PHOENIX — The state’s education sales tax, which supports teacher salaries, will be extended to 2041.
With more than enough votes, the state House and Senate agreed Thursday to extend for 20 years the 0.6-cent sales tax approved by voters in 2000. Without that action, the levy would self-destruct on June 30, 2021, taking with it the more than $670 million a year it now raises.
An aide to Republican Gov. Doug Ducey said Ducey will sign the extension into law.
Thursday’s action did not come without opposition: Six representatives and four senators, all Republicans, declined to go along.
Rep. Eddie Farnsworth, R-Gilbert, said he opposes how the proceeds are divided, pointing out that just $384 million of what’s collected is specifically earmarked for teacher salaries. He said if teacher pay is the top priority, it’s time to revisit who else gets a claim on the money.
That list includes $72 million for universities and $18 million for community colleges.
It also sets aside $25 million for low-income taxpayers, defined as individuals earning $12,500 or less or $25,000 for couples. They can get back up to $100 per household to compensate for the fact that those at the bottom of the income scale tend to spend a higher percentage of their income on sales taxes than those at the top.
Rep. Doug Coleman, R-Apache Junction, said he agrees the formula should be revisited. But Coleman, who helped craft the measure approved Thursday, said simply extending the levy without major tinkering was the only way to get the votes to continue the tax and assure that schools won’t lose hundreds of millions of dollars in 2021.
Coleman said there’s time to consider changes in the distribution formula before the extended levy kicks in.
That possibility worries supporters of the measure.
Dana Naimark, president of the Children’s Action Alliance, said a constitutional provision protecting voter-approved measures has prevented lawmakers from altering the current formula approved in 2000 for dividing up the $667 million now being collected each year.
This extension, however, lacks such constitutional protections because it was approved by lawmakers.
Naimark cited statements by Senate President Steve Yarbrough, R-Chandler, that one of the benefits of having the extension enacted by lawmakers is that they now can “tinker” with the formula as needed. She said that could allow lawmakers to siphon off dollars for things like vouchers to help parents send children to private and parochial schools.
“We think it’s important that parents and teachers and students understand how vulnerable this is,” Naimark said. She said her organization and other school advocates support the legislatively approved extension but “are counting on our elected leaders to protect this going forward.”
Yarbrough acknowledged he wants lawmakers to revisit the formula before the extended levy kicks in in 2021. But he said that’s simply because, as Farnsworth said, there may be some need to tweak the original 2000 plan.
He said some of the “pots” of money — individual allocations within the law — “were created to get votes,” citing $8 million earmarked for school safety and “character education.”
“That may very well be better served over in a ‘pot’ that could increase teacher salaries,” Yarbrough said.
And Sen. Sylvia Allen, R-Snowflake, said lawmakers should decide if more of the $667 million now being collected should go directly to teacher salaries.
Naimark, however, wants assurances that future changes won’t divert dollars. “We’re really looking for a commitment from the governor … that if he is reelected and he is the governor going forward, he will reject any changes that divert money away from public schools, any changes that divert money away from teacher pay, any changes that reduce this dedicated funding,” she said.
There was no immediate comment from Ducey.
The bill approved Thursday already makes one change in the formula. It puts $64 million more into teacher salaries, as that amount will no longer be needed for debt service on new school buildings.
But Rep. Reginald Bolding, D-Laveen, said that change translates into just an $18-a-week pay hike — and not until 2021. It isn’t enough, he said, in a state that is at or near the bottom nationally in teacher pay.
Other Democrats also complained more is needed, though all agreed to go along with the extension.
The extension had to be a show of bipartisan support because it needed a two-thirds vote of both the House and Senate for approval.
While it simply keeps the current 0.6-cent levy in place, it technically is a new tax because the old one is expiring. And the Arizona Constitution requires a supermajority for any tax increase.
Rep. Noel Campbell, R-Prescott, there is an option for those who, like him, believe additional revenues are necessary: Take the case directly to voters and ask them to expand the tax beyond the current 0.6-cent levy.