PHOENIX — Unable to defeat it at the ballot, business interests filed suit today to void the voter-approved hike in the state minimum wage.
The lawsuit filed in Maricopa County Superior Court contends Proposition 206 violates a constitutional provision which requires all measures that increase state funding to also have a specific dedicated funding source. The initiative does not spell out where the state will come up with the additional dollars it will need to cover the higher costs incurred by those who have contracts with the state to provide various services like health care.
James Barton, attorney for Proposition 206 supporters, said there is no basis for the claim. He said nothing in the ballot measure actually requires the state to increase its reimbursement rate to providers.
But attorney Brett Johnson, hired by the Arizona Chamber of Commerce and Industry, pointed out that the Arizona Health Care Cost Containment System already has posted a notice that it intends to increase what it pays to providers to compensate for the fact the minimum wage will go from $8.05 an hour now to $10.
More to the point, Johnson said those additional dollars will come out of general tax dollars, leaving less money for other priorities.
And he said that’s exactly what the constitutional provision about an identified funding source is designed to prevent.