ARIZONA HOUSE OF REPRESENTATIVES

Forty-ninth Legislature – First Regular Session

COMMITTEE ON GOVERNMENT

Minutes of Special Meeting

Friday, June 26, 2009

House Hearing Room 4  --  9:00 a.m.

Vice-Chairman Montenegro called the meeting to order at 9:17 a.m. and attendance was noted by the secretary.

Members Present

Mr. Antenori	Mr. Driggs	Mr. Montenegro, Vice-Chairman
Mr. Campbell CH	Mr. Gowan	Chairman Crump, Chairman
Mr. Chabin	Mr. Nichols

Members Absent

Mrs. Tovar

Committee Action

SB1005 – NOT ASSIGNED	SB1235 – DP (7-0-0-2)
SB1072 – DP (6-1-0-2)	SB1313 – DPA S/E (7-0-0-2)
SB1073 – DP (8-0-0-1)	SB1314 – DP (6-1-0-2)
SB1109 – NOT ASSIGNED	SB1323 – DP (7-0-0-2)
SB1111 – DPA S/E (6-2-0-1)	SB1362 – DP (8-0-0-1)
SB1148 – DP (6-0-0-3)	SB1446 – NOT ASSIGNED
SB1149 – DPA S/E (6-2-0-1)	SCR1009 – DP (6-2-0-1)
SB1161 – DPA S/E (6-1-0-2)	SCR1026 – DP (6-1-0-2)

CONSIDERATION OF BILLS

SB1005 – rabies vaccination certificate; county enforcement – NOT ASSIGNED

SB1109 – voter registrations; death notices – NOT ASSIGNED

SB1446 – animal shelters; procedures; requirements – NOT ASSIGNED

Vice-Chairman Montenegro announced that SB1005, SB1109 and SB1446 were not assigned to the Committee.

SCR1009 – voter-protection; temporary budgetary suspension – DO PASS

Chairman Crump moved that SCR1009 do pass.

Michelle Hindman, Majority Research Analyst, explained that SCR1009 constitutionally grants the Legislature authority, in order to avoid a budget deficit, to appropriate or divert funds created by an initiative or referendum, subject to voter approval (Attachment 1).

Senator Russell Pearce, sponsor, related that an initiative touted by drug lords for the medicalization of marijuana was passed by the voters, but it actually legalized heroin, cocaine, etc., so the Legislature modified it, after which Proposition 105, the Voter Protection Act, was passed by the voters prohibiting the Legislature from repealing any initiative measure approved by a majority of the voters.  The problem is that Proposition 105 ties the Legislature’s hands on all initiatives, so this is a ballot initiative for voters stating that in tough times, when the Governor’s Office and the Joint Legislative Budget Committee agree that there is a one percent deficit of total general fund expenditures, issues protected by Proposition 105 can be suspended, but only to the extent of the size of the deficit so there would be no risk of gutting the programs.

Mr. Chabin raised the possibility of the Legislature granting tax relief to reduce the size of revenue to create a deficit so the proposed initiative would be triggered and the programs Arizona voters passed and approved would be dismantled.  Senator Pearce responded that this is simply for when there are deficits of the magnitude there is today.  It is appropriate for legislators, who have a constitutional responsibility to appropriate, to have the tools at hand to make good decisions for the people they represent.

Mr. Chabin noted that this authority presently rests with the Legislature by a two-thirds majority vote.  Senator Pearce indicated that it would take a three-fourths vote and it would have to further the cause of the voter-approved measure.  Three-fourths vote would not facilitate this measure; it has to go back to the vote of the people.

Mr. Chabin surmised that the voters knew that when they voted on Proposition 105. 
Senator Pearce replied that it was not possible to foresee the condition the state would be in
20 years after its passage.  Circumstances have changed and some voter initiatives have passed with fairly deceptive campaigns such as Proposition 204, which was to be paid for by tobacco settlement monies but has cost taxpayers millions of dollars.  SCR1009 would give legislators the ability to make appropriate decisions in difficult times.

Mr. Chabin noted that the people of Arizona indicated that education and health care are priorities in Arizona that should be funded before anything else and should be part of the Constitution.  Mr. Gowan pointed out that SCR1009 will be referred to the people to make that judgment.

Mr. Nichols commented that when Proposition 105 went to the ballot it was in direct response to the Legislature overturning the initiative on the ballot dealing with the legality of marijuana.  It did not affect the budget at that time.  He believes it is appropriate to ask voters if they meant, in budgetary times like the present, that the Legislature is “hands off” because of the voter initiative.

In response to Mr. Campbell, Senator Pearce clarified that SCR1009 stipulates that before going to a tax increase, the options that are available should be used.  Rather than rereferring Proposition 105 to the voters, he believes this legislation is appropriate.

