Gov. Doug Ducey talks candidly about tax cuts, lawsuits and the 53rd legislative session
Yvonne Wingett Sanchez
Gov. Doug Ducey got much of what he wanted in the $9.8 billion budget passed last week by lawmakers. But it didn't happen without some drama — from threats of lawsuits over university capital funding, to the Republican governor's discussions with Democrats.
Ducey looked back on his third session as governor in a conversation with The Arizona Republic on Monday. The text has been edited for clarity and space.
Who is the biggest winner in this budget?
I think education is the biggest winner in this budget. Our classrooms, our teachers, our kids and their parents are the biggest winners, along with universities and the university presidents and our future university students.
Who are the losers?
I think we always can do more in the budget. To me, the focus has always been on the economy and education. So, in terms of what I wanted to accomplish ... I felt like the budget that was presented, in collaboration with the Legislature — and I give a lot of credit to the Speaker of the House J.D. Mesnard, and President (Steve) Yarbrough, both in their first year — in the way that we were able to communicate. Of course, you’d always like to have more votes on the budget, you’d like to do it on quicker timing. But I think we feel that this was a good achievement with a lot of positive accomplishment.
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Were you frustrated with the more collaborative process in the House? It seemed to slow things down.
I give (Rep.) J.D. (Mesnard) a lot of credit. He told me before he was sworn in as speaker that that’s how he wanted to do it. He wanted to have a more thoughtful appropriations process, and he didn’t want the budget to feel as if it was top-down or leadership-only. He went through the paces. Regardless of when these guys sine die, we’re going to be here. It’s not just about speed for speed’s sake. It’s about moving forward in a way that best serves the taxpayers and the citizens. So we were able to get what I thought was a good, positive budget, and we did it in good timing.
When do you think you’re going to sign it?
Tomorrow (Tuesday) or the next day.
Any plans for line-item vetoes?
(Big pause). There are no plans at this time for line-item vetoes.
You hesitated.
Of course, it’s like any bill. We have a feel for everything that’s in the budget, but we’re still in discussions on some final bills, doing daily briefings. We’re going to reserve that right, there’s no plans.
You worked to bring conservative Republicans on board. Did you find the “threat” of working with Democrats on the budget lured in conservatives?
I welcomed the opportunity to work with Democrats. We would love to have a bi-partisan budget and an even more bi-partisan budget. I have to get to 16 and 31 (votes in the Senate and House, respectively). I present a budget in mid-January and I have to get the votes to get it passed. And I want to advocate for the budget that I want. Of course, I respect the co-equal branch of the Legislature, and the institutions of the House and the Senate. We’ve had an incredible amount of bills that have passed this year in a bipartisan fashion. The university package was bi-partisan. But I think the vote on teacher raises is a bipartisan issue, and I’d like to see more votes for ideas like that, and ideas supporting education. I don’t want to speak for others in how they negotiate the budget. We have our role in those discussions and they have theirs, and this is the result. We feel good about the result.
Would you characterize your conversations with Democrats as “negotiations?”
But I do, on Jan. 16 when I released the budget, that’s the budget I want. They probably have a much a better feel for the vote count than I do, being up here (in the executive office). But I’m having conversations with leaders and Republicans and Democrats the entire time. And I’m open-minded to good ideas. The things you’ve seen in the budget are things that are not partisan issues. These are things that I think we should be able to build broader coalitions and get more votes on.
It’s a strange time nationally, and of course it resonates to the state-level. But we’re going to keep working hard to move our ideas forward, and I think with this one being so focused on K-12 education, being so focused on the universities, these are … not Republican or Democrat issues.
How did Arizona Board of Regent President Eileen Klein’s talk of a potential lawsuit play into the budget discussions?
I don’t ever think that discussion of a litigation attempt moves people in the right direction, at least that’s been my experience .. I was surprised, and didn’t know the total context of why it was introduced at this time, and didn’t want it to distract from what the goal was.
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It would cost $2.8 million to fully restore Temporary Assistance for Needy Families, the cash-aid assistance program, without the restrictions you proposed, but you weren't willing to do that. Why?
