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GOP leaders take first step to avoid more than $1.1B in school spending cuts

Top legislative leaders took their first steps Monday to ensure Arizona public schools don't have to slash more than $1.1 billion from their budgets in just two weeks.

House Speaker Rusty Bowers (R-Mesa) introduced legislation for a one-time waiver of what's known as the "aggregate expenditure limit” — a voter-approved cap on public school spending the Arizona Education Department warns will be exceeded by $1.15 billion, or roughly 16% of what is in each school district's budget.

Bowers, by virtue of his position as speaker, can virtually ensure the measure goes through the House Ways and Means Committee and gets to the full House ahead of the March 1 deadline.

Senate President Karen Fann (R-Prescott) is introducing "mirror" legislation in her chamber. That means both measures can get hearings at the same time and receive final approval in time. But Fann told Capitol Media Services that she is still lining up the necessary votes for approval.

Busting the limit, even for one year, takes a two-thirds majority vote of both the House and Senate. All Democrats in both chambers are expected to support. On paper, that means the measure needs just nine more votes in the 60-member House and six in the 30-member Senate.

But Sen. Juan Mendez (D-Tempe) has not been in attendance since the session began. As the parent of a newborn, he has decided to stay home after he was denied the opportunity to vote remotely.

Fann will have to convince a seventh Republican to support waiving the spending limit in place of Mendez. But some Senate Republicans have resisted approving the waiver, even though it would only allow schools to spend money that Republicans already approved in the state budget for the current school year.

"I cannot support raising the school spending cap until we have ESA's for all students," Sen. Kelly Townsend (R-Mesa) said last month.

Townsend is referring to what are known as "empowerment scholarship accounts." More familiarly, they are vouchers of public funds that allow parents to send their children to private or parochial schools or even permit home teaching. Fann said she recognizes there is resistance and efforts to link other policy questions, like vouchers.

"Those are all issues that we need to deal with," Fann said.

"Everybody is entitled to her vote," she added. Fann also said this isn't one of those measures where GOP leadership will demand party loyalty.

Bowers, for his part, said that as far as he is concerned, the matter of waiving the spending cap will not be tied to any other issue. He said that includes not just the question of expanded vouchers, but also any effort to re-enact a $1.9 billion tax cut approved last year that has been delayed because foes got enough signatures to hold up enactment until voters get the last word in November.

At the heart of the issue is a 1980 voter-approved constitutional amendment. It caps total spending on education at then-current levels, with annual adjustments for inflation and student growth.

Voters also approved giving the Legislature the authority to waive the cap, which it’s done in the past. But if lawmakers don’t act by March 1, schools would have to cut a collective $1.15 billion out of their current budgets. School officials have said any kind of loss, coming with less than three months remaining in the fiscal year to make those cuts, likely would mean laying off teachers and other staffers.

Bowers made it clear he expects the measure to pass.

"I don't introduce bills like this for fun," he said.

Bowers also said it is not contingent on what the Arizona Supreme Court does with a pending motion he and Fann filed to get a final ruling on whether a 3.5% surcharge on income taxes for the wealthy can or cannot take effect.

The issues are somewhat linked.

In a prior ruling, justices said voters had the legal right to approve Proposition 208 in 2020, which added the 3.5% surcharge. That additional tax on incomes of more than $250,000 for individuals and $500,000 for married couples filing jointly would raise more than $800 million a year for K-12 education. But the justices said they could not tell if the amount raised, by itself, would bust the aggregate spending limit, the same limit at issue here, sending the issue back to a trial judge. 

With no ruling likely before the March 1 deadline, Bowers and Fann asked the high court to take the case back and rule, once and for all, that Proposition 208 is void because the money raised could not be spent.

The new legislation introduced Monday ensures that it covers just the amount schools already budgeted for schools — not anything additional that they might otherwise get in the coming school year through the 2020 initiative. Bowers said it should calm the fears of educators, some of whom have rallied and lobbied lawmakers to finally take action before the March 1 deadline.

No date has been set for a hearing on either measure.

For more on the Legislature’s action on the school spending cap, The Show spoke to Howard Fischer of Capitol Media Services.

The Show also talked to Dr. Paul Tighe, superintendent of the Saddle Mountain Unified School District, who said his district is facing $3.4 million in cuts.

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Mark Brodie is a co-host of The Show, KJZZ’s locally produced news magazine. Since starting at KJZZ in 2002, Brodie has been a host, reporter and producer, including several years covering the Arizona Legislature, based at the Capitol.