Chairman Crump announced the names of those who signed up in opposition to SCR1009 but did not speak:

Tim Vaske, Director of Government Affairs, American Heart Association

Scott Mittelsteadt, representing self

John M. Skarhus, representing self

Diane Brown, Executive Director, Arizona Public Interest Research Group

Jeff Schlegel, representing self

Barbara Burkholder, representing self

Kari Nienstedt, Arizona State Director, Humane Society of the United States

Robert Mings, representing self

Elizabeth Baskett, Arizona Hospital and Healthcare Association

Janice Palmer, Governmental Relations Analyst, Arizona School Boards Association

Gini McGirr, Legislative Chair, League of Women Voters of Arizona

Michelle Steinberg, representing self

Bettina Bickel, representing self

Jennifer Loredo, Arizona Education Association

William Thornton, representing self

Rebekah Friend, Arizona American Federation of Labor – Congress of Industrial Organizations

Suzanne Schunk, representing self

David Landrith, Vice President of Policy & Political Affairs, Arizona Medical Association Barbara Meaney, Vanguard Health Systems

Percy De La Cruz, representing self

Pat Vanmaanen, representing self

Dana Naimark, President/Chief Executive Officer, Children's Action Alliance

Shannon Harper, Government Affairs Director, Planned Parenthood Arizona

Norris Nordvold, Intergovernmental Programs Director, Inter Tribal Council of Arizona 

Charles Essigs, Arizona Association of School Business Officials

Sam Polito, Tucson Area School Districts

Alisa McMahon, representing self

Michael Fiflis, representing self

Kristin Greene, Associate Director, Voters of Arizona Coalition

Dinora Reyes, representing self

Cindy Hallman, Chief Executive Officer, John C. Lincoln Hospital, representing self

Bruce Liggett, Executive Director, Arizona Child Care Association

Emily Jenkins, President/Chief Executive Officer, Arizona Council of Human Service Providers Jodi Liggett, Liggett Consulting Group, ResCare

Stuart Goodman, Catholic Healthcare West

Janet Kahler, representing self

Jason Bezozo, System Director, Government Relations, Banner Health

Karen Michael, Animal Defense League of Arizona

Daniel Patterson, State Representative, District 29, Tucson/Pima County

Ritch Steven, Chair, Advocacy Network, AARP Arizona

Chairman Crump announced the names of those who signed up in support of SCR1009 but did not speak:

Farrell Quinlan, West Valley Chambers of Commerce Alliance

Tom Dorn, East Valley Chambers of Commerce Alliance

Buffalo Rick Galeener, representing self

Jack Lunsford, President/Chief Executive Officer, WESTMARC, spoke in opposition to SCR1009 for the following reasons: 

• WESTMARC wants to be part of the discussions on the Governor’s five-point plan to build a consensus and create a comprehensive budget reform package, which is not what this resolution does. 
• One percent is far too low a threshold for a budget that might be out of balance because it could be a rounding error, etc.  
• It is problematic to allow the Legislature to tap funds for items like First Things First, which has a separate funding stream that does not impact the general fund. 
• Even if there is dispute about whether Proposition 301 is protected, the community colleges would be concerned about their particular aspect. 
• To place into the Constitution a prohibition against tax increases in this context versus a frank and open way is somewhat insidious. 

He added that WESTMARC pledged to work with the Legislature and Governor at some point in time to review items considered protected by Proposition 105, but this is not the way he subscribes to or contemplated.

Mr. Campbell asked if this problem was fixed by passage of Proposition 101 in 2004, which required any voter initiative to have its own funding source, and opined that SCR1009 goes well beyond addressing the problems of Proposition 105.  Mr. Lunsford agreed that SCR1009 goes well beyond Proposition 105, noting that initiative and referendum reform should be reviewed in a holistic way.  He added that Proposition 301 was a proposal by Governor Jane Dee Hull and her team to provide funding for education, probably because of inaction from the Legislature, particularly for teachers’ salaries, research at the universities and workforce training for community colleges.  He understands that only Proposition 301 impacted the general fund just as sales tax revenues began to decline. 

Sandy Bahr, Conservation Director, Sierra Club - Grand Canyon Chapter, opposed SCR1009 and made the following comments:

• This is a republic with representative democracy, but the drafters of the Arizona Constitution wisely provided for direct democracy through the initiative and referendum process. 
• The Legislature resists ballot measures referred by the people because they are a check on legislative power and bring forward measures the Legislature would not address, which is the purpose. 
• A number of measures were passed in the 1990s, and the ink was not dry on the Governor’s signature on those measures before the Legislature tried to gut them, cut them, divert the dollars and a variety of other things.  Leadership in the Legislature said voters did not know what they were doing, so the Voter Protection Act tapped into frustration by voters because of the Legislature working to undercut their decisions.  The Act passed despite the fact that the Legislature referred a competing measure to confuse voters and defeat it.  
• SCR1009 would undermine the Act and the argument could be made that this measure provides an incentive for the Legislature to create a deficit in order to have more control over measures. 
• It would be more responsible to look at specific measures, and if any problems are found, send those back to the voters for a direct, honest and forthright debate on those issues.
• The tax provision is somewhat hidden and basically decimates programs voters cared enough about to place on the ballot, which she does not believe is the message voters sent when they supported conservation, health care and education.

Laurie Lange Liles, Senior Vice President, Public Affairs, Arizona Hospital and Healthcare Association, stated that she opposes SCR1009 for the following reasons (Written Comments, Attachment 2):

• The Legislature will be authorized to divert critical funds that voters approved for health care programs, including Proposition 202, a voter-approved initiative that directs Indian gaming funds to the state’s level I trauma centers and emergency departments (ED), and Proposition 204, which covers more than 133,000 low-income working adults currently enrolled in the Arizona Health Care Cost Containment System.   This may jeopardize the financial viability of the state’s level I trauma centers and EDs and will significantly increase the number of uninsured in the state, resulting in a loss of services and programs at community hospitals.

