by admin | Mar 8, 2022 | Corporate Welfare, News and Updates, Tax
Arizona lawmakers are currently living in “La La Land.” No, really. They want to dole out $150 million of your dollars to sign checks to woke Hollywood producers to literally California our Arizona.
SB1708, sponsored by Senator David Gowan, passed out of the Senate last week by a vote of 21-7. It provides a tax credit for a percentage of movie production costs: 15% for productions up to $10 million, 17.5% for productions between $10 and $35 million, 20% for productions over $35 million, and the opportunity for an extra 2.5% on top for positions held by Arizona residents, if the production is filmed in a qualified facility or primarily on location, or if it was produced in association with a long-term tenant in a qualified production facility.
The worst part—it’s refundable. This means that if Hollywood producers wipe out their tax liability to zero, the remaining tax credits come as a check from you, the taxpayer.
Movie production is a multi-billion-dollar industry. They do not need a subsidy. But because one state was willing to cut them a check a few decades ago, they now seek the highest bidder. It’s a race to the bottom for Arizona. Very soon, $150 million won’t be enough, and the industry will send more lobbyists down to the Capitol to razzle dazzle lawmakers into doling out more taxpayer dollars.
These production companies are more than able and happy to pick up and jet-set from one location another—even in the middle of production. If Arizona isn’t willing to pay more, another state or country will, and we’ll be left in the dust.
Georgia taxpayers gave the movie industry $1.2 billion last year. To keep up, California, home of actual Hollywood, is doubling its cap from $330 million a year to $660 million. Kevin Costner is currently lobbying the Utah legislature to provide a carveout in their $8.3 million cap for credits, raising it for movie productions in rural areas. Costner is telling Utah he wants to film 5 films there if the cap is raised. And star struck New Mexico recently more than doubled its cap, after spending hundreds of millions from their general fund to pay off a backlog of credits.
But while these states are fighting to out-bid each other, others have scrapped the idea. 13 states have eliminated their Hollywood subsidies in the past 10 years, and several others have scaled theirs back. And for good reason. A recent study of the subsidies in New York, Louisiana, Georgia, Connecticut and Massachusetts found that despite $10 billion in taxpayer dollars spent, there was no statistically significant impact on employment.
If this seems like such a bad idea that it should be illegal—it likely is. The Arizona Supreme Court recently ruled that the government cannot include “anticipated indirect benefits” such as projected sales and tax revenue as part of the consideration with a private party under the Gift Clause in the Arizona Constitution. In other words, Hollywood dazzling lawmakers with projected economic development leading to increased tax revenue is an “irrelevant indirect benefit” that cannot be included in the consideration.
In addition to the bill’s terrible tax policy and obvious unconstitutionality, Arizonans do not want their hard-earned dollars being used to send checks to Hollywood. We do not want to subsidize their woke movies, and do not want thousands of liberal California voters shipped into Arizona on our own dime.
Tell Your Lawmakers to OPPOSE SB1708!
Right now, lawmakers are considering a $150 million REFUNDABLE tax credit for woke Hollywood producers.
Arizonans have been shouting “Don’t California my Arizona” for years. But SB1708 pays to literally California our Arizona, shipping in thousands of Hollywood voters on the taxpayer’s dime. Regardless of the industry, Arizona taxpayers don’t want their hard-earned dollars going to corporate welfare with any refundable credit.
Send a message to Arizona lawmakers today and tell them Don’t California our Arizona: OPPOSE corporate welfare and OPPOSE SB1708!
by admin | Feb 3, 2022 | News and Updates, Tax
It’s not every day that one political party would seek to find a way to get more of its opponents to vote. But this is 2022, and apparently some Republican lawmakers just can’t help themselves.
Earlier this week, the Senate Transportation and Technology Committee unanimously approved SB1356. This bill is a tax increase that follows the expiring Proposition 400, a transportation tax of half a cent that was approved by voters in 2004. The plan itself is a complete boondoggle. If passed and signed into law, most of the money would go to transit and pet projects. (You can read more about that here.)
