April 18, 2018

Howdy, Friends O’Farley…

So much for that idea that the state budget and adjournment Sine Die was close. The Capitol has been thrown into disarray this week and no one is talking about a quick end anymore.

Why? With a clear demonstration across the state of strong support for educators and schools on the part of the public last Wednesday and the threat of a possible teacher walkout looming, Governor Ducey was forced to perform a complete reversal of his rhetoric on public school funding on Thursday. This is good.

The plan itself is simply a series of goals without identified funding sources outside of leaked documents and rumors. It has to gel into something that can be approved by a majority of legislators and can satisfy educators and the public. That budget glide path is now a rocky road, and no one seems to have an accurate map of where we go from here. This is bad.

I plan to sketch the current version of that map — what we currently know and don’t know of the proposed “plan” — and a hopeful vision on where we should go, in this Farley Report.

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But first, the Pledge Break.

 

—> According to our polling, we are now in a statistical tie to beat Doug Ducey in November. This is the election towards which we have been working.

1) But we can’t win without your help. Please contribute what you can. Don’t let Doug Ducey and his dark-money backers buy Arizona. Including our first-quarter results we have now raised more than $900,000, more than any other statewide candidate of either party for any office, except Ducey, but we will need much more to spread our positive message to voters.

2) Please sign my nominating petition to help me qualify for the ballot in November 2018.  Please tell your friends and ask them to sign my petition. The first step to bringing change to Arizona is to put me on the ballot!

3) Tell ten friends there is hope for Arizona — there’s a leader named Steve Farley who can govern from Day One and knows how to win. And ask them to tell ten friends. This is our best chance in years to create positive change in Arizona, but we all need to pitch in.

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—> You may want to review last week’s Farley Report to see where we all were last Wednesday morning. Governor Ducey was refusing to meet with teachers, calling them “political circus” performers. He announced that he would only meet with “decision makers” and that he was pushing for no more than a 1% raise. 

Throughout last Wednesday thousands of educators, parents, and allies from across the political spectrum took part in statewide demonstrations supporting significant reinvestment in education, including 20% raises for educators. Even former Governor Jan Brewer appeared on KTAR in Phoenix lecturing Ducey to stop fighting and fund our schools.

Thursday afternoon everything changed. In a whiplash-inducing reversal of messaging, Governor Ducey convened a press conference to announce his plan to push for a 20% teacher raise by 2020.

I’m glad he’s had an epiphany that all those public education cuts he has enacted were wrong for Arizona. I’m glad that he has finally publicly changed his goals. People can change. Especially when a re-election is threatened by a united front of thousands of Arizona educators.

This would be a major change for Doug Ducey. 

You’ll recall that he first raised his Arizona profile as the leader of efforts to cut a billion dollars a year from public education when he fought Prop 204. Then he slashed $116 million from additional assistance funds for textbooks, computers, and teacher salaries at the same time that he gutted JTED career and technical education programs in his first budget. Then he signed the universal private school voucher bill threatening the very future of public education — luckily Save Our Schools Arizona’s intrepid volunteers referred that bill to the ballot and we can vote No on 305 this November.

This is not a man with a track record of supporting public education. So we must be wary.

People can change. But I walk into any future negotiations with both eyes wide open to see if there is a deal to be made, or not. Here’s what I wrote in my press release last Thursday on what little we knew of the plan at that time:

“I am glad to see Governor Ducey has walked back his insulting comments that the brave activism of thousands of Arizonans yesterday was simply ‘political theater’ and has finally released a proposal that is a first step to increase teacher pay,” said State Senator Steve Farley.

“I’ve been fighting for the rights of Arizona educators over my entire career as a legislator. I look forward to now using the Governor’s proposal as a starting point to begin the sorely needed bipartisan work at the state Capitol to solve this issue once and for all.”

“The #RedforEd movement has proven that a couple of billionaire brothers from Kansas are no match against some good old-fashioned organizing and the will of the people. Thank you to all the educators, parents, students, and allies who participated for your fearless leadership.  You truly are an inspiration and I will carry the torch for you as we continue the debate in Phoenix over the coming days.

“But let’s be clear, while it looks like we may have turned the battle in our favor, the fight is never over.  This plan has a long way to go, and many elements can change.

“I implore members of the #RedforEd movement to keep the Legislature’s and the Governor’s feet to the fire, stay active in your communities and remember to bring your power to the ballot box in November.  Our democracy depends upon it.”

So what is this plan? The only public words from the Governor’s office are two goals, not a sustainably funded package:

1) 20% teacher raises by 2020, with a 9% raise in the next fiscal year starting July 1, and an additional 5% raise in each of the following two years. He does not talk about raises for counselors, librarians, front office staff, bus drivers, and other vital educators.

2) Restoring the annual funding level for Additional Assistance funds to $371 million — phased in over the next five years — with $100 million for the year starting July 1. These funds can be used flexibly by districts to pay for textbooks, computers, and other needs that have been neglected for years. This is falsely billed by the Governor as a “full restoration of recession-era cuts” although it is purely prospective and does not restore the more than $1 billion already cut from public schools since 2009.