• This measure will drive up the hidden healthcare tax on privately insured individuals and businesses in Arizona.

David McCaleb, representing self, Paradise Valley, opposed SCR1009.  He conveyed that he supported Proposition 105 not because of the marijuana issue but because he believed it represented the rights the people of Arizona deserve.  He moved to Arizona in 1961 and has seen many astounding actions by the Legislature, but this really stands out.  As a business executive, he struggled with budgets many times and he appreciates creative attempts to manage the budget, but this is an underhanded way of gutting a number of key efforts the citizens supported.  It could be sold as a tax relief measure, but it basically relieves citizens of Arizona of their powers.

Sandra Junck Carpenter, Early Childhood Development and Health Board; First Things First, opposed SCR1009.  She related that at its January board meeting, the Early Childhood Development and Health Board voted against any intrusion by the Legislature regarding the Voter Protection Act.  First Things First went to the ballot in 2006 at which time initiatives placed on the ballot had to have their own source of funding.  Going to the ballot with this measure would be somewhat of a “bait and switch” where some monies in the general fund would be used that are identified for another purpose.  

Eric Ehst, State President, National Organization for Women, opposed SCR1009 and made the following comments:

• This measure reduces the flexibility of the Legislature and requires that before a tax increase can even be considered by the Legislature, every cent of funding for voter-approved programs must be used. 
• The Legislature’s hands are not tied; any time the Legislature believes a voter-approved measure is not working as intended, it has the power, by a simple majority vote, to refer any change or repeal to the voters with a strong argument as to why the change should be made. 
• Many measures passed required a source of funds, which accumulates over time, and if the Legislature swept those funds to reduce the deficit, it would permanently destroy the programs because the revenue could not be made up in the next year. 
• Only three voter-approved measures could significantly have an influence on reducing a state budget deficit, i.e., Propositions 204, 301 and First Things First, which all relate to education and health care, which the Legislature and Governor repeatedly indicated during this session would be protected; therefore, the only way the voter-approved funds could be taken is to “take money from education and health care to protect education and health care.”   

In response to questions, Mr. Ehst acknowledged that if this measure ends up on the ballot and passes, it would constitute the will of the people.  He indicated that placing a repeal of Proposition 105 on the ballot would be a more straightforward approach.

Vice-Chairman Montenegro asked if SCR1009 is intended to fix any of the programs or simply allow voters to choose because of the economic crisis.  Senator Pearce contended that this is a simple, straightforward initiative that attempts to honor the vote of the people by giving voters a choice to modify what they voted for in good times and to give the Legislature the flexibility to have the entire budget on the table and not decimate certain programs at the expense of others that cannot be touched.

Discussion followed about legislation to send an initiative to the voters for a tax increase.

Donald Morris, representing self, opposed SCR1009.  He stated that this legislation is an attempt by elected representatives of the people to reject/disenfranchise those who elected them and placed their trust in them (Attachment 3). 

Philip Carpenter, representing self, opposed SCR1009.  He submitted that this measure is not necessary.  If it comes to a decision that taxes need to be raised, so be it.  The people have spoken through the initiative process and he would hate to see the possibility of those funds being used for something else.

Barry Aarons, Lobbyist, Americans for Tax Reform, in favor of SCR1009, made the following comments:

• The bill states on Page 5, lines 24 through 27, that “nothing in this section shall be construed to deprive or limit the Legislature of the right to order the submission to the people at the polls of any measure, item, section, or part of any measure,” so the conversation about sending all of Proposition 105 back is an option.  The Legislature retains the right to make a determination that what they are sending specifically deals with a problem. 
• If one percent of the budget seems to be a small amount, it actually equates to about
  $100 million for a $10 billion budget in which $3 billion has to be found to make up the difference, which is not a small amount of money. 
• An initiative is a check and balance on legislative prerogative and the Legislature also has to have a check and balance on initiative prerogatives. 
• Circumstances change and voters should be given the opportunity to make changes.  It is appropriate to ask voters if the Legislature should have the right, during times of economic difficulties, to be able to send a piece of this back to their own authority.

Mr. Campbell noted that some reforms are needed in terms of Proposition 105, but this does not do that, and the provision that stands out the most is the prohibition of a tax increase. 
Mr. Aarons replied that dealing with the tax issue has to do with Proposition 105 because of its imposition on the ability to impose spending obligations. 

Mr. Campbell stated that this measure ties the hands of future legislators to make choices.  Discussion followed.

Leland Fairbanks, M.D., Arizonans Concerned About Smoking, opposed SCR1009.  He stated that without the initiative process, everyone would be sitting in a cloud of smoke because it took the good judgment of the people to do some things Members of the Legislature did not get around to doing.  He opined that the initiative process is necessary and contended that the real motive behind this measure is to get rid of the initiative process.  This legislation will take away the rights of people to obtain health care, and hospitals, indigent people and minorities will suffer.

Mr. Gowan stated that he is not aware of anyone in the Legislature who wants to eliminate the initiative process. 

Mr. Campbell remarked that he believes SCR1009 will hurt the public trust in the initiative process.

