Gov. Doug Ducey wants to remind the more than 50,000 military veterans living in Arizona that he signed legislation which now fully exempts military pensions from state income taxes.
“Veterans put the safety of our great nation first. We should honor their service, not tax it,” Ducey tweeted this week.
Arizona’s tax code previously exempted only $3,500 of a veteran’s military pension. Getting it to a full exemption was something Ducey announced as a priority during his January 2020 State of the State speech, but then the COVID-19 pandemic shut down all but priority budget considerations.
When the new legislative session convened in January 2021, the governor once again made tax relief for veterans a priority. It took until the last week of June, but the full exemption passed and Ducey signed the legislation.
“Our nation’s greatest heroes will no longer pay taxes on their retirement pay. This saves the average veteran an additional $650 a year,” Ducey said after signing the bill.
In addition to the pension income tax exemption, the Fiscal Year 2022 budget package signed by the governor includes $25 million for construction and operation of a State Veterans Home in northwestern Arizona. Additional funds were appropriated for operating State Veterans Homes recently opened in Flagstaff and Yuma.
Nearly $775,000 was appropriated to ADVS for the hiring of 12 additional Veteran Benefits Counselors, and the budget includes $100,000 earmarked for distribution to a charitable organization located in southern Arizona to work with regional Veterans organizations to improve services which can reduce Veteran suicides.
Ducey also signed SB1802 which establishes the date every August when Arizonans will recognize National Navajo Code Talkers Day.
Among those getting the word out to veterans is Col. Wanda Wright, director of the Arizona Department of Veterans’ Services (ADVS).
“This budget is a real win for Arizona Veterans,” Wright posted to the ADVS website. “It further proves that here in Arizona, we honor and support service members, Veterans and their families.”
A lawsuit filed in Maricopa County Superior Court on Wednesday argues that efforts to have voters decide whether Arizona’s new flat-rate income tax and other tax law changes should go into effect are unconstitutional.
The Arizona Free Enterprise Club (AFEC) is among the plaintiffs seeking a court order to bar the acceptance of petition signatures gathered by Invest In Arizona, a political committee sponsored by Arizona Education Association and Stand for Children – Arizona, which wants voters to overturn three revenue-related bills recently signed by Gov. Doug Ducey.
The problem with Invest in Arizona’s plan, the lawsuit argues, is that Article 4 of the Arizona Constitution prohibits referendums of legislation which deals with revenues and appropriations used for the “support and maintenance of the departments of state government and state institutions.”
AFEC is a nonprofit 501(c)(4) corporation organized and operated for the promotion of social welfare. It does so by engaging in public education and advocacy in support of free markets and economic growth in the State of Arizona.
Joining AFEC as plaintiffs in the lawsuit is the group’s executive director, Scott Mussi, as well as Diane Schafer, a registered voter from Yavapai County.
The legislation which Invest in Arizona wants to challenge via referendum are Senate Bills 1783, 1827, and 1828. The bills were passed near the end of the recent legislative session and then signed by Gov. Doug Ducey.
SB1828 amends Arizona’s current income tax brackets and tax rates and provides for a single income tax rate of 2.5 percent conditioned on certain general fund revenue thresholds. It was the cornerstone of Ducey’s budget package approved by the legislature earlier this month.
A companion bill, SB1827, ensures an individual taxpayer’s taxable income will not be subject to an overall marginal tax rate of more than 4.5 percent when a tax surcharge from Prop 208 (Invest In Ed) is considered. Meanwhile, SB1783 allows certain small business owners to pay an alternative small business tax.
The legislation is slated to take effect 90 days after the governor affixed his signature. That 90-day window provides time for challengers to initiate a petition signing drive to take the matter out of lawmakers’ hands and put it before voters across the state via a referendum.
Getting a matter onto a ballot as a referendum requires valid petition signatures to be submitted to Arizona Secretary of State Katie Hobbs equal to five percent of the total votes cast in the last gubernatorial election. If that happens, then the new laws would remain on hold until voters have their say in a statewide election.
