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Tag: Maricopa County Superior Court

Arizona Independent Party chairman pushes favored candidate, asks rival to drop out

Key Points:
  • Two candidates are running for Arizona Independent Party’s governor nominee
  • Party leaders back Hugh Lytle, ask Teri Hourihan to drop out of the race
  • Judge Greg Como will hear arguments on the party’s legal existence in March

There are two candidates currently running for the Arizona Independent Party’s nominee for governor.

But the leaders of the state’s newest political party are openly backing only one of those. And party Chairman Paul Johnson actually asked the other one to get out of the race to provide a clear path to Hugh Lytle, the chosen contender, to be the party’s standard bearer in November.

And Johnson has said there’s absolutely nothing wrong or unfair about the decision to back Lytle.

That, however, isn’t sitting well with Glendale resident Teri Hourihan, the competition, who has submitted her own statement of intent to run as an Arizona Independent Party candidate for governor. She believes she should be given an equal chance for office — one without the influence of party officials.

And Hourihan told Capitol Media Services that Johnson, who said he was speaking on behalf of all the party leaders, tried to get her to withdraw so Hugh Lytle, the designated favorite, would have a clear, unopposed chance to ensure his name is on the Nov. 3 general election ballot.

That’s a contention that Johnson does not dispute, but in his own conversation with Capitol Media Services, he said he concluded Hourihan was not ready to run for state office — even before he recruited Lytle to run.

The intra-party dust-up comes amid uncertainty over the new party’s future.

Maricopa County Superior Court Judge Greg Como is set to hear arguments in March by the Arizona Democratic Party, the Arizona Republican Party, and the Citizens Clean Elections Commission about the future of the Arizona Independent Party. They all contend that Secretary of State Adrian Fontes acted illegally in allowing Johnson to simply rename what had been the No Labels Party and keep all of those who had been registered with it.

The essence of the lawsuit is the argument that Johnson, who took over after the national No Labels Party severed ties with the local group, has created an entirely new party. And that, their lawyers contend, means he has to start from scratch, including gathering the necessary signatures to get official status.

What makes all this important is that if Como rules, there is no Arizona Independent Party; anyone seeking to run for office — including Lytle and Hourihan — would be considered an unaffiliated candidate and would have to gather at least 44,539 valid signatures to get on the ballot. For context, it takes only 1,288 signatures to be considered a candidate for the newly formed Arizona Independent Party.

The more immediate issue, however, concerns Johnson’s public efforts to prevent Hourihan from submitting the signatures and getting on the ballot — and to force a primary with Lytle in which she, and not the party’s favorite, could come out on top.

Johnson said he and his backers never planned to create a party.

Their first choice was to require an “open primary,” where all candidates from all parties would have to get the same number of signatures and run against each other, with the top vote-getters facing off in the general election, regardless of party affiliation. Voters rejected that plan.

Option B, Johnson said, was the creation of an independent party that could provide equal access to the general election ballot for those not affiliated with existing parties.

“Now it’s my job to make certain we have a decent brand as a party because it can be considered, if you’re not careful, something that’s a little bit goofy,” he said.

And Johnson said that, with that goal in mind, the decision was made to court Lytle, a health care entrepreneur, to be the party’s standard bearer — and promise him the party’s support.

“This guy is talented,” he said. “And you don’t get somebody like this guy to run if you justify that you’re going to hang back.”

Johnson said that what he’s doing in promoting Lytle over Hourihan is no different from what happens in the major parties, where leadership quietly decides who is the favored candidate.

Sometimes, however, that bursts out into the open.

That’s what happened in 2024 when Jeff DeWit, chairman of the Arizona Republican Party, tried to talk Kari Lake out of running for U.S. Senate.

In a phone call, he told Lake that Republicans in Washington did not think she could win a race against Democrat Ruben Gallego after losing the 2022 gubernatorial race to Katie Hobbs. And DeWit, in the recorded call, offered to find some other job for her while she sat out the race.

