A word from our lobbyist
By Alexis J. Glascock, Of Counsel, Fennemore. Chief Lobbyist at Surprise Regional Chamber of Commerce
By Alexis J. Glascock, Of Counsel, Fennemore. Chief Lobbyist at Surprise Regional Chamber of Commerce
Public Policy Report
May 5, 2021
The Legislature is very focused on the budget with the hope of adjourning in the next few weeks. The House is leading the charge on advancing a budget that has mustered support from the Governor and, as mentioned before, may likely include a flat tax that would decrease personal income tax over three years to 2.5%. While this appears to have strong support in the House, certain members of the Senate Republicans are concerned that the proposed tax cut is too aggressive. They are in negotiations on that topic this week and we will update you on the final budget and related tax cuts.
In terms of bills before the Legislature, of the 1,708 bills that were filed, 360 have passed, four have been vetoed and about 300 are still awaiting a vote on the floor of either the House or the Senate. The calendars for Floor votes are currently very light with just a few bills scheduled for a vote each day to ensure that members are at the Legislature remain engaged in the budget process and through the end of the session. Some pundits expect the budget votes to be lined up by next week, while others think the Legislature will not adjourn until Memorial Day or early June.
In other news, the Federal PRO Act passed the House and is expected to have its Senate vote in June. Arizona Senators Mark Kelley and Krysten Sinema, as well as Mark Warner of Virginia, are the only three Democratic Senators who have not co-sponsored the bill. If you haven't already and are interested in doing so, please reach out to our U.S. Senators to urge them to not support the PRO Act. The bill could be very harmful to the Arizona business community if it were to become a law because of the ability of unions to reach many businesses that are not required to allow union organizers. It would also eliminate Arizona’s status as a right to work state along with that of all other states that have this provision. Interestingly, at the state level, legislation pertaining to labor (SB1268: Labor Guidelines; Fiduciary Guidelines) has been transmitted to the Governor. It requires unions to disclose their annual financial information.
These are the AZ Constitutional provisions that require a ¾ Vote Related to an Initiative
(3) Referendum power; emergency measures; effective date of acts. The second of these reserved powers is the referendum. Under this power the legislature, or five per centum of the qualified electors, may order the submission to the people at the polls of any measure, or item, section, or part of any measure, enacted by the legislature, except laws immediately necessary for the preservation of the public peace, health, or safety, or for the support and maintenance of the departments of the state government and state institutions; but to allow opportunity for referendum petitions, no act passed by the legislature shall be operative for ninety days after the close of the session of the legislature enacting such measure, except such as require earlier operation to preserve the public peace, health, or safety, or to provide appropriations for the support and maintenance of the departments of the state and of state institutions; provided, that no such emergency measure shall be considered passed by the legislature unless it shall state in a separate section why it is necessary that it shall become immediately operative, and shall be approved by the affirmative votes of two-thirds of the members elected to each house of the legislature, taken by roll call of ayes and nays, and also approved by the governor; and should such measure be vetoed by the governor, it shall not become a law unless it shall be approved by the votes of three-fourths of the members elected to each house of the legislature, taken by roll call of ayes and nays.
6) (A) Veto of initiative or referendum. The veto power of the governor shall not extend to an initiative measure approved by a majority of the votes cast thereon or to a referendum measure decided by a majority of the votes cast thereon.
(6) (D) Legislature's power to appropriate or divert funds created by initiative or referendum. The legislature shall not have the power to appropriate or divert funds created or allocated to a specific purpose by an initiative measure approved by a majority of the votes cast thereon, or by a referendum measure decided by a majority of the votes cast thereon, unless the appropriation or diversion of funds furthers the purposes of such measure and at least three-fourths of the members of each house of the legislature, by a roll call of ayes and nays, vote to appropriate or divert such funds.
(14) Reservation of legislative power. This section shall not be construed to deprive the legislature of the right to enact any measure except that the legislature shall not have the power to adopt any measure that supersedes, in whole or in part, any initiative measure approved by a majority of the votes cast thereon or any referendum measure decided by a majority of the votes cast thereon unless the superseding measure furthers the purposes of the initiative or referendum measure and at least three-fourths of the members of each house of the legislature, by a roll call of ayes and nays, vote to supersede such initiative or referendum measure.
Best regards,
Alexis
May 5, 2021
The Legislature is very focused on the budget with the hope of adjourning in the next few weeks. The House is leading the charge on advancing a budget that has mustered support from the Governor and, as mentioned before, may likely include a flat tax that would decrease personal income tax over three years to 2.5%. While this appears to have strong support in the House, certain members of the Senate Republicans are concerned that the proposed tax cut is too aggressive. They are in negotiations on that topic this week and we will update you on the final budget and related tax cuts.
In terms of bills before the Legislature, of the 1,708 bills that were filed, 360 have passed, four have been vetoed and about 300 are still awaiting a vote on the floor of either the House or the Senate. The calendars for Floor votes are currently very light with just a few bills scheduled for a vote each day to ensure that members are at the Legislature remain engaged in the budget process and through the end of the session. Some pundits expect the budget votes to be lined up by next week, while others think the Legislature will not adjourn until Memorial Day or early June.