And that, according to AFEC, Mussi, and Schafer, should not be allowed to happen with SB1783, 1827, and 1828 because each deals directly with the generation of state revenue for funding Arizona’s state government and state institutions. Their lawsuit asks a Maricopa County judge to bar Hobbs from accepting petition signatures for any of the three bills.
“The filing of petitions in support of the Proposed Referenda will injure the Plaintiffs and all Arizona taxpayers by unconstitutionally delaying the effective date of non- referrable laws duly enacted by the elected Legislature and approved by the Governor,” the lawsuit states.
The plaintiffs are represented by Thomas Basile of the Statecraft Law Firm. Basile says his clients are not against voter referendums in general and only initiated this legal action to ensure the Arizona Constitution is followed by Hobbs’ office.
“At the core of our case is that while the right of referendum is broad, it is not unlimited,” he told AZ Free News on Thursday. “The framers of our Constitution carved out certain categories exempt to referendum, such as in the case of tax reform and appropriations.”
Hobbs is named as a defendant in her official capacity as the state officer responsible for accepting or rejecting referendum petition sheets. Invest in Arizona is also named as a real party in interest.
An investigation by the Arizona Auditor General has led to criminal charges being filed earlier this month against several people involved with the building of two new schools for the Higley Unified School District in Gilbert, including the district’s former superintendent, it was announced late Thursday.
Angela Denise Birdwell was indicted July 13 by a state grand jury for 18 counts related to procurement fraud, misuse of public monies, fraudulent schemes and practices, conflict of interest, filing a false state tax return, fraudulent schemes and artifices, and conspiracy. She served as Higley’s superintendent from 2009 until her retirement in 2015.
“Public officials with oversight authority have a responsibility to properly manage the administration of money and property entrusted to them and must ensure that sufficient internal controls are designed and implemented to protect those assets,” according to the Auditor General’s report. “Nevertheless, a system of internal controls will not succeed when those in a position to oversee those operations are perpetrating unlawful behavior and concealing their misconduct.”
Among the more serious issues identified by the Auditor General was Birdwell’s possible misuse of public monies from December 2012 to November 2013 when she authorized or caused the unlawful use of $6 million in restricted public funds toward construction of two new schools in the Higley district, which serves about 10,000 PK-12 students.
Also indicted were Gary Aller and Steven Nielsen, both corporate officers of Educational Facilities Development Services (EFDS) which was awarded a $2.5 million project development service contract related to construction of the new schools. Investigators believe EFDS had access to “early and exclusive Project information” which provided the company an advantage over other prospective vendors.
Public records show Aller and Nielsen founded EFDS in 2012 just two weeks before the Higley District issued an RFP for project development services. The men are each charged with three felonies related to fraudulent schemes and practices, conspiracy, and fraudulent schemes and artifices. There is also an allegation Birdwell violated state procurement laws in connection to the EFDS contract.
“Dr. Birdwell was 1 of 3 selection committee members, and she evaluated EFDS with the only perfect score and recommended Higley award EFDS the Project development services contract, which the Higley Governing Board approved on July 12, 2012,” the report states.
Meanwhile, three felonies related to filing of a false state tax return were brought by the state grand jury against Kay Hartwell Hunnicutt, an attorney described in the Auditor General’s report as being a “close acquaintance” of Birdwell, with whom she shared a home as well as a checking account.
According to the Auditor General, Birdwell indirectly received or benefited from $43,000 paid by Hunt & Caraway Architects Ltd., which served as the district’s procurement advisor and was part of the EFDS development team. Hunt & Caraway, whose now deceased president was never registered in Arizona as an architect, issued checks to Hunnicutt or Hunnicutt’s law office, which were then deposited in a checking account held jointly by Birdwell and Hunnicutt.
Concerns have been rife for years about misconduct related to the school construction projects, according to State Rep. Jake Hoffman (R-LD12), who served as a Higley district board member from 2013 to 2015. Hoffman says he and another board member were criticized by Higley district administrators in response their attempts to look into concerns at the time.