It all backfired when the recording became public and DeWit quit.

As it turned out, Lake decided to run anyway — and was defeated by Gallego by more than 80,000 votes even though Donald Trump outpolled Kamala Harris in Arizona.

“Here’s the difference: I’m doing it openly, proudly,” Johnson said of his efforts to push Lytle over anyone else. “I think you’d have to be a coward not to stand up and say who you would support.”

Still, Johnson said, there’s nothing he can do to stop anyone else, including Hourihan, from running in the Arizona Independent Party primary. And if she — or someone else — gets the necessary signatures along with Lytle, there will be a contested primary.

But Johnson did more than simply endorse Lytle. He even spoke at a public announcement of his candidacy in front of Sun Devil Stadium.

Hourihan said — and Johnson confirmed — that his efforts to get her to drop out of the race included proposing she instead run for a lower office. Johnson said she needed more political experience.

“You’re not ready for this,” Johnson told the licensed professional counselor in a conversation she taped with him and made available to Capitol Media Services. He suggested she “put in the work” and enter politics at a lower level.

Hourihan, for her part, said she is ready. And part of that, she acknowledged, is her belief that God is calling her to run.

“You can believe whatever you want to believe because you want to believe it,” Johnson responded. “I would just tell you to pray some more because I gave you solid advice.”

That, in turn, led Hourihan to ask whether, if she wins the primary, Johnson will apologize.

“I will say ‘congratulations,’ ” he responded. “But I will never say ‘I’m sorry’ because I’m positive that you’re not ready, even if you won.”

But would Johnson support her if she wins the primary?

“Probably not,” he said. And Johnson, a former Democrat who lost his own race for governor in 1998 against incumbent Republican Jane Hull, said if Hourihan is the nominee of the Arizona Independent Party, “she would not be the best candidate of the three that are left to be governor.”

Nor does he believe that his position as party chair — or that of other party officials — requires them to back the person who wins the party’s primary.

“From our standpoint, we don’t have to follow their set of rules,” Johnson said.

Court upholds Arizona film tax credits, rejects Gift Clause challenge

Key Points:
  • Judge rules Arizona film tax credits are legal
  • State allows up to $125 million in credits for film productions
  • The state has repealed similar film credit programs in the past

A judge has concluded that there’s nothing illegal about the state giving tax credits to companies that make their movies and even their commercials in Arizona.

That’s according to a new ruling from Maricopa County Superior Court Judge Adele Ponce, who said the Arizona Constitution bars the state from providing grants or subsidies to any individual or corporation. And Ponce acknowledged that lawmakers approved a statute allowing the Arizona Commerce Authority to issue up to $125 million in credits each year that producers can use to offset any tax liability they owe.

But she said there’s no Gift Clause violation here because the state isn’t giving away anything.

Instead, the judge ruled the program simply allows people and corporations to pay less of their own money to the state if they qualify.

And Ponce said that is not changed by the fact that the credits are “refundable,” meaning someone whose credits exceed the taxes owed actually can get a check from the state.

Her ruling is a defeat not only for the Goldwater Institute, which filed the lawsuit, but also for Senate President Warren Petersen. The Gilbert Republican actually filed a legal brief in the case urging the judge to undo the program that was enacted by lawmakers — including half of the senators from his own party.

The Goldwater Institute has vowed to appeal, and Jon Riches, vice president for litigation, said his organization still believes the credits are an illegal subsidy.

According to proponents, the credits were designed to breathe new life into what was once a more thriving film industry in Arizona, dating back at least to the 1930s, when John Ford visited Monument Valley and decided to film Stagecoach with John Wayne.

And the studios at Old Tucson were for a long time the site for various westerns, ranging from The Lone Ranger to Three Amigos, before much of the facility was destroyed in a 1994 fire.

But what’s happened more recently is that productions that were supposed to portray events in Arizona were actually filmed elsewhere.