Marti Eckrom, representing self, Flagstaff, opposed SCR1009.  She testified that thousands of people worked very hard to place several initiatives on the ballot because they knew the Legislature would never pass a tobacco education bill or a statewide smoke-free law.  She said she believes SCR1009 is the death knell of any present or future initiative-funded programs since it requires that all initiative funds are spent before any tax increase.  There are many ways to raise funds rather than suspension of the Voter Protection Act; it is time for a tax increase. 

Mr. Driggs pointed out that SCR1009 does not state that all funds must be exhausted before a tax increase, but only to the percentage of the deficit.  Discussion followed.

Question was called on the motion that SCR1009 do pass.  The motion carried by a roll call vote of 6-2-0-1 (Attachment 4).

SB1161 – PSPRS; reemployment – DO PASS AMENDED  S/E

S/E:  law enforcement officers; discipline; just cause

Chairman Crump moved that SB1161 do pass.

Chairman Crump moved that the Crump two-page strike-everything amendment to SB1161 dated 6/24/09 (Attachment 5) be adopted.

Chairman Crump moved that the Crump two-page amendment to the strike-everything amendment to SB1161 dated 6/25/09 (Attachment 6) be adopted.

Michelle Hindman, Majority Research Analyst, explained that the strike-everything amendment to SB1161 prohibits disciplinary action against a law enforcement officer unless there is just cause (Attachment 7).  The two-page amendment (Attachment 6) contains the following provisions:

• Clarifies that the just cause exception does not apply to law enforcement officers who have not completed the required probationary period as a law enforcement officer.
• Makes it clear that existing labor and management agreements stay in effect.
• Clarifies that the definition of just cause means that one of the conditions would apply; all of the conditions do not have to apply.
• Removes duplicative portions of the definition of law enforcement officer.
• Removes juvenile detention officers from the definition of law enforcement officer, which means the legislation will apply to law enforcement officers and correction officers.

Senator Russell Pearce, sponsor, stated that SB1161 puts into place a process that is fair to everyone.  Administrators must have the ability to discipline properly and officers who are disciplined have the right to have it done in a timely and appropriate fashion.

Chairman Crump announced the names of those who signed up in support of the strike-everything amendment to SB1161 but did not speak:

Ray Churay, Deputy Director, Maricopa County Sheriff's Office

Donna Neill, Director, Neighborhood Activists Interlinked Empowerment Movement, representing self

Jerry Neill, Neighborhood Activists Interlinked Empowerment Movement, representing self

James Mann, Arizona Fraternal Order of Police

Mark Spencer, President, Phoenix Law Enforcement Association

Kelsey Lundy, Lobbyist, Phoenix Law Enforcement Association

Paul Chagolla, Deputy Chief, Maricopa County Sheriff's Office

Cheryl Chase, Mother, Grandmother, Nurse, State Representative, Pinal County Sheriff’s Office

Don Isaacson, Fraternal Order of Police

Paul Babeu, Sheriff, Pinal County

Chairman Crump announced the names of those who signed up in opposition to the strike-everything amendment to SB1161 but did not speak:

Michael Celaya, Intergovernmental Relations Director, City of Surprise

Dale Wiebusch, Legislative Associate, League of Arizona Cities and Towns

Michelle Gramley, Town of Gilbert

Ryan Peters, Intergovernmental Programs Coordinator, City of Glendale

Chairman Crump announced the names of those who signed up as neutral on the strike-everything amendment to SB1161 but did not speak:

Lyle Mann, Deputy Director, Arizona Peace Officer Standards and Training Board

Jen Sweeney, Government Affairs Director, Arizona Sheriffs

John Thomas, Arizona Association Chiefs of Police

Ann Malone, Indian School Corridor Citywide Coalition-Require the Prior.Org, spoke in support of the strike-everything amendment to SB1161.  She stated that the very least that can be done to honor law enforcement is to guarantee them the right to an administrative disciplinary investigation that is based upon just cause and guarantees a fair investigation that meets objective standards.  She is not opposed to disciplinary investigations; however, society can no longer permit even the possibility that the whims of management personalities are the rule of law that officers are subjected to during an investigation.  It is time to level the playing field to give officers the same rights that officers are required by law to give to criminals. 

Levi Bolton, Vice President, Phoenix Law Enforcement Association, spoke in support of the strike-everything amendment to SB1161.  He stated that he is a retired Phoenix police officer and asked the Members to support SB1161 to provide this protection to the men and women who keep neighborhoods safe.

Question was called on the motion that the Crump two-page amendment to the strike-everything amendment to SB1161 dated 6/25/09 (Attachment 6) be adopted.  The motion carried.

Chairman Crump moved that the two-page strike-everything amendment to SB1161 dated 6/24/09 (Attachment 5) as amended be adopted.  The motion carried.

Chairman Crump moved that SB1161 as amended do pass.  The motion carried by a roll call vote of 6-1-0-2 (Attachment 8).

SB1148 – deed restrictions; for sale signs – DO PASS

Chairman Crump moved that SB1148 do pass.

Rene Guillen, Majority Research Analyst, Water & Energy Committee, explained that SB1148 prohibits various real estate instruments from preventing the display of a for sale sign and sign rider (Attachment 9).

