News and Updates

An interesting paradox has developed at the legislature this year. Even though state policymakers are sitting on record tax revenues and a robust Arizona economy, they seem more obsessed with tax increases than ever before.

So far this session there are efforts by Republicans to increase the sales tax by $600 million, raise the gas tax by $750 million, increase income taxes by $200 million, impose taxes on most internet transactions at a cost of over $250 million, retain the $190 Million VLT registration fee and allow political subdivisions to increase sales taxes at the local level. All together it would amount to over $2 billion in tax hikes, a mind-blowing amount that would dwarf any previous tax increase enacted in the State.

The arguments in favor of each of these tax hikes vary, but most surround the topic of additional funding for K-12 schools. This sentiment was understandable. As Arizona stumbled through eight years of job killing policies under the Obama Administration, there was mounting pressure to find new funding sources for education to address the state’s anemic revenue growth.

Fortunately, this is no longer the case. Between the change in administrations in Washington and a consistent focus on pro-growth policies here at home, our economy has taken off. Arizona now has the 3rd fastest growing economy in the country. People are once again flocking to the state, and the Arizona Office of Economic Opportunity projects that 165,000 new jobs will be created by 2020.

This has created a gusher in new tax revenue, most of which is going to K-12. Lawmakers are in the process of funding Governor Ducey’s ‘20by20’ teacher pay plan and restoring District Additional Assistance, which combined will add over $1 Billion in new dollars for public schools by next year.
When fully implemented this will be the largest increase in K-12 funding in state history, and will push per pupil funding so high that lawmakers will be forced to override the education spending limit in the Arizona constitution. This is only the 2nd time in 40 years that such an override vote will be required, a fact that should please everyone that has worried that not enough emphasis has been placed on education funding at the legislature.

And here is the best news yet—even after this large infusion of cash into the classroom, Arizona will still have a projected $1 Billion dollar surplus for FY 2020. It proves that the problem was the need for more taxpayers, not tax hikes.

Yet our political class appears ready to go all-in on job crushing tax increases that will derail Arizona’s economic recovery. While this may excite states like Texas looking to poach our entrepreneurs and job creators, it is bad news for everyone else that wants to keep prosperity here in the state.

Lawmakers instead should be looking to embrace our success, maintain the course and continue to pursue pro-growth ideas that work. Now is not the time to surrender to policies or politics that will move Arizona in the wrong direction.

Every American, no matter their political party, should have a significant interest in the wholesale integrity of the election process.  And yet the business of ensuring citizens voting is honest, clean and untampered with, has been a fiercely partisan issue, dividing Republicans and Democrats into two camps: the party for election integrity and the party against “voter suppression.”

The integrity of the elections systems is two-fold: ensuring there are legal and procedural safeguards to maintain clean and accurate voting rolls and preventing, discovering and deterring fraudulent activity.

One would think that maintaining up to date voter rolls would be an innocuous issue.  After all, neglecting to do so all but guarantees records will be cluttered with deceased persons and those who have moved out of state. In a 2012 study, the Pew Research Foundation found that 24 million voter registrations in the United States were either invalid or significantly inaccurate – that is one in every eight registrants.  This vast vulnerability directly dovetails into susceptibility of election fraud.

The issue of election fraud is as old as elections themselves and take form in a variety of ways including – double voting, ineligible voting, and voter registration fraud, etc. Yet, this type of crime is notoriously difficult to catch, document, and enforce, which makes the problem significantly underreported.

Following the Arizona general elections of 2018, many voters voiced concerns over how specifically the Maricopa County recorder’s office conducted operations.  And given the thin margins in many of the state-wide races, a little bit of fraud can have a big effect.

As a result, several Arizona lawmakers have introduced legislation to insert more practical checks into the system to both scrub voter rolls and fills cracks where the system is susceptible to fraud.

