AZ Chamber Blog

Unity Makes 2005 Session Pivotal for Business Community

2005-05-13T12:46:00.000-07:00

Arizona Chamber President & CEO James J. Apperson's op-ed column in the may 13th, 2005 Business Journal...

Future business leaders may view the 2005 Regular Session of the Arizona Legislature as a pivotal moment in the achievement of the business community’s political maturity and the development of a vital Arizona economy for the 21st Century.

Though this assessment is clearly premature, we believe we have established solid accomplishments in three fundamental areas that may soon fulfill these high hopes.

Vision -- the business community boldly declared an ambitious, broad-based agenda and focused its energies on the advancement of clearly defined priorities.
Organization -- forty-nine business organizations, including 32 chambers of commerce, representing more than 50,000 businesses joined together, and (more importantly) stayed together, in a united effort to win property tax relief.
Execution -- in four critical policy areas, the business community began moving the great ship of state in the direction of promoting job creation, educational achievement and government accountability.

Property Tax Relief. Lowering the business real property tax assessment ratio from 25 percent to 20 percent over the next decade has boldly begun the business community’s effort to reduce the single greatest barrier to business relocation, expansion and job creation in Arizona. Unarguably the greatest legislative victory for business in this new century, the property tax relief legislation alone makes this session an unqualified success for the business community.

Litigation Reform. With the leadership of the Tucson Metropolitan Chamber of Commerce, the Arizona Medical Association and dozens of business groups, Arizona has taken its first steps toward reforming the predatory lawsuit culture that raises the cost of both doing business and caring for our families. The medical malpractice reform enacted this session is a necessary first step in the larger effort to avert a crisis in access to medical care and even higher insurance costs for employers.

K-12 Accountability. The budget legislation agreed to this week includes funding for an important program (IDEAL) that creates an effective, user-friendly data system to track the quality and progress of students so all will have the tools to evaluate the quality of education in Arizona. Also, the business community can take heart in the defeat of repeated attacks on the AIMS test as a graduation requirement. This was accomplished almost single-handedly through the courageous leadership of Senate President Ken Bennett. He deserves our thanks.

Responsible Budgeting. The most underappreciated achievement for lawmakers and the governor this session is their rejection of further debt-financing to balance the state budget. Without ending borrowing, the state’s heavy accumulated debt service threatened to undermine responsible budgeting and increase the pressure to raise taxes. Also, business community-championed legislation will give lawmakers and taxpayers the ability to see exactly where and how the State of Arizona spends all of its money. Few realize that the state spends almost twice as much federal money as state general fund revenue. Tracking the money is essential to maintaining accountability and fostering responsible budgeting.

As important as these victories are to making this session historic, so too are the unity and strength demonstrated by the business community in fighting for business property tax relief.

Prior efforts at improving the business property tax situation have foundered on the rocks of divide-and-conquer tactics and the business community’s lack of discipline.

This year was different.

If next year and the next continue in this spirit, the 2005 session will be regarded as a pivotal moment where a united and confident business community directed its efforts toward advancing the Arizona economy and helping provide a better quality of life for all Arizonans.

Arizona Business Community Lauds Introduction of McCain-Kennedy Immigration Reform Bill

2005-05-12T12:57:00.000-07:00

Statement of Farrell Quinlan, Arizona Chamber Vice President of Communictions & Federal Affairs, on the introduction of the McCain-Kennedy immigration reform bill today...

It’s easy to point out the gross deficiencies in America’s immigration and border security system. It takes real leadership and courage to propose a bipartisan solution in this controversial area.

The Arizona Chamber is very encouraged by the introduction of this legislation and will continue to work with Arizona-based business groups and the U.S. Chamber of Commerce at the national level to support reform of our immigration and border security.

Sen. McCain and Congressmen Kolbe and Flake’s new bill includes many provisions the Arizona Chamber has recommended be included in any comprehensive immigration reform effort including improving security and border enforcement; establishing an employment eligibility confirmation system; creation of a new temporary worker program; reimbursement to states for certain health care expenses related to the treatment of undocumented immigrants; and, a process for undocumented workers to qualify for legal work status following security and background checks.

Employer Sanctions Pushed, Removed from Immigration Related Bills

2005-05-12T09:59:00.000-07:00

Below are recent articles about moves to impose additional state sanctions on Arizona businesses that run afoul of federal immigration laws...

