Now that the fiscal 2004 budget rests with Governor Napolitano, state lawmakers are concentrating on completing work on other key bills as the first session of the 45th Legislature—one of the longest ever — moves closer to adjournment.

Among measures awaiting action in the Senate are bills that have been dubbed “The Big 3” — state funding for new research facilities at Arizona’s three state universities and for expansion of Phoenix Civic Plaza, and a bill that could bail out the financially strapped Maricopa County public health system, called “Maricopa Integrated Health System.” It has lost $150 million over the past 10 years.

Also on the Senate’s plate are measures to increase unemployment benefits and provide unemployment tax breaks for certain employers and an expected “trailer” bill to the $6.4 billion budget package that passed the House June 11. (See House budget story, Page 1.)

House action will be needed as well on most of these measures, and that will further extend the session, which will be the seventh longest regular session in state history when it reconvenes June 16.

Ms. Napolitano has strongly endorsed the Big 3, all of which were put on hold in the Senate during budget negotiations, but now are back on the front burner, with legislators, anxious to wrap up the session, preparing to vote them up or down.

Two Senate Republicans, Linda Binder, R-Dist. 3, and Slade Mead, R-Dist. 20, deserted their caucus earlier in the session partly in an attempt to force action on these three bills before the vote on the budget.

It didn’t happen as they envisioned because Senate President Ken Bennett, R-Dist. 1, and Sen. Bob Burns, R-Dist. 9, chairman of the Senate Appropriations Committee, did not want to link the three bills to the budget just to secure aye votes from Ms. Binder and Mr. Mead.

The university research facilities bill (H2529), assigned to the Senate Finance and Appropriations committees, provides $831 million in state funding from fiscal 2007 through 2030 for lease-purchase capital financing of “research infrastructure projects” at Arizona State University, the University of Arizona and Northern Arizona University. The bill passed the House 41-17 on May 7.

After intensive negotiations on June 11 among university presidents, Mr. Bennett and Sen. Dean Martin, R-Dist. 6, chairman of the Finance Committee, the universities agreed to an amendment to have the schools deposit with the state certain percentages of the revenue they expect to derive from research royalties and sale of intellectual property. Assigned to Senate Appropriations, the Phoenix Civic Center expansion bill (S1365), calls for state sales tax revenue to be used to pay debt service on half the $600 million cost of expanding the convention center.

Proponents of the measure say increased revenues from the expansion could eventually pay for the entire project, while opponents, such as southern Arizona legislators, see the bill as benefiting only Maricopa County. Appropriations Chairman Burns, a Peoria resident, has said he opposes the bill.

Governor: ‘No Financial Risk’

Governor Napolitano, on the other hand, says Arizonans will remember the university research facilities and Phoenix Civic Plaza decisions as positive investments.

“In five or six years, no one is going to remember how this budget battle got resolved,” she said. “But they will remember what we invested in for Arizona.”

Ms. Napolitano added, “The state is at no financial risk” with convention center funding.

The third bill of The Big 3, S1359, would give Maricopa County voters in November the opportunity to turn thumbs up or down on the creation of a special hospital district with taxing and financing authority to cauterize the financial hemorrhaging at Maricopa County Medical Center. The bill stipulates that voters also must approve any district property tax levy.

The tax could raise as much as $40 million a year for 20 years, although caps would be placed on the tax each year according to property tax formulas.

As a whole, the Maricopa Integrated Health System, which comprises the medical center and 11 health clinics, has held its own, its CEO, Mark Hillard, said; but the medical center, which houses the region’s only burn center, has been losing money at a rate of $15 million a year over the past decade.

Sen. Jim Weiers, R-Dist. 10, said laws governing the distribution of federal funds to county hospitals that provide indigent care are partially responsible for MIHS’s financial problems. The law, he said, allows the state first crack at the funds. It “scoops” some of them, he said, before distributing the rest to the counties.

He said he doesn’t have much hope that the distribution laws can be changed. “I just want to go on record,” Mr. Weiers said, “and I know it’s not going to be done because there’s not the fortitude, and there’s not the ability for people within these hallowed chambers to make that decision to simply give the money back to the county where it was, because that would mean we wouldn’t be able to dictate on how we spent it.”

There were arguments in the Senate Finance Committee that Maricopa County could levy a tax to support MIHS without creation of a special taxing district, but MIHS officials told the committee the district would provide more flexibility in hiring physicians and purchasing pharmaceuticals, as well as the ability to form public-private partnerships to enhance its services.

Mr. Martin was the only vote against the bill in Finance. He said creating a taxing district allows the county to avoid complying with its spending limits.

The unemployment-compensation issue belongs to Sen. Carolyn Allen, R-Dist. 8, who was stung by Ms. Napolitano’s veto of her original bill (S1009) to increase jobless benefits to the newly unemployed.

In vetoing S1009, Ms. Napolitano said that House amendments, including a 20-week employment base period for eligibility and exemption of seasonal workers, would deprive thousands of unemployed people from benefits during tough economic times.

Ms. Allen said meetings on compromise legislation with the governor’s staff and labor leaders were contentious. She has introduced a new bill (S1367) identical to the vetoed bill, plus a measure, SCR 1031, to place the unemployment benefits bill on the November 2004 ballot for voters to decide.

By introducing a second bill, Ms. Allen opens debate on provisions of the bill the governor did not like, offering the opportunity to strip them out.

By introducing the SCR, she makes it possible, if she can get the votes, to bypass the governor and go directly to voters.

“I like the referendum idea,” she said. She added that she has given up on trying to get a vote to override the veto. An override requires 20 votes in the Senate, and considering that there are only 17 Senate Republicans, an override would be a real political surprise.