A bill which would allow restaurants whose liquor licenses prohibit off-premises or to-go sales of booze to lease a portion of another type of liquor license that allows for such sales was sent Monday to Gov. Doug Ducey.
HB2773 allows a bar, wine bar, or liquor store to lease its off-sale privileges of non-mixed cocktails for one-year periods to a restaurant which under current law is prohibited from engaging in such to-go sales. The lessee and lessor must be located in the same county, and the lessor’s liquor license must be held in non-use status.
Under the legislation, the Arizona Department of Liquor License and Control (DLLC) will be required to establish an off-sale privileges lease amount for urban and rural counties “that fairly recognizes and is derived from the commercial value of selling spirituous liquor for off-premises consumption.” However, the lessee and lessor can agree to a lease amount different from the DLLC amount.
Other provisions of HB2773 allow a bar or liquor store to begin selling mixed cocktails with a tamper proof seal for off-premises consumption as of Oct. 1. And restaurants can apply to lease those mixed cocktails to-go privileges from a bar or liquor store for one-year periods through Dec. 31, 2025 before applying for a newly created to-go mixed cocktails permit beginning Jan. 1, 2026. The value of a to-go cocktail lease will be established by the DLLC.
If the lease plan is signed by Ducey, the legislation calls for all lease payments to be paid in full in advance, and all existing applicable laws and regulations concerning containers, quantities, and training will apply. Any violations or liability connected to liquor service under a leased privilege or permit would be attributed only the leasing restaurant licensee, according to the bill.
Most restaurants operate with a Series 6 or 7 liquor licenses which cost a few hundred dollars, while bars typically have a Series 12 license which allows for more options such as selling liquor to-go. Series 12 licenses are limited in number and can cost tens of thousands of dollars.
Finding a way for restaurants to conduct off-premises sales of spiritous liquor has been a priority for the Arizona Restaurant Association since November when a state judge ordered the immediate end to one of Ducey’s COVID-19 executive orders which allowed restaurants to violate state law by selling alcohol on a to-go basis even though their liquor license prohibited such sales.
The executive order issued in June 2020 also forbid law enforcement agencies or DLLC from taking any action to enforce the state law. At the same time, many bars, saloons, and wine bars were forced shut due to other Ducey executive orders or public health regulations.
The executive order was challenged in court by attorney Ilan Wurman on behalf of dozens of Series 6 and 7 licensees. Judge Pamela Gates of the Maricopa County Superior Court shot down the governor’s order, ruling that Ducey was not allowed to suspend Arizona’s liquor laws even during a state of emergency.
Gates’ order forced restaurants to stop to-go sales of liquor at the end of 2020, but Dan Bogert of the Arizona Restaurant Association suggested at the time that a change in state law was needed.
“I think that you don’t need to look any further for evidence of that to how popular this is with the consumer base,” Bogert said. “Furthermore, we’re going to be looking at bringing some legislation forward in the next legislative session to address this permanently.”
HB2773 outlines restrictions on the percent of on-site and off-premises liquor sales a restaurant can have. The bill also authorizes a bar, beer, and wine bar or restaurant with a lease to maintain a delivery service. And it includes language retroactive to July 1, 2020 to exempt the manufacture or sale of certain bitters products from regulation under Arizona’s alcohol beverage laws.
Virtually since it was first announced, the effort by the Arizona State Senate to audit the results of the November general election in Arizona’s largest County has been mocked or vilified by members of the media and assorted partisan figures. There is little doubt that their initial attacks were designed to thwart an audit, and there is little doubt that most of the effort since then has been to discredit the process and its participants to the maximum degree possible. When I talk to political people, there is a consensus that this has been a deliberate sabotage in an effort to discredit any potential findings before they are disclosed. “Convince the voters in advance that the whole thing is a joke, and they won’t believe it if something real is turned up by the audit.” said one to me recently.
The entire state would be well served if everyone would take a deep breath, refrain from turning the effort into a partisan circus, and waited for any findings and supporting evidence.
In the meantime, let’s give credit where credit is due, to Senate President Karen Fann and State Senator Warren Petersen, both of whom continue to make themselves available to a media that is looking to undercut them, while providing reasoned answers in measured tones.
As someone who has dealt with a hostile media, I know how difficult it is to not get sucked into the insults and childish behavior. But that is often a tactic used by reporters who know that their own behavior will not be a part of the story, only the responses to their behavior. So they goad and wait, and too many elected officials fall for it. As a result we have the public spectacle of Republicans firing away at other Republicans in an increasingly personal way, just like the media wants.
Fann and Petersen know when to respond and how, and the points they make are generally fair and on target. The Senate has a responsibility and is acting on that responsibility. Opposition is largely partisan in origin and passionate objections to legitimate concerns come mostly from those who spent years insisting that Congress spends tens of millions of dollars investigating a Russia hoax that they got daily updates on from their MSNBC shows. Fann and Petersen recognize this hypocrisy and have kept focused on the audit itself, the need to do it right, and the importance of getting as many facts gathered as possible before conclusions are reached.
