Arizona Proposition 123 is bad for Arizona.

Surely you’ve seen the ads proclaiming Arizona’s Proposition 123 as a life saving, essential revenue infusion for schools.  The ads claim it’s a way to support our schools and teachers without raising taxes.  A no vote on Proposition 123 would leave our schools in disarray and underfunded for the foreseeable future.  How could anyone who cares about our children’s education vote no?

There’s no doubt Arizona’s public school system is severely underfunded.  Arizona currently ranks last in the nation for public school spending per student, and in the bottom 10 for all other categories.  A revenue infusion is needed immediately.

What Proposition 123 backers aren’t telling you is, you’ve already paid for it and the money is already available in the State Fund.  However, lawmakers would rather use that money to give corporations huge tax cuts, instead of what it was originally intended for…our children’s education.

A Brief History

In 2000, then Arizona Governor Jane Hull, and other Arizona leaders, used the same guilt trip to convince the voters to do the responsible thing and raise the State Sales Tax to properly fund schools.  At the time Arizona Schools were severely underfunded and ranked near the bottom of the country in all school statistics.  Sound familiar?

From the Arizona Auditor General Report (2002):

“In November 2000, voters approved Proposition 301, which increased the State’s sales tax from 5 percent to 5.6 percent to provide additional monies for educational programs. The tax is expected to produce $444 million in fiscal year 2002, of which over $261 million (59 percent) will be distributed to school districts, charter schools, and state schools.”

The proceeds of the sales tax hike were to fund public education.  The proposition also created a base funding level tied to inflation, in order to insure the amount of money budgeted to schools would raise each year, avoiding future funding issues.

In 2008, Arizona and the rest of the nation was hit with the “Great Recession”.  When confronted with tighter budgets and less state revenue, State Lawmakers decided to ignore the will of the voters and, began funneling money earmarked for education through Proposition 301 to other areas of the state budget.

In 2010, Arizona Schools sued the State of Arizona for not distributing the tax money to schools as the voters had directed them to do.  The Courts agreed and ordered the state to pay the schools the money that was owed.  The State appealed the decision all the way to the Arizona Supreme Court which agreed with the lower courts and ordered the State to pay Arizona Schools the $1.3 billion dollars that was withheld, against the clear mandate of the voters.

The “Settlement”

Instead of following the Court’s orders and giving the money to the schools as the voters intended through Proposition 301, the state has demanded a settlement.  In the last legislative session, Governor Ducey, the legislature and the schools agreed that Proposition 123 would be the quickest settlement.

Even the strongest backers of the Proposition like Fred Duvall (former candidate for Governor), state publicly Proposition 123 isn’t a perfect nor complete fix to our school funding problem.  The consensus of those affected, Lawmakers, The Governor and Teachers agree it’s more convenient to get money now instead of letting this drag out, even though the consequences down the road will be compounded many times over.

It should also be noted, the campaign for Proposition 123 is being funded by big business.  To date, almost $4 million dollars in large donations have funded the advertising blitz.  Two Arizona billionaires Bruce Halle, the founder of Discount Tire Company and Founder Bob Parsons donated $1 million dollars a piece to the campaign for it’s passage.  Think about it, business people are smart, that’s how they got rich.  If a business person spends $1 million dollars on something, they expect to get a much greater return, like say a big portion of that $600+ million currently sitting in the state’s general fund…via TAX BREAKS.

The opposition to Proposition 123 is minimally funded, but current Arizona State Treasurer Jeff Dewit and five former State Treasurers who have intricate knowledge of the State Land Trust and how it works, oppose Proposition 123.  Below are the Arizona State Treasurers who have opposed Proposition 123.

Photo Courtesy of left, current Arizona Treasurer Jeff DeWit; Dean Martin, treasurer from 2007-2010; Carol Springer, treasurer from 1999-2003; Ernest Garfield, treasurer from1971-1973; Morris Herring, treasurer from 1969-1971; and Bart Fleming, treasurer from 1973-1978. courtesy of

Arizona Has The Money To Fully Fund Our Schools Now

According to Arizona State Treasurer, Jeff Dewit, “by the governor’s and the Legislature’s numbers, we have the money to fully fund the money owed to teachers without raiding the trust fund…We go up to a $1 billion surplus within a few years.”

Instead of solving the problem by using the money we’ve already paid, in the increased sales tax, currently sitting in the State’s General Fund, the Governor and State Lawmakers crafted this “settlement” called Proposition 123.  Essentially, Arizona lawmakers want you let them keep the dollars you’ve already contributed to education (prop 301) as a slush fund to use however they choose and then write them a new blank check (Proposition 123), to drastically increase (by 300%) the yearly withdrawals from the State Land Trust.  

Think of it this way.  You have a 401k and you’ve got a big bill that needs to be paid.  You can either pay with money you have in a savings account, or you can cash in a significant portion of your 401k to pay for it.  Of course paying with your 401k makes no sense as you will be significantly decreasing it’s earning power over the long run.  In the end you will end up paying many times more than if you had used the cash you already had on hand.

Proposition 123 works the same way.  While it may be a quick fix to a long term problem, after proposition 123 expires 20 years from now, Arizona Schools will receive approximately $70-$100 million dollars per year less than they would have if we just took care of the problem now, with money we’ve already paid via increased sales taxes.  It’s estimated that Arizona Schools could lose up to $8 billion dollars in funding over the next 40 years if Proposition 123 passes.

There’s Also No Guarantee This Money Will Be Used For Education

The authors of Proposition 123 must believe the voters in Arizona have no memory and have an undying trust in our Government.  Just like Proposition 301, Proposition 123 has hidden language, called “triggers” that give our lawmakers yet another excuse to not use the money raised for education and instead funnel that money to other pet projects.

From The Arizona Daily Sun:

“These triggers include growth in sales tax and employment that each fall below 2 percent in a given year, allowing the legislature to decide to suspend the fund. If they each are less than 1 percent, the funding must be suspended.”

Arizona Leaders have already shown us we cannot trust them to do the right thing, and now they want you to give them permission to do it again!

The Solution

The only solution is a loud and clear NO vote on Proposition 123.  Further, the citizens of Arizona should demand the State use the Proposition 301 Sales Tax money already collected to immediately fund the schools as the voters ordered.

Fool me once, shame on you…Fool me twice, shame on me.  I promise you will not fool me a third time because another election is on the horizon and I will not forget which lawmakers tried to take the easy way out on the backs of the students of Arizona.