A regional tax that has funded major transportation projects in Maricopa County for decades is set to expire in 2025 and lawmakers say this legislative session is their last chance to extend it.
The half-cent sales tax, known as Proposition 400, has been in place since 1985, when voters approved a ballot measure sent by the Legislature. Prop. 400, which must be renewed every 20 years by voters, was extended in 2004.
Legislators have proposed several different Prop. 400 bills this session, but none have gained enough support to make it to the governor’s desk so far. However, there are two striker bills in the House sponsored by Rep. David Cook, R-Globe, and Rep. David Livingston, R-Peoria, that appear to be legislators’ last hope at getting a bill passed this session.
“I think it will be almost impossible to pass a new bill next year in the Legislature, which means Prop. 400 will formally end,” Livingston said to the Arizona Capitol Times on April 18. “This is the last chance we have.”
If Prop. 400 expires, the region would lose more than half its funding to implement transportation projects, according to the Maricopa Association of Governments. Prop. 400 has provided funding for 410 corridor miles of freeway, 252 miles of street projects and millions of bus service miles since it was implemented.
Lawmakers have been divided on how much of the tax money should go into transit projects, specifically light rail. Democrats and the Maricopa Association of Governments have asked for a large allocation for transit – similar to a Prop. 400 bill that passed through the Legislature with wide support last year.
Republican former Gov. Doug Ducey vetoed that bill, which allocated 40.4% of the tax for public transit and allowed cities to use 14% of funds for light rail. Livingston said that veto shocked both the Legislature and the Maricopa business community. Cook says the Legislature is different this year, noting that proposal would be much harder to pass, and Livingston agreed with that.
“For two-thirds of the House members, this is a brand-new issue,” Livingston said. “I think that the House and the Senate are much more conservative this year. In fact, I think most people consider it the most conservative House and Senate combination that we’ve ever had in the history of the state. So that makes sometimes things like this harder to do.”
Republicans are seeking to cut public transit funds and put a bigger allocation of the tax money into roads. Both Cook and Livingston’s bills allow funds to maintain current light rail, but don’t allow cities to expand light rail projects, despite MAG requesting light rail funding.
Cook’s bill, Senate Bill 1246, allocates 26% of funds into public transit, but Cook said the issue is more complicated than breaking it down into funding percentages. He said the idea of his bill is to offset bus route costs cities are currently paying for with their city budgets and free up that money for light rail, leaving Prop. 400 funds out of it.
Other bills that have advanced through the Legislature have frustrated Cook because they pull money from the general fund when he said those issues should be taken care of by Prop. 400.
“Obviously the bucket for arterial roads, and freeways and interstates and all that stuff, it’s not quite adequate because now we’re coming back for more out of general fund dollars, which needs to fund other things in the state,” he said.
Cook is confident his measure will be up for a full vote in the House in the coming weeks and that he’ll be able to send a bipartisan agreement that Gov. Katie Hobbs will sign, he said. There have been stakeholder meetings twice a week on the bill and the last piece stakeholders are trying to solve is estimating transportation revenue and cost over the next 20 years. That’s why Cook said he tells people not to get so caught up over the percentage breakdowns.
“You’re screaming out that you need 41% and then when I say ‘41% of what number,’ you don’t know. Do you want 26% of a billion dollars or do you want 41% of a million dollars,” Cook said.
Livingston said his bill is much closer to the proposal MAG has been asking for. His bill allocates 39% of funds to be spent on transit. It resembles legislation he drafted at the start of the session but was never assigned to a committee. Livingston chairs the House Appropriations Committee and he attempted to schedule that bill for a reading in February, but it never happened.
Now the bill is appearing as a striker, which Livingston scheduled a hearing for in Appropriations on April 3. Democrats took issue with the bill because it included language about housing policy, and they said it wasn’t germane to the bill.
Rep. Athena Salman, D-Tempe, said during that hearing that she thought it’s absurd that Maricopa County is the only county in the state that has to request a ballot measure of this kind from the Legislature.
“I hope that you’ll go back and look at what (MAG) has asked for and respect their local control,” Rep. Judy Schwiebert, D-Phoenix, told Livingston during the April 3 hearing.
Rep. Matt Gress, R-Phoenix, voted against Livingston’s proposal and alluded to Cook’s bill. He said Cook has to be involved in any discussions over the bill and said he supports Prop. 400, but in a different form than what Livingston presented.
Livingston said his investment over the issue comes from having previously served as a Senate Transportation Committee chairman and he has worked on Prop. 400 for the past five years. He said he believes his bill will be the one that goes forward over the next 60 days and that he has removed the housing language that was in his initial bill.
If a Prop. 400 bill doesn’t pass before sine die this year, Cook suggested that Hobbs call a special session specifically to get it done.
Axios Phoenix reported that some mayors are looking at other plans if the Legislature fails to pass a bill, which include a signature campaign to make it a statewide ballot measure or for a smaller collection of cities like Mesa, Tempe and Chandler to hold concurrent elections on transportation taxes.