In other news, the Federal PRO Act passed the House and is expected to have its Senate vote in June. Arizona Senators Mark Kelley and Krysten Sinema, as well as Mark Warner of Virginia, are the only three Democratic Senators who have not co-sponsored the bill. If you haven't already and are interested in doing so, please reach out to our U.S. Senators to urge them to not support the PRO Act. The bill could be very harmful to the Arizona business community if it were to become a law because of the ability of unions to reach many businesses that are not required to allow union organizers. It would also eliminate Arizona’s status as a right to work state along with that of all other states that have this provision. Interestingly, at the state level, legislation pertaining to labor (SB1268: Labor Guidelines; Fiduciary Guidelines) has been transmitted to the Governor. It requires unions to disclose their annual financial information.
These are the AZ Constitutional provisions that require a ¾ Vote Related to an Initiative
(3) Referendum power; emergency measures; effective date of acts. The second of these reserved powers is the referendum. Under this power the legislature, or five per centum of the qualified electors, may order the submission to the people at the polls of any measure, or item, section, or part of any measure, enacted by the legislature, except laws immediately necessary for the preservation of the public peace, health, or safety, or for the support and maintenance of the departments of the state government and state institutions; but to allow opportunity for referendum petitions, no act passed by the legislature shall be operative for ninety days after the close of the session of the legislature enacting such measure, except such as require earlier operation to preserve the public peace, health, or safety, or to provide appropriations for the support and maintenance of the departments of the state and of state institutions; provided, that no such emergency measure shall be considered passed by the legislature unless it shall state in a separate section why it is necessary that it shall become immediately operative, and shall be approved by the affirmative votes of two-thirds of the members elected to each house of the legislature, taken by roll call of ayes and nays, and also approved by the governor; and should such measure be vetoed by the governor, it shall not become a law unless it shall be approved by the votes of three-fourths of the members elected to each house of the legislature, taken by roll call of ayes and nays.
6) (A) Veto of initiative or referendum. The veto power of the governor shall not extend to an initiative measure approved by a majority of the votes cast thereon or to a referendum measure decided by a majority of the votes cast thereon.
(6) (D) Legislature's power to appropriate or divert funds created by initiative or referendum. The legislature shall not have the power to appropriate or divert funds created or allocated to a specific purpose by an initiative measure approved by a majority of the votes cast thereon, or by a referendum measure decided by a majority of the votes cast thereon, unless the appropriation or diversion of funds furthers the purposes of such measure and at least three-fourths of the members of each house of the legislature, by a roll call of ayes and nays, vote to appropriate or divert such funds.
(14) Reservation of legislative power. This section shall not be construed to deprive the legislature of the right to enact any measure except that the legislature shall not have the power to adopt any measure that supersedes, in whole or in part, any initiative measure approved by a majority of the votes cast thereon or any referendum measure decided by a majority of the votes cast thereon unless the superseding measure furthers the purposes of the initiative or referendum measure and at least three-fourths of the members of each house of the legislature, by a roll call of ayes and nays, vote to supersede such initiative or referendum measure.
Best regards,
Alexis

Public Policy Report
Tuesday, March 30, 2021
Arizona State lawmakers are 79 days into the 55th Legislature. So far, 179 bills have made it to Governor Ducey’s desk—152 of which have been signed into law. In a standard year, there are between 350 and 400 bills that are signed into law. However, due to COVID-19 and the premature adjournment of last year’s legislative session, it’s possible this year’s count will exceed 400 new laws. Many of the 1,708 introduced bills are repeats from last year’s session; because these bills had already partially made it through the legislative process, it’s likely a higher percentage of them will make it to the Governor. The last week for the Senate and the House to hear the bills in committees was last week, with the exception of bills assigned to Appropriations, which is hearing bills this week. Any bills that did not pass out of the committees to which they were assigned are no longer viable.
There was great news this week as Senate Bill 1377 (Civil Liability; Public Health Pandemic) passed out of the House on March 29th with a vote of 31 to 29 along party lines. It now returns to the Senate for a final vote on a House amendment before it is transmitted to the Governor for signing. SB1377 has been a top priority of the West Valley Chamber of Commerce Alliance! This is great news for the Arizona business community as the bill will protect businesses and numerous other entities, such as schools, religious organization, healthcare providers and others from unjust COVID-19 related civil litigation. Passage of this bill allows for much needed protections during Arizona’s reopening process.
State budget negotiations are taking place, but at a somewhat glacial pace. The most pertinent block to the discussion is confusion regarding how the $7.481 billion of federal money granted to Arizona for COVID-19 relief under the American Rescue Plan Act (“ARPA”) can be allocated. Arizona Attorney General Mark Brnovich filed a suit asking for clarification of how the state may utilize the funds as the Act prohibits states from using the funds to supplant their budget expenditures or to reduce taxes. Until this issue is resolved, budget discussions will continue to move at their current pace, especially given the Governor and Legislature’s desire to reduce taxes.
