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Senate to push ahead with budget, setting up battle with Brewer

The Senate plans to bring its budget packet to the floor today without changes to accommodate Gov. Jan Brewer’s recently-released budget proposal.

Senate President Bob Burns’ decision to move forward may set up a showdown between the competing plans of the executive branch and the GOP-led Legislature.

But a vote on a legislative budget also may pave the way to more structured negotiations on the fiscal 2010 budget between Brewer, a former lawmaker, and Republican legislative leaders.

First, though, Burns must secure 16 votes to advance his chamber’s proposal.

In a brief interview, Burns indicated the budget packet his caucus will attempt to pass is the one that lawmakers have been working on for weeks. Brewer released her budget proposal on June 1.

“There are some things I believe that she would support in the package that we have,” Burns said. “I would hope that we would be able to convince her that it would be a good move for us to move forward with a product that addresses part of the problem.”

Burns said, however, that the Senate budget will not solve all of the state’s problems and additional work probably will be necessary after it is passed. In earlier remarks, the Senate top’s lieutenant has not ruled out holding a special session later to adjust the fiscal 2010 budget.

“The sticking point as everyone knows has been the tax issue,” Burns said. “The other issues that are in her plan – I think we can do some good work there,” he said.

Burns also said they still want to repeal the $250 million property equalization tax rather than phase out its elimination as the governor has proposed.

The “tax issue” Burns referred to is Brewer’s position to temporarily increase taxes to raise $1 billion in revenue. Prior to the release of her budget on June 1, details of her tax increase plan had been scant.

The sales-tax increase in Brewer’s budget plan would last three years.

But GOP leaders at the Capitol said Brewer’s tax-increase proposal makes no sense. Adams called it “funny math” and said legislative analyses show raising the sales tax by a penny would generate only $700 million in new revenue.

Brewer also has indicated a willingness to allow voters to decide whether to increase taxes if lawmakers fail to do so.

But it isn’t clear whether there is enough support in the Legislature to place a sales-tax proposal on the ballot. Most Republicans have voiced strident opposition to the idea and legislative Democrats have said they feel it would disproportionately harm middle-class families.

House Majority Leader John McComish said the failure of such a ballot measure would mean lawmakers would be scrambling to cut $1 billion out of the budget with only half of the fiscal year remaining.

“It would make this past January look like a tea party,” he said, referring to the cuts lawmakers made to the fiscal 2009 budget several months ago.

Conservative lawmakers reiterated their opposition to any tax increase in floor speeches on June 2.

“This governor has shown that she is willing to break her pledge to the voters,” said Sen. Ron Gould, a Republican from Lake Havasu. Gould was referring to Brewer’s decision to sign the Americans for Tax Reforms’ No New Tax Pledge in June 2006.

“Apparently, with this governor, it is only a pledge to get elected because when push comes to shove she is willing to institute a tax increase,” Gould said. The Republican lawmaker said the No-New Tax pledge still applies to Brewer because she signed it when she ran for Secretary of State and the reason she is governor is because she was the in the office when former Gov. Janet Napolitano vacated her post.

Sen. Thayer Verschoor, a Gilbert Republican, has said repeatedly that he will not support a tax increase.

“The $1-billion tax increase is not a new scheme. We have seen this scheme before. It was offered by the TIME initiative folks,” Verschoor said, referring to an initiative registered with the Secretary of State last year to increase sales taxes by one cent per dollar for the next 30 years. The initiative’s aim was to raise $42.6 billion for transportation, but the supporters failed to gather enough signatures to put it on the ballot.

Sen. Pamela Gorman, the majority whip, also balked at the governor’s plan. She said it’s not feasible to raise taxes and expect the economy to produce more.

“We could take a $1-billion quick fix, and that just means instead of maybe a two-year recession we have a four-year recession, and you can’t keep going back for another billion dollars when the hole gets bigger and bigger and bigger,” she said.

Across the political aisle, reception to the governor’s budget plan is lukewarm at best.

Democrats were not supportive of Brewer’s sales tax increase. Senate Minority Leader Jorge Garcia said party members prefer a broadening or expansion of the tax base.

Garcia said he likes the “revenues and expenditures” but not the sources of revenue in Brewer’s plan.

But Democrats say Brewer’s plan, faults or not, is still better for the state than the one put forward by GOP lawmakers.

“I think the challenge for her,” said Sen. Ken Cheuvront, a Phoenix Democrat, “is to be able get enough Republicans and Democrats to work together to pass her budget, which means that she is going to have to make some concessions and we are going to have to make some concessions.”

Brewer’s plan stands in stark contrast to the most recent budget proposal backed by Republican legislative leaders, which includes no tax increases, doesn’t borrow against future Lottery proceeds and cuts spending by about $100 million more. The legislative proposal also aims to shift $190 million in costs to cities and counties and sweeps nearly twice as much from dedicated funds.

Republican leaders say Brewer should have been more forthcoming, as they have been asking her for budget details for months.

“Realistically, we believe we should have had this detailed information weeks ago,” Adams said

Adams also called on Brewer to publicly denounce the $225,000 media blitz designed by Building a Better Arizona 2012, a coalition of business groups formed by political consultant Chuck Coughlin.

“It’s not productive to producing a compromise agreement to balance the budget by June 30… The governor should repudiate any efforts to campaign against Republican legislators,” Adams said.

-Reporters Jim Small and Jeremy Duda contributed to this story.

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