In defense of delays
Prop 123 is like a fine wine … Horne grades Hobbs ... And does the $1.5 million include bonuses?
When state lawmakers gathered in Phoenix this week to kick off the 2025 legislative session, teacher pay raises were once again on everyone’s lips — as were the numbers 123.
“We must address the impending expiration of Prop 123, which provides critical funding for public schools and teachers,” Gov. Katie Hobbs said in her State of the State speech. “...If we fail to act, we are throwing away an opportunity to fund teacher pay raises and give Arizona’s children the opportunity they deserve.”
“Republicans like to see money in the classrooms,” Senate President Warren Petersen said in his preamble to Hobbs’ speech. “That’s why we have a plan to increase teacher pay above the national average in the state of Arizona (through extending Prop 123).”
Prop 123 is an amendment to the state Constitution that voters approved a decade ago to allow the state to draw about $300 million more per year from the State Land Trust to pay for public education.
The proposal was former Gov. Doug Ducey’s way to settle a longstanding lawsuit over lawmakers illegally shortchanging schools during the Great Recession.
But Prop 123 — and the $300 million per year it provides to schools — expires in July.
Inside the Capitol bubble, there’s so much bipartisan agreement about the need to renew Prop 123 that it almost seems as if it’s a done deal.
Hobbs says she’s been meeting regularly with lawmakers and stakeholders and they’re “close to something that could get across the finish line.”
But nobody has shown an actual plan this year.1
And the clock is ticking.
If state leaders want to keep Prop 123 in place without a lapse, they’ll have to send the question to voters in a May special election — just four months from now.
With each passing day, that’s looking increasingly unlikely.
And as critical as Prop 123 is for schools, letting it lapse for a while may not be the worst idea.
Hear us out…
Ten years after voters approved Prop 123, it’s easy to forget it wasn’t always a popular proposal.
In her State of the State speech on Monday, Hobbs praised Prop 123 as “a bipartisan success and proved that Republicans and Democrats could come together and do the right thing for our students, teachers, and parents.”
But as a state senator in 2015, Hobbs voted against sending Prop 123 to the ballot.
She wasn’t alone — only two Democrats in the Legislature supported the idea. Most argued it didn’t do enough to raise education funding, or that it came with enough assurances that the money would make it to schools.
And Republicans like then state Treasurer Jeff DeWit argued the additional draw from the state land trust was fiscally irresponsible — that it would cut into the principal of the trust and rob future generations just to solve a short-term funding problem.
In fact, only 50.9% of voters approved the idea during a special election in May of 2016 — it won by a margin of fewer than 20,000 votes.
Ultimately, the critics were wrong: The money made it to schools, and the trust kept growing.
But convincing voters that would be the case was not easy, as former Ducey spokesman and chief of staff Daniel Scarpinato is happy to remind people.
“You're talking about a statewide campaign in all 15 counties — you have to communicate with people,” he told us. “If anybody thinks that you can just put this on the ballot and let nature take its course and have no organized campaign, that's just not realistic in Arizona.”
In 2015, education funding was the issue on voters’ minds.
This was before #RedForEd and the 20% teacher pay raise that the movement inspired. And it was pre-pandemic and the anti-education backlash that school closures inspired.
Polling from the time shows about 43% of Arizona voters considered education their top issue. These days, the same pollster puts it at around 9% of voters calling education their top issue.
“With all of those circumstances in our favor, it still barely passed,” Scarpinato recalled.
When voters don't understand an issue, their default position is to vote against it. And the State Land Trust balance and withdrawal rate is complicated as heck. Getting more than 50% of voters to vote yes took Ducey and proponents months of hard campaigning and about $5 million.
Building that kind of campaign infrastructure takes time — time proponents may not have if they’re still scrambling to agree on a proposal ahead of a May ballot.2
In a recent interview, even Hobbs acknowledged that getting Prop 123 renewed before it expires in July may not be realistic at this point.
“August is another option,” she told 12News’ Brahm Resnik. “It’s not ideal.”
But it also wouldn’t be the end of the world.
In fact, it may be smart to postpone a vote even longer — until the 2026 election.
That’s because if Prop 123 expires, schools won’t lose funding.
Prop 123 is a mechanism to deliver $300 million to schools per year. But one way or another, lawmakers still have to pay that bill. If Prop 123 expires, the funds will just come out of other priorities (including, potentially, discretionary funding that would have otherwise gone to schools). But it could just as easily come from lawmakers’ slush funds.
But if the choice is between spending $450 million to backfill the lost Prop 123 funds until the next election, or putting up a rushed, shoddy campaign and potentially losing that revenue stream forever, that doesn’t seem like much of a choice at all.
The Arizona Board of Education voted unanimously yesterday to take the drastic and rare step of taking over fiscal management of a financially strapped West Valley school district — and potentially cutting off teachers’ pay in the next two weeks.
For years, the Isaac Elementary School District — which serves about 5,000 K-8 students between Van Buren Street and Indian School Road, and 27th Avenue to 51st Avenue — has consistently been labeled at “high risk” of being taken over by an independent “receiver” who would make all financial decisions for the district, cutting out its superintendent and governing board.
But after it submitted a woefully incorrect and misleading financial report this year, things got serious.
The report, which initially showed the district in the black, set off red flags with the treasurer and Auditor General’s Office, which started looking closer at the district’s finances only to discover it was more than $12 million in the hole due to a series of financial miscalculations and lost federal grants.