During debate on the 2022 legislation, Rep. Stephanie Stahl Hamilton, D-Tucson, cited “Only the Brave,” the 2017 movie about the deaths of the 19 Granite Mountain Hotshots who died while fighting the 2013 Yarnell Hill Fire. As it turns out, she said, the movie, which had a budget of $38 million, was not shot here.

“That is our story and that is our history,” she said. “It had to be filmed in New Mexico because it’s not economically feasible for them to shoot that film in our own state.”

And adding insult to injury was the 2008 film “Hamlet 2” starring Steve Coogan, Catherine Keener, Amy Poehler and Elisabeth Shue about a failed actor teaching high school drama.

It opens with the main character asking, “Where does one go for dreams to die?” — only to pan to a sign that says “Welcome to Tucson, Arizona.” Yet the whole thing was filmed in Albuquerque.

The tax credits can be generous.

Companies that spend up to $10 million in production costs can receive up to $1.5 million. And there’s a sliding scale for more expensive films, with credits going up to $7 million for a $35 million production.

What’s wrong with that, the Goldwater Institute argued, is there’s no evidence of actual benefit to the state. In fact, an audit of a prior version of the credits showed the credits awarded actually exceeded the state and local taxes generated by the movies.

And the lawsuit questioned whether there was any real value to the requirement that the film acknowledge it was produced in Arizona.

All that, Ponce said, is legally irrelevant.

She said the Gift Clause applies only to “public money.” And that, she said, is not the case with a credit.

The judge cited a 1999 Arizona Supreme Court ruling in which the Arizona Education Association challenged a state law that provided a dollar-for-dollar tax credit to individuals who donated to organizations that provided scholarships for students to attend private and parochial schools. Here, too, the allegation was that the credits violated the Gift Clause.

But Ponce pointed out that the justices said that in order for something to be a gift, it had to be money appropriated from the state treasury.

In that case, the high court said, there was no actual appropriation of state funds to a scholarship organization. Instead, it was the Legislature telling people that if they gave to these organizations they then could reduce their taxes by the same amount.

Put another way, there was no gift because the state never had the money to give away in the first place.

The same is true of the film tax credits, she said, because the state isn’t giving companies money to produce films in Arizona but simply allowing qualifying firms to pay less to the state.

Riches, however, contends there’s a difference.

In the case of the scholarships, he said, the taxpayers still were paying the money. The only difference is it went to the organizations rather than the state.

By contrast, Riches said, the companies taking the credits here have not given an equivalent amount to anyone else, and are simply pocketing the dollars.

He contended that’s even more true if companies can get refundable credits from the state if their earned credits exceed their tax liability.

Ponce disagreed, saying that even credits that result in a refund are not gifts.

This isn’t the first time the state has approved such credits. Lawmakers enacted a similar program in 2005 and expanded it in 2007.

A report on that program said the credits generated 317 full-time jobs in the industry in 2008, with another 413 created indirectly from spending by filmmakers in the state.

According to the report, that generated about $2.3 million in total additional state and local taxes.

But it turned out that Arizona actually issued more than $8.6 million in credits to achieve that gain. And a similar report for 2007 showed a $1.7 million loss to the state.

Lawmakers repealed the program in 2015.

Sen. David Gowan, R-Sierra Vista, who championed the new credits, has insisted these are different from the prior program. He said it requires those seeking the credits to actually show, subject to a state audit, that they actually have spent the money in Arizona.

Arizona Supreme Court reignites 2020 safety lawsuit against Circle K

Store owners have a legal responsibility to keep their shops “reasonably safe” for customers, the Arizona Supreme Court ruled March 12.

The justices rejected claims by Circle K that because the case of water that Roxanne Perez tripped over was “open and obvious,” the company cannot be held liable for her injuries.

None of that means Perez ultimately will win her case. The ruling sends the case back to a trial court which had thrown out her lawsuit as lacking legal merit.

But the decision is significant because it spells out a legal standard for the responsibilities of store owners to ensure that those they invite onto their property, like shoppers, are not subject to unreasonable risk of injury. And that places them on notice about what precautions they now have to take to shield themselves from liability.

