Taxpayer group calls departing AZ Governor “fiscally irresponsible”

FOR IMMEDIATE RELEASE: November 20, 2008
Contact:  Tom Jenney, Arizona director, Americans for Prosperity

Taxpayer group calls departing AZ Governor “fiscally irresponsible”

PHOENIX—As major news outlets began announcing that Gov. Janet Napolitano had been picked to be Barack Obama’s Secretary of Homeland Security, the Arizona chapter of Americans for Prosperity (AFP Arizona) described her as “fiscally irresponsible.”

“For six years, Captain Napolitano steered the state government toward a budget iceberg,” said AFP Arizona director Tom Jenney. “Now that the ship is sinking deeply into deficit, she is jumping into Obama’s lifeboat and leaving the scene.”

Jenney said that Napolitano’s strong position in budget negotiations, and the lack of fiscally conservative majorities in the Legislature, allowed her to increase the state budget by 59 percent from FY 2004 to 2008, compared to an economy that grew by 42 percent, and population and inflation, which grew by 30 percent. Rapid budget growth raised spending to unsustainable levels, resulting in massive budget deficits when the real estate bubble popped and the economy began to flag.

With more than $11 billion in spending commitments (including formula spending increases and cumulative K-12 rollovers), and revenues unlikely to top $9 billion, the state government is looking at a structural deficit for FY 2010 of over $2 billion, or 20 percent of the state budget—one of the nation’s worst budget crises.

As evidence of Napolitano’s record of fiscal irresponsibility, AFP Arizona cited:

  • A 17-percent spending increase in 2004, which occurred when several fiscally liberal Republicans joined with Democrats to pass the Governor’s budget bill.
  • Executive budgets with projected spending that was often dramatically higher than any of the realistic estimates of available revenue provided by the Joint Legislative Budget Committee and university economists.
  • The Governor’s enormously unbalanced FY 2009 budget, which AFP Arizona called “a $10.9 billion budget masquerading as a $9.9 billion budget,” at a time when revenues were projected to be $9.1 billion (the budget passed this June, with the help of all Democrats and a handful of fiscally liberal Republicans).
  • A billion-dollar university construction plan passed along with the Governor’s budget in June; the plan projects that the borrowing will be paid back with enhanced lottery sales, even though few observers believe lottery sales will actually meet the targets.
  • The Governor’s request this week that Congress provide “enormous relief to state budgets,” even though the Federal Government is itself running record deficits.

According to AFP Arizona, even the income and property tax cuts Napolitano signed in 2006 were tainted by the excessive spending increases she extracted from the Legislature in the bargain.  For every surplus dollar in 2006 that was returned to taxpayers, two dollars went to new spending.

“Napolitano has left us an awful mess,” said AFP Arizona chairman Chad Kirkpatrick. “Nonetheless, we remain optimistic that the incoming Governor and Legislature will enact fiscally responsible policies that return Arizona to the path of prosperity.”

In November, Arizona voters elected majorities of legislators who either scored very well on last year’s AFP Arizona Legislative Scorecard, or who have pledged to not raise taxes. Napolitano will be replaced by Secretary of State Jan Brewer.

Asked to define “fiscally responsible policies,” AFP Arizona pointed to its Reform Arizona Plan (link below), which calls for reducing the gigantic state deficit, preventing any tax increases, avoiding taking on debt that will hurt future taxpayers, and implementing reforms to bring government spending under control for the long term.

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