by admin | Jul 20, 2017 | News and Updates
Prescott is at a crossroads. Due to a crippling pension debt that has the city staring at possible bankruptcy in the next decade, the voters of Prescott will have an important decision to make in the upcoming election for Mayor.
Add in critical issues surrounding water and job crushing regulations, it is clear the decisions made by voters today will determine whether Prescott continues to grow and prosper for years to come, or begins down a path of financial and economic turmoil.
Currently there are three candidates vying for Mayor, and based on their public positions on the issues it is difficult to make an endorsement at this time. What is obvious is that there is one candidate that should be avoided by taxpayers at all costs.
Current sitting Councilwoman, Jean Wilcox, is the WRONG choice for Prescott Mayor.
Jean Wilcox has been a dedicated tax-and-spend politician from her first moments in office. She has publicly supported increases in the sales tax, property tax, gas tax, and a water tax. It’s hard to find a tax Wilcox does not want to raise.
Since being elected to Council in 2014, Wilcox has been beating the drum to raise taxes at every turn. The first tax increase she pushed for was an increase to the City’s sales tax in June of 2014. She had barely taken office but it did not take long for her to be convinced that increasing taxes was the only option for the city.
Wilcox then voted in June of 2014 to raise Prescott taxpayers’ property taxes. While casting her vote, Wilcox arrogantly stated that she was disappointed that they were “stuck” with Arizona’s voter enacted constitutional limitations on how high property taxes could go. Just two years later Wilcox voted again to raise property taxes.
After raising property taxes, Wilcox began pushing the council to increase water rates to pursue her environmentalist agenda and subsidize various crony capitalist pet projects. When it comes to municipal water service, taxpayers should have 100 percent confidence that water rates are based solely on the cost of providing the service. Water bills shouldn’t include extra taxes and fees to pay for special interest projects, which is exactly what Jean Wilcox wanted to do.
Jean Wilcox used her position on the council to work around these important protections for rate payers. Wilcox even entertained the idea that higher water fees could be cycled into select industries Jean Wilcox liked. In other words, she wanted to raise water rates in order to provide a few politically-connected commercial users with a subsidy.
What is even more telling of Jean Wilcox’s character is how she responded when voters didn’t agree with her high tax mentality. Two years ago, Councilwoman Wilcox pushed to roll a series of tax increases for open space, pension funding and street improvements into one package. The purpose of this maneuver was to increase the chances that her favored tax increase—more money for open space—would pass.
She failed in this endeavor to log roll the measures and the triple tax proposition went to the ballot as three separate proposals. After voters rejected two of the three measures, Wilcox expressed her disgust for taxpayers, stating those who did not vote for the tax were duped and that they “don’t understand that paying this tax will benefit the whole community.”
This is what Prescott residents must look forward to if they vote for Jean Wilcox for mayor. Her love of taxes knows no bounds, and as Mayor she will have a lot more power to implement her agenda.
As Prescott prepares itself for the future, it is going to require a leader with a strong record of fiscal discipline. That person is clearly not Jean Wilcox.
Paid for by the Arizona Free Enterprise Club. Not authorized by any candidate or candidate campaign committee.
by admin | Jul 18, 2017 | News and Updates
For decades, despite overall decreased levels of service, the Federal Aviation Administration has struggled with bloated operating budgets, expensive personnel and benefits costs, and high unit costs per service.
As Congress considers a reauthorization package of the FAA, a new proposal to modernize Air Traffic Control (ATC) should be adopted.
Specifically, commercializing the nation’s air navigation infrastructure would benefit taxpayers by increasing efficiencies, improving customer responsiveness, and accelerating the adoption of new technologies. All while saving users and taxpayers lots of money.
Many other countries have charted this course with much success. The UK, Canada, Germany, and France all have commercialized air navigation. Although there are variations, all are operated by private entities and have systems financed by users instead of taxes.