In terms of proposals to cut taxes, the Governor’s approach is aimed at reducing personal and business income taxes by $1.2 billion over a three year period. The $7.481 billion granted to the State of Arizona pursuant to ARPA adds to the standing cash surplus of $1.174 billion in the state’s Rainy Day Fund. The Legislature is discussing a flat income tax with a slight increase in sales taxes along with other efforts to reduce personal income tax rates and commercial property taxes. The state is hoping for direction from the federal government in the next few weeks and can then resume work on the budget.
Finally, President Fann’s SB 1411 to increase the unemployment insurance benefit rate continues to progress through the legislative process. As described in the March Legislative Update, it passed the Appropriations Committee and is waiting for a hearing in the Rules Committee. As you will recall, it raises the unemployment benefit cap from $240 a week to $320 a week. However, the cap would only extend for 20 weeks instead of the current 26 weeks during periods when the unemployment insurance fund is running at a very low level due to a high volume of claims. Over the adjusted 20 week period, President Fann’s proposal would total $6,400. SB1411 passed Senate rules on 2/24. It also increase the cost for employers from $7,000 to $8,000 in the first and second year. President Fann’s bill also includes increased security requirements to decrease the potential for fraud. One of those measures is real time reporting of the amounts that are disbursed daily. Representative Cook also has a bill on the same topic, HB 2805, unemployment insurance; benefits; tax base, that was assigned in the Senate to Appropriations and is set for hearing on March 30th at 9:00 am. We will update you on the status of these two bills as they continue to progress.
Tuesday, March 30, 2021
Arizona State lawmakers are 79 days into the 55th Legislature. So far, 179 bills have made it to Governor Ducey’s desk—152 of which have been signed into law. In a standard year, there are between 350 and 400 bills that are signed into law. However, due to COVID-19 and the premature adjournment of last year’s legislative session, it’s possible this year’s count will exceed 400 new laws. Many of the 1,708 introduced bills are repeats from last year’s session; because these bills had already partially made it through the legislative process, it’s likely a higher percentage of them will make it to the Governor. The last week for the Senate and the House to hear the bills in committees was last week, with the exception of bills assigned to Appropriations, which is hearing bills this week. Any bills that did not pass out of the committees to which they were assigned are no longer viable.
There was great news this week as Senate Bill 1377 (Civil Liability; Public Health Pandemic) passed out of the House on March 29th with a vote of 31 to 29 along party lines. It now returns to the Senate for a final vote on a House amendment before it is transmitted to the Governor for signing. SB1377 has been a top priority of the West Valley Chamber of Commerce Alliance! This is great news for the Arizona business community as the bill will protect businesses and numerous other entities, such as schools, religious organization, healthcare providers and others from unjust COVID-19 related civil litigation. Passage of this bill allows for much needed protections during Arizona’s reopening process.
State budget negotiations are taking place, but at a somewhat glacial pace. The most pertinent block to the discussion is confusion regarding how the $7.481 billion of federal money granted to Arizona for COVID-19 relief under the American Rescue Plan Act (“ARPA”) can be allocated. Arizona Attorney General Mark Brnovich filed a suit asking for clarification of how the state may utilize the funds as the Act prohibits states from using the funds to supplant their budget expenditures or to reduce taxes. Until this issue is resolved, budget discussions will continue to move at their current pace, especially given the Governor and Legislature’s desire to reduce taxes.
In terms of proposals to cut taxes, the Governor’s approach is aimed at reducing personal and business income taxes by $1.2 billion over a three year period. The $7.481 billion granted to the State of Arizona pursuant to ARPA adds to the standing cash surplus of $1.174 billion in the state’s Rainy Day Fund. The Legislature is discussing a flat income tax with a slight increase in sales taxes along with other efforts to reduce personal income tax rates and commercial property taxes. The state is hoping for direction from the federal government in the next few weeks and can then resume work on the budget.
Finally, President Fann’s SB 1411 to increase the unemployment insurance benefit rate continues to progress through the legislative process. As described in the March Legislative Update, it passed the Appropriations Committee and is waiting for a hearing in the Rules Committee. As you will recall, it raises the unemployment benefit cap from $240 a week to $320 a week. However, the cap would only extend for 20 weeks instead of the current 26 weeks during periods when the unemployment insurance fund is running at a very low level due to a high volume of claims. Over the adjusted 20 week period, President Fann’s proposal would total $6,400. SB1411 passed Senate rules on 2/24. It also increase the cost for employers from $7,000 to $8,000 in the first and second year. President Fann’s bill also includes increased security requirements to decrease the potential for fraud. One of those measures is real time reporting of the amounts that are disbursed daily. Representative Cook also has a bill on the same topic, HB 2805, unemployment insurance; benefits; tax base, that was assigned in the Senate to Appropriations and is set for hearing on March 30th at 9:00 am. We will update you on the status of these two bills as they continue to progress.

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One of the most valuable, and often overlooked functions of a chamber is being an advocate for the business community. The Chamber works to represent the collective voice of the business community. Whether it's setting legislative goals, working with our lobbyist, sending out Action Alerts or keeping voters informed through our forums, the goal is ensuring an environment where business can prosper.
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