The City of Flagstaff can be forced to pay the State of Arizona more than $1.1 million for enacting a minimum wage that is significantly higher than the state wage, according to an Arizona Court of Appeals opinion released Tuesday.
But whether the State gets to keep the money will be determined once a Maricopa County judge conducts a trial on the matter.
Back in 2006, Arizona voters approved Proposition 202 which allows cities and towns to set their local minimum wage, as long as it is not below the state level. Flagstaff did just that in 2016 with the passage of a local voter initiative.
The Arizona Legislature passed a new law in 2019 which allows the State to collect yearly assessments from any municipality with a minimum wage that exceeds the State’s. The assessment entails a detailed process involving state agencies estimating their costs “attributable” to the higher minimum wage.
Each assessment must be approved annually by another act of the legislature, after which the Arizona Department of Administration (ADOA) is required to issue an assessment to the municipality by July 31.
Any impacted municipality then has until the end of the calendar year to remit payment or the Arizona Treasurer must withhold the amount with applicable interest from the municipality’s share of tax revenues.
In the Flagstaff case, the state agencies were asked by the Legislature in 2019 to calculate their “projected costs attributable to Flagstaff’s higher minimum wage” in their 2021 budget estimates. That amount was calculated at $1,110,992, based on Flagstaff’s $15 per hour minimum wage effective Jan.1, 2021.
The Arizona hourly minimum at the time was only $12.15.
The $1.1 million Flagstaff assessment was approved by the Legislature via Senate Bill 1827 on June 30, 2021 and signed the same day by then-Gov. Doug Ducey. ADOA then advised city officials the assessment would be formally issued 90 days later, well after the July 31 deadline.
In the meantime, city officials filed a lawsuit, challenging the 2019 statute as well as the 2021 Senate Bill, arguing both were unconstitutional under the Voter Protection Act (VPA). The effective date of the assessment also plays a big role in the lawsuit.
Without opining on Flagstaff’s constitutional arguments, a Maricopa County trial judge quickly issued a preliminary injunction to prevent the State from enforcing the assessment while the lawsuit is being litigated.
The judge primarily relied on the belief at the time that the June 2021 assessment did not take effect the day it was signed into law, thus making ADOA’s plan to collect the money 90 days later untimely.
The trial judge also briefly noted he was granting the preliminary injunction “out of an abundance of caution” as Flagstaff officials had argued about the “possibility of irreparable harm” with funding critical services if forced to pay the $1.1 million.
The Arizona Attorney General’s Office appealed the preliminary injunction order, arguing on behalf of ADOA and Treasurer Kimberly Yee that the Maricopa County judge made multiple errors to support issuing it. And in a Feb. 21 opinion, the Court of Appeals agreed.
The opinion authored by Acting Presiding Judge Randall M. Howe noted the trial court erred in considering Flagstaff’s irreparable harm argument under the set of facts as they are in the case. Howe added that the city had sufficient funds to cover the assessment, and could have gotten the fund back if the State lost the lawsuit.
As a result, Howe was joined by Judge D. Steven Williams and Vice Chief Judge David B. Gass in overturning the preliminary injunction and sending the case back to the Maricopa County Superior Court “for a trial on the merits.”
The opinion also strongly suggests the trial judge consider a 2022 ruling by the Arizona Supreme Court (Ariz. Free Enter. Club v. Hobbs) in which the justices clarified that revenue laws proving “for the support and maintenance” of “existing state departments or state institutions” are valid upon enactment instead of taking effect at a later date.
If applied to SB1827, that would have allowed ADOA to issue the assessment to Flagstaff in plenty of time to meet the July 31 deadline.
The Court of Appeals also unanimously declined a request from the parties for the judges to weigh in on some other key legal issues with the case, including whether the 2019 statute allowing for assessments of costs to cities like Flagstaff “impliedly amend the VPA, violating Arizona’s constitution.”
Howe wrote that the court of appeals “sits as a court of review, not of first view,” and would not decide the merits of the case without the benefit of having a fully developed record from the trial court.
“While the parties are understandably eager to resolve this case as quickly as possible, quickness must not eclipse thoroughness,” Howe wrote. “We respect the role of the trial court and trust in its competence to resolve all legal and factual matters before it in the first instance.”
The opinion does not take effect for at least 30 days, giving both sides time to petition for review by the Arizona Supreme Court.
As of Jan. 1, 2023, Flagstaff’s minimum is to $16.80 per hour ($14.80 tipped) while the state minimum rose to $13.85.
Terri Jo Neff is a reporter for AZ Free News. Follow her latest on Twitter, or send her news tips here.
Flagstaff Mayor Becky Daggett will focus first on addressing climate change and affordable housing.
Daggett issued this promise during her swearing-in at last week’s city council meeting. She said she would direct her staff to tackle these two issues first.
“[We are going to emphasize] affordable housing and climate action, and also scheduling meetings with the public and really trying to hit the ground running,” said Daggett.
Affordable housing and climate action are the leading two of several priorities Daggett pledged on the campaign trail. After those priorities, Daggett listed small business growth, job creation, and increased investment in “greener” multi-modal transportation: pedestrian pathways, biking, and busing.
