John --



Good morning, and welcome to our twenty-second edition of our weekly updates from the state capitol. Twenty two!



Yes, it is mid-June, and we are still in session. We officially returned from our two-week “recess” last Thursday, but other than re-introduce the twenty two bills the governor vetoed a couple of weeks ago (because he wanted a budget on his desk that doesn’t have the votes to pass), we didn’t do anything.



The governor also announced late last week that we are going into a special session this week to respond to some of the wildfires that have raged across the state in recent weeks. We don’t have all the details yet, but we expect to approve around $100 million for fire prevention and mitigation efforts across the state. It sounds like we will be using state dollars to fund this, not federal dollars, but I don’t have confirmation on that as of yet.



You might be asking, “why go into a special session when you are already in session, and you don’t seem to be doing much anyway because the budget proposal currently on the table doesn’t have the votes to pass?” Good question!



We don’t have to go into a special session to dedicate federal or state dollars to fire prevention and mitigation efforts. We don’t need a special session to even pass changes to state policies to better assist with relief efforts.



Calling a special session is mostly about optics. If we were to handle this with just a regular bill in a regular session, it wouldn’t receive as much press attention. But because it’s being introduced in a “special session,” it gets more coverage.



Now, if we were in the middle of the legislative session and had committee hearings running and full floor calendars, that would be one thing. In that scenario, hitting the pause button and focusing on a critically important issue like this would be a justifiable reason to call a special session.



But we’re not in the busy middle of a legislative session. We’re mostly sitting on our hands waiting for a budget vote which isn’t coming because the current proposal doesn’t have the votes. So instead of admitting that the votes aren’t there, we are hitting the pause button on that and focusing on this special session for the rest of this week.



The only other time I’ve dealt with a special session was back in 2018, when the governor called a special session to tackle the opioid crisis. This was in January of 2018, during the second week of the legislative session. Again, it didn’t need a special session, but it garnered more press coverage and guaranteed a more specific focus on one issue than it would receive in a regular session.



During that special session, we passed a package of specific bills relating to the opioid crisis, all of which, if I remember correctly, passed unanimously.



How do the logistics of a special session work? Well, it could be as simple as gaveling in and out of our regular session, and then gaveling in for the special session. Not much changes, other than during a special session the bill number order resets, and any bill that is introduced will likely be SB 1001 or HB 2001.



We expect the special session to officially start later this morning, when a bill or series of bills is introduced. A committee hearing will take place on Wednesday, and final floor votes are expected on Thursday.



I fully expect the legislation that comes out of the special session to have strong bipartisan support, as this is an issue that is important to address for all Arizonans both now and into the future.



Now, if only we could have that kind of commitment to bipartisanship in the budget process!



So what’s new with the state budget? Not much change from last week, since it has been painfully clear for anyone who is watching that the current budget proposal does not have the votes to pass in either chamber.



The governor and legislative leadership REALLY want their flat tax, to the tune of $1.9 billion a year. The entire Democratic caucus is opposed to the plan, and a few Republicans are as well. That bipartisan opposition mean it does not have the votes to pass.



There is still a significant chasm of difference between what moderate folks like me will accept with the state budget, and what the current proposal on the table is. As I have said in this newsletter frequently during this session, I am open to ongoing tax cuts, but they have to be much smaller than the current proposal and more evenly distributed among all Arizona taxpayers, not just those at the top end of the income scale.



The wildfires raging across the state also highlight the need to maintain revenue going forward in case we DO have additional wildfires or natural disasters. We won’t always have one-time federal dollars at our disposal, and we won’t always have the resources to allocate to events like these when they arise.



Whether it’s wildfires, water shortages, or other weather-related events, it’s critically important that we have the flexibility and the resources to handle crises as they come. Passing a massive flat tax plan that would cut nearly $20 billion from our state budget over the next decade would severely hurt our ability to alleviate future crises.



Our deadline to pass a state budget is a little over two weeks away. I would expect next week to be very interesting, when pressure will inevitably ramp up about making a deal. As always, I will be eager and willing to work in a bipartisan way to pass a responsible state budget that protects our state and makes the kind of critical investments we need to grow our economy and best serve our constituents.



One idea on the table right now is to pass another “skinny budget,” like we did last year during the pandemic. This would mean spending very little in new endeavors and saving resources for either a special session late this year or future budget cycles.



While a skinny budget would likely mean no flat tax, it would also likely mean some of the good portions of the budget this year, like pay raises for some state employees and “gap funding” to help our K-12 schools, would likely go away too.



My strong preference is that we pass an actual budget, and not rely on a skinny budget for a second year in a row. But it has to be the right kind of budget, one that focuses on paying down debt and making critical investments, while at the same time passing tax reform that is reasonable and provident.



Stay tuned! Remember that you can always check my social media feeds for more regular updates. Until next week!



Thank you,



Sean





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