According to court records, Perez went to a Circle K store in 2020 that she frequently patronized in Phoenix to buy ice cream. After getting the ice cream from the freezer, she turned to enter the next aisle when she tripped and fell over a single case of water on the floor at the end of the aisle.

The company said it had been placed there as an “end cap” display, a common tool of retailers to show off certain items. Perez said she did not see it before tripping.

In 2022, Maricopa County Superior Court Judge Joan Sinclair threw out the lawsuit.

“While the case of water may have created a dangerous condition, it did not create an unreasonably dangerous condition,” the judge wrote.

“The plaintiff could have seen the case of water if she looked down,” said Sinclair. “She is expected to take care of herself and Circle K owned no duty to the plaintiff in this context.”

Chief Justice Ann Scott Timmer, writing for the unanimous Supreme Court, said it’s not that simple.

“Indisputably, Circle K, as a business owner, has an affirmative duty to make and keep its markets reasonably safe for customers, who are invitees,” she said. And in this case, it is clear that Perez was an “invitee.”

“Thus, as a matter of law, Circle K owed a duty of care to Perez,” Timmer said. That means that the trial judge should not have barred Perez from pursuing her claim.

All that sets the stage for what comes next.

Timmer said that whether that end cap — and the fact it was only one crate high — was unreasonably dangerous is something that the trial court will have to consider in deciding whether Circle K had a duty to protect patrons in such circumstances and whether it breached the standard of conduct in complying with that duty.

Similarly, she said, a trial court can address the questions of whether the display was “open and obvious.”

The chief justice said the March 12 ruling does not strip business owners of their ability to have claims against them thrown out before actually having to go to a full-blown trial. Timmer said there are circumstances where there is no real dispute over the facts — the issues that are decided by juries — leaving a trial judge free to conclude that the law does not create a legal liability.

There was no immediate response from the Arizona Retailers Association to the ruling and the implications to its members.

Justices fend off removal, voters keep power over the bench

Voters kept two state Supreme Court justices on the bench and roundly rejected a measure poised to walk back the results of the 2024 retention election and limit when and how often voters can weigh in on whether to fire judges.

Election results painted an existential picture of how the state’s voters sat with and acted on judicial candidates, and how they valued the civic power to keep or kick out judges.

Initial election results showed 79% of voters rejected Proposition 137, a measure poised to nullify results of the 2024 retention election and effectively do away with judicial term limits. 

As for how individual judges fared, Supreme Court Justices Clint Bolick and Kathryn King are likely to stay on the bench, per initial returns, with Bolick seeing support for his retention from 58.42% of voters, and King receiving 59.47%. 

All four Arizona Court of Appeals judges and all 42 Maricopa County Superior Court judges are safe, too, with early results awarding some sizable margins. 

The 2024 retention election served as a turning point for the typically lackluster portion of the ballot. Justices at the top of the ticket prompted high-ticket campaigns both for and against and some zeal on judicial races drifted down to Superior Court judges, too. 

Campaigns for and against retention coalesced around Bolick and King. 

Those seeking to see the two booted from the bench primarily highlighted their vote on the ruling keeping the state’s 1864 abortion ban intact and touched on past rulings striking down school funding initiatives.  

Opposing groups noted Bolick’s past work on litigation for the Goldwater Institute, Institute for Justice and the American Federation for Children and King’s past work as former Gov. Doug Ducey’s deputy general counsel and as a corporate litigator. 

Judicial Independence Defense PAC, a group seeking to keep Bolick and King on the bench, highlighted the threat of Gov. Katie Hobbs appointing two new “liberal” justices to the bench in the event of Bolick and King’s exit and made a general plea for voters to reject the “politicization” of the judiciary. 

Judicial Independence Defense PAC brought in high dollar donations from in-state and out-of-states, including $125,000 from Randy Kendrick, Goldwater Institute board member and wife of Arizona Diamondbacks managing general partner, and $200,000 from billionaire Jeff Yass. 

