The Superior Court of Maricopa County on Friday removed the “Invest in Education” proposition from the ballot on account of its 100-word description posing a “significant danger of confusion or unfairness to a reasonable Arizona voter.”
Both the 2018 and 2020 proposals sought massive income tax increases on certain taxpayers, including small businesses.
Massive tax increases
As reported several weeks ago by Chamber Business News, the “Invest in Ed” initiative would raise state income taxes on top income earners by 77.7% — moving the top rate from 4.5% to 8%. The tax increase would also affect small businesses organized as pass-through entities, including sole proprietorships and limited liability companies.
The big tax hike was ruled to be misrepresented by the summary provided to Arizona voters who signed a petition to send the measure to the November ballot..
The summary described the tax increase as follows::
“establish[es] a 3.5% surcharge on taxable income above $250,000 annually for single persons or married persons filing separately, and on taxable income above $500,000 annually for married persons filing jointly or head of household filers…”
By failing to alert voters on the impact on certain business entities and the true size of the tax increase, the Court found that the summary was sufficiently “mislead[ing]” to warrant it being removed from the ballot.
The initiative was found to completely exclude several key provisions from its voter summary.
The “No Supplant Clause” included in the proposition would lock certain funds towards specific ends, “limit[ing] the power and authority of the Arizona Legislature”, which has direct power over budgeting. Despite curtailing the power of the state House and Senate that is constitutionally assigned, it has no mention in its summary.
Furthermore, the authors of the initiative excluded the “Local Revenue Clause” from the ballot summary.
Responses to Molera v. Hobbs
Arizonans for Great Schools and a Strong Economy, the committee that took the initiative to court, hailed the ruling as a victory for Arizona voters, students, parents, and taxpayers.
Jaime Molera, the former state superintendent of public instruction who chairs the opposition committee, stated that “This was the right decision. As we made clear, the tax increase proponents’ entire process, from signature gathering to their 100-word summary, was flawed and misleading.”
The Invest in Ed organization, sponsored by the Arizona Education Association, decried the ruling as “blatantly… political.”
Invest in Ed has pledged to appeal the ruling to the Arizona Supreme Court.
Before the proponents announced their decision to appeal, Molera said, “Should the proponents appeal the decision to the state Supreme Court, we anticipate the same outcome.”