KNAU and Arizona News
10:04 pm
Tue December 30, 2008

The Top Ten Arizona Stories of the Year

Flagstaff, AZ – By Howard Fischer, Capitol Correspondent, KNAU Arizona Public Radio
Here are the Top 10 stories of statewide significance for 2008:

1 -- The economy:

The slump hit Arizona harder than most states, with Arizona going from first in job creation to 49th, just ahead of Rhode Island.That was mirrored in the jobless rate which jumped from 4.1percent at the end of 2007 to 6.3 percent a year later -- with predictions of it topping at least 7 percent.

Home values are now in free-fall, with various reports putting the year-over-year decline in the 15 to 25 percent range,depending on the community.

And consumer confidence, in turn, has taken a hit, which has reduced the willingness of Arizonans to buy what is not necessary.

Vehicle sales in particular are down 25 percent from a year earlier. And people are choosing to stay in their homes rather than build new ones.

All this has taken a toll on city, county and state governments who are heavily dependent on sales tax revenues that car sales and construction generate. Which leads to:

2 -- The state budget:

State spending has increased in the last half decade far faster than both inflation and population growth, with lawmakers --often at the behest of outgoing Gov. Janet Napolitano -- adding new programs and expanding existing ones. At the same time,legislators cut individual income tax rates by 10 percent and suspended the state property tax, a levy that may be politically impossible to reinstate.

All that has resulted in a deficit for this year that conservatively is pegged at $1.2 billion, with estimates for the coming year north of $2 billion.

Until now, the state has avoided layoffs and service cuts through borrowing, budget gimmicks and maneuvers that have depended on better fortunes ahead. But the length and depth of this recession makes that option less viable.

3 -- Napolitano leaving:

Governors come and go. But this Democrat is quitting two years into her second four-year term to become -- if confirmed by the U.S. Senate -- the new U.S. Secretary of Homeland Security.That would turn the reins of government over to a far more fiscally and socially conservative Republican, Jan Brewer.

GOP legislators, chafing under Napolitano's record number of vetoes, are anxiously preparing to reintroduce the measures on issues ranging from gun control and illegal immigration to abortion. What remains to be seen is whether Brewer, hoping to project an image of moderation to win a term of her own in 2010,convinces legislative leaders to put those measures in a drawer and not put her on the spot.

But Brewer has made it clear she is more likely to depend on actual spending cuts than budget shenanigans. And Arizona bucked the trend in much of the rest of the nation, actually increased the number of Republicans in the state Legislature.

4 -- Employer sanctions:

What is believed to be the toughest law in the country aimed at curbing illegal immigration took effect on Jan. 1. And efforts by business groups and some civil rights organizations to have it declared unconstitutional were rebuffed by both a federal trial judge and an appellate court.

No company has actually been prosecuted under the law which allows a judge to suspend any licenses to do business of firms which are found guilty of knowingly hiring undocumented workers.A second conviction within three years would put the firm out of business.

But there is at least anecdotal evidence that companies, fearful of the repercussions, are screening applicants closer and even laying off those workers who cannot prove a legal right to work in this country. And state School Superintendent Tom Horne said some school districts have reported an exodus of children as their parents decide to look for work elsewhere.

5 -- Gay marriage:

State lawmakers made same-sex weddings illegal in Arizona in 1996 after a Hawaii Supreme Court ruling -- since overturned by voters-- allowed gays to marry in that state. The law was designed to ensure that Arizona was not obligated to recognize such unions from other states.

An effort to have that law declared unconstitutional was rejected by the state Court of Appeals, a decision upheld without comment by the Arizona Supreme Court.

A 2006 measure to enshrine the same language in the Arizona Constitution faltered when backers also included provisions that also would have barred recognition of civil unions and banned governments from providing benefits like health insurance to the domestic partners of their employees.

This year supporters stuck with a simple ban on gay marriages and managed to raise $7.7 million to get their message out. And the essence of that message -- that a state law is insufficient --was buttressed by a California Supreme Court decision overturning that state's law banning gay marriage, fanning the fears that mere statutory language is insufficient to withstand constitutional challenges.

6 -- Spring training:

Cities in and around Phoenix continued to attract new teams for Cactus League spring training. But not all of them were coming from the Grapefruit League in Florida.

The Chicago White Sox finally bought their way out of their deal with Pima County that otherwise would have required them to play there for at least another few years.