Senator Sylvia Allen, sponsor, related that a bill was passed a few years ago to allow people in Homeowner Associations (HOA) to display for sale signs on their property, but it did not include properties with a deed restriction.  SB1148 allows property owners to put a sign on their property if there is a restriction in their deed prohibiting that.

John Mangum, Arizona Association of Realtors, echoed Senator Allen’s comments. 

Vice-Chairman Montenegro announced the names of those who signed up in support of SB1148 but did not speak:

Tom Farley, Arizona Association of Realtors

Question was called on the motion that SB1148 do pass.  The motion carried by a roll call vote of 6-0-0-3 (Attachment 10).

SB1072 – charity game ticket games. – DO PASS

Chairman Crump moved that SB1072 do pass.

Zach Tretton, Majority Assistant Research Analyst, explained that SB1072 allows Class B and Class C bingo licensees to conduct sales of charity game tickets during authorized bingo occasions (Attachment 11).

Jason Isaak, Charity First, spoke in support of SB1072.  He related that Charity First is a coalition of veterans’ organizations, fraternal organizations and bingo businesses.  This same bill passed the House last week (HB2172, charity game ticket games.).  Some recommended changes were made by the Governor’s Office, which along with the tribes, is reviewing language to determine what type of amendment may be needed on the Floor.  He requested that the Members keep the bill moving forward.

Chairman Crump announced the names of those who signed up in support of SB1072 but did not speak:

Buffalo Rick Galeener, representing self

Paul Griffin, Department Commander, The American Legion

John Aldecoa, State Adjutant, The American Legion

Kristen Boilini, Arizona Indian Gaming Association, neutral on SB1072, stated that she is working with Mr. Antenori, the Governor’s Office and the tribes on amendments for the Floor that will not be substantive but will be legal in nature.

Mr. Antenori remarked that the tribes and organizations represented by Mr. Isaak reached a tentative agreement.  Amendments will be made on the Floor with a statement read into the record that everyone is in agreement with the legislation.  There is some worry from the Governor’s staff about triggering the poison pill provision of the Indian Gaming Act.  Most of the attorneys involved, except a few on the ninth floor, agree that it would not, but the Governor’s staff fears that the Attorney General will disagree.  He will make sure those fears are alleviated and any issues in that regard are addressed.

Mr. Isaak remarked that Senator Jonathan Paton asked the Attorney General directly about that in a hearing last week and he understands the Attorney General does not have concerns.

Question was called on the motion that SB1072 do pass.  The motion carried by a roll call vote of 6-1-0-2 (Attachment 12).

SB1362 – solid waste; private enterprise – DO PASS

Chairman Crump moved that SB1362 do pass.

Zach Tretton, Majority Assistant Research Analyst, explained that SB1362 prohibits all municipalities from prohibiting or restraining the private delivery of commercial or industrial recycling or solid waste management services (Attachment 13).

Senator Ron Gould, sponsor, conveyed that current statute states that cities and towns with a population of less than 60,000 can choose an exclusive monopoly for the hauling of commercial trash.  He has a constituent who would like to provide that service to small business owners.  The current law is not fair because it limits competition in small towns.  In response to a question, he said he does not know the reasoning behind the population threshold.

Chairman Crump announced the names of those who signed up in opposition to SB1362 but did not speak:

Jacqueline Walker, City of Kingman

Dale Wiebusch, Legislative Associate, League of Arizona Cities and Towns

Chairman Crump announced the names of those who signed up in support of SB1362 but did not speak:

Amiee Pelzer, Cellular World

Mona Whitmier, Owner, Living Well Health Food Store

Phillip Shannon, Carpet Emporium

Ted Palmer, Owner, Amici's Italian Bar & Grill

Dean Agius, Owner, Edjardo Jewelers

Daun Branam, representing self

Jeff Anthony, Cornco Excavation

Paolo Pavigianiti, Owner, Cutting Edge Concrete; Cutting Edge Homes; Cutting Edge Plastering Craig Bowen, Owner, Mexidona Furniture

Wayne Legrande, Owner, Havasu Hardware

Ed McInerney, Plumcrazy

Brandion Duger, Owner, Duger Haul it All, spoke in support of SB1362.  He indicated that he currently picks up trash for construction companies and hauls items for residents, such as dishwashers, tree trimmings, etc., to the dump.  Several private businesses in Lake Havasu City and Bullhead City requested trash service from him.  He found out about the law stipulating that cities with a population fewer than 60,000 are allowed to sign exclusive, non-compete contracts with a trash company.  When the contract was up for renewal it did not go back out for bid, but was extended under the current contract with the corporate provider.  Until Lake Havasu City reaches 60,000 people, he cannot haul commercial trash in the city limits.  He asked that he be allowed to be on an even playing field in order to support his family.  He provided a letter from private business owners in support of the bill (Attachment 14).

Question was called on the motion that SB1362 do pass.  The motion carried by a roll call vote of 8-0-0-1 (Attachment 15).

SB1073 – population thresholds; counties – DO PASS

Chairman Crump moved that SB1073 do pass.

Michelle Hindman, Majority Research Analyst, explained that SB1073 adjusts Arizona county population threshold requirements (Attachment 16).

