Prop. 208 promises more money for schools from tax dollars. Here’s what you need to know

By
Cami Parrish
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Prop. 208 signs at an intersection in Phoenix (Hailey Rein/DD)

This November, Arizona will vote on Proposition 208 to decide whether or not to levy a tax increase on a small portion of Arizona taxpayers in order to fund K-12 public education.

If passed, Proposition 208 would increase the highest income tax rate in Arizona by 3.5% and put the revenue toward state education. The increased tax applies to single-filers who report at least $250,000 in annual income, or joint-filers who report at least $450,000.

The proposition will first establish a Student Support and Safety Fund (SSSF), where the revenue raised by the tax increase would be stored. Once collected, the money would be used to hire teachers and provide classroom support, student services, retention programs, mentoring, and other similar services.

Elected officials who have vocalized support of the proposition include Arizona Superintendent of Public Instruction Kathy Hoffman and downtown Phoenix representatives, Rep. Jennifer Longdon and Rep. Amish Shah.

While Longdon did not explicitly state her support, she did hint at it through hashtags in a tweet about mailing in her ballot for the upcoming election. She and Shah are also listed as supporters on Invest in Ed’s website.

The proposition is primarily supported financially by the Invest in Education campaign. Notable organizations in favor of Prop. 208 also include the Arizona Education Association, Stand For Children, LUCHA and the ACLU.

David Lujan, who is involved with the Invest in Education campaign and serves as the director of the Arizona Center for Economic Progress, believes that Proposition 208 is a necessary investment in Arizona’s future.

A road sign by Invest in Ed promoting prop. 208 (Hailey Rein/DD)

“Between 2008 and 2015, no state in the country cut more funding from its public education system than Arizona. More than $2 billion in annual funding was cut during that time. Arizona’s public schools are operating with less funding today than they were in 2008,” Lujan said.

Invest in Education, a group dedicated to fixing the teacher shortage, believes that by increasing the income tax rate of the wealthiest Arizonan taxpayers, the state could generate an estimated $940 million in annual revenue to put toward hiring qualified teachers, Lujan said.

However, many Arizonans are skeptical of this figure.

Garrick Taylor, the spokesperson for the No On 208 campaign, explained that the campaign opposes the proposition for two reasons: they don’t believe that Prop. 208 will deliver revenue for students and teachers in the way that its proponents have promised and they believe the tax increase could harm small businesses.

According to Taylor, this particular source of revenue is too volatile to sustain teacher salaries because wealthy individuals are highly susceptible to sharp drops in income during economic downturns.

“I want you to put yourself in the shoes of the school board members and superintendents, right? You’re not going to base your teacher pay budgets on the dollars that fluctuate with the whole economy. They’re just too volatile,” Taylor said.

In addition, No On 208 is concerned that the 3.5% increase will hurt Arizona’s small businesses.

If the proposal passes, Arizona will have an 8% income tax rate for the top income tax bracket, which would be the ninth highest income tax rate in the country. No On 208 believes that this could not only deter small businesses from relocating to operate in Arizona, but could gravely hurt Arizona’s current small businesses.

The U.S. Chamber of Commerce issued a statement on Thursday, Sept. 24, echoing similar concerns.

“If passed, Arizona would have one of the highest small business tax rates in the nation, destroying jobs and discouraging new start-ups,” said Chief Policy Officer and U.S. Chamber Executive Vice President Neil Bradley.

However, according to the U.S. Small Business Administration’s Office of Advocacy, the median annual income for self-employed Arizona small-business owners in 2018 was $51,005, which is nearly $200 thousand less than the annual income of the tax bracket that would be affected by the 3.5% increase.

“The average income for a small business owner in Arizona is well below the threshold of Prop. 208, so any individual small business that is going to be taxed under Invest In Ed. is not your typical mom and pop business,” Lujan said.

Arizona Governor Doug Ducey has stated that he opposes the proposition on multiple occasions. In a statement, Ducey said he believes the tax amount is too high during a time of economic recovery.

Ducey is scheduled to speak to the Arizona Chapter of the Commercial Real Estate Development Association about his opposition to Prop. 208 on Friday.

The general election will take place on Tuesday, November 3.

For information about voter registration, requesting mail-in ballots or finding your polling location, visit cleanelections.gov.

Contact the reporter at clparri2@asu.edu.

Cami is Downtown Devil's co-executive editor. Cami is a third-year student studying print journalism and political science. When she's not writing or editing, she enjoys hosting radio shows, playing piano and bass, and teaching art classes at a local art studio.