PHOENIX (AP) - A sharply divided Arizona Supreme Court on Friday said it blocked a ballot measure seeking to boost taxes on the rich from the November ballot because proponents failed to reveal it also would increase some taxes for other taxpayers and it misstated the actual increase on high wage-earners.
The 5-2 opinion issued by the court gives a full explanation of why the majority blocked the voter initiative in August.
Chief Justice Scott Bales and Justice Ann Timmer dissented, and said their colleagues wrongly bought into opponents’ arguments and should have let voters decide the fate of Proposition 207.
More than 270,000 Arizona voters signed petitions to put the tax increase on the November ballot, which came after years of complaints about low school funding in the state. Despite big teacher raises this year, inflation-adjusted school funding is only slightly above what it was a decade ago and many schools haven’t been able to hire enough teachers, maintain buildings or keep textbooks current.
The opinion said the court did not overrule those citizens without substantial thought.
“We greatly respect the initiative process, including the civic activism required to collect the signatures necessary to qualify a ballot measure, and we do not lightly disturb the fruits of such efforts,” the unsigned ruling said. “However, we must do so, as the Court has done in various prior circumstances, when essential requirements necessary to qualify a measure are not adequately followed.”
The opinion from the five justices who voted to block the measure said the initiative’s 100-word description left out the elimination of tax bracket inflation indexing that would affect other taxpayers, a fact disputed by proponents and questioned by Timmer and Bales.
The opinion by Vice Chief Justice Robert Brutinel and justices John Pelander, Clint Bolick, Andrew Gould and John Lopez also said the description used unclear language to explain the tax increase on the wealthy intended to boost education funding by about $690 million a year.
“The omission of the change in tax indexing paired with the confusing language about the magnitude of tax increases makes it clear that petition signers were not adequately informed about what they were signing …,” it said.
The indexing law, passed in 2015, automatically adjusts tax brackets upward each year to account for inflation. The state Legislature’s budget analysts say a couple earning $100,000 a year would pay an additional $34 in taxes if indeed the indexing were eliminated.
The proposal sought to raise the income tax rate to 8 percent for individuals earning more than $250,000 a year and households earning more than $500,000 annually for the portion of their income above those cutoffs. Individuals who earned more than $500,000 annually and households making more than $1 million annually would have paid 9 percent above those cutoffs.
The initiative description said taxes would go up 3.46 percent on individual incomes over a $250,000 and 4.46 percent on individual incomes over $500,000. Opponents said that description was confusing because the numbers referred to tax rates, not the percentage increase, which was 76 percent and 98 percent, respectively.
Bales wrote that the majority erred by accepting the parsing of language opponents of the measure put forward and should have allowed voters to decide.
“I agree with the majority that better drafting of the 100-word description and Proposition 207 itself could have avoided the issues addressed in today’s opinion,” he wrote. “But we have never required perfection in drafting as a condition for the valid exercise of legislative authority, and doing so with initiatives would infringe upon the people’s constitutional right to enact laws independently of the legislature.”
The decision angered proponents of the measure, some of whom are targeting Bolick and Pelander in next month’s election, where they appear on the ballot to be retained or rejected. They also questioned whether Gov. Doug Ducey’s decision to add two members to the court swayed the decision. The 5-2 ruling showed that it did not; it would have been blocked by a 3-2 majority without Lopez and Gould, the two new members.
David Lujan, who was treasurer for the Proposition 207 campaign, said there is still a significant school funding crisis in Arizona.
“So we will be back at the Legislature this next session to make sure they understand it’s a priority and they do something about it,” Lujan said. “And if they don’t, then yes, I think the ballot is always an option, and also what’s an option is the income tax on high-earners.”
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