But one part of this bill is a total disaster. And anyone who considers themselves to be conservative should be outright concerned that Republican lawmakers not only approved the bill, but two of them actually sponsored it.
Buried inside SB1356 is language that attempts to rig the vote on this particular initiative. And that’s not the worst part. This language would also provide a big boost to Democrats in November.
But how?
First of all, the legislation prescribes (on pages 24-25) the exact ballot subject title and description, along with the language to describe the effects of both a “yes” vote and a “no” vote that will appear on the ballot. Normally, this would be drafted by attorneys or election officials not affiliated with the campaign. And while that certainly isn’t a perfect system, at least they are independent from the campaign and are required by law to draft impartial language. (This allows someone who believes that the language isn’t impartial to sue.)
But with SB1356, the supporters of the tax are the ones who drafted the language. And they did so using poll-tested and focus group language paid for with your tax dollars. In fact, they even included in the bill (on page 7) the ability to engage in an unlimited amount of polling—all at the expense of taxpayers like you. And because this language is included in the bill, there is no recourse for suing to ensure that it’s impartial.
If you think that is bad, we’re not done yet.
The legislation also provides unlimited funding through the roadway fund to Maricopa County to conduct the election for the tax. This includes funding for lawyers, consultants, employees, telecommunications costs, and canvassing for the election. So, basically, this bill is writing a blank check to Maricopa County to conduct a massive, taxpayer funded “Get Out the Vote” campaign to drive supporters of the tax to the polls.
And who do you think the supporters of such a tax will be?
Democrats.
That’s right. The Republican legislature is thinking about including a measure on the November 2022 ballot that is specifically designed to garner Democrat support. And less than a year after the state legislature banned Zuck bucks from influencing Arizona’s elections, some are apparently ok with a rigged election and making taxpayers foot the bill for a campaign that will increase Democrat turnout.
Clearly, this isn’t a plan to build roads and freeways—or improve how we move people from point A to point B. And this sort of bill is certainly not why you voted for a Republican legislature. Now, they need to do the right thing and vote NO on this so-called “transportation” bill.
Help Protect Freedom in Arizona by Joining Our Grassroots Network
Arizona needs to have a unified voice promoting economic freedom and prosperity, and the Free Enterprise Club is committed to making that happen. But we can’t do it alone. We need YOU!
Join our FREE Grassroots Action List to stay up to date on the latest battles against big government and how YOU can help influence crucial bills at the Arizona State Legislature.
by admin | Dec 21, 2021 | News and Updates, Tax
If you have been listening to the left and their friends in the media over the last several years, you might be under the impression that conservatives in the legislature have chronically underfunded K-12 education. But this couldn’t be further from the truth, and the truly historic levels of education funding actually threatens their soak the rich tax hike (Prop 208).
The reason we know K-12 is funded at historic levels is because there is a constitutional expenditure limit. Next year, we’re on track to blast above it. By billions.
Their pivot has been to attack the expenditure limit, as opposed to acknowledging how much the state is spending. But taxpayers should be thankful for this constitutional protection. It isn’t outdated, and it isn’t holding our schools back.
In 1980, Arizona voters approved the limit. It isn’t some subjective cap that legislators can manipulate to cover up how much or how little is being spent. It’s an objective formula that bean counters at the Department of Revenue use to calculate the limit every year. Funding levels are calculated annually to include student population, plus inflation, plus an additional 10% is added on top. For this year, that amounts to just over $6 billion.
Oh, and did we mention that this funding cap doesn’t include certain revenue streams, as many sources of funding are exempt from the K-12 spending limitation? For example, all of the Covid $$ received from the federal government is exempt from the constitutional cap. The result is that the actual amount spent on K-12 in FY 2022 is $16.2 billion, or $3.4 billion more than the entire state budget.
