Originally Published: January 14, 2013 10 p.m.
Arizona's economy is on the rebound, but it's still the top issue for local legislators as they began their 2013 session this week.
Arizona House Speaker Andy Tobin of Paulden, Sen. Steve Pierce of Prescott and Rep. Karen Fann of Prescott all cited the economy.
"Our biggest issue is still jobs and the economy and keeping the budget balanced until we're out of this black hole we're in, and that's going to be a challenge," Fann said.
The state could have a $676 million surplus for the next fiscal year, alongside $450 million the Legislature has already set aside in a rainy-day fund, the Associated Press reported. But the state's temporary one-cent sales tax ends in May.
If the state does have some extra money, Fann would like to see some go to pay off debt and improve infrastructure such as roads, bridges, airports and telecommunications facilities to create jobs.
"Clearly, the economy continues to be a big piece," Tobin agreed.
Tobin put the blame on the federal government for some of the state's job woes.
"We've got a lot of federal issues restraining our ability to grow jobs quickly," he said.
Pierce likes the idea of lowering personal income taxes, and lowering government regulations in areas such as health care and home construction.
The state needs to expand Medicaid coverage to help hospitals now footing the bills, Pierce added.
The state dropped Medicaid coverage for childless adults, and hospitals have been forced to continue to care for that group of people without government help if they still want to get federal dollars for other low-income patients, he said.
"Now they're starting to bleed and I think it's time to help hospitals out," Pierce said, especially rural hospitals such as Yavapai Regional Medical Center.
Gov. Jan. Brewer announced in her State of the State address Monday that she has decided to expand the state's Medicaid plan to cover people earning as much as 133 percent of the federal poverty level. That could add about 300,000 people to the Medicaid rolls, including low-income childless adults.
The governor's office reported later on Monday that the state would have to pay another $150 million to expand the program and get $1.6 billion more in federal match money next year.
Hospitals immediately praised her action, saying it "will boost the economy, save the state money, lower health care cost for employers and, most importantly, improve the quality of life for everyone."
The state could see major changes in water law during this legislative session, Tobin said. The Legislature will consider implementing some of the recommendations of the Arizona Water Resources Development Commission that Tobin created. Tobin is likely to carry the bill.
The commission recommended a new state law to allow the creation of "regional water augmentation authorities," allowing local governments and water providers to pool their resources.
Pierce would like to see more state money for education.
"I think we need to show more support," he said.
Education always is a top priority, Tobin said.
"Whatever money we can get to schools, we're going to do it," he said.
Sales tax reform also will be an important issue this year, Fann predicted, since a governor's task force just released a draft report with ideas.
But Fann, a former member of the Prescott and Chino Valley councils, said she wants to protect rural communities from losing sales tax revenues.
She also wants to help local communities by allowing them to ban fireworks. She tried such a bill last year and plans to try again.