In what some education supporters see as a cruel blow, the Superior Court recently denied placement of the Invest in Ed measure on the November 2020 ballot. Calling the summary of the initiative “legally insufficient,” the pointed opinion stated that the description “does not accurately describe the Initiative’s principal provisions without the substantial risk of confusion for a reasonable Arizona voter.” The initiative’s supporters are appealing the decision to the state Supreme Court.
The business community is justified in their concern over the lack of disclosure provided to voters on Invest in Ed. Blithely posed as a “surcharge” on individual income taxes, the direct impacts to business are significant and widespread. Among Arizona’s more than 570,000 small businesses, estimates suggest that 40% to 50% of those impacted by the tax increase will be business owners who legally file their taxes as individuals rather than as corporations. The marginal rate change (from 4.5% to 8.0%) represents about a 77% increase in their top tax rate. Without appropriate summary, voters are left on their own to interpolate the measure’s meaning, reach and consequence. They will find no illumination from the Invest in Ed website, which provides only relative and comparative tax data and fails to calculate or estimate actual impacts.
Arizona education leaders are well acquainted with legal obligations and expectations to communicate openly and transparently with the public. For instance, informational pamphlets for bond elections must include specifics on the tax impacts to business owners as well as individual homeowners. In other communications with the public, school officials are advised that when discussing or considering school matters, which can be complex, information provided must be “sufficiently descriptive to inform the average, off-the-street person.”
The ballot is no place for obscurity and euphemism. Nor is soft pedaling to voters even necessary. Arizonans have a solid record of funding education at the ballot box, even when they are told clearly and directly that they will be paying more in taxes and shown how.
In 2000, Arizona voters supported Proposition 301, which imposed a new sales tax predominantly benefitting K-12 education, providing monies to fund teacher pay, classroom size reductions and students support programs like tutoring and dropout prevention. In 2010, Arizona voters passed a temporary additional sales tax through Proposition 100 to provide nearly $1 billion in funding to protect education budgets during the Great Recession. Although it involved changing a constitutional formula rather than raising taxes, voters in 2016 approved Prop 123 to increase distributions from state land trust earnings to raise K-12 per-pupil spending and add an estimated $3.5 billion over ten years.
Notably, those ballot measures were led and funded by a broad coalition of Arizona business and education interests, working together with elected officials in the best interest of our public schools, teachers and students. As a result, they faced little opposition due to extensive efforts to bring together diverse stakeholders in a bipartisan fashion.
In contrast, Invest in Ed has been organized and underwritten by a narrow set of special interests located outside Arizona. Campaign finance reports show that as of June 30 over $4 million has been raised to pay for campaign workers’ salaries and benefits, as well as political activities like signature gathering and text message outreach. Nearly all of that funding – over 85% – has come from a single organization located in Portland, Oregon.
Arizona’s Voter Protection Act creates a compelling reason for activists to go to the ballot rather than the Legislature to lockbox their efforts. Passed by legislative initiative in 1998, Proposition 105 immunizes measures passed at the ballot from gubernatorial veto or legislative diversion. Those who seek to change Arizona’s Constitution, laws and appropriations through the voting booth should not be surprised to find their efforts facing extra scrutiny given the act’s protective shield.
For their part, Arizona education advocates are understandably worried that calling a halt on the Invest in Ed initiative will end the conversation on school funding. They shouldn’t be so pessimistic. For at least a decade, Arizonans have said more money should be spent on schools and the majority are willing to pay more in taxes. They also want their hard-earned money spent efficiently.
Despite the legal battle underway, Arizona business leaders support spending for teachers and schools. Arizona business leaders supported the “20 by 2020” plan introduced by Governor Ducey and passed by the Legislature to raise teacher salaries 20% by 2020. It cannot be overlooked that Arizona business supported teachers and school personnel continuing to get paid even while schools were closed due to COVID, while their own employees have gone without work and without pay. Ignoring these efforts, out-of-state forces instead imported Invest in Ed to Arizona in 2018 and again in 2020, refusing to set aside their agenda even amid the hardships caused by a global pandemic.
Should the Supreme Court uphold the lower court’s decision, rest assured there will be Arizona business leaders who step forward, willing to create a more robust and comprehensive school funding plan without the threat of economic harm.
It’s time for a more modern, more sensible approach to school finance – one that is Arizona led, and Arizona backed – and that will generate revenue from more reliable resources to support schools and teachers. Beyond shoring up per-pupil spending levels, the plan must make funding allocations among schools more equitable and result in greater academic achievement for all students. Spending equity and tax equity go hand in hand in Arizona school finance, so the plan likewise should update our tax code and spur additional business investment that grows Arizona’s economy and personal income for its residents, not stifle their prosperity.
Working together, Arizona business and education leaders have the opportunity to make our state the best place to educate a student, whether they attend a public K-12 school, community college or university. The millions being spent on court battles on both sides could be put to better use by funding an inclusive stakeholder process to keep Arizona voters from going through this conflict again in future election cycles.
Meanwhile, no one should argue that Arizona voters deserve straight talk when it comes to their ballots and their pocketbooks. Back in Oregon, the commanders of Invest in Ed might heed the wisdom of Chief Joseph of the Nez Perce, a revered leader and forefather of the lands that belong to their state, “It does not require many words to speak the truth.”
Eileen Klein is the owner of a small businesses in Arizona. Her public service includes serving as the 35th state treasurer of Arizona and chief of staff to Governor Janice K. Brewer. Eileen is past president of the Arizona Board of Regents and a former member of the State Board of Education.