A week prior to her swearing-in, Daggett attended a bipartisan meeting with 12 other mayors to discuss housing as well as public safety, American Rescue Plan funds, Bipartisan Infrastructure Law, and CHIPS and Science Act. Daggett met with President Joe Biden, the White House Intergovernmental Affairs staff, Domestic Policy Council Director Susan Rice, Transportation Secretary Pete Buttigieg, Labor Secretary Martin Walsh, and Housing & Urban Development Secretary Marcia Fudge.
Both Daggett and the former mayor, Paul Deasy, ran their campaigns on promises to tackle climate change and affordable housing. On the trail, Daggett indicated that she would lean into higher density housing (high rise apartments, etc.) or missing middle housing (duplexes, townhomes, bungalow courts, carriage houses, etc.) to expand neighborhood walkability. Daggett also indicated a desire to reduce parking minimums.
Daggett noted that state law precludes Flagstaff from implementing its ideal affordable housing initiatives. Daggett said that until state law relaxes, the city would rely on incentives such as Low-Income Housing Tax Credits, partnerships with nonprofit and for-profit developers on city-owned land, and prioritize affordable housing during budget talks.
Climate change has been a winning topic for Flagstaff’s voters for the better part of the past decade; former mayor Coral Evans committed the city to carbon neutrality by 2030, a plan which Daggett supports. Affordable housing presents a newer concern prompted by the hot-turned-cold housing market, combined with the glut of short-term rental properties in the area.
Last June, Daggett and the Flagstaff City Council passed a Carbon Neutrality Plan. The plan noted that every action would integrate equity as a foundational element. The council pledged to encourage alternatives to cars such as walking, biking, rolling, and busing; reduce citizens’ dependence on driving; electrify its buses; expand micro-mobility devices; support citizens’ transition to electric vehicles; transition to 100 percent renewable electricity for municipal needs; increase renewable energy installations and usage in new buildings while supporting solar installations on existing buildings; reduce or remove natural gas usage in municipal buildings; encourage electrical grid reliance on new buildings; require new homes to be net zero energy homes by 2030; encourage sustainable consumption; divert waste from the landfill; reduce organic waste to the landfill to feed people; and develop a portfolio of local and regional carbon dioxide removal initiatives to achieve carbon neutrality.
Last August, Daggett said she would look to use American Rescue Plan Act funding to expand emergency shelter and affordable housing initiatives. In June, Daggett said that the city should apply its $5 billion budget surplus to climate action and affordable housing.
According to Flagstaff’s profile on the Global Covenant of Mayors for Climate & Energy (GCoM), the city has about 971,600 annual GHG emissions. It’s completed five out of nine phases spanning mitigation, adaption, and energy access & poverty initiatives.
GCoM is a coalition of over 11,500 cities and local governments across six continents and 142 countries pledging to lower emissions and establish climate resiliency. GCoM is co-chaired by Michael Bloomberg, former New York City mayor, and Frans Timmersman, European Commission executive vice president for the European Green New Deal.
GCoM ex-officio members include Patricia Espinosa, UNFCCC executive secretary; Maimunah Mohd Sharif, UN-Habitat executive director; and the Global Covenant of Mayors executive director. On the board are the mayors of Guelph, Canada; Warsaw, Poland; Heidelberg, Germany; Colombo, Shri Lanka; Kloto 1, Togo; Makati, Philippines; and Hobart, Australia.
Phoenix is also a member of GCoM, with reported annual GHG emissions of 16.45 million.
Corinne Murdock is a reporter for AZ Free News. Follow her latest on Twitter, or email tips to corinne@azfreenews.com.
The city factors minimum wage based on cost of living in addition to inflation. In 2016, Flagstaff voters approved Proposition 414, a measure raising the minimum wage to $15 an hour last year and ensuring annual adjustments for inflation and cost of living every year thereafter. The city’s minimum wage must be at least $2 above the state’s minimum wage.
Prop 414 also ensures that hourly tipped minimum wage will be the same as hourly minimum wage by 2026.
It’s anticipated that the state will increase minimum wage to $13.85 an hour, just over a $1 increase from the current $12.80 minimum wage.
Despite criticism that the minimum wage would exacerbate unemployment, Deasy shared in March that unemployment rates have halved since 2016.
Flagstaff’s Minimum wage and Unemployment rate
Dec. 2016: $8.05 / 6.4% Dec. 2021: $15 / 3.7%
When exactly was min wage going to kill jobs again?
— Flagstaff Mayor Paul Deasy (@MayorDeasy) March 8, 2022
Those unemployment rates may reflect the hiring and growth of big box and chain stores, in turn masking the suffering of small businesses.
Several small businesses were vocal about experiencing the brunt of Flagstaff’s minimum wage increases. About a month before the pandemic occurred, small business owners reported that they’d resorted to reducing their number of employees and their hours of operation.
The Flagstaff City Council has also considered a minimum wage increase for its city employees. They haven’t voted on an increase yet.