Protect Abortion Rights No Retention Bolick and King reported a total of $17,477 in income per their pre-general election campaign finance report and no money spent or raised in the post-primary report, but noted they had been working with partner organizations to campaign against the justices. 

Daniel Scarpinato, spokesperson for Judicial Independence Defense PAC, the effort formed to back Bolick and King’s retention, said the results showed “a reputation of these independent justices and all of our judges and a real repudiation of this effort to inject partisan politics into our retention elections and into our judicial branch.” 

Scarpinato said, had the effort to oust Bolick and King been successful, it would have “opened the floodgates on both sides.” 

“Next time around, whoever the new justice is that Governor Hobbs selects would have a target on their back. If there had been success on this front, partisan special interests would have smelled blood in the water,” Scarpinato said. 

As for Court of Appeals and Superior Court judges, another political action committee, Arizonans for an Independent Judiciary, advocated for the retention of all judges on the ballot and made specific defenses of Court of Appeals Judge Angela Paton, Maricopa County Superior Court Judge Chistopher Coury, and Pima County Superior Court Judge Kellie Johnson after Gavel Watch, a voting guide to the retention elections by Civic Engagement Beyond Voting, advocated against their retention. 

Voters retained all four Court of Appeals judges, with Paton seeing a slightly lower margin at 67.48%. 

Early results also showed voters on track to retain all Maricopa County Superior Court judges, too, with comfortable margins. The vast majority of judges courted more than 70% support from voters, with Coury seeing a slightly lower margin at 65%.

In Pima County, judges had similar success, with the vast majority seeing approval above 70%. Johnson, who initially lifted the injunction on the 1864 abortion ban, was still retained, but saw a slightly lower margin of support at 67%. 

In Pinal County, all four judges are on track to stay on the bench. 

Proposition 137

Beyond individual judges, the 2024 judicial retention elections, and all retention elections thereafter, will stay intact given the sweeping failure of a measure poised to void retention results rendered this cycle and limit when judges are made to stand for retention.

Proposition 137, as referred by the Legislature, would have nullified the results of the 2024 retention election and effectively done away with judicial term limits.

Under the measure, judges are only made to sit for a retention election given a negative finding from the Commission on Judicial Performance Review, or if the judge is facing a conviction of a felony offense, any crime involving fraud or dishonesty, or personal bankruptcy or foreclosure. 

The measure also input legislative say into the Judicial Performance Review Commission by way of an appointee. 

Proponents of the measure made the case by noting the typically lengthy judicial retention ballot means a low-information election and further expressed a fear of a politicized judiciary, given ramped-up efforts to keep or oust judges. 

Proposition 137 did not draw any dedicated for or against campaigns but was instead woven into messaging, primarily from Democrats. Those against the measure highlighted the need to keep voter input on judicial retention elections and to ensure the results of the 2024 election stand, while a Republican judicial PAC opted not to take a position. 

Scarpinato noted too, though the Judicial Independence Defense PAC did not engage in Prop. 137, that the measure reflected the public’s appreciation of the current system in place. 

Cathy Sigmon, co-founder of Civic Engagement Beyond Voting and founder of Gavel Watch, the state’s first voting guide on judicial retention elections, said the “resounding” rejection of Prop. 137 served as a “big bright spot in the results.” 

She said, “The people in Arizona don’t like to have their powers curtailed or taken away.” 

Gavel Watch advocated against the retention of Bolick and King, as well as some Superior Court judges down ballot. 

Though all judges are likely to be retained, Sigmon said margins for the two justices – 58.42% for Bolick and 59.47% for King – were lower than a typical retention election and gave some an indication of higher voter attention. 

In 2022, Gavel Watch advocated for the removal of Justice William Montgomery. 

He was ultimately retained by 55.53% of voters, but his margins stood lower than two justices on the same ballot – Justice Ann Timmer, who courted 71.09% support from voters, and Justice James Beene, who secured 70.53%. 

