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The Good, The Bad and the Ugly of the K-12 Inflation Funding Settlement

After Republican legislative leaders fought long and hard against restoring inflationary funding for public schools that voters had mandated in 2001, Governor Ducey led them to an agreement with the education groups who sued the state.

This agreement will likely go before state lawmakers this week. The agreement looks and feels like a compromise. It is a small commitment from our state leaders to keep school funding in line with rising costs. If it is the first step in education funding reform, it is a worthwhile compromise. If digging into our State Land Trust for the next ten years is a bridge to a longer term, reliable and robust funding source for public schools, the short term financing makes sense. But if this is the end of the line for the Governor and legislators on school funding, it is a disaster for Arizona’s families and economy.

So we ask state legislators who vote YES for this compromise on inflation funding to also vote YES in the 2016 legislative session to fill more gaps in school funding and vote NO on new tax cuts that steal money away from students. While we have not yet seen the details of the bill, a brief summary of the plan is available by clicking here. Highlights are below:7372466

THE GOOD

If voters approve the plan at a special election and if the State Land Trust distributions are not held up in court,

• The plan ends the inflation lawsuit and ends the political fighting about inflation funding.
• The plan brings $225 million in additional funding to district and charter schools in June of 2016 and they can count on $225+ million each year for ten years.
• The base funding level per student is raised by 5% this year. It will be voter protected and the legislature shouldn’t be able to reduce it.
• Charter schools and district schools can use the funding to meet their highest needs; there are no new mandates from the state.

THE BAD

• The increased withdrawals from the State Land Trust for 10 years mean less funding available from the Trust for education every year after that.
• Arizona faces a funding cliff for schools when the Proposition 301 sales tax expires in 2021 and another cliff when the high withdrawals from the Land Trust expire in 2025.
• The legislature can cut back on this school funding if there are large dips in the Land Trust earnings or major economic slowdowns.

THE UGLY

• After 2025, the legislature can cut school funding if education spending reaches 49% of the total budget. Politicians who don’t support public schools can play many games with the budget that will trigger this formula and get them out of their commitments.
• For every dollar in this plan from accelerated withdrawals from the State Land Trust, there is only 30 cents in new commitment from the state general fund. The plan relies much more heavily on borrowing from our future than on re-setting basic budget priorities. If the legislature uses general fund dollars instead for more permanent tax cuts, that means even less money available for public schools when the State Land Trust plan expires.

We will update you with further details about the proposal as soon as we know more.

Thank You for Making Our Event a Success

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We want to express our gratitude to each and every one of our generous donors and attendees for making our 17th annual Inspiration: Through the Eyes of a Child awards luncheon a rousing success. More than 500 people from around Arizona joined Children’s Action Alliance in honoring state Representative Kate Brophy McGee and Children’s Cancer Network co-founder Patti Luttrell for their tireless efforts to improve the lives of our state’s children.

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The enthusiasm for auction and raffle items was tremendous, the proceeds of which help this organization continue to speak out on policy issues on behalf of Arizona’s children.

If you were unable to attend, you can contribute to Children’s Action Alliance via our online donation link.

To see images of the event, click here.

Many thanks to our exclusive event sponsor, Blue Cross/Blue Shield of Arizona, and our premier, platinum and gold event sponsors: Greenberg/Traurig, Desert Neonatal Associates and Sheridan, Arizona Public Service, Mercy Maricopa Integrated Care, Mercy Care Plan, and Cox Communications. 

Inspiration: Through the Eyes of a Child Event Honors Arizona Legislator, Children’s Cancer Organization Founder

Click Here for PDF Version 

(Phoenix, AZ) Children’s Action Alliance (CAA) will this year honor state representative Kate Brophy McGee and Children’s Cancer Network co-founder Patti Luttrell for their contributions to the lives of children at CAA’s 17th annual Inspiration: Through the Eyes of a Child luncheon in Phoenix on October 23.

Jacque Steiner Public Leadership Award for Children: Rep. Kate Brophy McGee

Brophy McGee, who has served in the state legislature since 2010, is the 2015 Jacque Steiner Public Leadership honoree. The Steiner Award, given to a public official who fights to improve the lives of children, is named after the late senator. Brophy McGee is co-chair of the Joint Legislative Child Safety Oversight Committee and has sponsored important legislation geared toward protecting children and placing them in safe, permanent homes. She is a tireless advocate for children and education, having served for ten years on the Washington Elementary School Board in Phoenix and six years on the School Facilities Board.

Horace Steele Child Advocacy Award:  Patti Luttrell

Luttrell co-founded Children’s Cancer Network (CCN) in 2004, following her personal experience with cancer, during which she saw firsthand the need for support services for families who are struggling with a childhood cancer diagnosis. The nonprofit organization helps with gift cards for gasoline, food and other programs, including scholarships and peer support. CCN’s work with families continues even if a child does not survive, as it facilitates group support meetings for parents who have lost their children to cancer.

