We tried to warn them. But Pinal County officials decided to move forward with their illegal and unconstitutional transportation tax anyway. Thankfully, on Tuesday, the Arizona Supreme Court issued a tremendous victory for Pinal County taxpayers and the rule of law.
And while it’s disappointing that taxpayers were forced to pay thousands of dollars to defend this illegal tax scheme in court, the Pinal County Board of Supervisors will now have to end the collection of this tax and issue refunds to aggrieved taxpayers.
A tax on retail sales below $10,000
This all started in 2016 when Pinal County officials began turning the political wheels to send a $640 million tax increase to voters to fund a wide array of transportation projects throughout the region.
Devastating. That’s how it felt earlier this week when the Arizona Supreme Court upheld the trial court’s ruling in Arizona School Boards Association v. State of Arizona. This decision strikes down critical reforms contained in a series of Budget Reconciliation Bills passed by lawmakers and signed by Governor Ducey earlier this year.
And it’s a big blow to the people of Arizona.
This past July, Arizona lawmakers took important steps to protect our state from more COVID mandates and government overreach. Among the laws passed were bans on:
A county, city, or town from issuing COVID ordinances that impact private businesses, schools, churches, or other private entities, including mask mandates.
K-12 schools from requiring vaccines with an emergency use authorization for in-person attendance.
The state and any city, town, or county from establishing COVID vaccine passports or requiring COVID vaccines.
Public universities and community colleges from mandating COVID vaccines and vaccine passports.
A city, town, county, school board, or charter school from mandating students and teachers to be vaccinated or wear masks.
But COVID wasn’t the only thing these Budget Reconciliation Bills addressed.
This past July, Arizona lawmakers and Governor Ducey did the right thing. Through a series of Budget Reconciliation Bills, they took important steps to protect the people of Arizona from more COVID mandates and to prevent children from being indoctrinated in public schools by Critical Race Theory.
While COVID was certainly an issue that warranted some action, it never should have included trampling on the rights of the people. And we definitely should not be wasting tax dollars on lessons that teach public school students that one race, ethnic group, or sex is in any way superior to another.
Not surprisingly, these laws sent teachers’ unions into a tailspin. As students headed back to campus, some Arizona schools decided to teach students that it’s ok to violate the law. And the Arizona Board of Regents recently announced that all three state universities will require their employees to be fully vaccinated against COVID-19 by December 8.
The Arizona Supreme Court will hear arguments Tuesday morning in a first of its kind case about whether a political candidate or campaign committee can be held liable under state law for defaming a third party or a private company while attacking a political opponent.
Pamela Young claims she and her company Models Plus International (doing business as The Young Agency) were defamed and presented in a false light by campaign ads approved by state Sen. Wendy Rogers in 2018. At the time, Rogers was running for U.S. House of Representatives against Steve Smith, a state senator who had worked for Young’s Christian-based modeling company and talent agency for about a decade.
Young alleges Rogers’ campaign utilized radio, telephone, and direct mail ads which gave the impression Young and her company were involved in or condoned sex trafficking of young children. One such ad called Smith “a slimy character whose modeling agency specializes in underage girls and advertises on websites linked to sex trafficking.”
Rogers’ campaign also alleged Smith advertised on the Model Mayhem website, which the campaign described as being “full of pornographic material, which has also been involved in human trafficking.”
Smith lost to Rogers in the 2018 Republican primary by less than seven points, but Rogers lost in the General Election.
Young sued for defamation and invasion of privacy. Rogers has continually argued her 2018 ads never “directly” tied Smith to The Young Agency and never directly linked the company to any illegal conduct.
But the ads did not set well with several prominent Republicans, including Congressman Andy Biggs who called Rogers’ effort “one of the most despicable ads in campaign history.”
In 2019, a Maricopa County judge denied a motion by Rogers and her husband to dismiss Young’s claims. However, the Arizona Court of Appeals reversed the lower court in December 2020, ruling Young had not presented sufficient evidence to move her lawsuit forward against the defendants.
Young filed a petition for review to the Arizona Supreme Court in January seeking for her lawsuit to be reinstated. Rogers’ husband Hal Kunnen and her official campaign committee are also named as defendants.
Arizona Attorney General Mark Brnovich filed an amicus curiae brief in the case in June after which the justices set oral arguments for Sept. 28. A decision against Rogers would reinstate Young’s case, which could have major ramifications in how election advertising is conducted in Arizona and protect the rights of employers whose employees run for public office.
