To bill sponsor Senator Don Shooter’s credit, he decided to discontinue this schoolyard brawl and accepted the House’s petty, preening language in order to get the bill to the Governor as quickly as possible. I will post on my Facebook page as soon as I hear that the bill is signed so we can all breathe again.

FarleySpeakingJTEDVote.jpg

I rose to explain my vote on the JTED bill this afternoon and told the story of Vail’s Andrade JTED High School’s students who were up in the gallery last year watching us debate the budget all night long, hoping we would not cut their programs. When we Democrats at around 3am proposed an amendment to stop those cuts in the first place, we on the floor stood in support of that amendment during a “division.” At that point I heard the sound of 50 chairs in the gallery folding up -- I turned around and discovered that everyone in the gallery, including all those Andrade JTED kids, had stood up with us. I was so moved and energized by that show of solidarity that I was never even tempted to sleep for the rest of the night.

That is who we are governing for. Those students are our future. I said this afternoon that I hoped all those who enshrined their names in Title 15 will remember their statement of support of public education when they are tempted in the future to cut our public schools again, and they will act differently than they have in the past. 

—> In Appropriations Committee yesterday Department of Child Safety director Greg McKay graced us with his presence at last, to defend his continuing lack of progress in reducing the backlog of cases that have not been touched in 60 days or more and the huge numbers of children being removed from their homes. He admitted we are now second in the nation in the latter category in raw numbers — projected to be more than 20,000 by the end of June. 

JLBCDCSchart.jpg

His defense consisted primarily of denial. I asked him how he thought he would reduce the numbers of children being removed from their homes given that he — against the requirements of the legislation — already shifted more than $17 million from in-home prevention and intervention programs into out-of-home care (and proposes to do the same thing this coming year). Instead of answering, he simply talked about the importance of those in-home programs that he refuses to fund. 

I asked him how he would get through the backlog and hire the legislatively-funded 1,406 caseworkers he needs if there is currently a 36% attrition rate for case managers, the Governor nixed his request for performance pay, and the training graduation rate declined five-fold from December 2014 to December 2015. He said he thought training would help. 

The answers were not satisfactory to anyone there, and now the agency is responding to the bipartisan outcry against the backlog by seeking to redefine what a “case” is and declaring that a case is off the backlog if a caseworker opens the computer file and adds a note that the caseworker viewed the file. They are still unable to say whether any of those more than 13,000 “non-active” cases are children in imminent danger.

Bottom line: Arizona children remain at risk until there is a change of management at DCS.

—> In Finance Committee today we heard a number of bills that would expand the sales tax loopholes in our tax code to several new special interests. SB1505 sought to add another exemption on the trucks and transportation costs of natural gas delivery. A lobbyist for Southwest Gas portrayed it as making the tax code fair and equitable, since electric companies don’t pay taxes on their wires and poles. 

That definition of “fairness” is how we have ended up with more than $12 billion in sales tax loopholes in our tax code, and what forces us into a sky-high sales tax rate in order to make up for all those lost revenues. Each little exemption is sold as solving an “equity” issue, for just a few million dollars in lost taxes. Over the course of decades, a few million here and a few million there add up to more than $12 billion annually — and that is just the quantifiable losses. 

I took the opportunity to have an extended discussion about true finance reform by offering an amendment to eliminate the loophole for the sale of 4” pipes. Faithful Farley readers have seen this before — I have tried to eliminate this senseless loophole for ten years with now luck. You pay tax on 3” pipes, but not 4” pipes. Why? Because Southwest Gas uses mostly 4” pipes to transport natural gas. They got that in place in the 1970s by arguing that it was a fairness issue — those electrical utilities got their tax break on poles and wires years earlier, so why not the gas company? 

I pointed out that a small carpet business that has to buy a truck to transport carpet to customers doesn’t get a break on its purchase of a truck — they can’t afford to hire a lobbyist, so they pay the sales taxes like the rest of us. Is it fair that Southwest Gas gets that break, but not the carpet business? Is the solution to give a break to everyone so no one pays sales taxes? Or should everyone pay their fair share for our schools and roads and first responders, no matter how much money or power they have?

The amendment failed, but I did get to talk for a while about what true fairness in the tax code might look like. Instead of adding another loophole for a utility, perhaps we should get rid of the existing ones for gas and electric. Why not level the playing field for every industry by removing the special interest loopholes that only serve those lucky few who can afford to hire lobbyists to get them passed. Then we can lower the overall tax rate for everyone, and not punish brand new industries seeking to enter the market without the benefit of pre-existing loopholes. That would be true fairness. 

Thanks for your continuing faith in me as your Senator. 

Steve

Steve Farley

Senator, District 9, Tucson

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