As part of the annual event, attendees will have a chance to bid through a silent auction on a variety of one of a kind photographs, paintings and ceramics handcrafted by Arizona children, as well as high value items donated by local organizations and merchants.

Inspiration: Through the Eyes of a Child is Children’s Action Alliance’s main community event and fundraiser of the year.

Children’s Action Alliance is an independent voice for Arizona children at the state capitol and in the community. CAA works to improve children’s health, education, and security through information and action.

 

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Are We Getting Our Money’s Worth in Job Creation Dollars?

Return on Investment (ROI) is a simple concept, meaning: What are we getting for the money we’re spending?

Last year, the quasi-public state agency, Arizona Commerce Authority, was given more than $30 million in taxpayer dollars to create and retain high quality jobs. This year they’re requesting a little less, but still substantial, $26.8 million.

What has been the ROI? According to a recent Arizona Auditor General report, it’s hard to tell, but what we can tell is that it falls far short of expectations. In fiscal year 2014 (the period covered by the audit), $4.3 million from the Arizona Competes Fund (known as a “deal-closing” fund), was awarded to four different companies. That $4.3 million got Arizonans a commitment from those companies to create a little over 2,000 jobs.canstockphoto10794492 (1)

Note the word “commitment” versus “created.” The Auditor General noted the difference and cited that as one flaw of the Commerce Authority report that is supposed to give Arizona taxpayers a summary of what was done with their money. So far, only 257 jobs have been created out of the over 2,000 committed from last year’s awardees.

Yet another problem noted by the Auditor General is that “although statute requires the Authority to report median wages, it reports average wages” instead. An average of wages could be easily skewed by one high paying job, whereas a median wage is the middle wage of all the jobs created. So, without a report on the median wage, we don’t know the quality of the jobs being committed by these companies.

The lack of accountability is troubling, as it’s not clear if Arizona taxpayers are getting an adequate ROI based on what is reported by the Authority. As the Auditor General concludes: “Without clear information about the State’s return on investment, it may be difficult for decision makers to make informed decisions about Arizona’s economic development activities.”

In reviewing the reports from the Arizona Commerce Authority, we found that three years into their five year plan to create 75,000 higher wage jobs, companies had committed only 5,846 jobs. Fewer than half, 2,310 positions, have actually been created.

Join Children’s Action Alliance for Our 17th Annual Inspiration: Through the Eyes of a Child Luncheon

At our annual Inspiration: Through the Eyes of a Child luncheon this week, we honored two outstanding Arizonans for their tireless work to implement public policy or spearhead efforts to improve the lives of children.  This year, we recognized State Representative Kate Brophy McGee and Children’s Cancer Network co-founder Patti Luttrell.

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A Look at the Department of Child Safety’s Budget Request for the Upcoming Year

The Department of Child Safety (DCS) recently submitted its funding request for fiscal year 2017, asking for a 21% increase of $105.9 million in appropriated funds (including the state general fund, federal TANF block grant and federal child care funds).  DCS requests that $65.5 million of this increase begins during the current fiscal year with a supplemental appropriation to address system deficits.

In February when Governor Ducey appointed Greg McKay as Director of the Department, he declared a new day for child safety. Yet, we are still waiting for DCS to make a difference in children’s lives: the agency can’t manage its workload, staff turnover is alarmingly high, too many children are being taken into foster care rather than staying with their families and getting in-home services, and there is far too much time and trauma before children are connected with safe and permanent homes.

The budget Governor Ducey signed for the current year in no way reflects the demands on the agency.  Now it is up to the Governor and DCS leadership to make the case that they can target the dollars requested effectively to turn the trends around and get the crisis under control.

The top priority must be to safely reduce the skyrocketing growth in foster care which is overwhelming our system and unnecessarily traumatizing children.  While foster care is clearly needed in some cases, research and experience around the country show that many children can be safe and have better long-term success if they remain with their families and have the support of in-home services.

The budget request forecasts DCS will have 18,700 children in the foster care system next year — only slightly more than the current number.  But it is unclear how DCS will actually reduce the growth in foster care. The legislature has tried to move in this direction over the past three years with more than $12 million in new funding added specifically for in-home services.  Last fiscal year, however, DCS spent less than half of its in-home services funding and transferred the rest to foster care. When auditors surveyed 1,000 DCS staff members — from top management to investigators — most noted that in-home services were unavailable for them to use. As recently as last week, DCS Director McKay testified before the legislature about the many barriers preventing the agency from increasing the use of in-home services.

Now is the time for Governor Ducey to work with legislative and community leaders, child welfare experts and the private agencies throughout the state that provide services to families. Legislators and citizens across the state need to know how his administration will confront these barriers and clear the path to increased up-front services.

Attached is a summary of the funding increases in the general fund budget request – and one decrease – submitted by DCS for next fiscal year, which begins in July.