The private systems work while the FAA continues to struggle. Since the 1990’s, lawmakers have set policy goals for the FAA, but with little to show for it. In the last 25 years, Congress has adopted several key pieces of legislation to direct the agency to modernize its operations, cut costs, and improve efficiencies.
But a report published by the Inspector General of the Department of Transportation released in May of this year, shows that despite legislative action and significant resources poured into the FAA, there has been little to show for their “efforts.”
This should come as no surprise considering giant bureaucracies funded through general appropriations have no incentive to streamline their operations or respond to user needs and desires. Despite the FAA undergoing a massive reorganization to reduce costs, between 1996 – 2015 the agency increased their operations account by 110 percent.
Even amid nine percent lower workforce levels and a constant number of facilities, compensation and benefits expenses doubled in that timeframe. The fact is, because of outsized union influence, the FAA has not taken steps to reduce personnel costs, even though they were given great latitude in negotiating collective bargaining agreements.
Countries that permit private non-profits to run their air navigation systems have become hubs of technological innovation.
With transportation in this country undergoing a massive evolution, now is the time to tear down antiquated models and erect new, innovative and responsive models in their stead. The current model has increased the tax and fee rate on the average ticket by 20 percent. The old system for ATC does not serve taxpayers well. Consumers deserve better.
by admin | Jul 13, 2017 | News and Updates
If taxpayers had any lingering doubts that Phoenix is a lost cause when it comes to sane financial stewardship, a series of recent votes by the council should wipe them away.
First, the City Council voted in May to approve the FY 2018 budget that contains an ongoing structural deficit between $43 to $64 million. This, despite the fact that Phoenix has raised the sales tax, raised property taxes, added a water tax on utility bills and is currently taking in a record amount of revenue.
A few weeks after the budget vote, the council approved a restructuring of their ballooning pension debt, adding an additional $2.3 billion in liabilities onto the backs of taxpayers by extending the amortization schedule from 20 to 30 years.
Phoenix is drowning in pension debt, a problem city staff continues to acknowledge. Yet the amortization extension was implemented anyway to free up more money for the Council to spend in the next fiscal year. It’s a win for the politicians since they will be long gone when the bill for this budget gimmick comes due. Phoenix taxpayers, on the other hand, won’t be so lucky.
Then, just days after the pension vote, the council voted to spend $100 Million on an extension of the Sky Train at Sky Harbor Airport from Terminal 3 to the rental car lot. For those not familiar with the Sky Train, it’s the wildly unnecessary $1.6 billion-dollar train built to take people 4.3 miles from the airport to the light rail station on 44th street and Washington. That’s at a cost of $372 million per mile. By comparison, the 22-mile South Mountain Loop 202 highway project slated for completion in 2019 will cost $916 million.
According to the figures from Sky Harbor (which deserve a healthy dose of skepticism), approximately 10 percent of flyers used the Sky Train in 2016. Of course, that number would be substantially less if passengers weren’t forced to use the train for inter-terminal service after the airport cancelled inter-terminal shuttle bus service in 2015.
Most normal people would see the empty train cars going back and forth along this elevated eyesore and recognize the failure of the endeavor. But normal and city hall don’t go together, so now they think extending the line to the rental car lot will fix their white elephant.
It is all but guaranteed to fail—rental car shuttle buses are already performing this service at a fraction of the cost and an increasing percentage of visitors are using alternative services such as Uber or Lyft in lieu of renting. Once driverless cars start hitting the road in a decade, Sky Train use will dwindle to zero, but the debt service to pay for it will linger on the books for decades.
Now not everyone on the council is tossing Phoenix taxpayers over the financial cliff. Councilmen Sal DiCiccio and Jim Waring have consistently fought against each of these reckless measures, but they are outnumbered 7-2 on the council and are limited in what they can accomplish. Complicating matters further is an entrenched city staff that has a vested interested in maintaining the status quo. Add in the clout of the public-sector unions, and you have the iron triangle of municipal politics.