Even adjusted for inflation, this amounts to the highest per pupil spending in state history.
The constitutional spending cap does allow for a one-time override, but that requires a vote of two thirds of the members of the legislature. That means we can expect early next year to see the education spending lobby, democrats, and the media beating the same K-12 drum that $14,326 per student is not enough.
They will tell the public that conservatives have chronically underfunded education and that they must override the expenditure limit or schools will be broke. But conservative lawmakers should stand firm, push back on the misinformation, and tell voters that the only reason we are having this debate is because the legislature has continued to pump record amounts of money into schools.
The expenditure limit ensures K-12 funding grows at a contained and reasonable rate, provides an objective measure on how much we spend, and, importantly, protects the pockets of taxpayers from being robbed to flood schools with cash. Arizona taxpayers should be grateful that this constitutional protection exists and should tell lawmakers to say no to any reckless expenditure override.
Help Protect Freedom in Arizona by Joining Our Grassroots Network
Arizona needs to have a unified voice promoting economic freedom and prosperity, and the Free Enterprise Club is committed to making that happen. But we can’t do it alone. We need YOU!
Join our FREE Grassroots Action List to stay up to date on the latest battles against big government and how YOU can help influence crucial bills at the Arizona State Legislature.
by admin | Nov 23, 2021 | News and Updates, Tax
The fight against the left to protect our freedoms isn’t just happening at the legislature and ballot box. Our courtrooms are currently filled with cases working their way through the process, each involving critical issues that will impact the future of our state and country.
Given the plethora of lawsuits, it is difficult even for the most die-hard activist or informed citizen to keep track of what is going on. For many it seems as if new lawsuits are being announced every day, with injunctions and decisions raining down from all over the country.
To help make sense of some of these court battles, the Club has compiled a litigation update on several lawsuits, including cases involving mask and vaccine mandates, Critical Race Theory, Proposition 208, referendums over the recently enacted tax cuts, and the Biden vaccine mandate.
Proposition 208
Perhaps one of the best court outcomes from the past few months is that Proposition 208 is on its deathbed. Earlier this year, the Arizona Supreme Court decided that Prop 208 is unconstitutional. The drafters of the initiative, despite being warned by Legislative Council, attempted to statutorily exempt their tax hike from a constitutional expenditure limitation. That doesn’t work. The decision has effectively killed 208, but it isn’t six feet under quite yet – the Supreme Court has sent the case back to the trial court for a facts and findings hearing with the directive that if it is found that monies from the 208 tax hike would cause the state to exceed the expenditure limitation (it will) it must be struck down entirely. The hearing is scheduled for the beginning of January, the same time the legislature begins its new session.
Tax Cut Referendum
With a record budget surplus and the threat of Prop 208 in mind, Republicans passed a historic tax cut package that would benefit all Arizonans. But once it was passed, democrats immediately began collecting signatures to refer them to the ballot – which would halt implementation and risk voter protecting our tax code.
In response, the Club immediately filed a lawsuit challenging the constitutionality of referring tax policy to the ballot at all. Though voters have reserved the power to refer legislation to the ballot, there are exceptions to this power – one being that anything that relates to the support and maintenance of the state cannot be referred. Our lawsuit argues that changes in the tax code do directly relate to the support and maintenance of the state.
At this point, the campaign has failed to get a sufficient number of signatures for two of the three aspects of the tax cut package, but they did submit more than enough signatures for the portion that would phase down the income tax to a single, flat rate of 2.5%. The Club immediately began a challenge to these signatures and filed an additional lawsuit in early October. Both of these cases are still ongoing and likely will not be fully decided for months, lingering into the legislative session.
Budget Bill Litigation
The Arizona constitution limits the legislature to passing bills pertaining to only one subject and where the provisions of the bill are reflected in the title. It has been a long practice for the legislature to use Budget Reconciliation Bills (BRBs) to include some policy changes. This session, that’s where many of the conservative wins were enshrined. This includes a ban on mask and vaccine mandates, a ban on CRT in schools, and a host of election integrity provisions.
