Governor Sends Higher Bills to Arizona Property Tax Payers

Published July 1, 2008

Homeowners across the country are feeling the pinch of higher property tax bills, and tax revolts are popping up all over in response. A recent veto by Gov. Janet Napolitano (D) may have added fuel to the fire for Arizona homeowners.

Since 2006, taxpayers in Arizona have enjoyed a break on their property taxes. Lawmakers that year passed a bill calling for the repeal of the state equalization property tax, saving Arizona homeowners about $250 million in taxes annually. Without legislative action to make the repeal permanent, the tax was set to return in 2009.

This spring, state legislators set out to erase the equalization property tax permanently and approved House Bill 2220, which would have implemented that goal.

But Napolitano vetoed the bill in April, leaving fiscal conservatives and taxpayers across the state aghast.

Veto Stuns Taxpayers

The governor had long promised not to use tax increases to close the state’s estimated $1.4 billion budget deficit, emphasizing in her January 2008 State of the State address, “State government must live within its means, so the budget I will deliver to you for our next budget year, fiscal year 2009, will be balanced, and will not raise taxes” [emphasis added].

Taxpayer advocates beyond Arizona are concerned about the long-term implications of Napolitano’s veto.

Americans for Tax Reform President Grover Norquist noted, “What the governor has essentially done is reject an opportunity to provide tax relief at a time when soaring property tax bills are already forcing homeowners to pinch their pennies.

“Given today’s uncertain economic outlook and the already-tight squeeze on Arizona’s state budget,” Norquist continued, “the governor should be looking to free up taxpayer dollars to stimulate the state economy. Instead, she has swiftly moved to suck more money from the private economy, which will only aggravate the sour economic climate.”

Homeowners See Record Increase

Many Arizonans, including Steve Voeller, president of the Arizona Free Enterprise Club, view the governor’s veto of the property tax relief bill as a record property tax hike.

“It’s pretty gutsy to be for property tax increases when property taxes are already going up,” Voeller said, “but with her veto, Governor Napolitano paved the way for the largest property tax increase in Arizona history.”

Arizona voters could have their say in the matter yet.

With a simple majority vote in the legislature, a measure to permanently eliminate the state equalization property tax may be referred to the ballot this November without the governor’s consent. Arizona voters would then have the opportunity to dictate the future of their property tax bills.

“Thankfully, the Arizona legislature is prepared to refer this measure to the November ballot and give voters the chance to override the governor’s veto,” Voeller said.

Karri Bragg ([email protected]) is a state government affairs manager at Americans for Tax Reform.