Chairman Crump announced the names of those who signed up in opposition to SB1073 but did not speak:

Ann Armstrong, Arizona Auto Theft Authority

Michael Racy, lobbyist, Pima County, spoke in support of SB1073.  He attested that this is purely a conforming bill allowing Pima County to hold its same place in statute.  He can follow-up on the Auto Theft Authority’s opposition, which he does not understand.

Question was called on the motion that SB1073 do pass.  The motion carried by a roll call vote of 8-0-0-1 (Attachment 17).

SB1111 – county planning and zoning; revisions – DO PASS AMENDED S/E

S/E:  same subject

Chairman Crump moved that SB1111 do pass.

Chairman Crump moved that the Crump 106-page strike-everything amendment to SB1111 dated 6/24/09 (Attachment 18) be adopted.

Mr. Campbell moved that the Crump 106-page strike-everything amendment be divided so questions regarding county zoning and planning statutes and formation of a public health services district can be considered separately.  

THE MEETING RECESSED AT 12:00 NOON.

THE MEETING RECONVENED AT 12:12 P.M.  ALL MEMBERS WERE PRESENT EXCEPT MRS. TOVAR.

Chairman Crump noted that the Rules Attorney clarified the procedure and Mr. Campbell’s motion to separate the question on SB1111 will be granted according to Rule 25 as follows:

• Subpart (formation of a public health services district) on Page 103, lines 23 through 45, and Page 104, lines 1 through 37.
• Major portion (county zoning and planning statutes).

Michelle Hindman, Majority Research Analyst, explained that the major portion of the strike-everything amendment to SB1111 reorganizes the Arizona statutes on county planning and zoning (Attachment 19).  The Subpart eliminates the option for counties to create a Public Health Services District with the unanimous consent of the county Board of Supervisors beginning January 1, 2009. 

Chairman Crump announced the names of those who signed up as neutral on the strike-everything amendment to SB1111 but did not speak:

Todd Madeksza, Director of Education and Licensing, County Supervisors Association

Mr. Campbell stated that a bill relating to Section 36 (Subpart) was heard on the Floor where it did not pass, and he voted no.  He wants to support the major portion of SB1111, but cannot support the Subpart, which is why he requested that the sections be considered separately. 

Question was called on adoption of the planning and zoning (major) portion of the strike-everything amendment to SB1111.  The motion carried by a roll call vote of 8-0-0-1 (Attachment 20). 

Question was call on adoption of the Subpart of the strike-everything amendment to SB1111.  The motion carried by a roll call vote of 6-2-0-1 (Attachment 21). 

Question was called on adoption of the Crump 106-page strike-everything amendment to SB1111 dated 6/24/09 (Attachment 18).  The motion carried by a roll call vote of 6-2-0-1 (Attachment 22).

Chairman Crump moved that SB1111 as amended do pass.  The motion carried by a roll call vote of 6-2-0-1 (Attachment 23).

SB1149 – child support; notice of lien – DO PASS AMENDED S/E

S/E:  districts; university athletics

Chairman Crump moved that SB1149 do pass.

Chairman Crump moved that the Nichols nine-page strike-everything amendment to SB1149 dated 6/24/09 (Attachment 24) be adopted.

Kitty Decker, Majority Research Analyst/Senior Economist, explained that the strike-everything amendment to SB1149 allows the county Board of Supervisors to establish a University Athletic Facilities District that will collect revenues from commercial lease assessments for the improvement of property for new or existing athletic facilities at public universities
(Attachment 25).

Mr. Nichols, sponsor, stated that this bill passed the House, but for different reasons, did not make it through the Senate.

Chairman Crump announced the names of those who signed up in support of the strike-everything amendment to SB1149 but did not speak:

Greg Fahey, Associate Vice President, University of Arizona

Michael Haener, Director of Legislative Affairs, Arizona State University

Christine Thompson, Assistant Executive Director for Government Affairs, Arizona Board of Regents

Tom Dorn, American Planning Association Arizona Chapter

Chairman Crump announced the names of those who signed up in opposition to the strike-everything amendment to SB1149 but did not speak:

Gretchen Kitchel, Senior Public Affairs Representative, Pinnacle West Capital Corporation

Russell Smoldon, Salt River Project

Kevin McCarthy, President, Arizona Tax Research Association, spoke in opposition to the strike-everything amendment to SB1149.  He indicated that it has been a long-standing policy of the state that all taxing jurisdictions have equal access to tax property value from the smallest sanitary district to the county.  This measure allows the universities to use its tax-exempt status for private development but does not allow any of the other jurisdictions to tax the property.  He opined that government should not use its tax-exempt statutes to deny other jurisdictions from taxing property.  The purpose of the strike-everything amendment is to devise a funding stream for the universities to take care of what is viewed as a legitimate need for capital construction, which the state is not well-armed to deal with and needs to be addressed.  This approach is not only bad policy but it would take many years to work.   

Mr. Nichols said this measure sets an equitable position for businesses that want to locate on university land with those not located on university land through contracts and leases with the universities to obtain bonds that will go against the district instead of the university overall.  He asked how Mr. McCarthy proposes funding the infrastructure needs of Arizona.