The audit will show that everything was largely done right, or it will show meaningful problems or weaknesses in systems that need to be corrected. Both outcomes are victories for Arizona voters, even though some will claim victory and insist it is a defeat for others. If all was well then that’s obviously good news. If corrections need to be made, then the fact that they were identified and can be fixed for future elections is also good news. We all benefit from a system that strives for perfection and is checked for improvements.
If you want Election Integrity, accurate and legitimate elections, and a process that every voter can largely trust, then you’re on the side of an accurate and professionally done audit that produces verifiable results. I for one, am more than willing to patiently wait for the process to work, and I’d encourage every Arizonan to do the same.
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Sergio Arellano was born and raised in Tucson, AZ. He joined the Army at the age of 17 and served his country honorably as an Infantryman and Human Resources Specialist for a total of 10 and a half years before retiring from the military due to combat sustained injuries.
Sergio is a founding member of the Arizona International Consortium, the Santa Cruz County Elections Integrity Committee, and the first ever AZGOP Latino Coalition. Sergio is also credited with establishing Arizona’s first ever cultural exchange agreements between the Arizona Republican Party and some of Mexico’s prominent political parties.
On Monday, Arizona State Treasurer Kimberly Yee, and Arizona Board of Regents member, Karrin Taylor Robson, announced their plans to run in the governor’s race.
The announcements have been expected for some time.
Yee has spent most of her adult life working in the government sector.
Yee served as executive fellow for the Office of the California State Superintendent of Public Instruction, program and policy analyst for Wilson on the California State Board of Education. She served as deputy cabinet secretary for the Office of Governor Arnold Schwarzenegger, before becoming director of communications and government affairs for the Arizona State Treasurer’s Office.
Yee was appointed by the Maricopa County Board of Supervisors to the Arizona House of Representatives to replace fellow Republican Doug Quelland after he was ousted for violating Clean Election Limits. She was later elected to the State Senate. She was elected to the Treasurer’s Office in 2018.
Taylor Robson was appointed to the Arizona Board of Regents in June of 2017 by Governor Doug Ducey.
Taylor Robson is the founder and president of a development company, Arizona Strategies. Prior to forming Arizona Strategies, Taylor Robson served as executive vice president of DMB Associates, Inc., a Scottsdale-based master-planned community developer. Prior to DMB, she was a principal with the law firm of Biskind, Hunt & Taylor, P.L.C., where she practiced in the areas of land use, development and zoning law representing large land owners on complex land use cases.
After months of meetings, crunching numbers, and compromises, the group of legislators and state staff tasked with hammering out Arizona’s $12 billion budget could be ready to roll it out this week.
Rep. Regina Cobb (R-LD5) told AZ Free News that after numerous meetings this session the fine-tuning of the budget package “is down to the last few items.” As a result, legislators could be presented with the package in a few days.
The two most anticipated features involve whether Arizona’s current multi-rate income tax structure will transition to a flat tax rate, and what types of immediate tax cuts will be divvied out of the state’s budget surplus of between $1 billion and $2 billion.
Cobb, who chairs the House Appropriations Committee, said tax relief via tax cuts was on top of the House’s budget wish list heading into budget negotiations, and now that all sides have come to “a general agreement on how much there is to spend” that income tax cuts for all Arizonans are part of the budget.
The other priority was a proposed flat tax which could drop Arizona’s four income tax brackets (which range from 2.59 percent to 8 percent) into one flat tax. According to Cobb, that plan is would get all Arizonans to a 2.5 percent income tax by 2024. A flat income tax has been supported by Gov. Doug Ducey although he had not proposed a rate plan.
Cobb has been involved in the budget or appropriation side of the legislature for five of the seven years she has been in office. Normally the House and Senate hammer out their differences and then bring the plan to the Governor’s Office. This year, however, the budget process differed in that the executive side became involved earlier.
“It was clear our philosophies between the House and the Senate were different, so we made it a three-way negotiation sooner than expected,” Cobb said, adding that the “majority of the negotiating and give-and-take is complete.”
Among those working with Cobb on this year’s budget is House Majority Leader Rep. Ben Toma, as well Sen. David Gowan, the chair of the Senate Appropriations Committee, and Sen. J.D. Mesnard, chair of the Senate’s Commerce Committee. A few issues remain, which is not unusual at this stage.
“The last items are always the most controversial items,” Cobb said.
Ducey introduced a budget for consideration by the legislature when the session started in January. The governor’s budget included discretionary spending and revenue changes necessary to enact a balanced budget, with a forecasted $350 million surplus.
That surplus prediction continued to exponentially grow every few weeks. In mid-April, the Joint Legislative Budget Committee and its Finance Advisory Committee of public and private sector economists pegged the surplus at $1 billion, while some economists put it closer to $1.5 billion or even $2 billion.