“They lied to us … I’m very very concerned something much more heinous has been going on here,” Maricopa County Treasurer John Allen told the board, adding that the situation at Isaac is “probably one of the worst school screwups we’ve ever had.”
Isaac School District’s Superintendent Mario Ventura urged the Board of Education to give the district more time to right its finances, saying that while the district has faced financial strains, they’ve got a plan to fix it.
Ventura said the district struggled to track the influx of federal grant dollars it has received since the pandemic thanks to some key staffers departing. And he presented a plan to bring in his own consultant to oversee a lease-purchase agreement to sell the schools then buy them back with bond money in order to solve the district’s cash-flow problems.
“Give me three months — I’ll show you meaningful results,” the proposed consultant, Jeremy Calles, told the board.3
But the board was unsympathetic to the district's excuses, voting to appoint a receiver who can make all financial decisions — including staff cuts — for the district.
But if something doesn’t get worked out soon, that may not even be an issue.
Allen, the county treasurer, said the district is insolvent and he’s going to stop cutting checks for the district after next week’s checks go out if the Maricopa County Board of Supervisors doesn’t step in and offer to fund the district.
“This (office) will not become the slush fund for a district that is so out of whack that I don’t see any way out,” Allen said.
The Arizona Board of Education only puts about one school district into receivership every five years. And usually, they continue receiving funding until the districts are able to turn things around, board members noted.
But board members weren’t convinced that the Isacc School District could dig itself out of its hole, or that the Maricopa County supervisors would be willing to take the risk.
“It’s clear, crystal clear to me, that unless this goes into receivership, there's no chance that the board of supervisors will advance money,” Superintendent of Public Instruction Tom Horne told the board. “In the meantime, f something doesn’t happen in the next two weeks, they will not make payroll. Teachers will be looking for jobs elsewhere.”
Not mincing words: Gov. Katie Hobbs went after the school voucher system in her State of the State speech this week, calling for “overdue accountability” for the “billion-dollar boondoggle,” 12News’ Kyra O’Connor reports. Arizona Superintendent of Public Instruction Tom Horne, who has been at odds with Hobbs over the voucher program for some time, fired right back.
“The Governor needs to pay more attention to what is going on. She gets an F,” Horne declared.
Letting it stand: A federal judge says there won’t be a do-over election for two seats on the Phoenix Union High School District Governing Board, the Republic’s Madeleine Parrish reports. County officials screwed up the ballots in November by telling voters to cast ballots for up to two at-large candidates. That violated a 1990 consent decree that said voters could only vote for one at-large candidate, in an effort to give minority voters a fair chance to win a seat. Officials scheduled a do-over election for March, but two candidates dropped out, leaving just two candidates for the two seats.
Tough choices: Mesa Public Schools is cutting staff amid a drop in enrollment and less federal and state funding, FOX10’s Lindsey Ragas reports. Superintendent Andi Fourlis said the district is expecting nearly $18 million in budget cuts. The vast majority of the district budget goes to staff, so that’s where the cuts will come, Fourlis said, calling it “one of the hardest decisions I have ever had to make.” School officials at the district, which is the largest in the state, expect to lose 1,800 students next year, KTAR’s Kevin Stone reports. Fourlis didn’t say how many teachers and staff would lose their jobs.
Stretched thin: A recent report from Arizona State University, commissioned by Hobbs’ Educator Retention Task Force, found deep dissatisfaction among teachers in Arizona. Alison Cook-Davis, director of ASU’s Morrison Institute for Public Policy, explained the report to KJZZ’s Sam Dingman. More than two-thirds of teachers said they considered leaving the profession in the last year, she said, and many of them struggled with feeling like they were “stretched so thin” they couldn’t do the job right for their students.
Preparing for the worst: Now that President-elect Donald Trump has said he plans to rescind a longstanding policy that kept schools off-limits to immigration enforcement officers, school officials in Phoenix and throughout the country are preparing staff to deal with requests from U.S. Immigration and Customs Enforcement, the Republic’s Parrish reports. That training includes understanding what type of information they have to share with authorities, and information they are prohibited from sharing. Since 1982, the U.S. Supreme Court has guaranteed public education as a constitutional right for immigrant children.
ICYMI: If you missed our inaugural edition of the A.I. Agenda yesterday, we wrote about a new charter school opening in Arizona that runs on AI — no “teachers” needed.
While scrolling through the massive number of bills that have been introduced in the Legislature this week, we caught one education bill that especially piqued our interest.
Republican Rep. Alexander Kolodin sponsored House Bill 2187, which would limit state university presidents’ salaries to 20 times that of a state lawmaker.
Ostensibly, state lawmakers earn $24,000 per year, so the cap would be roughly $500,000 for university presidents.
Seems reasonable enough.
Except many lawmakers pull in closer to $75,000 including their mileage and per diem payments — so really, the cap for university presidents would be closer to $1.5 million.
But you gotta start somewhere!
Plus, lawmakers can’t just approve a bill in May and send it to voters that month — it takes time to prepare a statewide special election.
Fun fact: Calles is also the superintendent of the Tolleson Unified School District, though up until recently he was suspended for allegedly having a relationship with a school board member. He claims the board member, Elda Luna-Nájera, who is also a state lawmaker, sexually harassed him. That backstory was not lost on Board of Education member Jennifer Clark, who grilled him about it.
Good job, just upgraded to a paid subscription - all in for the Arizona Agenda (please continue doing your best to present education issues in a balanced manner - those of us who have been in the trenches, as volunteers, and are pro “education choice”, will be watching closely - especially interested in actual performance data).