In 2019, #AZLeg Should Review Corporate Tax Giveaways (video)

Fair tax forum in Tucson
A standing room only crowd filled the IBEW Hall for the Stop Thief! Let’s Restore Fair Taxes Forum, hosted by PALF and PDA Tucson, with support from other unions and community groups.

#RedForEd lifted the veil from our eyes and put the issue of corporate tax giveaways front and center in the fight to restore public education funding in Arizona.

As many of you are aware, the Arizona Legislature is giving away more than $13 billion in taxes every year and using only $10 billion to run the state. It is not sound fiscal policy to use accounting gimmicks and 50 fund transfers to “balance” the budget. It is no surprise that the state owes K-12 education around $1 billion. Thanks to scheduled corporate tax cuts passed by the Tea Party*, beginning in 2011, Arizona’s corporations got to keep an extra $1 billion in 2017. These corporate tax cuts continue through 2019, even though we can’t afford them.

As a result of the anger and frustration that many Tucsonans feel about the Arizona Legislature’s performance, the Stop Thief! Let’s Restore Fair Taxes Community Forum drew a standing room only crowd of diverse participants.

The event opened with heart-felt testimonies from current high school students, who explained how school budget cuts have impacted their lives and their schools.

LD9 Rep. Randy Friese gave a detailed presentation on tax revenue and how it has been siphoned off by special interest groups and corporate tax cuts for decades. (Video here.)

LD9 Rep. Pamela Powers Hannley’s talk focused specific tax giveaway bills and the drama that swirled around the bills that passed and the ones that failed. (Video here.) Excluding any votes related to budget appropriations, all of the tax giveaway votes in the 53rd Legislature were bipartisan— with Democrats and Republicans on both sides.

Stop Thief fair tax forum
Small group breakout sessions followed the formal talks.

The Legislature’s mindset on tax giveaways shifted from January 2017– when two Progressive Democrats made a pact to vote against every tax giveaway until the schools were fully funded– to budget night in May 2018. The Progressive viewpoint was: If the state “can’t afford” to fully fund K-12 public education (due to self-imposed austerity), then we “can’t afford” to give away or excuse any more taxes until the schools are on stable footing and fully funded. Thanks to the #RedForEd movement, on budget night 2018, hundreds of teachers, parents, and supporters filled the House gallery and the Capitol lawn and demanded that public education take priority over corporate tax cuts.

LD9 incumbents, Reps. Pamela Powers Hannley and Randy Friese
LD9 incumbents, Reps. Pamela Powers Hannley and Randy Friese at the fair tax forum.

As I mentioned in my talk, a thorough tax giveaway review bill and several tax reform or repeal bills were proposed in the Legislature in 2018. Unfortunately, due to the GOP gamesmanship at the Capitol, these bills were not heard because they were proposed by Democrats: Senator Steve Farley and Reps. Mark Cardenas, Randy Friese, and Pamela Powers Hannley.

It’s time to review all of the tax cuts, tax exemptions, tax credits, tax subtractions, and other tax loopholes. Some of these tax giveaways benefit very narrow interests– to the detriment of the general fund and the general public. We must determine which tax exemptions benefit the people of Arizona (like the TPT exemptions for food and prescription drugs); which ones benefit special interest groups (like gold bullion enthusiasts); which ones benefit individual corporations (like the infamous four-inch pipe); which ones we are effective and affordable; and how we can spark economic development without breaking our budget and starving all of our educational institutions, as we are now.

Several people told me that they felt hopeful after my talk because so many costly tax giveaways were stopped on a bipartisan vote.  This is why it is important to ask every candidate in the 2018 election what their stance is on tax giveaways, the #RedForEd movement, the Invest In Ed Citizens Initiative (to secure long-term funding for K-12), and the Outlaw Dirty Money Citizens Initiative.  Will these candidates fight for the people or will they “take the money and run”?

