Prop. 414 is shameless shenanigans

The Arizona Republic
Friday, October 17, 2003
Robert Robb

A new property-tax-supported hospital district in Maricopa County, as would be established by Proposition 414, is unnecessary and unwise.

Moreover, the political shenanigans engaged in by Maricopa County officials with the ballot pamphlet and even the ballot question itself deserve a sharp rebuke from voters.

The county used to be the primary health provider to low-income residents. But that responsibility shifted to the state in the 1980s, with Arizona's managed-care alternative to Medicaid, the Arizona Health Care Cost Containment System.

AHCCCS now covers children up to 200 percent of the poverty level and adults up to 100 percent. State voters set the latter threshold when they passed Proposition 204 in 2000. That proposition also relieved Arizona counties of any remaining legal obligation to provide health care.

In other words, health care is now an optional service for Maricopa County. It could get out of the business tomorrow, if it wanted to.

There are some good reasons, however, for the county to remain in the heath care business. It has a residual network of hospitals, clinics and programs. In fact, the county is, in part, an AHCCCS provider.

And there are those who need assistance with health care who are not eligible for AHCCCS, primarily the uninsured lower middle class and illegal immigrants.

The county, however, argues that remaining in the health care business would be an unbearable financial burden. Thus the need for a new, property-tax-supported hospital district.

But there is little evidence to support that contention.

From 1998 to 2002, the county health system generated a surplus. The county general fund has had to subsidize it by about $13 million a year for the last two budget cycles.

But that's peanuts in the county's $1 billion general fund, just over 1 percent. Moreover, it's also not much in a $750 million health care operation that a recent financial audit said was hugely inefficient in collecting revenues.

The county argues that health operations will squeeze it under the state levy limit, which restricts what can be collected in property taxes, and the state expenditure limit, which restricts what can be spent overall.

But the county is not using all the property-tax authority it now has, collecting $12 million less than permitted under the state's levy limit. Moreover, both the levy and expenditure limits have mechanisms to get additional authority from voters.

The county also argues that the health care system, and particularly the county hospital, needs major repairs and renovations. But the county has more than $3.6 billion in unused bonding capacity. It has the ability to go to voters for approval to upgrade the health care system any time it wants.

In other words, there are no financial needs for the county health care system that the county cannot handle now and for the foreseeable future.

So, why a special tax district? After all, the money will come from the same pockets regardless of the structure.

Because if the health care system remains with the county, it will have to compete with other priorities for funding. Health care advocates don't like this, and the Board of Supervisors would just as soon be relieved of hard choices.

But special tax districts, focused on only a single service with independently elected boards, are bad fiscal policy. Hard choices are good for taxpayers and make for more efficient government.

The publicity pamphlet and ballot question adopted by the county are the most blatant case of government propagandizing I've seen in over a quarter century of Arizona elections.

The supposedly neutral ballot explanation is headlined: "KEEP THE COUNTY HOSPITAL OPEN, SAVE THE ARIZONA BURN CENTER, TRAUMA CENTER, AND QUALITY HEALTH CARE." And from there it gets argumentative.

A "No" vote supposedly gives the county authority to shut down the system. But voters gave the county that authority with passage of Proposition 204. Defeating this proposition gives the county no more authority to shut down parts of the system than it already has.

Defeating the proposition would, however, leave responsibility for the heath care system with the Board of Supervisors, with this now-discretionary service having to compete with all the other county priorities for funding.

And defeating the proposition would appropriately spank the county for its insult to democracy with such a shamelessly politicized ballot pamphlet and ballot question.

A new property-tax-supported hospital district in Maricopa County, as would be established by Proposition 414, is unnecessary and unwise.

Moreover, the political shenanigans engaged in by Maricopa County officials with the ballot pamphlet and even the ballot question itself deserve a sharp rebuke from voters.

The county used to be the primary health provider to low-income residents. But that responsibility shifted to the state in the 1980s, with Arizona's managed-care alternative to Medicaid, the Arizona Health Care Cost Containment System.

AHCCCS now covers children up to 200 percent of the poverty level and adults up to 100 percent. State voters set the latter threshold when they passed Proposition 204 in 2000. That proposition also relieved Arizona counties of any remaining legal obligation to provide health care.

In other words, health care is now an optional service for Maricopa County. It could get out of the business tomorrow, if it wanted to.

There are some good reasons, however, for the county to remain in the heath care business. It has a residual network of hospitals, clinics and programs. In fact, the county is, in part, an AHCCCS provider.

And there are those who need assistance with health care who are not eligible for AHCCCS, primarily the uninsured lower middle class and illegal immigrants.

The county, however, argues that remaining in the health care business would be an unbearable financial burden. Thus the need for a new, property-tax-supported hospital district.

But there is little evidence to support that contention.

From 1998 to 2002, the county health system generated a surplus. The county general fund has had to subsidize it by about $13 million a year for the last two budget cycles.

But that's peanuts in the county's $1 billion general fund, just over 1 percent. Moreover, it's also not much in a $750 million health care operation that a recent financial audit said was hugely inefficient in collecting revenues.

The county argues that health operations will squeeze it under the state levy limit, which restricts what can be collected in property taxes, and the state expenditure limit, which restricts what can be spent overall.

But the county is not using all the property-tax authority it now has, collecting $12 million less than permitted under the state's levy limit. Moreover, both the levy and expenditure limits have mechanisms to get additional authority from voters.

The county also argues that the health care system, and particularly the county hospital, needs major repairs and renovations. But the county has more than $3.6 billion in unused bonding capacity. It has the ability to go to voters for approval to upgrade the health care system any time it wants.

In other words, there are no financial needs for the county health care system that the county cannot handle now and for the foreseeable future.

So, why a special tax district? After all, the money will come from the same pockets regardless of the structure.

Because if the health care system remains with the county, it will have to compete with other priorities for funding. Health care advocates don't like this, and the Board of Supervisors would just as soon be relieved of hard choices.

But special tax districts, focused on only a single service with independently elected boards, are bad fiscal policy. Hard choices are good for taxpayers and make for more efficient government.

The publicity pamphlet and ballot question adopted by the county are the most blatant case of government propagandizing I've seen in over a quarter century of Arizona elections.

The supposedly neutral ballot explanation is headlined: "KEEP THE COUNTY HOSPITAL OPEN, SAVE THE ARIZONA BURN CENTER, TRAUMA CENTER, AND QUALITY HEALTH CARE." And from there it gets argumentative.

A "No" vote supposedly gives the county authority to shut down the system. But voters gave the county that authority with passage of Proposition 204. Defeating this proposition gives the county no more authority to shut down parts of the system than it already has.

Defeating the proposition would, however, leave responsibility for the heath care system with the Board of Supervisors, with this now-discretionary service having to compete with all the other county priorities for funding.

And defeating the proposition would appropriately spank the county for its insult to democracy with such a shamelessly politicized ballot pamphlet and ballot question.