Mr. McCarthy agreed that if a private concern locates on university property there is no mechanism to tax that property like there is on the books for city operations.  He proposed making the state debt capacity constitutional by raising the $350,000 debt limit to a reasonable amount, for example, $1 million.  Once that is accomplished, the Legislature can use what is a legal debt instrument to take to the voters to argue that money is needed for major capital projects, whether it is fixing up the state capitol, Sun Devil Stadium, etc.  It would be legal and provide a steady funding stream that does not complicate maintenance and operations budgets.  He added that he does not believe even the universities would argue that the funding stream proposed in the strike-everything amendment is the best idea, but something that perhaps can be passed.

Mr. Nichols responded that this is not a perfect solution, but it is one that over time can create a revenue stream to fix athletic facilities.  The Legislature is responsible for helping to fund these infrastructure needs, but when there is no general fund money to do so, creative options are needed.

Mitch Menlove, Arizona State University (ASU), spoke in favor of the strike-everything amendment to SB1149. He stated that there are critical needs at the universities such as the stadium.  This involves asking businesses to locate in an area where property taxes would typically not be paid, and in lieu of that, help dedicate a funding source to repair the stadium with the argument that the businesses would benefit from having a nice stadium.  The first priority is for educational infrastructure, which is the reason for looking for a dedicated source. 

Mr. Nichols noted that the strike-everything amendment includes the other universities and asked how much ASU spent on renovations for Sun Devil Stadium in the last five to ten years. 
Mr. Menlove answered that there has been a lot of effort to maintain the stadium.  Recently, close to $10 million was spent on items that are not noticeable, but are very important.  The state will not have the funds to maintain the stadium and academic facilities also need to be maintained, which is the first priority.

Mike Williams, City of Tempe, spoke in support of the strike-everything amendment to SB1149.  He stated that Sun Devil Stadium needs to be refurbished badly and questioned opposition by the utilities, which are basically a monopoly, but use ratepayer money to advertise in the stadium.

Mr. Nichols expressed disappointment that the utilities are not willing to support the universities’ attempt to maintain infrastructure.

Question was called on the motion that the Nichols nine-page strike-everything amendment to SB1149 dated 6/24/09 (Attachment 24) be adopted.  The motion carried.

Chairman Crump moved that SB1149 as amended do pass.  The motion carried by a roll call vote of 6-2-0-1 (Attachment 26).

SB1313 – county merit system; hearing officers – DO PASS AMENDED S/E

S/E:  project financing review; extension; repeal

Chairman Crump moved that SB1313 do pass.

Chairman Crump moved that the Crump six-line strike-everything amendment to SB1313 dated 6/24/09 (Attachment 27) be adopted.

Michelle Hindman, Majority Research Analyst, explained that the strike-everything amendment to SB1313 extends the exemption of nonprofit nursing homes, rest homes, skilled nursing facilities or life care facilities from the multiple review requirement of an industrial development authority (IDA) project through December 31, 2014 (Attachment 28). 

Don Isaacson, Aging Services of Arizona, spoke in support of the strike-everything amendment to SB1313.  He said this bill passed the House unanimously and was assigned to two committees in the Senate, but there was no time to place it on agendas.  There is no controversy or opposition.  Three years ago, a pilot program allowed separate government reviews of a bond issuance for nonprofit housing to be consolidated so the issuance was reviewed by one agency.  The goal was to reduce government duplication and cost to the nonprofit housing applicant.  Shortly after the bill passed, the economy in this sector went down and IDA housing has not used this model so it has not been tested, but the Department of Housing is supportive of this approach.

Chairman Crump announced the names of those who signed up in support of the strike-everything amendment to SB1313 but did not speak:

Buffalo Rick Galeener, representing self

Question was called on the motion that the Crump six-line strike-everything amendment to SB1313 dated 6/24/09 (Attachment 27) be adopted.  The motion carried.

Chairman Crump moved that SB1313 as amended do pass.  The motion carried by a roll call vote of 7-0-0-2 (Attachment 29).

SB1314 – underground storage tanks; technical correction(now: custodial and janitorial services; transfer) – DO PASS

Chairman Crump moved that SB1314 do pass.

Zach Tretton, Majority Assistant Research Analyst, explained that SB1314 transfers all monies that the Arizona Department of Administration (ADOA) receives for the purpose of providing custodial and janitorial services for state-owned or leased buildings to each state budget unit occupying state-owned or state-leased properties and requires each budget unit to hire current or former state employees to provide those services (Attachment 30).

Senator Thayer Verschoor, sponsor, related that in 2009 ADOA cut the janitorial staff and brought in prisoners from the Arizona Department of Corrections (ADC).  Complaints were received from some agencies that prisoners were working in areas housing sensitive information.  ADOA also brought in a private custodial service whose employees are not screened that charges the same amount of money for service, but the agencies only receive half of the service.  This bill is revenue neutral.

Vice-Chairman Montenegro asked if ADOA would only be allowed to choose from the pool of employees previously laid off.  Senator Verschoor replied that would be the preference; he does not believe the choice can be limited to that pool.

David Mendoza, Legislative Director, American Federation of State, County and Municipal Employees, spoke in support of SB1314.  He testified that in May 2009 the Department of Economic Security (DES) Child Support Division was able to match the records of inmates and identified those that owed child support.  There is concern by employees about inmates adversely impacted by DES policies cleaning DES offices.  Also, at DES across the street, state employees are required to lock their offices before leaving to secure files, but in the morning before the employees arrive, inmates are opening the offices and cleaning.  He added that the bill is revenue neutral and allows state agencies to protect the resources of the state.

