Arizona Legislature ends session with tax, welfare bills on final day

State lawmakers ended their 2017 session Wednesday with a tax-break flourish, approving two tax-credit bills worth millions of dollars aimed at spurring business development, and a revision of a controversial cash-aid program for poor families.

The 122-day session ended at 6:58 p.m., a rare daytime close from a Legislature that has extended debate late into the night and into the morning in recent years. Lawmakers applauded the daylight end as a sign of the more genial tone of this year’s Legislature.

The tax bills and the cash-aid programs were philosophical bookends to this 53rd session, which used tax incentives to boost business and carrot-and-stick approaches to attempt to wean people off state assistance.

The key tax measure, Senate Bill 1416, passed the House with one vote to spare. In the Senate, it had a comfortable 21-8 margin.

Sponsored by Rep. Jeff Weninger, R-Chandler, the bill extends several tax incentives aimed at boosting Arizona’s manufacturing sector, including Intel’s plans to expand in Chandler.

The bill, watered down from an earlier version, highlighted the Legislature’s ideological divide on the role of tax breaks and incentives. Most Republicans supported it, although a handful who objected to tax credits joined Democrats in opposition.

The bill extends the Quality Jobs program lawmakers created years ago until 2025. It provides tax breaks for employers who meet certain hiring and salary requirements. The program was slated to expire this year.

It also extends the current research and development tax-credit program for five years, with the rates — which are pegged to the size of an investment — dropping in 2022.

Bill criticized as give-away of tax dollars

Democrats complained the bill was a give-away of state tax dollars that makes it impossible to address some of the state’s pressing needs, such as more education funding, pay raises for state workers and infrastructure repair.

Lawmakers also sparred over the size of the tax break in the bill, with Democrats arguing a legislative budget-office estimate of the bill omitted details that could drive the cost to as much as $10 million over the next three years. That estimate put the cost at $1.6 million a year.

To sweeten the deal in the House, Rep. Jill Norgaard, R-Phoenix, revived a bill that Gov. Doug Ducey had vetoed last month. The measure gives a sales-tax break for people who share ownership of aircraft and clarifies what qualifies as ownership.

But the break, now included in SB 1416, is likely to win the governor’s signature as he has lobbied hard for the overall tax package.

Lawmakers also added an extra $10 million to a tax-credit program intended to spur small-business development. House Bill 2191 passed with bipartisan support.

The final bill to pass was an extension of the state’s cash-aid program for poor families, House Bill 2372. The Temporary Assistance for Needy Families will revert to a two-year lifetime limit, but with new restrictions that critics said will kick people out of the program before they can hit the two-year mark.

It was a key part of Ducey’s agenda, and it took two Democratic votes to win passage in the Senate. Democratic Minority Leader Katie Hobbs and Sen. Robert Meza, both of Phoenix, voted yes with most of the Republicans.

While the vote happened, Ducey posted a message on Twitter committing to work harder with job-placement specialists to get more of the families off the program and into jobs that would help lift them out of poverty.

The final votes came hours after lawmakers approved several other bills now headed to the governor’s desk. They include:

• House Bill 2494, which provides legal immunity for anyone who enters a locked, unattended vehicle to rescue a child or pet if the person believes the child or pet is “in imminent danger of phyiscal injury or death.” Critics, such as Rep. Eddie Farnsworth, R-Gilbert, complained the bill was overly vague and put animals on a par with children.

Despite those objections, the so-called “puppies and babies bill” passed its final House hurdle on a 35-20 vote.

• House Bill 2091, which waives the fingerprint requirement for food-stamp eligibility. The bill had faltered last week, when it was not included in the state budget, but was revived as supporters successfully argued it would save the state $3 million.

“They’ve had six people caught in six years,” said Sen. Bob Worsley, R-Mesa. “It’s a waste of money.”

Mesnard made a pitch for his plan to ensure half of the inflation dollars directed to the public schools each year go to teacher cost-of-living raises. However, he declined to offer an amendment to an education bill because it did not have enough support.

Republic reporter Alia Beard Rau contributed to this article. Reach the reporter at [email protected] and follow her on Twitter @maryjpitzl.

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The Arizona House of Representatives tries to wrap things up for the session at the Capitol in Phoenix on May 10, 2017. Tom Tingle/azcentral.com

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