So what can be done? Unfortunately, any meaningful change in course will be difficult to achieve, and relief is likely years away. Two realistic reforms are possible, but both would involve going around the entrenched establishment at City Hall.
The first reform would be to consolidate the candidate election dates to even numbered years. Consolidated elections would not only save taxpayers money, but it would also increase voter turnout and engagement, a reality that strikes fear into the Phoenix power set.
A second fix would be to reform Phoenix’s broken pension system. For years the city has pushed sham reforms and actively opposed citizen efforts to transition non-public safety city employees into a 401(k)-style defined contribution plan. If enacted, pension reform would save taxpayers millions over the next 30 years.
In the meantime, Phoenix residents should expect the Illinois budget management strategy to continue at City Hall for the foreseeable future—higher taxes, more spending and creative new accounting gimmicks to hide the mountain of debt.
by admin | Jul 11, 2017 | News and Updates
It has been nine months since Arizona citizens cast their vote in favor of Proposition 206, a measure to increase the State’s minimum wage and mandate businesses provide paid sick time to employees.
Since January, employers and the State have felt the pain of the minimum wage changes. The Legislature struggled to fill budgetary gaps for contracted care providers, and businesses have faced retracting their workforce or closing altogether. It will only get worse as workers begin to encounter the Seattle experience of less pay and fewer hours when the wage ratchets up to $12/hour by 2020.
Now, at the beginning of this month, the second kicker of the 9-page proposition takes effect. The new law requires employers provide one hour of paid sick time per every thirty hours worked; with up to 24 hours per year for employers with fewer than 15 employees, and 40 hours of paid sick time a year for employers with more than 15 employees.
These mandates come with real hard costs for all businesses large and small – both in the ways of new bureaucratic requirements, higher legal standards to defend themselves against possible suits, and a less reliable workforce.
With the sick time allowance comes a slew of new accounting and reporting burdens. Employers will now be required to reformat pay stubs to include employees’ accrued time, amount of pay earned as sick time, as well as sick time used to date. In addition to this, employers will have to retain these payroll records up to four years and post a notice in their workplaces outlining employee “rights” under Prop 206. The law applies to part-time and temporary workers as well – which means employers will have to think long and hard about whether the costs associated with these additional requirements are worth the investment in employees who may or may not provide longer term value to the company. These considerations are compounded when the minimum $250 penalty for record-keeping noncompliance is factored.
More significant however, will be the new legal reality employers face. Companies are prohibited from taking a negative action in response to an employee’s use of paid sick time. That means within 90 days of a sick time request or use, the employer will be under a microscope, whereby any action perceived as negative by the employee may be scrutinized as retaliation or deterrence. And because employees are permitted to take their sick time in the smallest increment of time within the business’s accounting system, an employee could spread out their sick time in a way that puts employers within perpetual 90-day duress.
This policy change threatens the very nature of Arizona’s “Right to Work” laws that make the state such an attractive place for businesses. Employers will need to meticulously document every reason for changing or cutting an employee’s hours, denying or requiring transfers, or denying vacation time use in peak times. Anytime there is a dispute, the higher burden for defending any changes will always fall upon the employer.
Despite the inevitable damages and economic drain of these liberal, socially-engineered policies, paid sick leave is a “solution” wanting a problem. Comprehensive studies of employer paid leave policies demonstrate most businesses provide paid sick days, workplace illness is not a widespread issue, and mandatory sick laws do not reduce employee turnover. Arizonans will see no real benefit from this policy change.
Over time, the greatest effect of paid leave will be the expansion of government authority into employment contracts and the adoption of one of the highest-cost paid leave mandates in the country. It undermines Arizona’s “right-to-work” law, emboldens big unions, and erodes the trust and synergy of the employer/employee relationship.
For more information on compliance with the new minimum wage or paid sick time laws, businesses should visit the Arizona Industrial Commission: https://www.azica.gov/frequently-asked-questions-about-wage-and-earned-paid-sick-time-laws