The budget discussions are also addressing the impact of Proposition 208, which mandates a 3.5 percent income tax surcharge for thousands of Arizonans, many of whom are small business owners. Those subject to the surcharge are being “walloped” by the tax and need relief, according to Scot Mussi, president of the Arizona Free Enterprise Club.
“We currently have an uncompetitive tax rate structure, which needs to be a priority for the legislature,” Mussi told AZ Free News. “We need a simpler tax code, we need to correct the damage from Prop 208, and we need to push for a $1 billion tax cut to return that money to the taxpayers.”
Another priority, particularly for business owners, is for Arizona’s income tax code to better conform or match up with the federal tax code. This limits the potential for double taxation of income, Mussi explained.
Mussi also noted none of the tax cuts or additional spending due to the surplus will impact Arizona’s rainy day fund, which was established in 1990 as a reserve of funds the state could turn to during economic downturns.
Once the budget bills pass the House and the Senate, Ducey will have the option to sign them, veto them, or let them take effect without his signature. He also has authority to do a line‐item veto of appropriations, although any veto can be overridden by a two-thirds vote in each chamber before adjournment.
But how long it will take for the budget to get approved is not very clear. Traditionally, the legislature will sine die after the budget is approved. Sine die marks the adjournment and end of the session without setting a date for reconvening. It also terminates any unfinished legislative business.
However, Sen. Kelly Townsend has suggested there should be no sine die in case the Senate’s election audit of Maricopa County requires some type of legislative action. She has also been critical of the fact several of her 18 election reform bills never made it out of a Senate committee this year.
It is possible Rep. John Kavanagh, as chair of the House Government & Elections Committee, will introduce strike-everything amendments to others bills in an effort to force the Senate to support Townsend’s legislation, thus potentially ensuring her vote on the budget.
None of the budget surplus being considered by the legislature involves COVID-19 funds, as Arizona is one of a handful of states in which the executive branch controls federal funds issued to the state. That means Ducey has control of his own multi-billion purse derived from federal monies.
Making matters even trickier is that approving the budget will require the support of all 16 Republican senators and 31 Republican representatives unless a Democrat or two cross the aisle. Such uncertainty means it is unclear how much time will be needed by the leadership in both chambers to be ready for a vote.
Another shadow hanging over the budget negotiations is whether Arizona will be punished by the U.S. Treasury Department if it approves tax cuts which the Biden Administration later considers were “directly or indirectly” offset by federal COVID-19 funds.
Attorney General Mark Brnovich has filed for a court order declaring part of the recent COVID-19 relief package unenforceable. That provision prohibits states from using COVID-19 federal monies to essentially underwrite tax cuts, but the language needs to be clarified, according to nearly two dozen attorneys general.
“The fact that those politically allied to enact the Act cannot even agree with each other as to what the Tax Mandate means provides powerful evidence that it is subject to multiple potential interpretations,” Brnovich argues in a lawsuit filed in March in U.S. District Court. “Indeed, the language of the Tax Mandate is patently ambiguous, and even borderline incoherent.”
With the legislature expected to take up the budget package sooner than later, three high-profile bills appear to have been shelved by Senate President Karen Fann, despite growing calls for her to calendar them for a vote before the session ends.
HB2190, also known as the Vaccine Passport bill, along with SB1074 and SB1532 cleared the House and were transmitted to the Senate. But none have appeared on a Senate calendar, which is controlled by Fann.
SB1074 would prohibit state government entities, including cities and counties, from forcing employees to engage in orientation, training, or therapy that is based on a theory of blame or judgment on the basis of race, ethnicity, or gender. SB1532 bans Arizona’s public schools and community colleges from discussing controversial issues unless presented in a way which addresses diverse or opposing perspectives. Both are commonly referred to as anti-Critical Race Theory legislation.
Meanwhile, HB2190 seeks to protect the rights and private medical data of Arizonans against efforts to force consumers to prove their COVID-19 vaccine status or disclose their status in order to receive government benefits. The current version was introduced in February by Sen. Kelly Townsend and cleared the House through efforts by Rep. Bret Roberts, who has expressed frustration at the lack of action in the Senate.
“Let the Senators that want to be on the record, be on the record on this important issue!” he tweeted last week. In response, Sen. Michelle Ugenti-Rita responded by publicly supporting a vote on HB2190.
“I would like an opportunity to cast a yes vote for this bill. Put it on the board of truth!” tweeted Ugenti-Rita, who chairs the Senate’s Government Committee.
Behind the scenes, some members of the Republican caucus point to the fact Fann allowed SCR1044 -which deals with in-state tuition for DREAMERS and others without U.S. citizenship- to go to a floor vote but has dug in her heels on bills which seek to protect Arizona workers and students.
Bills which Fann has placed on Monday’s Senate calendar involve election deadlines, instruction of the Holocaust, the impounding of vehicles by law enforcement, and advertising rules for political action committees.
