Brewer signs $9.23B budget but vetoes some items

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By Catherine Holland By Catherine Holland

PHOENIX (AP) -- Arizona Gov. Jan Brewer on Friday signed the Legislature's $9.23 billion budget for the fiscal year starting July 1, calling it principled and fiscally prudent and a step in the right direction because it adds spending for child welfare services.

But the Republican governor used her line-item veto power to cut some spending, including $1.3 million to help counties who will see lower revenue because of a bill eliminating electricity taxes for manufacturers that she signed earlier in the day. Other cuts include $1 million for special technical education high schools, money for northern Arizona law enforcement and part of the money allocated for a new English language learning software program.

The largest item in the budget is for K-12 schools, spending $3.8 billion, $189 million more than the current year. Other top spending areas include the state's Medicaid plan at $1.3 billion, $768 million for universities and $72 million for community colleges.

The state will also spend nearly $1 billion on prisons, a $25 million increase from the fiscal 2014 spending plan.

Overall, Brewer called the more than $57 million in additional spending for child welfare "a significant step in the right direction for our state."

But she reminded lawmakers that they had agreed to revisit the child welfare issue and its funding once a report is released on setting up a new agency to take over from the old Child Protective Services. Brewer ordered CPS separated from its parent agency in January after the discovery of more than 6,500 uninvestigated child abuse and neglect cases.

Some of her line-item vetoes targeted spending she believed wasn't needed now and could be better used when the new agency is formally created. That included the entire $828,500 budget for the state ombudsman's office because the Legislature included an extra $200,000 to handle additional work from the new agency.

Brewer spokesman Andrew Wilder said it was impossible to cut the $200,000 alone and the office won't run out of money until June 30. He said Brewer expects the funding to be part of the discussion on a new CPS agency before then.

"This is something that can be revisited in the upcoming session on child safety," Wilder said.

Senate President Andy Biggs, R-Gilbert, chafed at the governor's veto of the money for the ombudsman's office, which investigates complaints of government wrongdoing.

He said the ombudsman's office helps people who cannot afford to hire attorneys and noted that a third of all cases that are heard by the office are related to the child welfare agency.

"If people believe state government is encroaching and taking away their rights, the ombudsman office is supposed to be there for them to complain and resolve problems."

A group of lawmakers and others are working with Brewer's staff to write legislation to make that executive order permanent and expect to release it by May 1. Brewer is expected to call a special legislative session when that report is ready to formally created the agency and ensure it has needed funding.

In all, Brewer cut more than $4 million from the budget, including $10,000 for an airstrip in northern Arizona which she said had an unclear state purpose and added liability and operating costs.

House Speaker Andy Tobin, R-Paulden, said he was disheartened by Brewer's veto of the money to replace revenue counties are losing because of the elimination of taxes on electricity and natural gas purchases made by manufacturers.

"We were just trying to level the playing field for them," Tobin said.

He was also disappointed by her vetoing extra funding for rural career and technical education programs for high school students, saying that rural communities often incur extra costs for transportation.

"That was something our rural folks really wanted," he said.

The $1.3 million appropriation for counties was negotiated by rural lawmakers who worried that Brewer's proposal to cut sales tax charges to manufacturers and smelters would hurt local budgets. Brewer signed Senate Bill 1413 on Friday morning in a move she said was needed to make the state more attractive to large businesses.

The power tax cut is expected to cost the state general fund at least $17 million a year.

In her veto letter, Brewer called the appropriation an "unnecessary appropriation" because the loss to individual counties would be so small.

"More importantly, this appropriation would have set a policy precedent that would undermine future efforts to improve the competitiveness of Arizona's tax code."

The House and Senate spent three weeks fighting over the budget proposal before reaching a compromise on Monday. The overall spending plan is about $133 million less than Brewer requested and does not make the $50 million deposit she wanted into the state's rainy day fund.


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