The Arizona Supreme Court on Thursday heard oral arguments on Republican lawmakers’ challenge of a hospital assessment that funds the state’s Medicaid expansion. Fate of GOP’s challenge to Medicaid expansion now in hands of the Arizona Supreme Court:
An attorney for three dozen current and former lawmakers argued that the hospital assessment is a tax that requires a two-thirds legislative majority to enact. The assessment was narrowly approved by the Legislature in 2013.
The lawsuit was rejected by a Maricopa County Superior Court judge in 2015, and the Arizona Court of Appeals upheld that decision in March.
The appellate court in its opinion (.pdf) said the law imposed an assessment that is exempt from the requirement that any act by lawmakers increasing state revenues, such a tax hike, must get a two-thirds vote in the Legislature [the “Two-Thirds for Taxes” amendment, Prop. 108 (1992)].
The “Kochtopus” Death Star, the Goldwater Institute attorney representing the lawmakers, pressed ahead with an argument before the seven-member Arizona Supreme Court that the assessment is a tax that required the vote of a two-thirds majority of the Legislature under Proposition 108, which was passed by voters in 1992.
“It is clear under Proposition 108, a supermajority is needed for the Legislature to authorize what they did here,” said Christina Sandefur, a Goldwater Institute attorney who represented the lawmakers. “That is what the voters wanted. They wanted the supermajority to apply any time the Legislature acts to raise revenue.”
Timothy Berg, an attorney representing Arizona and the state’s Medicaid program, said the voter-approved initiative included an exception that allows fees and assessments imposed by state agencies.
Berg argued that voters passed Proposition 108 with the intent of limiting the Legislature’s ability to raise taxes with a simple majority, not restrict fee increases that are a routine part of state government.