Sigmon said Gavel Watch would continue gathering information for the next round of retention elections and dissecting the 2024 results in the meantime. 

She noted, too, in assessing the passage of the abortion measure but the failure to boot Bolick and King, of a continued goal to draw lines between candidates and key issues.

“It’s extremely common that people don’t quite see the connection between people making those decisions and the policies they care about. So that, to me, just makes it all the more important to continue doing what we’re doing throughout Arizona,” Sigmon said. “We try to focus less on the actual candidates and more on the issues, and draw that association.” 

Sigmon said certain voters do in fact care about judicial retention, contrary to claims of ballot fatigue and disinterest in judges. 

“That has been very decisively debunked,” Sigmon said. “People do care about the judiciary, and they very much see that it’s a third branch of government that they should have public oversight of.”

LD15 GOP candidate fighting residency challenge

Editor’s note: This article has been corrected to indicate Rep. Michael Way referred to the complaint filed against him as being driven by members of the North Carolina  Legislature rather than the Arizona Freedom Caucus. Way clarified he didn’t think anyone from Arizona’s Freedom Caucus was involved in filing the residency challenge against him.

A Republican legislative candidate accused of not being eligible to hold public office due to state residency requirements said the complaint filed against him is “politically motivated.”

Attorneys presented evidence in a Maricopa County Superior Court hearing Sept. 3 alleging Michael Way of Queen Creek isn’t eligible to be a member of the Legislature because he hasn’t lived in the state for three uninterrupted years prior to the election in accordance with state law. Way recently won his primary race to be a nominee for the state House of Representatives in the Republican stronghold of Legislative District 15. 

Way testified to the court that he believes the complaint against him was driven by members of North Carolina’s state legislature after he was asked about a news release from North Carolina Republican state Rep. Keith Kidwell’s office calling for an investigation of Way’s voting history. Kidwell leads the ultraconservative Freedom Caucus in the North Carolina House of Representatives.

Michael Way, a Republican candidate for LD15. Residency.
Michael Way, a Republican candidate for LD15.

“It is my position that he was tipped off and asked to put this on his letterhead and put out on social media after the story broke,” Way said. “He is a member of the Freedom Caucus … I believe this is all politically motivated.”

LD15 Republican precinct committeewoman Deborah Kirkland filed the complaint against Way days after The Arizona Republic published a story that questioned if Way is eligible to hold public office because of voter records showing he voted in North Carolina’s 2022 general election. 

Kidwell said in his news release that he wants Way to be investigated for “possible voter fraud.”

“I am deeply concerned by reports that Michael A. Way voted in North Carolina during a period for which he attested that he was in fact living in Arizona,” Kidwell said. 

Freedom Caucus members aren’t the only ones who have weighed in on the issue. Rep. David Cook, R-Globe, sent a letter to Attorney General Kris Mayes on Sept. 3 calling for her office to investigate the allegations against Way, according to a Washington Post report. Several Freedom Caucus members have criticized Cook during his time at the Legislature.

Cook wrote: “A number of politicians beat the drums regarding election integrity frequently. This seems to be the poster child for laws ensuring election integrity – we cannot have individuals simply picking and choosing which state they want to vote in depending on the election.”

Kirkland testified that she supported Way’s opponent Peter Anello in the primary election. Anello was endorsed by Rep. Jacqueline Parker, R-Mesa. Parker represents the district and is a member of the Arizona Freedom Caucus but she isn’t seeking re-election. 

Anello also ran on the same slate as Rep. Neal Carter, R-San Tan Valley, and Arizona Freedom Caucus Chairman Sen. Jake Hoffman, R-Queen Creek. 

Kirkland said she initially planned to support Way after the primary election because he’s a Republican but changed her mind after she became aware of The Arizona Republic article. 

“I feel that Mr. Way lied to me,” Kirkland said. “How can it not be a little personal.”

