Key legislative leaders want to ask Arizonans to repeal a constitutional amendment that bars legislators from trimming voter-approved programs.
And they want to take the issue to the ballot in a special election as early as March.
Russell Pearce, incoming chairman of the Senate Appropriations Committee, said it will be virtually impossible to balance next year’s budget if almost half of the state’s spending is constitutionally off limits.
The Mesa Republican said lawmakers need the flexibility to make adjustments.
Rep. John Kavanagh, R-Fountain Hills, who will be Pearce’s counterpart in the House, said putting the entire budget in play “would allow us to do (overall) cuts with more mercy.”
But Kavanagh questions whether voters, having tied the hands of lawmakers in a 1998 ballot proposal, will be willing to remove the fiscal handcuffs. “They seem to have a lingering mistrust of the Legislature,” he said.
The latest revenue forecasts show the deficit for the current fiscal year is now in the neighborhood of $1.5 billion. Richard Stavneak, director of the Joint Legislative Budget Committee, said as much as $4.9 billion of the $9.9 billion spending plan may be legally untouchable.
Any vote this spring probably will come too late to fix this year’s gap. But Pearce and Kavanagh say it could help deal with next year’s deficit, which is approaching $3 billion.
The 1998 law bars lawmakers from repealing or altering any voter-approved initiative or referendum.
That includes a 2000 measure that hiked the state sales tax to provide more money for education.
That same measure also requires legislators to increase base school funding annually by the amount of inflation. This year that added $108 million to the budget.
Another 2000 ballot measure requires the Arizona Health Care Cost Containment System, the state’s Medicaid program, to provide free health care for anyone below the federal poverty level, a figure that now equals $21,200 for a family of four.
The move to let lawmakers trim those voter-mandated expenses will get a fight from groups that pushed those two 2000 initiatives.
“The voters have spoken,” said John Wright, president of the Arizona Education Association, of any plan to alleviate the Legislature of its obligation to annually increase state aid to schools. “They’ve said, 'Here’s where we need to spend money.’”
And Wright called education “a responsibility of the state, an investment to the future and an obligation that the Legislature needs to meet.” Wright said it’s up to lawmakers to determine how to meet the state’s “other responsibilities” without tinkering with education funding.
But Pearce said voters should be allowed to reconsider limiting the power of lawmakers to alter voter-approved measures given the state’s current fiscal crisis.
“I don’t think they expected to raise taxes or to grow government … when we can’t even pay our bills,” he said.
Pearce also said voters have been “fooled a little bit” into believing the additional spending mandates would pay for themselves.
That was the argument behind expansion of AHCCCS. The additional funding was supposed to come from the state’s share of a nationwide settlement of lawsuits against tobacco companies.
This year, however, the state will get about $114 million in tobacco settlement funds; the cost of the expanded program is $519 million.
Pearce said one option short of throwing people off AHCCCS would be to require a “reasonable contribution” from some who now get care for free, possibly a co-pay, where enrollees have to pay perhaps $10 for each office visit.
But Eve Shapiro, a Tucson pediatrician who chairs the Healthy Arizona coalition, which pushed expansion of AHCCCS, said that move actually could cost Arizona more in the long run.
She said studies have shown that when even a modest fee for care is imposed, people of limited means delay seeking health care. That, in turns, allows minor problems that might be caught through things like routine doctor visits and screenings to turn into major — and more expensive — problems.
And Shapiro said making care more expensive for the working poor makes no sense. “It would be stupid to force the state to balance the budget on the backs of the people that you want to be more productive,” she said.
Shapiro said she is hoping the Obama administration increases the federal match for state Medicaid programs, at least temporarily, to help Arizona and other states that find more people seeking care as the unemployment rate rises.