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Brewer wants tax hike or targeted cuts to schools, cities

In an attempt to curry public support for her sales tax increase proposal, Gov. Jan Brewer has sought to make deep cuts to education and to allow the state to keep some of the money it normally shares with cities if voters reject the temporary tax increase in May’s special election.

Several sources with knowledge of the budget negotiations between Republican legislative leaders and the governor told Arizona Capitol Times Brewer had asked for the cuts, which totaled $920 million, to be included in the budget as a contingency.

The sources spoke on the condition of anonymity because they were not authorized to speak publicly about the negotiations.

The sales tax increase is structured to provide new revenue for public schools, universities and public safety. A spokesman for Brewer said she would like to see any contingency plan built into the fiscal 2011 budget reflect how the tax proposal is constructed.

“It needs to be an accurate portrayal of the will of the voters,” said Paul Senseman, the governor’s spokesman.

Sources said Brewer had initially sought $650 million in cuts to K-12 education and the universities and $270 million in cuts in the income tax revenues shared with cities. Taking money from cities, they said, would force cash-strapped cities that have already reduced spending to consider reducing the amount of money they spend on police and fire departments.

In the fiscal 2010 budget, Arizona municipalities split $629 million in state-shared revenue. The money was awarded based on population of each city and town. Legislative budget analysts have said the cities’ portion of that revenue source will drop nearly 25 percent in fiscal 2011, to $474 million, because of the economic downturn and declining tax revenues.

But Brewer’s proposal would take 57 percent of the $474 million if the sales tax fails in May.

Senseman would not comment on the details of the governor’s proposal, but also didn’t deny she sought to take money from cities.

“What an additional $1 billion out of the (budget) would do…is pretty obvious if you do the budget math,” he said.

Republican budget leaders, though, were not amenable to that proposal. Rep. John Kavanagh, who chairs the House Appropriations Committee, said Brewer’s plan to isolate the spending cuts in the contingency plan was a non-starter.

“That’s not going to happen. The sales tax may actually fail, and then we’d have to live with a good political policy but a poor public policy,” he said.

He and other GOP leaders have said the contingency will make up about 10 percent of the state budget and would be applied relatively evenly across all state agencies. However, Brewer and Republican lawmakers were still reportedly hammering out a deal on the contingency plan.

Senseman said the notion of merely cutting a percentage of an agencies funding will carry no weight with voters and won’t meet Brewer’s approval.

“It’s got to be something with details (on cuts) so citizens know,” he said. “A percentage (cut) or a number is a concept. It’s something you could do on the back of a napkin. It’s not a real budget.”

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