The first thing you see when you walk into Michele Reagan’s office in the House of Representatives is a large, black scorpion — dead, thankfully — in a display case on the wall. A second glance reveals a note stuck to the wall above the arthropod declaring that the curiosity is neither a low-tech security system nor a desertic hunting trophy; rather, it is an award for being the top small business defender given to the District 8 Republican by a national pest control industry association. Reagan says only she and disgraced Congressman Tom Delay received the award. “Everyone thought I was just weird and put a big bug on my wall,” she says. “I say, I’m the only one who has the small business defender award who hasn’t been indicted.”
Reagan, in her third term as a representative and her second as chair of the Commerce Committee, has made increasing opportunities for businesses in Arizona her top priority at the Capitol. She spoke with Arizona Capitol Times by phone June 6 about those efforts this year, her work on expansive changes to the Clean Elections system and the possibility of the legislative session ending soon.
How has the session been so far for you, other than long≠
I’ve had a pretty successful session. I’ve gotten some things that I’ve worked on that I was excited about passed and some things that didn’t pass that I know I want to work on over the summer.
Which things still need some attention over the summer≠
I am going to work on three things: really trying to nail down the retention issue and the proportional liability issue that deals with contractors and subcontractors and developers. What we really want to do is we’re striving for true proportionality — you break it, you buy it. And that’s really not how the current statute is.
How does it work now≠
Right now, a lot of the liability is passed on to the sub and the big people get to, in some cases, walk away.
And the other bills≠
Well, I’m hoping to get [a tax credit for] research and development into the budget this year. This is my third crack at it. If you remember [former Representative] Steve Huffman, he worked on single-sales factor for many years before people finally embraced the idea. I’m hoping this is the year for R&D. The credit already exists, so it’s trying to finish it and get it the way we want it so it’s done and we don’t need to revisit it every year.
What benefit will it give Arizona’s economy≠
It’s a huge benefit. We hear people say all the time, especially when they’re on the campaign trail, “Let’s keep high-wage jobs in Arizona,” or “Let’s attract high-wage jobs in Arizona.” This is one way to actually do that. We’re seeing a lot of those research and development jobs go to neighboring states, because they have different statutes in place. If we could make our statutes and our credit system the same as neighboring states, we’d be able to retain a lot of those jobs.
So the problem isn’t as much attracting new jobs as it is keeping the ones we already have≠
It’s actually both. We see a lot of companies that say, “I’m going to open up a new plant and I have a choice of five states.” Well, they’re going to go to where they’re going to get the most bang for their buck.
You hit on a very important point of this bill, which is that we see a lot of tax credits or a lot of tax implementation that doesn’t have a huge payback. This is one that pays the state back so much more than the state would give out. And that’s important.
There’s actually no cost [to the state] in the FY07 budget. In the FY08 budget, it should be around $5 million, and it ramps up in the future. But, again, we’re going to get a lot more than a $5 million bang back into our economy. It just seems like such a no-brainer to me, but there’s a lot of resistance to research and development.
What’s the objection≠
Oh, another tax credit for a specific industry, it’s too targeted, we’ve done enough for the business community — that’s the kind of thing I’ve been hearing. But we’ve got to remember it’s the business community that is putting the money into our coffers, so we need to protect them. They need every protection as any other taxpayer.
Most of my opposition right now is in the Senate. It’s not in their budget. I’m hoping that when the meeting of the minds happens and they compromise that that’ll be one of the pieces that they decide to compromise on.
How has this session been different than your previous terms≠
Obviously, the biggest thing is that our numbers in the Republican Party are different, and that could be looked at as a bad thing or a good thing, but we’ll focus on the good. The good news is that it forces us — we can’t afford to lose any votes, so to speak, so what we bring to the floor has to be really well thought out and it just needs to be good legislation. We can’t afford to lose five or six votes.
The other thing that I’ve found, and this has been really exciting, is that I’ve been able to work a lot of bipartisan bills. I’ll give you an example: the accelerated depreciation bill for business equipment. That was a bill that Rep. [Ben] Miranda and I worked on together. That was exciting, that was fun. It was neat to see both sides saying, “Yeah, this needs to happen.”
If the numbers weren’t as close, would we have that working relationship≠ I don’t know. But it was very enjoyable.
