Arizona’s finances aren’t immaculate, but state Treasurer Doug Ducey told the audience at the Chandler Chamber of Commerce Economic Update Forum the state has improved to the point that it should be a standard bearer for many other state governments.
Ducey, who was the keynote speaker at the forum held at Ocotillo Golf Resort on June 26, said Arizona has made significant progress in its finances to the point where the state has $3 billion in cash in its operating account: As of December 2009, Ducey said the state was $733 million in the red.
“We were insolvent as an enterprise,” he said. He credited a “fiscally conservative” state legislature and Gov. Jan Brewer for tightening the state’s proverbial belt and finding ways to operate with less money.
Ducey explained that Arizona has become more attractive to companies; the state is primed to “take advantage” of regulation changes in states like California and Illinois and land more corporate headquarters, he said.
He added many states like California, could take a lesson from what Arizona has done over the last four years.
Ducey also discussed the circumstances surrounding Arizona’s pension fund. While Arizona's unfunded pension liability did increase significantly in the wrong direction over the last 10 years -- from virtually nothing to $14 billion, according to information provided by the treasurer's office following the Chandler event – the state has become more attractive to high-quality police officers, firefighters, teachers and other public employees who might want to move to Arizona from states in far worse situations.
“We just want to make sure we manage their retirement funds so they’re there,” Ducey said of his commitment moving forward.
Other issues Ducey discussed during his speech and ensuing question and answer session were two propositions voted on during the 2012 election. The first, Proposition 204, would have made the previously-passed 1-cent sales tax permanent if voters approved it; the measure fell with almost 64-percent of voters rejecting it.
Ducey, who was one of the leading advocates against it, said voters made the right decision in rejecting it because it could’ve negatively affected businesses and wasn’t necessary at that point.
“Let’s use the dollars we already have instead of raising taxes on hard-working Arizonans,” he said.
The second was the voter-approved Proposition 118, which altered the way the state shifts money from its permanent fund to schools and universities starting in 2013 and ending in 2021. Essentially, Ducey said the bill, “took out 250 complicated words in the state constitution” and replaced them with “30 easy words” that will help schools across the state.
“If there are 10 things needed to fix education in Arizona, Prop 118 is one of them,” he said.
Although Ducey said the finances are better, he said the $8 billion debt the state owes — well above the $350,000 he said the state constitution allows — is a problem the state needs to keep working to reduce.
The forum’s other speaker was Chandler economic development director Christine Mackay, who said the city has added more than 4,800 jobs to its boundaries during the 2012-13 fiscal year, which ends in July, and expects thousands more during the next fiscal year.
While one of the city’s goals is to add more jobs from large-scale companies, Mackay said Chandler wants to make gains with neophyte technology companies like the 24 incubators already in place to make the city’s future even more promising.
“These young entrepreneurial companies are the next industry giants you want to keep in your community,” she said.
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