Judge rules voter approved Invest in Ed Act can't be enforced, tax levy to fund education permanently blocked - AZEdNews
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Judge rules voter approved Invest in Ed Act can’t be enforced, tax levy to fund education permanently blocked


Joe Thomas, Right, President Of The Arizona Education Association, Talks About The Invest In Ed Initiative While David Lujan, Left, Director Of The Arizona Center For Economic Progress, Who Helped Draft The Initiative, During A Press Conference Jan. 13, 2020 At The Arizona Capitol In The Rose Garden. Photo By Lisa Irish/AZEdNews

Maricopa County Superior Court Judge Michael Hannah ruled today that the Invest in Ed Act, which would have added a tax levy on high-earning Arizonans to fund public K-12 education, cannot be enforced due to a state Supreme Court ruling that the funds raised from Prop. 208 would have put schools above the aggregate expenditure limit and permanently blocked the collection of the tax levy.

Awaiting Judge Hannah’s ruling in this case had been a key issue that delayed Arizona Legislators from raising the aggregate expenditure limit until late last month – just days away from a March 1, 2022 deadlines, which would have forced Arizona public schools to cut 16% of their budget to comply with the Arizona State Constitution in the final months of the school year.

Prop. 208 would have enacted a 3.5% surcharge on the existing 4.5% income tax on taxable annual income above $250,000 per individual and $500,000 per couple and distribute the revenue to support public K-12 education.

Prop. 208 would have brought about $800 million into public schools, according to Rebecca Gau, executive director of Stand for Children Arizona. That revenue would benefit public education and help support teachers and classrooms in Arizona, which is ranked 49th in the nation for state education funding, according to a study done by WalletHub.

In January this year, Prop. 208 supporters and Republican opponents of the bill had agreed that funds generated from the Invest in Education Act would have exceeded the aggregate expenditure limit.

“This Court understands the remand order as a direction to declare Proposition 208 unconstitutional in its entirety, and to enjoin its operation permanently, if the Court finds as a fact that the annual education spending limits imposed by the Arizona Constitution will prevent Arizona’s public schools from spending a “material” amount of Proposition 208 tax revenue in 2023. On that basis, the Court is obligated to strike down Proposition 208. This order explains that decision. It also raises an issue that the Court respectfully suggests the higher courts may wish to consider if this case comes before them again on appeal,” Judge Hannah wrote in his ruling.

Judge Hannah’s ruling noted that the remand order from the Supreme Court said that the Superior Court “must declare Prop. 208 unconstitutional and enjoin its operation” if the measure “will result in the accumulation of money that cannot be spent without violating the expenditure limit.”

Judge Hannah’s ruling means that education advocates seeking to find a sustainable revenue stream for public education will need to develop a different strategy to do so.

Judge Hannah also noted in this ruling that “when the people of Arizona enacted Proposition 208, they exercised their co-equal Constitutional authority to implement their desired public education funding and taxation policies. That touched off a policy dispute with (among others) a majority in the Arizona Legislature. The dispute has played out in a series of political events — the Legislature’s enactment of tax law changes that will substantially reduce the amount of revenue generated by Proposition 208, an initiative measure that will ask the voters to repeal some of those changes, proposed tax legislation that would attempt to moot the initiative. There are legal guardrails on this political maneuvering, notably the Voter Protection Act, article IV, part 1, section 1(6) of the Constitution, which prohibits the legislature from simply repealing laws enacted by initiative. Within those guardrails, the political actors have worked their way toward a political resolution of their policy disagreement.”

Judge Hannah also said in his ruling that the main political players are parties in this lawsuit and the courts are responsible for answering their legal question, but “judges must remain wary of political actors who want them to take sides in ongoing political disputes.”

Related articles:
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Advocates turn in signatures to put tax cuts that impact education funding on ballot
Judge rejects preliminary injunction & claims in Prop. 208 lawsuit
Court ruling on the Prop. 208 Invest In Ed lawsuit
Judge rejects two claims in Prop. 208 lawsuit

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