“The level of apparent corruption is staggering and heartbreaking. I am proud to have actively fought against this abuse of power, misuse of taxpayer monies, and blatant disregard for the law during my tenure on the Higley governing board,” Hoffman said, adding that he plans to use the Auditor General’s findings to push for education reform during next year’s legislative session.
After retiring from Higley, Birdwell received eight checks totaling $57,000 from Hunt & Caraway before she was hired in 2016 by the Scottsdale Unified School District as its superintendent through June 2019.
The memo section on two of the Hunt & Caraway checks referred to “consulting” but the company failed to provide investigators any documents supporting the purposes of the checks.
But Birdwell’s time at SUSD was cut short, when she was given a $150,000 contract buyout in April 2018 after district officials alleged she failed to disclose a “substantial, personal interest” with Hunt & Caraway, which billed the Scottsdale District for nearly $2 million after Birdwell became its superintendent.
Birdwell is accused of not claiming the payments as income on her state income tax returns.
Court dates have not been announced for the four defendants who will stand trial in Maricopa County Superior Court.
Shockwaves continue to ripple through Arizona’s beleaguered healthcare industry after Tuesday’s emailed announcement by Banner Health CEO Peter Fine that employees could lose their jobs if they fail to provide proof of a COVID-19 vaccination by Nov. 1.
Fine’s companywide email touted uncited “overwhelming evidence” and “vaccine data” which purportedly proves the “safety and efficacy” of the three current vaccines. Employees will have the option to undergo an unspecified “exemption request process,” in hopes of retaining their job without being vaccinated but the between-the-lines message to Banner Health employees is that terminations are possible for refusing to subject themselves to the risks of an emergency-use-only vaccine.
Banner Health is also putting up $100,000 to award 10 fully-vaccinated employees with $10,000 each in a companywide drawing this summer.
“We care for some of the most vulnerable people in our communities and we owe it to them to take every measure possible to ensure the safest care environment,” Fine wrote, adding that mandatory vaccinations will reduce risk “for our patients, their families, visitors and each other.”
The problem, according to many in the healthcare industry, is that Arizona is already experiencing a shortage of workers in a high demand market. An exodus of qualified workers to other hospital systems or into smaller healthcare companies could leave Banner Health without enough medical professionals to adequately serve its patients.
Studies show the majority of healthcare workers who have declined so far to be vaccinated for COVID-19 are under the age of 40. Many have expressed concern about the lack of data about long-term impacts on fertility and overall health.
In April, Gov. Doug Ducey issued an Executive Order banning proof of vaccinations, also known as vaccine passports, and preventing state and local governments from requiring anyone to disclose their COVID-19 vaccination status to receive service or enter a public area.
The Order, however, allowed health care institutions to require COVID-19 vaccination status documentation of a patient, resident, employee, or visitor.
Protecting all Arizonans from being coerced into obtaining a COVID-19 vaccination was a priority for Rep. Bret Roberts throughout the recent legislative session. Roberts (R-LD11) advocated strongly for passage of a state law to prevent government and private employers from interfering with anyone’s freedom of choice when it came to being vaccinated.
Eventually the language of Roberts’ bill was watered down to protect those doing business with government entities, as well as customers and clients of private employers. Employees of private companies -particularly those working in the healthcare industry- would have had no protection.
The bill never made it to Ducey’s, but the governor did sign legislation which ensures any person “may refuse a vaccination…based on the person’s personal beliefs” during a public health emergency.
Roberts spoke out Tuesday against Banner Health’s mandate, expressing concern about the unknown risks associated with the current COVID-19 vaccines.
“Force and coercion, in my opinion, are not routes that should be taken,” he said. “Adults should be able to weigh the risks involved and decide for themselves.”
One of those who opposed freedom of choice protections for employees of private companies was State Sen. T.J. Shope (R-LD8). Shope bragged earlier this month about protecting Arizonans -including legislative staffers- from government required proof of vaccinations, but refused to support the same protections for most employees across the state.
To date, Banner is the largest private employer in Arizona to announced forced vaccinations as a condition of new or continued employment. However, earlier this year the U.S. Chamber of Commerce provided tips to its members on how to persuade employees and customers to receive the COVID-19 vaccine.