Kirkland also said she didn’t support Way during the primary election because she felt that he wasn’t active enough within the LD15 GOP precinct committee. 

Way said he voted in North Carolina in a 2021 municipal election and in the state’s 2022 general election. He also testified that he and his family lived in multiple properties in North Carolina but said he was stationed there for a temporary work assignment for his company Charter One while visiting Arizona almost every month to see family, report on his business dealings, and attend church events. 

“I would give him a big hug and I would say ‘welcome home,’” Charter One Managing Partner William Guttery said of how he greeted Way every time he saw Way when he returned from North Carolina.

Way said he’s considered Arizona his home since 2009 when his family moved to the state. He’s been out of the state for extended periods including a church mission to Brazil for two years, law school at the University of Wyoming, and the North Carolina work assignment. Way said he often frequented Arizona during each absence and left most of his personal belongings with family each time. 

Way’s attorney, Andrew Gould, said there is no law preventing a person from being registered to vote in two states and there is no duty on a voter to cancel their voter registration.

It is a felony to vote in the same election in multiple states. Way said he didn’t vote in Arizona during the North Carolina elections that he participated in. He said he voted in those North Carolina elections because he believed it was his civic duty and it was in the best interest of his company.

Kirkland’s attorney Tim La Sota said Way’s North Carolina voter registration is an admission of residency in the state. 

“We’ve got nothing but self-serving testimony in Mr. Way’s defense,” La Sota said. “One should not be able to avail oneself the right to vote in one state and then say oh you know what – I didn’t really mean that. I should still be able to register to vote in another state when they have the residency requirement that overlapped.”

La Sota also questioned Way about an opinion article he wrote that was published by The Carolina Journal in January 2023 that describes Way having “deep roots and an appreciation” for his family’s home in the greater Raleigh area. 

Way said he didn’t write the editor’s description La Sota referenced and it was likely done by a person on Charter One’s marketing team that didn’t run it by him before the article was published. 

Maricopa County Superior Court Judge Rodrick Coffey, an appointee of former Gov. Jan Brewer, said he will try to rule on the case no later than Sept, 9. Coffey also took a motion to dismiss the case by Gould under advisement but proceeded with the evidentiary hearing due to the expedited pace the case needs to proceed.

Group folds effort to raise minimum wage

Arizonans won’t get a chance to vote in November to raise the state minimum wage.

One Fair Wage, the sponsoring group of what would have been Proposition 212, said Thursday it is withdrawing the signatures submitted in July to put the measure on the ballot. Instead, it will most immediately focus on electing sympathetic candidates to the Legislature.

The longer-term goal, however, is to approach the issue not on a statewide basis but instead by trying to get individual counties, cities and towns to adopt their own minimum wage at a level that is higher than what is now required by state law.

The decision, though, was not entirely voluntary.

Raise the Wage Arizona, the local operation of One Fair Wage, submitted 354,278 signatures.

But the Arizona Restaurant Association, in a lawsuit filed in Maricopa County Superior Court, contends there are a series of problems.

For example, state law requires that anyone who is a paid circulator or from out of state must first register with the Secretary of State’s Office. Attorney Kory Langhofer told Judge Scott Blaney many of those who collected signatures did not comply.

Langhofer also contends there are other violations of state laws regulating petition circulators. And if circulators were acting illegally, all the signatures they collected cannot be counted.

All total, he said that once those invalid signatures are eliminated, the petition drive no longer has the legally required 255,949 names.

A hearing had been set for next week. Now, with the withdrawal, that is no longer necessary.

Saru Jayaraman, president of One Fair Wage, said it is possible the measure still could have survived the legal challenge. But she admitted that was not a sure thing.

“We didn’t want to just keep spending money on that when the chances were getting harder and harder, given the process,” Jayaraman said. “That’s why we decided to pivot to legislation and local initiatives.”

More immediately, what she also wants to do is focus on killing Proposition 138.