Do you think that makes for better legislation in the end≠
Oh, absolutely. You can’t ignore half the body, and they’re almost half now. They’re more of a force to be reckoned with and you need to work with them. That’s been, actually, quite enjoyable.
One of your successes, though I know it’s still moving through the process, has been your Clean Elections bill.
Yes, and don’t jinx it!
Explain what the current status of the bill is and what it does.
The bill is going to be brought into conference committee, hopefully this week, and we’re going to add — the Senate made a lot changes in their engrossed version. Some of them were phenomenal changes that we got really excited about in the House. So, we want to incorporate some of the things they added to it, and some other members have come forward with some additional changes they’d like to see that weren’t in either version, so we’re going to be adding those as well.
Then, it’ll have to go to a vote before both the Senate and the House and get a super-majority in each chamber again, so this is kind of a scary time.
What’s the goal of the bill≠
The goal, I would say, is to level the playing field. I think that was the intent of the Clean Elections Act when the voters voted it in. There are some instances where the current law is more favorable to a Clean Elections candidate and there are some instances where it’s more favorable to a privately funded candidate, so this fixes a lot of the loopholes that almost everyone would agree are there.
Have you spoken with the Governor’s Office about it≠ Do you know if she’ll sign it if it reaches her desk≠
I have not spoken to the governor specifically, but I have spoken to her staff and they seem favorable. I would assume she would want to see what the changes are in conference committee and what the votes are. But if we can get a really solid vote out of the House and the Senate, I don’t understand why she would not sign it — but that’s her call.
In the past, you’ve been a critic of Clean Elections — why are you now working with the Clean Elections Commission on legislation≠
I still am a critic. I’m a staunch opponent of the Clean Elections system, but that doesn’t mean that I don’t want the system to work. You have to remember that, regardless of how I feel about Clean Elections, it’s still going to be in place in the 2008 election cycle. I think it should be our duty as legislators to make that system work effectively.
Of course, I have to work with the Clean Elections Commission on this. There were a lot of things that, by their own admission, needed to be changed. They weren’t out there saying, “Oh, we’re not going to change anything. The system is perfect.” They had things that they thought needed to be changed, as well. There’s just a lot of little anomalies that needed to be changed.
So, it’s a safe bet that you won’t be running a publicly funded campaign, even if your bill becomes law≠
I would prefer to never run Clean. I don’t like to use the word never, but… I’m trying to not be selfish with this bill. I’m trying to do things that are going to make the 2008 elections easier for whatever type of candidate there is. So, whether you run private or Clean or if you’re a Democrat or Republican, you shouldn’t have the problems that we had in 2004 and 2006.
What were some of those problems≠
There were huge problems. There are three big ones. We all know that it costs money to raise money, yet there’s no deduction for fundraising expenses for matching funds. This puts a fundraising percentage in there. It says that seven percent of every dollar you raise is not matchable. That’s huge for candidates like me that are out there raising that money, knowing there’s a cost to raising it.
The second big thing it does is most people would find it very surprising that, in statute, you can qualify for Clean Elections funding and yet not qualify to be on the ballot. There’s nothing that says you have to be on the ballot. So, we’re going to be changing that so it says once you get your funding, should you not qualify for the ballot, you have to give your money back. I think that’s fair. I haven’t met one person who runs Clean or traditional that says that’s the way the law should read. Absolutely, that’s just a big oversight.
The other big one is we do not want the Clean Elections system to be able to change the rules in the middle of an election. I think I came up with a great analogy: The government can’t change the tax rules in the middle of a tax year and have them apply to that tax year. It is applied the following tax year. Yet, in the Clean Elections system, rules can be changed and they apply in that current election year and, even worse, sometimes they apply retroactively.
As a candidate, you can’t run a campaign not knowing what the rules are. Basically, it’s going to be saying any rule changes don’t apply until the next [election] year. That’s the way every other government agency works.
What is the biggest thing, besides the budget, that the Legislature needs to tackle this year≠
I think we really need to nail down what’s happening with employer sanctions.