“Vaccination is a personal decision, so it’s logical that when employers show a personal willingness to be vaccinated, they are more likely to increase the willingness of their employees—across all demographic groups – to follow their lead and get the shot,” according to the chamber’s website.
The website also provides guidance for employers on talking to employees about getting vaccinated and includes advice on conducting business-sponsored “get vaccinated” events.
For the second time this year, Attorney General Mark Brnovich and Missouri Attorney General Eric Schmitt have authored a “friend-of-the-court” brief to the U.S. Supreme Court in support of a challenge to the constitutionally of a New York state law which severely restricts who can obtain a concealed carry permit.
On Tuesday, Brnovich, Schmitt, and the attorneys general of 24 other states joined in urging the justices to declare New York’s subjective-issue firearm license process as unconstitutional under the Second Amendment. The case is New York State Rifle and Pistol Association v. Corlett.
Forty-two states, including Arizona, have objective-issue systems where a concealed carry permit is issued to an individual who meets a certain set of objective criteria such as a background check, a mental health records review, fingerprinting, knowledge of applicable laws, and firearms training.
However, New Yorkers who want a concealed carry permit must demonstrate to a state worker some type of “special need” for self-protection outside their home that is greater than the average citizen. In effect, the law serves as a de facto ban on most New Yorkers who want to exercise their right to protect themselves when away from home.
The 26 signors of the brief believe they have “a unique perspective that should aid the Court in weighing the value and importance of the rights implicated by the questions presented.” In particular, they cite empirical evidence that legal concealed carry holders are significantly less likely than the general public to commit a crime.
In addition, a 2013 National Research Council study is cited, showing that crime victims who resist with a gun are less likely to suffer serious injury than victims who resist in other ways or who offer no resistance at all.
“Those who obtain firearms-carry permits are, and remain, overwhelmingly more law-abiding than the general population. That conclusion makes perfect sense, as permit holders must typically pass background and other checks prior to being issued a license under state regimes,” the brief argues.
Brnovich issued a statement after the brief was filed Tuesday.
“Law-abiding citizens should not require the consent of faceless bureaucrats to exercise their right to keep and bear arms. New York cannot override the Second Amendment or the natural right of self-preservation,” Brnovich said, adding he will continue to vigorously protect the constitutional rights of all Americans.
According to the attorney general’s office, Arizona implemented a licensed concealed carry regime in 1994. That year, the state experienced 10.5 murders per 100,000 people compared to the nationwide rate of 9 murders per 100,000.
Then in 2010, Arizona implemented a right-to-carry for all law-abiding citizens, even without a license. By 2016, Arizona’s murder rate was 5.5 per 100,000, even though more guns were being lawfully carried in the state.
Joining Arizona and Missouri are the state attorneys general of Alabama, Alaska, Arkansas, Florida, Georgia, Idaho, Indiana, Kansas, Kentucky, Louisiana, Mississippi, Montana, Nebraska, New Hampshire, North Dakota, Ohio, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, West Virginia, and Wyoming.
The July 20 brief follows one filed in February in which the 26 attorneys general argued why the U.S. Supreme Court should take up the case. The Justices announced in April that they will take up the case in its next term which starts Oct. 4, 2021.
The New York case, however, is not the only Second Amendment challenge Brnovich’s office has been involved with this year.
In April, he co-authored an amicus brief signed by nearly the attorneys general from nearly two dozen states urging the Ninth Circuit Court of Appeals to uphold the Second Amendment by declaring California’s law limiting magazine capacities as unconstitutional.
Then in May, Brnovich led another multi-state coalition in urging the U.S. Supreme Court to review a New Jersey law which limits magazine capacities and requires gun owners to surrender to law enforcement certain magazines which are legal in 43 other states.
And last month, Brnovich led a coalition of 22 states in writing a brief to the Ninth Circuit of the U.S. Court of Appeals in an effort to strike down a three-decade-old California law that bans popular rifles, even when kept in the home for self-defense.