Employer sanctions removed; Bills won't sock firms with undocumented workers, Arizona Republic, Thursday, May 12, 2005
GOP hits Napolitano on immigration issues, The Business Journal, May 11, 2005
Last big issue is migrant hiring: Legislators consider employer crackdown, Arizona Republic, Saturday, May 7, 2005
Penalties for hiring migrants sought: 75% of residents polled believe sanctions on companies are OK, Arizona Business Gazette, May 5, 2005
Bill penalizes firms for hiring migrants, Arizona Republic, Wednesday, May 4, 2005
Stiff penalties are proposed for firms that hire entrants, Arizona Daily Star, Wednesday, May 4, 2005
GOP backs penalties for hirers of illegal immigrants, East Valley Tribune, Wednesday, May 4, 2005
Senate backs penalties for businesses with illegal workerss, Arizona Daily Sun, Wednesday, May 4, 2005

Legislature Reaches Budget Deal with Governor, Property Taxes to be Cut

2005-05-11T13:19:00.000-07:00

Businesses laud tax cut: Deal trims property levy to 20% over 10 years, Arizona Republic, Saturday, May 7, 2005
'Historic' budget deal reached, Arizona Republic, Friday, May 6, 2005
Republicans strike budget deal with governor, The Business Journal, May 5, 2005

"What's in it for business?"

2005-05-06T15:04:00.000-07:00

As you may have read in this morning’s Arizona Republic front page article, the governor and lawmakers reached a budget agreement last night. Here is the “upside” of the deal:

Business Priorities

Business Real Property Tax Reduction -- Commercial property tax assessment ratio reduction from 25% to 20% over 10 years

Federal Funds Reporting -- $500,000 to initiate reporting of the estimated $23 billion in Federal Funds received by executive branch agencies.

Job Training Funds -- $3.9 million restoration of job training funds

Water Quality Assurance Revolving Fund (WQARF) -- $1 million restoration to the WQARF fund.

Fiscal Responsibility – The $8.2 billion state budget is balanced with no borrowing and a surplus (to date) of $168 million. The surplus amount is likely to continue to grow.

Other Issues

Although not necessarily priorities of the business community there are several issues that were the basis for the compromise that brought the agreement together.

All-Day Kindergarten – The budget deal fully funds the second year of all-day kindergarten along with a longitudinal study to evaluate the effectiveness of the program.

Corporate Tuition Tax Credits – The Governor agreed to sign a modified corporate tuition tax credit program that provides tax credits to businesses that contribute to private school tuition. Conservative legislators agreed to include this proposal in the budget rather than the previously pursued voucher bill. However, the voucher proposal will be sent to the Governor as a separate bill.

Phoenix Medical School – The Governor was asking for $7 million for phase one development of a downtown medical school. The Legislature agreed to $3.5 million up front with an additional $3.5 million eligible for release later in the year. This keeps the project moving forward while giving the Legislature the opportunity to collect and study the data it feels it has not received to date.

FINAL VICTORY! Property Tax Relief Passed, Gov. Agrees to Sign

2005-05-06T10:24:00.000-07:00

The House and Senate passed HB 2779 last night. The bill is the same as SB 1095 which was vetoed earlier this session along with the rest of the GOP budget. Last night's passage was part of a larger budget deal between the governor and lawmakers. Click here for the Arizona Republic's rundown of the agreement.

East Valley Tribune Calls for Cut in "Exorbitant" Business Property Tax in Negotiated Budget Deal

2005-03-27T15:02:00.000-07:00

-- “The governor should also reconsider her summary rejection of legislation that would modestly scale back the exorbitant property tax assessment rate that businesses pay — 25 percent as opposed to homeowners’ more reasonable 10 percent. While Arizona’s tax rates generally are reasonable, business taxes are higher than other states’, putting us at a competitive disadvantage in recruiting job-creating businesses and fueling the controversial developer incentive wars between cities.”

"Carte blanche canceled; Napolitano needs to bens a bit in dealing with new Legislature," Editorial, East Valley Tribune, Page F2, Sunday, March 27, 2005

AZ Chamber Chairman Speaks Out on Business Property Tax Relief

2005-03-26T12:27:00.000-07:00

AZ Chamber Chairman C.A. Howlett's op-ed on business property tax relief appeared in the Arizona Republic this morning. Read it here: "Business tax relief has vital role for state"

Business Journal Coverage of Business Property Tax Fight

2005-03-25T12:21:00.000-07:00

The Business Journal's Mike Sunnucks continues his fine reporting on the business property tax issue today in the print edition of his paper. Read his story here: "Governor pledges business tax cuts despite earlier veto"

