Thursday, 30 March 2000
By Rhonda Bodfield Sander
The Arizona Daily Star
http://www.azstarnet.com/public/dnews/000330taxveto.html
PHOENIX -- Gov. Jane Hull yesterday vetoed a bill that would have increased gas taxes, saying Arizona residents are paying too much at the pump to have to pay more.
The measure would have imposed a penny-per-gallon tax over the next three years to pay off the $72 million the state owes to 1,400 claimants who cleaned up underground storage tank contamination and are now waiting to be reimbursed under a 1986 law.
"Timing is everything and this is not the proper timing," Hull said, adding that calls to her office are overwhelmingly opposed to the proposal.
In her veto letter to lawmakers, Hull said residents must absorb the higher gasoline prices, in addition to paying more for goods and services as the additional transportation costs are passed on to consumers.
Hull made it clear that she wasn't necessarily against the proposal, saying she'd be willing to look at it again when market conditions return to normal.
About $41 million in claims belong to large oil companies, which Hull said should be able to float the debt while the state finds another mechanism to address the issue.
Another $5 million is owed to schools, hospitals, cities and towns. The remainder is owed to a variety of other businesses, including small mom-and-pops around the state.
"By the time this tax were to have been imposed, the gas prices would already be back down," lamented Debra Margraf, executive director of the Arizona Automotive Trade Association, a coalition of service station dealers. "I've already seen some decreases in the last week on the wholesale price."
And John Pearce, a lobbyist representing the Arizona Petroleum Marketers, said he was disappointed with the veto.
"These people are hit hard by the fact that they've spent money to address environmental contamination and have often taken out loans to do so and now they can't pay back their loans because the money promised them by statute isn't there," Pearce said.
It's not there for a variety of reasons, one of them being that lawmakers underestimated the cost of cleaning up the sites. But the Legislature also borrowed $19 million from the fund to subsidize the Maricopa County vehicle emissions program and to pay for transit.
Meanwhile, some businesses are waiting for repayments in the hundreds of thousands of dollars and some have waited five or six years.
Hull said she plans to get funding for schools on the list by tacking environmental cleanup costs on to the Students FIRST formula, the Legislature's plan to bring all schools up to minimum standards.
But the Legislature is bracing for a bill that could already be about $1 billion and so far, there isn't a lot of discussion about how to pay for it.
Otherwise, Hull said she'd try to find some money administratively to address some of the cases, although she conceded that probably wouldn't take care of too many of them.
The Legislature could conceivably override the veto. Because the measure was a tax increase, it already was supported by two-thirds of the House and Senate. But it would take a three-fourths vote to override a veto on a tax increase, politically difficult in any year, let alone an election year.
Hull said she did not veto the bill out of fear that it would jeopardize her plan to ask voters in November to support a sales tax increase for education.
"We don't tie things in this office,'' she said.
Sen. Rusty Bowers, a Mesa Republican who sponsored the measure, was surprised at the veto. He said the Governor's Office had assured him the veto was only being contemplated, not sealed. "By the time the door hit me on the way out, the ink was already dry," he said.
Bowers said he would consider mounting an override attempt,
but added, "going from considering to doing is one big jump
and some of us have to come back here."