Unfortunately, the court unanimously ruled that some of the provisions challenged were not reflected in the title, and that the budget bill containing the election integrity provisions did not pertain to only one subject. Therefore, all of these provisions were struck down – not because of the constitutionality of any of the specific provisions, but because of the process in which they were enacted.
Vaccine Mandates – 5th circuit ruling: A win
Perhaps one of the best rulings for conservatives came out just a week ago, temporarily stopping the implementation of Biden’s vaccine mandate. On the mandate, the 5th Circuit wrote, “its promulgation grossly exceeds OSHA’s statutory authority” and that it passing constitutional muster would be a “dubious assumption.” Further, on the details of the mandate, the court wrote, “rather than a delicately handled scalpel, the Mandate is a one-size fits-all sledgehammer.” The court issued a stay barring OSHA from taking any further steps to enforce the mandate. There are many other lawsuits around the country on the mandate, and new decisions could come out, but in the meantime, OSHA has announced it will not implement its mandate.
Help Protect Freedom in Arizona by Joining Our Grassroots Network
Arizona needs to have a unified voice promoting economic freedom and prosperity, and the Free Enterprise Club is committed to making that happen. But we can’t do it alone. We need YOU!
Join our FREE Grassroots Action List to stay up to date on the latest battles against big government and how YOU can help influence crucial bills at the Arizona State Legislature.
by admin | Oct 28, 2021 | News and Updates, Tax
Invest in Arizona wants you to believe that they ran a grassroots campaign. But that notion is absurd. And you don’t need to look very far to find out.
Recently, the political committee filed its campaign finance report. And lo and behold, what does it show? That the National Education Association (NEA) and Stand for Children, two out-of-state special interest groups, purchased the referendum against historic tax cuts that Republicans delivered earlier this year.
Just look at the numbers. In Quarter 3, Invest in Arizona received just over $16,000 from individual donors. Now, compare that to the nearly $2.4 million it received from the NEA and the more than $2.3 million it received in cash, goods, and services from Stand for Children.
That’s more than $4.5 million—basically their entire budget—with the overwhelming majority spent on gathering signatures.
So much for “grassroots,” eh?
Of course, Stand for Children is trying to claim that its money came from its Phoenix office. But these groups can’t be trusted. In 2020, Stand for Children was funding Invest in Ed from its headquarters in Portland, Oregon, which the Club pointed out here and here. But now we’re supposed to believe that its Phoenix office miraculously developed the ability to start writing 7-figure checks to fund Invest in Arizona?
Either the Phoenix chapter became a fundraising behemoth overnight, or more than likely, the Portland headquarters has been laundering their money to a Phoenix address..
But that’s not even the worst part.
In order to buy their way onto the ballot, these out-of-state special interest groups flooded the streets with hundreds of paid circulators to gather signatures. And you probably won’t be surprised to find out that many of them weren’t following the law. Some failed to fully and properly register with the Secretary of State. Some did not correctly disclose their assigned circulator registration numbers. And some were felons.
That’s right. Invest in Arizona used convicted felons whose civil rights had not been fully restored to circulate its ballot measure.
For all these reasons, the signatures they gathered illegally should be void. That’s why the Arizona Free Enterprise Club filed a lawsuit last week to challenge the validity of over half the signatures Invest in Arizona submitted to the Secretary of State.
It’s clear that these groups are upset that Prop 208 was put on its deathbed by the Arizona Supreme Court back in August. And now, they want to stick it to the people of Arizona by trying to stop them from receiving some much-needed tax relief.
Invest in Arizona is making a farce of the referendum process. It was never intended to be used by Washington, D.C. teachers’ unions that disapprove of the decisions made by Arizona lawmakers. And while the fate of Invest in Arizona’s astroturf referendum is still unclear, the Club will not be deterred from fighting back against out-of-state special interest groups that parachute into our state trying to buy our ballot box.