AZ Chamber VP of Communications and Fedral Affairs Farrell Quinlan is in the same issue with an op-ed on the property tax campaign. Read his op-ed here: "Arizona business property tax relief's time has come"

Quinlan is also quoted in an article about legislative efforts to remove "voter protection" from health care and education funding spending. Read the article here: "Patient No More: Proposed referendum could jeopardize $1B in federal Medicaid funds"

Property Tax Coalition Letter to Gov. Napolitano on Her Veto of SB 1095

2005-03-24T15:26:00.000-07:00

With a united front of 46 business organizations, the Coalition for Business Property Tax Relief this afternoon sent the following letter to Arizona Gov. Janet Napolitano regarding her veto of SB 1095 which would have cut the business property tax assessment ratio 20 percent over the next 10 years.

As representatives of the statewide business community, we wish to urge you to support meaningful business property tax reductions as contained in SB 1095 which would have also held harmless residential property taxpayers.

As you know, Arizona’s business property tax assessment ratio of twenty-five percent is often mentioned as a major impediment to business relocation to and expansion in Arizona. We believe that lowering the assessment ratio is the most effective and direct way to positively impact economic development in Arizona. This approach to business tax reduction also enjoys the benefit of fairly distributing tax relief to all business property taxpayers.

We are sure that you understand why the business community is disappointed in your veto of SB1095 but we also recognize that this veto must be considered in the context of your veto of all of the budget bills. We believe that your veto message sent a clear signal that you are willing to sign business property tax relief as part of a negotiated budget agreement. Further, we believe that this is consistent with your State of the State message in which you recognized the need for business tax relief “to spur Arizona’s competitiveness for new jobs.”

Our growing coalition of business trade associations and chamber of commerce is united like never before to urge your support for business property tax relief found in SB 1095. Please keep such job-creating property tax reduction near the top of your priorities when working toward agreement on fiscal issues.

Thank you for considering our views on the need to seize this opportunity to reduce the business property tax burden.

Signed by representatives of the following business groups:

American Electronics Association - Arizona Council
Apache Junction Chamber of Commerce
Arizona Association of Chiropractic
Arizona Association of Industries
Arizona Building Owners & Managers Association
Arizona Chamber of Commerce
Arizona Dental Association
Arizona Food Marketing Alliance
Arizona Medical Association
Arizona Mini Storage Association
Arizona Pest Management Association
Arizona Restaurant and Hospitality Association
Arizona Tax Research Association
Arizona Tourism Alliance
Benson/San Pedro Valley Chamber of Commerce
Buckeye Valley Chamber of Commerce
Bullhead Area Chamber of Commerce
Carefree/Cave Creek Chamber of Commerce
Chandler Chamber of Commerce
East Valley Chambers of Commerce Alliance
Flagstaff Chamber of Commerce
Fountain Hills Chamber of Commerce
Gilbert Chamber of Commerce
Glendale Chamber of Commerce
Greater Phoenix Chamber of Commerce
Greater Sierra Vista Chamber of Commerce
Kingman Area Chamber of Commerce
Marana Chamber of Commerce
Mesa Chamber of Commerce
National Association of Industrial and Office Properties - Arizona Chapter
National Federation of Independent Business – Arizona Chapter
Nogales-Santa Cruz County Chamber of Commerce
North Phoenix Chamber of Commerce
Northern Pima County Chamber of Commerce
Peoria Chamber of Commerce
Prescott Chamber of Commerce
Rim Country Regional Chamber of Commerce
Scottsdale Area Chamber of Commerce
Springerville-Eager Regional Chamber of Commerce
Tempe Chamber of Commerce
Tucson Metropolitan Chamber of Commerce
Western Carwash Association
Wickenburg Chamber of Commerce
Williams-Grand Canyon Chamber of Commerce
Valley Partnership
Yuma County Chamber of Commerce

To download an Adobe Acrobat file of the actual letter delivered to Governor Napolitano, click here: Coalition for Business Property Tax Relief 3/24/05 Letter to Gov. Napolitano

VETO: Napolitano Vetos SB 1095... fight continues

2005-03-21T17:20:00.000-07:00

Gov. Janet Napolitano vetoed the business property tax cut legislation (SB 1095) along with the rest of the budget bills sent to here by the Arizona Legislature.