We want to restore TANF, we just want accountability with it. Again, we don’t think that’s a partisan issue. Seventy-five percent of the people eligible for TANF would be able to receive their benefits under the accountability that we put forward, so in the sense, the people that won’t vote for it are punishing those people who need those dollars.
What’s your message to the other 25 percent who wouldn't qualify?
We want people to have a hand-up. We also want people to be actively looking for work — and we’re talking about able-bodied people here — and we want their kids to go to school. That’s something we can be supportive of. We don’t want to just hand dollars out if we’re not going to have it as a two-way street in terms of trying to re-enter the workforce and make certain your child is going to school.
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Does the budget make caregivers for the developmentally-disabled whole in light of the minimum-wage hike?
We’re going to be reviewing that, but I believe that it does.
Would you support additional funding for contracts to serve people with developmental disabilities?
Well, this is a financially responsible budget. The budget remains structurally balanced, but we did spend what we’re going to bring in. We want to be responsible. Of course we can revisit that at a later date.
Empowerment Scholarship Accounts will be open to all public school students. Could children with disabilities, and those in poor performing schools be squeezed out?
That hasn’t been the case so far … This has been a small reform, and its gradual as it goes forward. Let’s see what happens as these roll to an opportunity for more of Arizona’s children. We have room before the second ESA bill was passed, we still have room today under the cap. I don’t anticipate that happening because it hasn’t happened in the past.
A coalition of parents and public-school advocates are pulling paperwork to overturn the ESA expansion with a measure on the 2018 ballot. What are your thoughts about that?
I’ve had a lot of discussion around educational savings accounts and how it can benefit kids in Arizona, and how it’s a good idea, but it’s really a small reform, and it’s capped, and it’s gradual. Once people understand facts that it’s 5,000 children a year, and it’s at its maximum less than 3 percent of the population that’s in the K-12 education system … I think once people understand the scope of it, the temperature comes down. Let’s see how it works. It’s just an expansion of parental choice and school choice.
READ MORE:Parent group will seek to overturn Arizona school-voucher expansion
Former Gov. Jan Brewer, a Republican, evidently thinks the 2011 tax cuts she signed went further than they should. What is your reaction?
When I’m talking to business people that are considering moving to Arizona and investing in Arizona, asking their supply chains to come to Arizona, the fact that we are lowering taxes every year, that we’re an attractive state in which to do business, that we’re getting rid of 500 regulations are always things that are at the top of their list. I see this often times where people say, “What have we gotten for these tax cuts?” I’ve read recently that Maricopa County was the fastest-growing county in the nation. I think sometimes we take that for granted here. There’s 3,144 counties in this nation … and we live in the No. 1 fastest-growing .. that is a result of a business climate that attracts both businesses and individuals.
There is another tax cut, Senate Bill 1416. Can we afford more cuts?
We’re growing as a state, our economy’s growing. So we’re going to have a tax base that’s broadening, that’s expanding. And I’m in competition with other states that want to attract individuals, so I think it’s my obligation to make sure that we are more attractive every year, and that we’re responsibly spending.
With the filing of a $2 billion K-12 capital lawsuit, you and the Legislature find yourself legislating by lawsuit. What’s your reaction to that legal action?
Well, the lawsuit is saying that we need more money for capital and construction in K-12. And I agree, and that’s why we put more money into capital and construction in this budget, and I imagine we’ll put more money going forward in future budgets.
I've talked a bit about trial lawyers and the settlement of Prop. 123, which was the result of a lawsuit, which we were able to settle and move along. The way you settle things is with dollars and finances. Everybody’s got to make a living, including trial lawyers. We’re going to be bringing more money into K-12 education and into the capital structure, and we’ll deal with the legal remedies along the way.
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Do you see yourself once again trying to negotiate a resolution on this lawsuit like you did with Proposition 123?
Teachers and parents and K-12 education versus lawyers that are trying to make a buck out of their lawsuit. If someone wants to make a case to protect the trial lawyers, I’d rather pay the teachers.
Follow the reporter on Twitter @yvonnewingett and reach her at yvonne.wingett@arizonarepublic.com or 602-444-4712.
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