Help Protect Freedom in Arizona by Joining Our Grassroots Network
Arizona needs to have a unified voice promoting economic freedom and prosperity, and the Free Enterprise Club is committed to making that happen. But we can’t do it alone. We need YOU!
Join our FREE Grassroots Action List to stay up to date on the latest battles against big government and how YOU can help influence crucial bills at the Arizona State Legislature.
by admin | Oct 7, 2021 | News and Updates, Tax
Arizona taxpayers have had good reason to celebrate over the past few months. Not only did Republicans deliver historic tax cuts earlier this year, but the Arizona Supreme Court ruled that Prop 208 is unconstitutional.
This should be a time of rejoicing for the people of Arizona who will get some much-needed relief while still trying to recover from COVID shutdowns.
But the backers of Prop 208 won’t give up. They are angry and upset that their unconstitutional tax hike was struck down. Now, their latest move is to target the $1.8 billion tax cut that would establish a flat tax and provide a tax cut to all Arizonans.
Last week, Invest in Arizona, a political committee sponsored by the Arizona Education Association and Stand for Children, submitted a referendum to put the historic tax cuts on the ballot for voters to decide its fate.
And not surprisingly, this effort has a few similarities to last year’s Prop 208 campaign.
Let’s start with the signature collection effort, which was bought and paid for by the teachers’ union and Stand for Children. During the final weeks of their signature collection campaign, these two special interest groups flooded the streets with hundreds of paid circulators in an attempt to buy their way onto the ballot. In total, they employed 619 paid circulators, many of which likely have criminal records and were not properly registered with the Secretary of State.
Then, there’s the lies.
In the case of Prop 208, voters were consistently lied to about how the tax wouldn’t affect small businesses. But it did, which resulted in several small businesses leaving the state.
And the lies didn’t stop there. Prop 208 backers also said that the tax did not try to skirt the constitutional expenditure limitation. Thankfully, this lie ultimately doomed the measure in the Arizona Supreme Court.
Now, with this referendum, the lies continue.
Invest in Arizona is telling voters that the legislature cut education funding, which is blatantly false. Conservative leaders passed the historic $1.8 billion tax cut while spending a record high amount for education with hundreds of millions in new funding for K-12 and universities.
And to top it all off, Invest in Arizona is telling the people of Arizona that signing the referendum will restore over $1 billion in education funding. But this is a total lie! The referendum has nothing to do with education!
More than likely, this entire effort is just as unconstitutional as Prop 208. That’s why the Club filed a lawsuit challenging the legality of referring the tax cuts to the ballot. Right now, our case is currently awaiting a hearing in Superior Court, and we are optimistic that it has a high chance of success.
After all, Arizona Secretary of State Katie Hobbs has decided to remain neutral, despite being named in the lawsuit. And Attorney General Mark Brnovich field a motion for leave, along with an amicus brief urging the court to rule in our favor.
But regardless of what happens at the Superior Court, we are committed to pursuing our legal challenge all the way to the Arizona Supreme Court, if necessary. And as the process for reviewing the validity of the referendum signatures begins, you can rest assured knowing that the Club will be watching to ensure that all illegal and fraudulent signatures are removed from the petition total.
Invest in Arizona may not like it, but the people have already spoken. The tax reform package was voted on and approved by 90 lawmakers who were duly elected by the people of Arizona. And it was signed by Governor Ducey who was also duly elected by the people or Arizona. That means it should be here to stay.
Help Protect Freedom in Arizona by Joining Our Grassroots Network
Arizona needs to have a unified voice promoting economic freedom and prosperity, and the Free Enterprise Club is committed to making that happen. But we can’t do it alone. We need YOU!
Join our FREE Grassroots Action List to stay up to date on the latest battles against big government and how YOU can help influence crucial bills at the Arizona State Legislature.
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