VICTORY on Business Property Tax Assessment Ratio Cut

2005-03-17T18:27:00.000-07:00

Effort Now Moves To 9th Floor, Napolitano to Decide Fate of #1 Business Community Priority

In the wee hours of Friday morning, the Arizona House passed SB 1095 that serves as the culmination of more than a decade of effort to lower the enormous business property tax burden in Arizona. The bill is part of the Republican-controlled legislature’s budget package.

The legislation which was passed by the Arizona Senate earlier in the evening would reduce the assessment ratio for business property, increase the homeowner’s rebate program and caps the qualifying tax rate and county equalization assistance for education rate.

Click here to reads the official legislative fact sheet on the bill.

Major provision of the bill include:

Reduces the assessment ratio for business properties from 25 percent to 20 percent of full cash value over ten years. (1/2 percent per year)
Increases homeowner’s rebate from 35 percent to 40 percent over five years.
Increases the maximum homeowner’s rebate amount from $500 to $600 over five years.
Prohibits the Legislature from increasing the qualified tax rate (QTR) for school funding and the county equalization rate over current rates.

The purpose of the changes in the homeowner’s rebate and the QTR is to “hold-harmless” other taxpayer classification for any tax-shift that might result from the lowering of the business assessment ratio. This goal is aided by the dramatic appreciation of property values in Arizona. Such increases in valuation coupled with new development have also alleviated any potentially negative impacts on bonding capacity for municipalities and special taxing district.

Gov. Napolitano has not express support or opposition to the legislation, though she did identify business property tax relief as a priority in her January 2005 State of the State Address.

It is expected that the Legislature will transmit SB 1095 and the other budget bills on Monday thus triggering a 5-day window for the Governor to sign, veto or allow the legislation to be enacted without her signature.

The Arizona Chamber has worked closely with a 43+ strong statewide business coalition to get the property tax issue to this point. Our present success would not have been possible without the united front this coalition presented to lawmakers. Soon we will be working with this coalition tol focus its attention on urging Gov. Napolitano to sign SB 1095.

House May Join Senate in Passing Clean Business Property Tax Assessment Ratio Cut

2005-03-17T17:58:00.000-07:00

Hurrah, though an effort to remove the two non-property tax provisions from the bill will have to wait, we are confident that within a few short hours lawmakers in both houses will vote on the floor for a clean property tax assessment ratio cut like SB 1095 which passed the Senate Finance Committee earlier today.

I'll post more on this on Friday...

Personal Income Tax Changes Pass House Committee

2005-03-17T17:54:00.000-07:00

The House Appropriations Committees just passed HB 2762 which does three things to lower the tax burden on individual income tax payers. They include IRS conformity, elimination of the marriage penalty and instituting an inflation adjustment for the standard deduction.

Now comes the corporate bill, HB 2763...

Senate passes stand-alone business property tax assessment ratio cut

2005-03-17T15:48:00.000-07:00

The Senate Finance Committee just passed a striker to SB 1095 creating a stand-alone business property tax assessment ratio reduction bill that reflects the agreement reached last night with the House and Senate leadership. You can find (confusing) information about the bill by clicking here. Soon there should be a fact sheet posted for Senate COW (committee of the whole) that will reflect the new language.

Great Article on Today's Happenings

2005-03-17T15:46:00.000-07:00

The Business Journal has a good article detailing some of the activities unfolding today and tonight… we hope.

Click here: Business tax break combination faces likely revamping

Business property tax assessment ratio cut is moving right now

2005-03-17T15:43:00.000-07:00

Watch it LIVE: Go to http://www.azhousetv.org/ and watch the hearing on the “Floor Session and Hearing Room 1” Channel

The bill we are watching is HB 2763. This summery sheet shows a packaging of a 3 corporate tax changes… a Huffmanesque assessment ratio cut over 5 years, an increase in the sales factor and creation of a corporate tuition tax credit.

An amendment we have negotiated with House and Senate leadership is being prepared to change this bill at the committee level to extend the phase in to a half-point every year over ten years instead of one point every year over 5 years. We also expect that the 3 separate tax issues may be separated out as stand-alone bills. For individual income taxpayers, partial IRS conformity, removing marriage penalty on tuition tax credit and indexing the standard deduction are addressed in another bill.

Once the bill reaches its final form on the House and Senate floors, our coalition will need to communicate to the Legislature and the Governor Napolitano that the united business community supports business property tax assessment ratio reductions.

Again, thank all of you who signed on to the coalition’s March 15th letter supporting property tax assessment ratio reductions. To read the letter, click here.

Stay tuned…