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Brewer leaves out legislative priority in Chamber lunch economic speech

Gov. Jan Brewer made her economic agenda for the upcoming session clear, and the agenda she didn’t lay out spoke volumes as well.

Speaking Jan. 7 at the Arizona Chamber of Commerce and Industry’s 2011 Legislative Forecast Luncheon, Brewer reaffirmed her commitment to lowering the state’s corporate income tax rate, expanding Arizona’s enterprise zone program to the entire state, and establishing an Arizona Commerce Authority with a significant deal-closing fund to lure new businesses.

But Brewer made no mention of the business property tax assessment rate, a high priority for many Republican lawmakers, including leadership. The Chamber of Commerce included business property taxes in its 2011 legislative agenda, and legislative leaders, such as Senate President Russell Pearce and House Majority Leader Andy Tobin, cite it as a top priority.

“The Arizona Commerce Authority is a vital part of our plan, essentially the bedrock of our strategy. And I intend to see that it flourishes,” Brewer told the crowd at the Hyatt Regency in downtown Phoenix. “But the Commerce Authority cannot do it alone. We need to replace Arizona’s enterprise zone tax incentive program with a statewide program to reward companies with tax incentives that create high-quality jobs.”

Some parts of Brewer’s agenda will receive broad support among GOP lawmakers, including a reduction in Arizona’s corporate income tax rate. The governor wants to lower the rate from nearly 7 percent to about 5 percent, and she received a loud applause at the luncheon when she said the rate must be lowered “to be competitive with other states.”

Other parts of Brewer’s agenda, however, won’t have the near-unanimous support that her income tax plan is expected to get. Pearce has openly criticized the Commerce Authority’s job-closing fund and the enterprise zone plan because they favor certain companies and industries, and is pushing for broad-based tax cuts for all businesses.

Pearce, who refers to himself as president of the “tea party Senate,” reiterated the conservative mantra of less spending and less government at the luncheon. Talk of cutting government down to size is nothing new for many Republicans. But while others may get weak in the knees, Pearce has no compunction taking the axe to government spending.

“In this time of crisis, government is the problem, and that’s where we are at today,” Pearce said. “What we’ve got to do, again, is reduce the burden of government on businesses and families.

Meanwhile, House Speaker Kirk Adams vowed to continue Arizona’s battles against the federal government. The U.S. Department of Justice sued Arizona over a strict illegal immigration law the state passed in 2010, and Brewer has been a prominent voice on the national stage against the health care law signed by President Barack Obama. Some GOP lawmakers support cutting Medicaid spending in direct violation of the health care law.

Adams said Arizona would continue a tradition of bucking the federal government that began during the debate over statehood nearly 100 years ago.

“Arizonans knew what was right, so they fought the system and went rogue,” Adams said.

Glenn Hamer, president and CEO of the Arizona Chamber of Commerce and Industry, said he was pleased with most of what Brewer said, but he glossed over her avoidance of the property tax issue in her speech. Brewer has said she’s concerned that cuts to the business property tax rate will ultimately mean higher residential rates, and said she won’t support any plan that shifts the property tax burden to homeowners.

“We’re 90-plus percent on the same page,” Hamer said.

Brewer too focused on the points of agreement, but may have inadvertently hinted at the disagreements to come.

“I believe, with very few exceptions, you and I are on the same page,” she said from the stage.

Brewer said she would provide more details about her agenda on Jan. 10, when she will give her State of the State Address, and Jan. 14, when she will unveil her budget.

- Luige del Puerto contributed to this story.

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