For years liberal groups have
aimed to unravel basic election integrity practices in the state of Arizona. From repealing ballot harvesting to pushing
for same day voter registration – the goal is a California-style free for all
where anything goes. Even
amidst legal defeats that have forced California to remove staggering numbers
of inactive and unverified voters from their rolls, extremists continue to try
to import these same policies in our state.
Case in point, an initiative dubbed
the “Fair Elections Act” was recently filed with the Secretary of State’s office
and includes almost every possible measure to erode safe, secure and honest
elections in Arizona.
Among the worst of the provisions
is the creation of a “democracy voucher” system which would furnish every
registered voter with certificates of $50 – $150 in order to facilitate small
dollar political contributions. Despite
claiming to be a tool to empower average Arizonans to exercise choice and their
political voice, these funds would only be eligible to be given to candidates
running via the Clean Elections Commission system.
Democracy isn’t cheap
Based upon current registration levels
and the minimum and maximum allowable distributable certificates, $191 – $573
Million of hard-earned taxpayer dollars could be up for grabs by politicians.
How does the initiative purport
to pay for this? With a tax increase of
course. The proposal would raise the minimum
corporate income tax from $50 to $150 – swiping the $100 increase for Clean
Elections. In addition, it would allow an up to $500 dollar for dollar tax credit
for contributions to the commission. Although these revenue enhancers alone are no where
near enough to cover the potential exorbitant costs, proponents are banking on
the idea that there will be low voter participation in the program – proving even
when you give people free money, they would rather not take it then give
it to a politician.
The voucher program isn’t the only
part of the measure with a hefty new price tag.
The initiative would also trigger automatic voter registration for
citizens receiving a drivers’ license or updating their information with the DMV. Within the 30-page initiative are tedious administrative
requirements for inter-agency coordination to include the Secretary of State,
Department of Transportation, Arizona Health Cost Containment and other
Because not everyone getting
their license or updating their information is eligible to vote, the initiative
includes a complicated process for mailing citizens. It would be incumbent upon the citizen to
return the pre-stamped mailer to indicate they do not want to be registered to
vote or that they are ineligible to vote.
The citizen has two years to complete missing or fix inaccurate information
before their status as a registered voter is cancelled. Even when their status as a voter is pending,
they are able to vote if an election is occurring.
No where in the initiative is it
mentioned how the state will pay for the inevitable technology overhaul
required to implement this “automatic voter registration system” or the onerous
process for constant pre-stamped mailers. Even more glaring are the gaping opportunities
for fraud. Currently, it is so easy to
register to vote in Arizona, the only excuse for not is apathy, laziness or
ineligibility. Placing the burden on
someone in any of these categories to ask to be excluded in the voter
rolls is a waste of time and money and sure to be a magnet for inaccuracies.
This is the tip of the iceberg when
it comes to bad ideas jammed packed into this election omnibus initiative. Hopefully voters will see through this
attempt to co-op the security of the Arizona ballot box and reject ideas that
have destroyed the election integrity of states like California and Washington.
The Joint Budget Legislative
Committee released their October
Fiscal Update, and it was more good news for the state budget
coffers. September tax receipts were $120 Million above the adopted budget
forecast, an 8.7% increase over the prior year. The explosion in tax revenue
has led JLBC to conclude that the state will finish with at least a $700
Million dollar budget surplus for FY 2020.
A large chunk of the surplus
revenue rolled in at the end of 2019 fiscal year, coinciding with a surge in
individual and corporate income tax filings that occurred in May and June after
the approval of the state budget.
The explosion in revenue didn’t
shock anyone following the income tax conformity debate at the legislature over
the last 18 months. Arizona was one of the last states to conform with the Federal
Tax Cuts and Jobs Act passed in 2017, leaving taxpayers in a
lurch on what tax laws to follow and forms to use. So, both individuals and
corporate entities waited until conformity legislation was passed to then file
with the state.
While JLBC stresses caution on
the current revenue projections, it is hard not to see that a chunk of this
surplus is the result of continued overcollection from the conformity tax
increase. During negotiations on a proposed conformity fix, the legislature and
Governor Ducey chose to adopt the low-end revenue estimate from the conformity
The agreed upon package settled
on an anticipated $220 million tax increase even though the Department of
Revenue estimated it could be well north of $300 million in FY 2020. Though no
one faults them for their cautious approach, it is now looking like the higher
figure was much closer to the mark.
This isn’t the only tax change
that will likely result in taxpayers paying more than expected to the state.
The budget also included a new sales
tax for online purchases, which went into effect over the summer. The
revenue estimate included in the budget for the implementation of the online
sales tax was $85 million annually, which was then offset by the legislature
with a corresponding reduction of the income tax.
At the time a lot of skepticism
surrounded the $85 million figure. Some groups, including the Arizona Tax
Research Association, analyzed the data and believe that the revenue from
taxing online sales could be
closer to $300 million. It is still early, but based on the fact
that every revenue projection is overperforming JLBC estimates, the higher figure
will likely prove more accurate.
What does this mean for
taxpayers? It means that they are still overpaying (and experiencing a tax
hike) even with the passage of a conformity package that attempted to hold
filers harmless last spring.
In order to address the
overcollection, the responsible solution is for lawmakers to work toward
returning a portion of the $700 million surplus back to hardworking taxpayers.
The spending lobby, media and political establishment won’t like this, but it
is the right thing to do. Plus, the gusher in new revenue is so large that
other priorities can be additionally funded while implementing rate reductions.
Interestingly, some Republicans
have expressed fear of political backlash if it appears that they are cutting
taxes. Setting aside the fact that
voters generally like having their money returned to them in years when there
is a large budget surplus, there is not a single politician in the state that
will be able to dodge the issue of tax cuts in 2020.
President Trump will be at the
top of ticket, and his signature achievement is the passage of the Tax Cuts and
Jobs Act in his first term. It is very likely that he will be running on a plan
for a second round of tax cuts if he is reelected. Unless every member of the
GOP intends to disassociate themselves from Trump and his 2nd term
agenda, this is the horse they will be riding with next November.
Republicans will have a choice:
run away from the idea of cutting taxes to address the overcollection of revenue
or try going on the offensive by promoting a low tax, pro-growth agenda. We
will see soon enough which path they choose.