The state budget deficit is an opportunity in disguise. The pressure of a multi-billion dollar shortfall might enable reforms we wouldn't have the courage for otherwise.
Gov. Janet Napolitano, although often cited for her skill in avoiding tax hikes, recently unveiled a couple of particularly bad ideas for revenue enhancement. First, she wants to expand photo radar on state highways to generate $90 million of deficit reduction. I have to admit I thought people who claimed photo radar was just a cash cow for government were scofflaws who didn't like to get caught speeding. Maybe they were onto something after all.
The governor also recommended ratcheting up the marketing of the Arizona lottery to generate additional income. But as Steve Voeller of the Arizona Free Enterprise Club points out, lottery tickets have an embedded 41 percent tax. Worse, the tax is hidden and sharply regressive. Low-income people desperately trying to hit it big are the backbone of lottery support. We should be ashamed to urge them to do more to help us solve our current dilemma.
There are better options than victimizing the poor. For starters, we could offer more vouchers to Arizona students to attend the schools of their choice. But don't vouchers siphon money from public schools, as were so often told?
Well, no. Lets think this through. Proposed voucher amounts are always less, much less, than the amount of per pupil spending in public schools. Education researchers calculated that in a recent year, if 5 percent of Arizona students had used vouchers of $3,500 for elementary school or $4,500 for high school to transfer to private schools, $32 million would have been saved. The money could be used to increase the per student funding in public schools or could be applied to our budget deficit. Either way, the effect of vouchers is to improve the level of per student funding available. Moreover, low-income students especially would benefit academically from having choices in schooling.
This might also be a good time to reassess whether its a good idea for the state to have primary responsibility for building schools. The state Supreme Court in the 1990's goaded the Legislature into taking over school construction from the districts, on the grounds that it would be more equitable. It hasn't worked out that well. The state spends about $400 million a year, yet local school taxes haven't gone down in most districts and capital funding disparities among the districts persist. A plan to restore the role of districts in school construction, with aid to low property tax districts, would potentially save money for the state and enhance local control of schools.
Highway funding is another area where fresh approaches are worth a look. In our growing state, we need to bear down on highway construction and maintenance. Rather than spend money we don't have or add to our mountain of debt, we could follow the lead of other states in successfully privatizing road construction. Texas, for example, has contracted with private firms who build roads in exchange for the right to collect tolls for a limited period of time. Ownership than reverts to the state. These private roads are typically limited-access highways which could be alternatives to existing, overcrowded venues such as Interstate 17 or the Phoenix-Tucson corridor. Nobody would be forced to use them, yet all drivers would benefit from congestion relief. Technology now exists, as in Orange County, Calif., to permit variable pricing which changes every six minutes depending on demand. Motorists with a transponder never have to stop at a toll booth. There may even be a way to rebate the gas tax to those who pay tolls.
If you don't like these ideas, there are others. We could fund university students directly rather than institutions. We could eliminate taxpayer-funded lobbyists. We could choose from a long list of options to cut noncritical spending.
We don't need Chicken Littles all upset because their spending binge has been ended. Hopefully, leaders will emerge who can bring our state through our fiscal problems in better shape than ever.