A few people have told me that I shouldn’t go to the Legislature and just vote “no.”  My goal in the Legislature is to work for and fight for the people of Arizona. In a Legislature that is controlled by right-wing ideology, that often translates into trying to stop bad bills from becoming law. In the 53rd Legislature, being the voice of the people meant fighting against corporate tax giveaways, stingy TANF benefits, English-only insurance contracts, risky pension fund investments, untested technologies, diminished workers compensation benefits and workers rightsfinancial deregulation, misleading insurance contracts, environmental degradation, bad water policy, increased debt, increased sales tax, and more. Thankfully, there were many others– sometimes on both sides of the aisle– who disagreed with these bad bills and also voted “no” to stop them.

A reporter recently told me that, historically, Democrats in the minority make deals with Republicans and vote for Republican bills in exchange for votes on their bills. I have seen this vote-trading up close and personal in the Arizona House. I have been lobbied by other Democrats to vote for bills I disagreed with– like the bill that would have classified home health workers as not real employees. A Democrat asked me why I was voting “no”. First of all, this bill conflicted with federal law and could get us sued. (It’s a total waste of money to pass laws that will cost us millions in court battles.) Other than that, why would we vote for a bill that diminishes the rights of workers, who are already underpaid and who suffer from wage theft? The only reason I can see for classifying these workers as “not employees” is to further screw them on wages, benefits and travel time from one home to another. Trying hard to get me to change my vote, this Democrat said, “They’re just leased employees”– as if that status makes them less deserving of worker protections.

I look at every bill and ask, “How will this benefit the people of Arizona?” I don’t look at the bills and ask, “Will a ‘yes’ or a ‘no’ vote please my big donors?” Or, “What position will boost my political career?”

When you stand up for the people, and you use your debate skills and tough questions to change minds and votes, that’s a good thing. Going bold and arguing against bills that are morally wrong is more important than groveling for Republican favor by giving away your votes in exchange for the opportunity to pass a small-scale, safe bill that the GOP doesn’t care about (or wants to use as a striker later). In the 53rd Legislature, there were times when “reaching across the aisle” actually meant voting “no” on Republican bills.

As Legislators, our goal should be improving the lives of all Arizonans– not featherbedding corporations and special interest groups.

Here is a banner showing 195 of the 334 tax giveaways in Arizona.

A Few Slides

Here are a few of the slides showing the bipartisan votes on the corporate tax giveaway bills.

HB2325 Arizona Legislature 2017
The “Greenhouse Bill” was one of the first corporate tax giveaway bills to be heard in 2017. It went down on a bipartisan urban/rural vote because it would decrease funding to rural schools.
HB2492 Arizona Legislature 2017
The “Raytheon Bill” was a massive, multi-layered corporate tax giveaway that would have helped only a handful of Arizona’s largest employers. It was soundly defeated on a bipartisan urban/rural vote.
SB1416 Arizona Legislature
The “Intel Bill” was a scaled back version of the “Raytheon Bill.” It came back on the last night of the session as a striker and passed with much arm-twisting. When you compare the “Raytheon Bill” vote (above) with this vote, you can see how many votes flipped between March and May, after the story broke that Arizona gives away $13+ billion and uses only $10 million to run the state.
HB2479 Arizona Legislature 2018
The tax exemption for digital goods and services passed the Arizona House before we even knew how much it would cost the general fund. After the projected $140 million per year price tag was revealed, it died in the Senate. The cost of this bill would have increased every year as more goods and services are purchased online.

Watch my full presentation on corporate tax giveaways in the 53rd Legislature here.

The forum is hosted by the Pima Area Labor Federation and Progressive Democrats of America (PDA Tucson). Sponsors include: Alliance 4 Action, Arizona Education Association (AEA), AEA Retired, Arizona Educators United (AEU), A. Philip Randolph Institute, Pima County African American Democratic Caucus, Democrats of Greater Tucson (DGT), Pima County Education Democratic Caucus, The Arizona Ground Game (TAGG), Justice Alliance, Progressive Democrats of Southern Arizona, #RedForEd, Tanque Verde Democratic Club, Tucson Education Association, Vets for Peace-Tucson, Voices for Education, YWCA-Southern Arizona.

*FUN FACT: Some of the original Tea Partiers who were elected in 2018 are still in the Legislature and termed out in 2018. This means many of them are trying to flip from the House to the Senate or vice versa.