You’ll note that conspicuously absent are funds to restore our now-suspended Building Renewal Formula, the money we need to spend each year to hire local tradespeople to keep our schools safe and in good working order throughout the state. The formula says we should be investing around $300 million a year; instead we have been investing only around 10% of that for the last ten years. This lack of funding endangers the safety of our children and educators and takes money out of our local economies.

And what does the Governor say about funding?

“The state’s revenues are on the rise and have been higher than originally projected, combined with a reduction in state government operating budgets through strategic efficiencies, caseload savings, and a rollback of governor’s office proposals included in the FY2019 Executive Budget, more dollars are available to invest in two of Arizona’s most important priorities: Arizona teachers and Arizona classrooms.”

Based on a leaked budget briefing paper on the plan from the Joint Legislative Budget Committee (JLBC) let’s try to flesh out that vague and brief statement.

Yes, the state’s revenues have been “higher than originally projected”. New money available in FY19 amounts to $296 million. That’s good. But some of it we can consider ongoing, some of it only one-time. JLBC estimates only around $156 million of that is ongoing. If we fund education spending with one-time money, then we face pressure to cut it again next year when that one-time money goes away. In order to sustain our education funding in a responsible way, we need to assure that there is a dependable source of ongoing revenues to support it into the future.

Which brings us to the other items mentioned in the Governor’s statement and detailed in the options from the JLBC document. Those “strategic efficiencies” include items like a $35 million increase in hospital assessments that are supposed to be used to draw down federal Medicaid funds to provide healthcare for those in poverty, an overly optimistic guess that fewer people will use Medicaid services, and an overly optimistic guess that fewer children will go to Arizona public schools in upcoming years. These could be seen as accounting gimmicks that may not actually provide real savings that can be spent sustainably into the future.

Perhaps most disturbing to me is the disconnect between the Governor’s own words and his actions on teacher raises. In the Governor’s document, he says that this year’s 9% teacher raise is “permanent, ongoing, and in the base (not a bonus)”. “In the base” means the funding becomes part of the ongoing education funding formula and future raises will be based on the past raises. The money cannot be taken away. This is good.

But his assertion is not backed up by the details in the JLBC document which states that the raises are only partially in the base. Specifically, in FY19 a 7% raise is in the base. But the other 2% is not in the base — it is one-time money and will be at risk unless it is put in the base. This is bad.

I completely share the goal of a 20% raise for all educators (not just classroom teachers), and called for it last year. I share the goal of restoring recession-era cuts. The Governor’s statements are a first step in the right direction. But we need to sit down, with educators at the table, and negotiate a deal that truly accomplishes those goals rather than simply gestures at them. 

The funding needs to be fiscally conservative, sustainable and permanent so we don’t have to keep fighting these battles. We can’t let this year’s possible successes be undercut by future failures.  

There are new and sustainable funding sources that we can put on the table. Even some influential legislative Republicans have voiced support for full IRS conformity, which I urged in a floor speech on April 3. In brief that could bring in new, sustainable revenues of more than $200 million annually by applying the new federal tax changes to state law. The folks who would pay a little more in Arizona taxes are the same higher-earners who would get massive breaks on the federal side and would still come out far ahead personally while getting us the revenues we need to invest in our schools.

And as Farley Report readers know well, we do have more than $13.7 billion annually that we give away in sales tax loopholes. Closing just $3 billion of those would enable us to lower our overall sales tax by a full percent while increasing revenues for our schools and other important needs by $2 billion a year so that we can restore our Building Renewal Formula as well.

Thanks to the activism of our educators and their allies, we now have a tremendous opportunity this session. There are many good options we can use to get a win, and get it now. 

We have the resources to get our teachers and our schools what they need to succeed for our children and our economy. The governor took a first step by embracing goals he recently rejected, and that makes me hopeful. Now we need to work together, with all of us at the table, to turn good goals into a sustainable reality so we can move our state forward.

In 2013, we legislative Democrats worked with Governor Jan Brewer and a few Republicans to expand Medicaid healthcare to 400,000 people in poverty while keeping our hospitals from going under. We can work together again. This would be a great time to do it.

—> The Farley campaign had another busy week bringing our good news of positive change to Arizonans everywhere.

We’ll never stop traveling all over our amazing state. This week we spoke with great gatherings of motivated Arizonans from Paradise Valley to Oro Valley to Tucson, on the the border with the Cochise County Democrats in the beautiful Gadsden Hotel in Douglas, and standing in solidarity with teachers, parents, and allies at last Wednesday’s walk-in in the morning at Encanto School in the Osborn district in Phoenix and in the evening at the Kyrene District headquarters in Tempe. Outside of campaigning, one of the week’s highlights was conducting a mock committee hearing in the Senate with more than a hundred fifth graders and their dedicated teachers from Garden Lakes Elementary School in Avondale in the Pendergast District.

Wherever you live, you, too, can join our campaign so we can finally get the leadership we deserve right here in the state we love.

Thanks for your continuing faith in me as your Senator.

Steve

Steve Farley

Senator, District 9, Tucson

If you like my representation and want to keep me in office, CONTRIBUTE TODAY!

Paid for by Farley for Governor

April 18, 2018