That measure, put on the ballot by the Republican-controlled Legislature at the behest of the Arizona Restaurant Association, would allow its members to pay its tipped workers 25% less than the minimum wage as long as what they make, with tips, is at least $2 an hour above the minimum wage. The current tip credit is $3 an hour.

There is no question but that change would financially benefit the restaurants.

In the case of the current $14.35 minimum, the tip credit can reduce the restaurant’s cost to $11.35 an hour. But bumping that up to 25% would drop that to $10.76.

But the focus, beyond defeating Proposition 138, is trying to do on a community-by-community basis what Proposition 212 would have done statewide: Hike the minimum wage.

That local option is allowed under versions of changes to the state minimum wage laws previously approved by voters.

Voters in Tucson and Flagstaff already have enacted their own minimum wage ordinances. Jayaraman says she believes residents of other communities would be amenable to the idea.

Arizona had no minimum wage before 2006, with employers required to pay only what the federal government required – $5.15 an hour at that time.

That year, over the objections of restaurants and some other businesses, voters approved creation of the state’s first minimum by a margin of 2-1. That hiked it immediately to $6.75 with a mandate to make annual changes to account for inflation, adjustments that brought it to $8.05 an hour in 2016.

A new successful initiative at that time, approved by 58% of those who voted, brought it immediately to $10 in 2017 and automatically to $12 by 2020. Subsequent inflation adjustments now have it at $14.35.

By contrast, the federal minimum remains at $7.25.

Proposition 212 would have added a dollar an hour to the state minimum this coming January, with another dollar at the beginning of 2026, all on top of the regularly scheduled inflation hikes.

But what particularly alarmed the Restaurant Association was that the initiative would have phased out the tip credit. That would have forced employers to pay at least the minimum wage, regardless of how much the workers made in tips.

Now Prop 212 and that risk are gone. But Steve Chucri, president of the Arizona Restaurant Association, said the effort to get voters to approve Prop 138 and its 25% tip credit will continue.

He said that a larger tip credit does not mean workers would take home less. Chucri pointed out that restaurants could claim the credit and reduce their own costs only if an employee actually made $2 an hour over the minimum when tips were included.

“This isn’t saving big corporate giants like they’re suggesting,” he said. “This is the mom-and-pops who need this tip credit to keep people employed and to keep their restaurants operating.”

And while the restaurants lost the minimum wage ballot battles in 2006 and 2016, Chucri said he believes the results will be different this time and voters will approve the increased tip credit in Prop 138.

“What we are seeing and what people and our guests are understanding is that it’s getting more and more expensive to dine out,” he said.

But State Rep. Mariana Sandoval, who has been working with One Fair Wage, said in a written statement there is no reason to have a tip credit at all.

“We should not feel obligated or the social pressure to tip because we know folks are not making a living wage,” said the Goodyear Democrats. “And we should definitely not be subsidizing anyone’s payroll.”

Chucri also argued that efforts to increase wages at the ballot and get rid of the tip credit are being pushed by “outside interests” and not restaurant employees who he said “get paid very well.”

“And if they didn’t, they wouldn’t be staying at these restaurants for decades,” he said.

And what of the $14.35 minimum wage that can be paid to workers who don’t get tips?

Chucri said that, at least in the fast-food industry, that is a starting wage. And he said that most have to pay more just to get and keep workers.

“They’re letting the market dictate that,” Chucri said.

The future of Proposition 138 aside, that still leaves One Fair Wage with the local option.

On one level, the same hurdle remains: Putting a measure on a ballot requires valid signatures which generally need to equal 15% of those who voted in the last local election. But  Jayaraman said that focusing the resources on just a few communities at the time versus a statewide contest could prove more effective, saying it could take as few as 1,000 signatures in some cities to qualify for the ballot.

That local option is already playing out in Glendale where a group known as Worker Power has submitted enough signatures to raise the minimum wage for hotel and event center workers to $20 an hour. The same measure has other provisions, including how many rooms attendants can clean in an eight-hour workday before their pay is doubled.

 

 

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