Pending Council’s vote, Flagstaff’s minimum wage for city employees will be $16.60/hr starting in July.
Come work with us cool kids 😊
— Flagstaff Mayor Paul Deasy (@MayorDeasy) April 22, 2022
Deasy has petitioned the council to increase city employees’ minimum wage, initially asking for $17 an hour but settling for slightly less, $16.60 an hour.
I asked staff to assess the financial impact of a $17 minimum wage for City of Flagstaff employees at today’s budget retreat.
The Flagstaff City Council approved expenditures of over $1.1 million for what it said would improve Americans with Disabilities Act (ADA) compliance for the public library entrance — yet the majority of the project accomplishes sustainability and artistic ends, and the conceptual rendering removed current handicap parking. Construction began Monday.
Of the seven initiatives outlined in the project’s executive summary, only one directly addresses an ADA item: safety railing. The executive summary noted that the project’s priorities and objectives align with diversity, inclusivity, sustainability, and carbon neutrality initiatives, in addition to benefiting a local artist.
That artist, Maria Salenger, received a $75,000 contract in December 2020 to create exterior artwork for the library, which includes miniature steel sculptures of open books that will line the pathway and be illuminated at night.
The Flagstaff City-Coconino County Public Library entrance renovations include new asphalt, curbs, gutters, and sidewalks; railing and ground-mounted art pieces; project lighting and electrical components; conduit and pull boxes for ITS Fiber and APS charging stations; a concrete plaza, pathways, and stairs with integral color and architectural finishes; hydronic heating in certain concrete pathways; and expanded landscaping.
Noticeably absent from the conception drawing are the two handicap parking spaces currently positioned directly in front of the building; there, the city projected the installation of a garden bed. There’s no handicap parking anywhere near the library entrance in the drawing.
According to the ADA: “Accessible [parking] spaces must connect to the shortest accessible route to the accessible public entrance or facility they serve.” For every 25 parking spaces in a lot, there must be at least one accessible parking space and at least one van accessible parking space.
(Source: U.S. Department of Justice, “ADA Compliance Brief,” ada.gov)
A conceptual rendering of the renovations depicts the library with a zigzag of sloped wheelchair-accessible concrete ramps lined with benches, plant beds, and safety railing. One side of the building will have stairs, whereas the current library entrance doesn’t. The new library entrance will also have porch tables and chairs.
The current exterior of the library has two straight, wide concrete pathways leading directly to the entrance, and no stairs.
The city announced early last year that the library’s front entrance wasn’t ADA compliant.
The city awarded the “Main Library ADA Entrance Project” contract to Scholz Contracting, the only company to submit a bid for the job. The city posted a solicitation for construction last month and closed it after two weeks. In that time, the city received only one bid: Scholz Contracting.
According to the city’s procurement code, invitation for bids must be issued 21 days before the closing date and time for receipt of bids, unless a shorter time is determined necessary in writing by the purchasing agent pursuant to a written request from the department requiring the contract. The city charter requires that public notice of bid invitations must be published at least once in the newspaper, five days prior to the opening of bids.
Funds for the renovation come from the general government and BBB funds for the library. The project is scheduled to take 130 days.
Corinne Murdock is a reporter for AZ Free News. Follow her latest on Twitter, or email tips to corinne@azfreenews.com.
Flagstaff City Council will consider requiring all single occupancy public restrooms to be gender-neutral. Affected restrooms would be those in city-owned buildings designed for one person, a family, or assisted use.
If enacted, the affected restrooms would be required to have “nongendered signage.” Instead, signs would read: “gender neutral,” “all gender,” or “restroom” without reference to a specific gender.
The Commission on Diversity Awareness characterized the change as equitable and ensuring safety for “gender non-conforming persons.” The commission also urged the council to recommend gender-neutral restrooms for all others not owned by the city.
The proposed push for gender-neutral restrooms arose out of the city’s application of the Municipal Equality Index: a metric designed by the Human Rights Campaign, the largest LGBTQ activist and lobbying group in the country. The index measures from 0 to 100 the inclusivity of laws, policies, and services within five categories: non-discrimination laws, municipality as an employer, municipal services, law enforcement, and leadership on LGBTQ equality.
Flagstaff scored 88 out of 100. They lost points in areas related to housing, health care, conversion therapy, youth bullying prevention, general resources, and all-gender facilities.
Some private facilities took the step toward gender-neutral accommodations years ago. The Flagstaff YMCA changed its single occupancy restrooms into gender-neutral ones in 2016 after a young transgender male lodged a complaint. The operations director received Northern Arizona University (NAU) LGBTQIA’s Ally of the Year award. The director reported that the sign change impacted the transgender male so profoundly that the parents cried over it. NAU established gender-neutral restrooms in 2015.
The site refugerestrooms.org lists the location of gender-neutral restrooms on Flagstaff and nationwide. The restroom locator service also comes in the form of an app.
The city commission discussed the policy proposal on Tuesday.
Corinne Murdock is a reporter for AZ Free News. Follow her latest on Twitter, or email tips to corinne@azfreenews.com.
