This month, Phoenicians will get to vote on two issues that could change the landscape of the city.
One of the initiatives would create a city spending budget until Phoenix pays off pension debt while the other would stop current and future light rail expansions.
With the Aug. 27 election coming up quick, Phoenix voters have big decisions to make on two issues that could affect generations to come.
Voting yes on Prop. 105 would amend the city charter to end construction of light rail extensions, including all current projects, and redirect the funds to other transportation infrastructure.
It would also prohibit any future funding for other light rail developments.
Prop. 105 is the effort of Building a Better Phoenix, a citizen group that wants to stop the South Central Light Rail Expansion and divert the money to different infrastructure improvements in south Phoenix.
According to Building a Better Phoenix, more than 70 percent of Phoenix city streets require billions of dollars for repairs and halting light rail expansions would free up the money needed to fix roads.
“The initiative does multiple things. One, it fixes all of the roads. It keeps the light rail that is there, but all future light rail monies goes to fixing roads and our bus system,” Phoenix City Councilman Sal DiCiccio, a strong supporter of the proposed initiative, said. “The other thing that it does on a more local level is that the monies that are designated for the South Central Line, all those monies stay in South Phoenix for infrastructure.”
Proponents of Prop. 105 think bringing the light rail into south Phoenix will result in too much construction, causing businesses along Central Avenue to lose money.
“They tell us already that 70 percent of the traffic will go to 7th Avenue and 7th Street. We are businesses that depend on the traffic. We cannot survive with only 30 percent of the traffic. Who can survive the four years of construction? No customers, no [vehicle] traffic. It’s dead. So we are concerned. We don’t want the light rail,” Celia Contreras, local business owner of Tony’s Window Tinting and founder of an anti-light rail group “4 Lanes and No Train,” said.
On the other end, opponents of 105 say the light rail system helps the Phoenix economy by connecting workers to their jobs, students to their schools, families to the community as well as adding density to downtown Phoenix.
“We’ve seen $11 million of investment along the light rail as well as connecting communities,” Phoenix Mayor Kate Gallego said at a Global Chamber even in July. “If [105 passes], there will be no more light rail expansion in Phoenix. We won’t be able to do commuter rail. Amtrak is looking at whether they want to provide service in the Phoenix area, including connections to places like Tucson, so that would not be able to go forward.
According to Gallego, the federal funding for light rail cannot be reallocated. Instead, it would go to another state.
“It’s hundreds of millions of dollars and that’s dollars that would go outside of Arizona. So, it’s not dollars that we could allocate elsewhere, it’s money that will be gone,” Gallego said. “If we’re going to have a dense, global downtown, we have to build up. We have more vacant land in our downtown than most large cities do.”
According to local group Invest in PHX, the light rail’s connectivity drives Phoenix’s economy and brings in billions of dollars in economic development as well as “tens-of-thousands of jobs and new opportunities.”
A Valley Metro Quality of Life Report found the following impacts of the light rail: “Residents have more access to grocery stores, 19,133 tons of air pollutants were prevented from reaching the atmosphere, and 20 new K-12 schools and 21 new vocational and community colleges have opened.”
Phoenix has more than $4 million in pension debt that it has creatively tried to manage in the past. However, the city continues to spend hundreds of millions of dollars each year to pay down the debt.
DiCiccio’s project, Prop. 106 would require annual assessments of the city’s pension debt. It would limit budget growth if pensions are not 90 percent funded and earmark revenue over the budget limit to pay down pension debt, as well as require city officials to reimburse the city for pension benefit employer contributions.
The proposition has four main parts:
- Require an annual assessment of the pension and retirement health care liabilities and funding levels, using GAAP and the 10-year average return on investment, rather than an assumed return.
- When pension and retirement health care liabilities are not adequately funded, it limits the annual general fund spending growth to no more than inflation and population.
- Any revenue overpopulation and inflation growth goes to pay down the pensions – starting with Police & Firefighter pensions. They become the first budget priority.
- As a first step to finding the savings needed to ensure adequate funding, it ends retirement pensions and retirement healthcare benefits for newly elected officials.
“This ticking time-bomb of underfunded public pensions and retirement health care benefits will leave states, cities, and counties with a future of dramatic tax increases, slashed services and potential city, county and even state bankruptcies,” according to the Responsible Budgets Act (Prop. 106) proponent group.
On the other hand, if passed, Prop. 106 could limit city services such as libraries, parks, serving seniors and road repairs.
According to Mayor Gallego, many international partnerships come from general fund dollars and if Prop. 106 is passed it would harm those relationships.
“There is a ballot initiative on August 27th in the City of Phoenix about whether to cap general funds dollars and say everything needs to go towards our pension system. So, if we are putting all of the dollars into the pension system, that’s money we can’t put into strategic investments,” Gallego said.
According to Invest in PHX, the proposition is poorly written and deeply flawed.
“This proposition has internal contradictions and mistakes, which make it unenforceable. If it passes, it will be a confusing mess held up in courts for years. It will cost the city hundreds of thousands in legal fees, prevent investment in important programs like parks and libraries, and hinder real progress on pension reform,” Invest in PHX said on its site.
Invest in PHX also says that Phoenix is on track to pay off its debt, making Prop. 106 unnecessary.
The City of Phoenix election is Aug. 27, 2019. To learn more about the election, click here.