The best batch of election integrity bills have been introduced by Senator Michelle Ugenti-Rita (R) and include:

  • SB 1046 requires voters who receive a ballot by mail to return that ballot by mail. If they do not, they may vote in person on election day with a standard ballot.  Practically, this bill helps prevent the illegal practice of ballot harvesting.
  • SB 1072 requires voters to show identification when voting at an early voting location. This makes the identification requirements consistent across all methods of in-person voting.  And although Democrats want to claim the basic function of showing I.D is burdensome to voters, 76 percent of Americans believe such requirements should be mandatory.
  • SB 1188 requires a county recorder to remove a voter from the permanent early voting list and cease sending them early ballots if the elector has not voted in two consecutive primary or general elections.
  • SB 1090 requires electors voting at an emergency voting center to sign an affidavit under penalty of perjury that they did in fact suffer an emergency. Also requires the County Board of Supervisors to sign off on location, quantity and hours of emergency voting centers.

Given the reasonable proposals being suggested, one might be surprised by the very vocal fidelity of the left to the notion that 1. Fraud doesn’t exist, 2. When it does it is insignificant, and 3. Any legal framework that inserts predictable rules and guidelines into the system disenfranchises voters.

This is less surprising when you consider the bills drafted by Democrat legislators this year which take a free-for-all approach.  Their philosophy seems to be the more votes cast the better – even if those votes are duplicative, unverified, or non-citizens.  These bills include repealing the prohibition of ballot harvesting, same-day voter registration, and automatic restoration of voting rights for felons.

These election integrity bills are important steps to shore up weakness in Arizona’s election process.  Despite the left’s effort to diminish the relevance of the election integrity issue, the real disenfranchisement of voters comes from diluting the votes of honest electors. Allowing for the erosion of the system casts doubt into the minds of citizens as to if their vote even counts – and that is true voter suppression.

The individual health insurance market has been a roller coaster for consumers since the passage of the Affordable Care Act.

Last year, the average ACA plan rose 34 percent – pricing out many of the individuals who do not qualify for federal subsidies.  Additionally, many counties across the country have lost insurers, with only one option or even no options for consumers.    Younger, healthier Americans have been forced into high-risk pools to subsidize the high-costs associated with pre-existing conditions and other benefits they are likely not to need.   As a result, many have opted out of full coverage at all and risk incurring the Obamacare tax penalty for not carrying insurance.

After a failure of the Senate to repeal these disastrous policies, the Trump Administration has had few options for fixing our health insurance system.  However, a year ago, some progress was made on this front.

With the passage of the Tax Cuts and Jobs Act in December 2017, Congress included the repeal of the tax penalty for individuals without medical coverage for policies beginning in 2019.  Then in February of 2018, Trump issued an executive order allowing for the appropriate federal agencies to amend their rules regarding short-term duration health insurance.

Short-term duration insurance is not meant to qualify as full medical coverage, but instead is another insurance product available to help individuals through different periods of transition.  Trump’s executive order overturned the Obama Administration’s directive to limit these plans to only 90 days.  Instead they are now allowed to be issued for less than a year and may be renewed for up to three years.

These short-term plans will likely cost Americans half what the traditional ACA plan costs and the administration predicts around 600,000 people will choose these plans this year.  Of the over half a million people, no more than a third are likely to leave their ACA plan; with most enrollees coming from individuals without any insurance at all.

Opponents argue the reversal of this rule will poach enrollees in the individual market.  Obama’s rollback of short-term duration policies was meant to increase enrollment in the exchange.  But it didn’t work.  Instead, enrollment in the ACA plans decreased by 10 percent following the year of the rule change; which may have had something to do with premiums increasing by 21 percent that year.

There is a want and a need for more affordable policies that do not have all the bells and whistles of a traditional plan.  Under the Obama 3-month cap of short-term policies, enrollees would have to reapply every 90 days, forcing a reset of their deductibles or sometimes a cancellation of their policy altogether.  Given the short time frame, many customers would not be able to access full coverage insurance for months, until another enrollment period opened.

This rule change is good for consumers.  It will dramatically expand choice and opportunity for coverage to hundreds of thousands of Americans.

Now it is up to the states to ensure these options will be available to their constituents by amending their laws to allow for greater regulatory flexibility of short-term duration plans.  In Arizona, Representative Nancy Barto is sponsoring legislation to do just that.  We encourage lawmakers to support this common-sense bill and allow more Arizonans to access affordable coverage.

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The Arizona Free Enterprise Club is a free market policy and advocacy group dedicated to promoting a strong and vibrant Arizona economy.