That leaves the question of whether the Arizona Diamondbacks and the Colorado Rockies will continue to winter in Tucson, what with various contractual provisions which appear to let them out of their own deals once the number of teams drops below three.

7 -- Payday lending:

Arizona voters may have signaled the beginning of the end for payday loans in the state.

When lawmakers first approved the short-term, high-interest loans in 2000 they made the provision temporary: The authority to exceed the 36 percent usury limit would expire in 2010 unless renewed. The idea was to see how the industry works.When legislation to eliminate the "sunset'' faltered, lenders took their case directly to voters. They even sought to sweeten the deal with slightly lower charges and offers of interest-free financing for those unable to pay off their debts at the end of two weeks.

Despite the $14.6 million spent, the measure still went down to defeat.

That still gives industry lobbyists another chance to convince legislators that payday loans and their charges that translate to an annual percentage rate north of 400 percent should remain legal. But it remains uncertain whether lawmakers, who have to plead their own case to voters every two years, are willing to ignore the defeat of the initiative.

8 -- Transportation:

Phoenix, Tempe and the edge of Mesa finally got light rail, two decades after voters defeated a similar plan. While early ridership was heavy -- the fares were waived -- the heavily subsidized system still needs to prove it can attract people on a daily basis.

Despite that, plans already are being made to extend the mainline further north and west, with preliminary work being done on a second line west in the median of Interstate 10.But the weak economy, coupled with what had been record high gasoline prices and more fuel efficient vehicles, has left the state and federal governments far short of the fuel tax revenues they were anticipating for not just mass transit projects but even road construction.

An effort to convince voters to fill that void with a one-cent hike in the state sales tax failed to even qualify for the ballot. And even supporters acknowledge that voter appetite for higher taxes remains weak.

Putting the issue on the 2010 ballot remains up in the air over the question of whether the issue will get caught up in the gubernatorial race that year.

9 -- Photo radar:

When Gov. Janet Napolitano first unveiled the plan for a statewide system of fixed and mobile speed cameras, she insisted it was all about public safety. After all, she said, a test program along Loop 101 through Scottsdale had reduced speed and accidents.

But the program the governor eventually pushed through the Legislature -- buried deep in a budget bill -- was clearly about money.

Unlike similar systems in several cities and counties, the new statewide plan spelled out that offenders would not accumulate"points'' against their licenses. And the citations would not be reported to insurance companies who could use the information to raise rates or deny coverage.

Even Napolitano acknowledged that language was inserted to encourage people to pay the citations and not to fight them.The budget crunch and the possible $90 million the tickets could generate in net revenues for the state could make it difficult for lawmakers to now eliminate the cameras.

10 -- Snowbowl:

The battle between religious beliefs and commerce came into sharp focus in the fight between the operators of Snowbowl and various Indian tribes who consider the San Francisco peaks to be sacred.The company, which operates the resort on U.S. Forest Service land, wants to be able to use treated effluent to make snow when Mother Nature does not. The issue is so controversial that it deeply divided the 9th U.S. Circuit Court of Appeals.

A three-judge panel at first ruled the proposal violates a federal law which requires government agencies to use the "least restrictive" means of interfering with religious practice. Judge William Fletcher equated the use of treated effluent to requiring Christians to use reclaimed water for baptisms.

But the full court thought otherwise, saying the artificial show would not interfere with the ability of the tribes to practice their religion.

The case, which is now before the U.S. Supreme Court, ultimately will determine the scope of the Religious Freedom Restoration Act.

Bonus -- Media layoffs:

Even in a growing state like Arizona, the battle of newspapers to attract new readers has proven difficult. But the real problem has been the World Wide Web, as businesses who used to buy classified advertising found free alternatives on places like Craigslist.

The Douglas Daily Dispatch opted to seek survival by cutting publication to four days a week. That pattern is going to be tried by the East Valley Tribune which is scrapping its seven-day-a-week paid circulation in favor of becoming a free publication just four days a week, but concentrating its coverage-- and available in -- only certain areas it hopes advertisers want.

Media giant Gannett, owner of The Arizona Republic, Tucson Citizen and KPNX-TV, saw the value of its stock continued to shrink, as did Lee Enterprises which owns the Arizona Daily Star and Arizona Daily Sun.

Virtually no newsroom has been spared the staff cutbacks that have followed. How much more will need to be pared and what media outlets remain -- and their ability to provide local news coverage -- remains uncertain.