Bill Montgomery, who in 2018 was Maricopa County’s elected county attorney, denounced Rogers’ ads as “the worst kind of politics.” Montgomery was later appointed by Gov. Doug Ducey to the Arizona Supreme Court. He has recused himself from hearing Rogers’ petition. In his place, Judge Philip Espinosa of the Arizona Court of Appeals will sit in on arguments.
The ads also did not set well with Kathleen Winn, who is a member of the Maricopa County Community College District board. She is also an expert on child sex trafficking in Arizona.
“If you happen to believe one of your opponents is exploiting children, trafficking minors, selling them on a website for sex producing a political attack ad is NOT your first course of business,” Winn said. “Contacting law enforcement to report the alleged crime is what you need to do.”
Rogers was elected to the state Senate for LD6 in November 2020.
On Thursday, the Arizona Supreme Court ruled that Proposition 208 (Prop 208), the voter-approved increase on income taxes to fund public education, was unconstitutional and remanded to lower court. If that trial court determines that Prop 208 exceeds the constitutional spending limit, then Prop 208 would be killed. Chief Justice Brutinel authored the opinion.
The case, Fann, et al. v. State of Arizona, et al., challenged one major provision of Prop 208 and the circumstances of its approval.
First, the case questioned how Prop 208 exempted itself from the Arizona Constitution’s provisions on tax revenue spending caps, or the Education Expenditure Clause.
Brutinel ruled this aspect of Prop 208 unconstitutional. The chief justice made sure to note that this ruling rendered the other aspects of Prop 208 unworkable and unseverable. Meaning, no part of Prop 208 is enforceable if the trial court concurs with the Arizona Supreme Court’s opinion.
“We hold that the direct funding provision does not fall within the constitutional definition of grants in article 9, section 21 of the Arizona Constitution, and Prop. 208 is therefore unconstitutional to the extent it mandates expending tax revenues in violation of the Education Expenditure Clause,” wrote Brutinel. “Likewise, the remaining non-revenue related provisions of Prop. 208 are not separately workable and thus not severable.”
Second, the case challenged tax impositions made by voter initiative. The plaintiffs cited the Arizona Constitution’s Tax Enactment Clause, which stipulates that tax changes must be approved through a two-thirds vote by the state legislature.
The court disagreed with this assessment.
“Additionally, we hold that Prop. 208 does not violate article 9, section 22 of the Arizona Constitution (‘Tax Enactment Clause’), because that clause does not apply to voter initiatives,” wrote Brutinel. “Therefore, the bicameralism, presentment, and supermajority requirements found therein are inapplicable to Prop. 208.”
The Goldwater Institute, Snell & Wilmer, and Greenberg Traurig filed the lawsuit on behalf of the 11 plaintiffs: State Senate President Karen Fann (R-Prescott); State Senators David Gowan (R-Sierra Vista) and Vince Leach (R-Tucson); Arizona House Speaker Russell Bowers (R-Mesa); State Representatives Regina Cobb (R-Kingman), John Kavanaugh (R-Fountain Hills), Steve Pierce (R-Prescott); Montie Lee of Lee Farms; Dr. Francis Surdakowski; NO on 208; and Arizona Free Enterprise Club.
In a statement, Goldwater Institute Vice President for Litigation Timothy Sandefur classified the ruling as a win.
“Today represents a major victory for the hardworking taxpayers of Arizona,” said Sandefur. “The justices made clear that the state constitution’s limits on spending—which were added to the Constitution by the voters themselves—cannot be simply ignored, as Prop. 208’s funders attempted.”
Governor Doug Ducey concurred that this ruling signaled that the end was near for Prop 208.
“There is a clear legal path to Prop 208 being knocked down entirely, it’s only a matter of time,” tweeted Ducey. “The out-of-state proponents of this measure drafted bad language, and now they are paying the price.”
Proposition 208 (Prop 208) tacked on 3.5 percent to the existing 4.5 percent income tax for individuals making over $250,000 or couples making over $500,000. Previously, Arizona’s income tax rate was capped at 4.5 percent for individual incomes above $159,000 or joint incomes above $318,000. The revenue from the income tax increase would fund a wide variety of educator salaries and programs.
About 52 percent of Arizonans voted in favor of Prop 208 last November, and about 48 percent voted against it.
Corinne Murdock is a reporter for AZ Free News. Follow her latest on Twitter, or email tips to corinne@azfreenews.com.