Chairman Crump announced the names of those who signed up in support of SB1314 but did not speak:

Roman Ulman, AFSCME Arizona

Rebekah Friend, Arizona American Federation of Labor – Congress of Industrial Organizations

Chairman Crump announced the names of those who signed up in opposition to SB1314 but did not speak:

Alan Ecker, Program Associate, ADOA

Question was called on the motion that SB1314 do pass.  The motion carried by a roll call vote of 6-1-0-2 (Attachment 31).

SB1323 – emergency mutual aid agreements – DO PASS

Chairman Crump moved that SB1323 do pass.

Michelle Hindman, Majority Research Analyst, explained that SB1323 allows any county, city, town, private water or wastewater utility or special taxing district to enter into mutual aid agreements during an emergency (Attachment 32).

Jeff Gray, Legislative Liaison, City of Phoenix, spoke in favor of SB1323.  He said this is a permissive measure supported by public and private water and wastewater service providers.  Mutual aid agreements allow service providers to respond to man-made or natural disasters in a timely manner and provide expedited access to resources, including equipment and manpower.  The idea is to protect residents from any disruption of service during disasters.  He mentioned that he was asked in the Senate why local governments cannot currently enter into these agreements.  He was able to clarify that it is not prohibited by statute but it is also not permitted.

Chairman Crump announced the names of those who signed up in support of SB1323 but did not speak:

Arthur Chapa, Legislative Counsel, Pima County Board of Supervisors

Dale Wiebusch, Legislative Associate, League of Arizona Cities and Towns

Susan Charlton, Attorney, Metro Water District

Ryan Harper, Arizona American Water

Stuart Goodman, Lobbyist, Southern Arizona Water Users Association

Mike Williams, City of Tempe

Question was called on the motion that SB1323 do pass.  The motion carried by a roll call vote of 7-0-0-2 (Attachment 33).

SB1235 – cooperative purchasing agreements – DO PASS

Chairman Crump moved that SB1235 do pass.

Zach Tretton, Majority Assistant Research Analyst, explained that SB1235 clarifies that any public procurement unit conducting or administering a cooperative purchasing agreement for the procurement of construction or professional services must comply with the procurement of specified professional and construction services statutes (Attachment 34).

Chairman Crump announced the names of those who signed up in support of SB1235 but did not speak:

Tina Litteral, Executive Director, Arizona American Institute of Architects

Michael Preston Green, American Institute of Architects – Arizona Chapter, spoke in support of SB1235.  He stated that this is a fix-it bill that requires cooperative purchasing agencies to follow the same rules as cities, counties, state government and all federal government agencies. 

Question was called on the motion that SB1235 do pass.  The motion carried by a roll call vote of 7-0-0-2 (Attachment 35).

SCR1026 – secret ballot; fundamental right – DO PASS

Chairman Crump moved that SCR1026 do pass.

Zach Tretton, Majority Assistant Research Analyst, explained that SCR1026, subject to voter approval, constitutionally guarantees the right of individuals to vote by secret ballot
(Attachment 36).

Allison Bell, Vice President of Government Relations, Arizona Chamber of Commerce & Industry, spoke in support of SCR1026.  She stated that the Chamber leads the Protect Arizona Workers Coalition, a 140-member grass roots organization of businesses, chambers of commerce and other trade associations.  The members are opposed to the federal Employee Free Choice Act, aka Card Check bill, which will radically restructure very carefully crafted labor law that has been a good balance between unions and employers for many decades.  She added that HCM2004, a memorial to Congress, is also moving in the Legislature.

Chairman Crump announced the names of those who signed up in support of SCR1026 but did not speak:

Jason Bagley, Government Affairs Manager, Intel Corporation

Farrell Quinlan, West Valley Chambers of Commerce Alliance

Don Isaacson, Aging Services of Arizona; Fraternal Order of Police

Penny Allee Taylor, Specialist/Government Affairs, Southwest Gas

Elizabeth Baskett, Arizona Hospital and Healthcare Association

Gabriel Rushing, Public Affairs & Economic Development Representative, Greater Phoenix Chamber of Commerce

Sydney Hay, AMIGOS Trade Association

Marcus Osborn, Manager of Government and Public Affairs, Arizona Manufacturers Council John Kaites, Arizona Hotel and Lodging Association

Jason Bezozo, System Director, Government Relations, Banner Health

Lyn Thomas, President, Pioneer Equipment, representing self

Chairman Crump announced the names of those who signed up in opposition to SCR1026 but did not speak:

Jennifer Loredo, Arizona Education Association

Rebekah Friend, Lobbyist, Arizona AFL-CIO

Eric Ehst, National Organization for Women

Mike Colletto, Executive Director, Community Horizons

Question was called on the motion that SCR1026 do pass.  The motion carried by a roll call vote of 6-1-0-2 (Attachment 37).

Without objection, the meeting adjourned at 1:09 p.m.

                                                                        _______________________________

                                                                        Linda Taylor, Committee Secretary

                                                                        July 10, 2009

(Original minutes, attachments and audio on file in the Chief Clerk’s Office; video archives available at http://www.azleg.gov)

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                        COMMITTEE ON GOVERNMENT

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                        June 26, 2009

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