The bill’s gotten through the House and Senate, though in different forms, and is headed for conference committee. What do you think of the different proposals from each chamber≠
I don’t really have an opinion so much on the different proposals. What I am afraid of and what I’d like to see is I’d like the Legislature to come up with what the employer sanctions are going to be and get them in place. What I don’t want to see is it going on the ballot, for the simple reason that, if we make a mistake or if we see some tweaks that we need to make, our hands are tied in making those tweaks. If we pass something legislatively and we see that something doesn’t work or needs to be tightened, we’re allowed to do that the following year. We can’t do that if it goes on the ballot, so that’s why I think it’s so important that the Legislature passes employer sanctions.
Does that need to happen this year or, if an agreement doesn’t get reached, can it wait until next year≠
I don’t think it should happen next year. I think it should happen this year because next year — we’ve just delayed it a whole other year. We have a clear directive from the voters to start fixing this problem. I don’t know why we would leave session without at least trying to fix it.
What do you think of the immigration debate going on in Congress≠
I think it’s very exciting that they’re finally tackling it. I don’t know if I agree — I don’t think anyone agrees 100 percent with what they’re working on, but they’re working on it, and I think they need our full support to continue working on this and come up with something that’s going to work not just for Arizona, but for the entire country.
We’ve been asking them to work on this now for four years, so how exciting they’re doing it! This is good news.
Both parties have been telling the federal government to take this up for several years and now that they have, I think one of the interesting things that’s happened is there are a lot of Republicans who have said this isn’t the way to go.
We’ve seen a lot of criticism from our party of Sen. [Jon] Kyl, and I think that’s really disturbing. We don’t know the details and the level to which he’s working on it. What I’m saying is we don’t understand his business, so to be on the outside looking in, saying, “He’s doing it all wrong,” when we don’t know really what’s happening with negotiations — he has a seat at the table. We should be proud of that! We should be encouraging him to make Arizona’s voice heard in this debate, not sending him nasty e-mails and messages saying, “You’ve got it all wrong.”
We should be supportive of him because, in the end, he’s a staunch conservative man. He’s not going to sign off on something that is against his beliefs. I just think we need a little bit more trust with someone who’s never let us down before.
What does it say about the state of the Republican Party in Arizona when you have the grassroots Republicans here leading the charge against Kyl and castigating him for this one thing, despite having a long record of being so conservative≠
I think we have to realize this is a very emotional issue for a lot of people and we have to respect that. We have to respect the fact that the state party and the grassroots Republicans are passionate about this issue and want their voices to be heard. I respect that about them.
What I would like to see is for them to trust a senator that, again, has never let them down. Let’s give him some leeway before we start throwing stones at him.
An issue that was a hot topic a couple years ago and came back to the light of day a few weeks ago in the House budget discussions is photo radar on the freeways. Are they another tool for law enforcement or a danger to the public and a cash cow for the cities≠
That’s the thing with photo radar: it could go either way. It can be used as an effective tool or it could be used as a moneymaking opportunity. That’s why I think people who are passionate about photo radar would like to see some restrictions put on it, so it isn’t used as a moneymaking device. If the goal is public safety, great, let’s make sure that when it’s used, it’s used to better public safety and it’s not just used to make money. I think that’s the crux of that debate.
My city’s program is not included in that discussion, so I kind of stayed away from it. Scottsdale’s program is not in jeopardy. Truthfully, I’ve kind of had it with that issue. If you look at it, it’s almost kind of humorous in the sense that we could have countries all over the world producing nuclear weapons, yet when I go to a town hall meeting, they want to talk about photo radar. You want to kind of put it in perspective. We’re doing a $10 billion budget right now and people are worried about three cameras in Scottsdale. You kind of want to say there are bigger issues. Well, I’m sorry for bringing it up.
No, not you. [Laughs] It’s just that if I have to do another photo radar interview I’m going to eat my shoe.
Your name has come up as a possible challenger to Harry Mitchell for Congress next year. Have you given the idea any thought≠ I’m sure you’ve heard the same rumors.
Yeah, I’ve heard those and it’s flattering, but there are a lot of people’s names being thrown out there that are considering running. It’s truly something that I didn’t think about. I would, personally, like to get into the Senate someday — the state Senate. That’s where I think I could do the most good right now. So, I’m waiting my time to, if the people will have me, hopefully be in the Senate some day.
Do you have a sine die prediction≠
Let’s say Friday, the 15th.