PHOENIX — Rocked by the “sexting” debacle of last week, d former Arizona State Senator Steve Montenegro lost the Republican primary to Debbie Lesko, who is also a former senator. The special election is for Congressional District 8, the seat vacated by Republican Representative Trent Franks last year when he resigned over sexual harassment allegations.
In the legislature, committees returned to hear bills from the other chamber as both House and Senate voted on the floor to move legislation forward. Below are some of them.
Streaming Free of Taxes
The Arizona House of Representatives moved a bill one step closer to keeping taxes out of streaming TV. HB 2479, originally introduced by Rep. Michelle Ugenti-Rita (R-Scottsdale), would exclude from taxation any “selling, leasing, licensing, purchasing or using specified digital goods that are remotely accessed by a consumer, and not transferred electronically to the consumer.”
Things like internet cookies and temporary files don’t change how a user interacts with the “remotely accessed digital good,” so it seems as if streaming music or renting video will be exempt where buying computer games and other software will not. Those would be “transferred electronically to the consumer.”
The broad language in this bill may have far-reaching consequences, and the financial effects of this bill have yet to be determined.
“After 26 years of tax cuts, we are foregoing income that we need,” Minority Whip Rebecca Rios (D-Tempe) said. “Once again we are taking the opportunity to give away revenue before we even recognize it.”
Revenue that Rios and her Democratic colleagues claimed would normally go to students. Arizona has fallen behind other states in spending per pupil among other financial metrics, following spending cuts during the Recession.
“Yes there may be some unknowns, but I don’t think we are talking anything astronomical,” Speaker of the House J.D. Mesnard said. “This is trying to establish clarity where clarity is lacking.”
Mesnard asserted that the lack of legislation on these types of goods had led to taxes being levied by departments that lacked authority to do so, but were operating under rules made as they went along. The House voted in favor of changing that, with a vote 39-19 in favor of moving the legislation on to the Senate.
Arizona’s Baby Bounty
The House of Representatives started the day off on Tuesday with debate about a child tax credit bill called HB 2459, which was initially introduced by Rep. Paul Mosley (R- Lake Havasu City) to the House Ways and Means Committee. The bill would create tax credits for taxpayers who are supporting children under 17, elderly family members and dependents that suffer from mental illness or emotional disorders. This is on top of the deduction already offered for dependents.
“It’s not like the federal government hands us a bunch of money,” Rep. Ken Clark (D-Tempe) said. “This is not fiscally conservative, it’s not fiscally responsible.”
The cost to the state for offering this is expected to be $96 million which Mosley claimed would be partially offset by the federal tax cuts from 2017.
“This is not throwing money away. This is not spending,” Mosley said. “This is giving money back to the taxpayer. I’m advocating that with this bill we give money back to working Arizona families.”
The House Committee of the Whole voted in favor of the bill Tuesday, but it failed in third reading the following day. Mosley, who has seven children, will have to try again next year.
Free Credit Freezing
If the Arizona Legislature has its way, Arizonans will no longer be charged a fee for freezing their credit going forward. Currently, it costs $5 per credit bureau (of which there are three: Equifax, Experian PLC and TransUnion) to issue a freeze and $5 to lift or remove it, according to the Arizona Attorney General website. Sen. Kate Brophy McGee (R-Paradise Valley) introduced SB 1163 to the Senate, which passed through and is now making the rounds at the House.
The impetus for such a bill follows the wake of the Equifax data breach over the summer, where hackers managed to gain access to databases holding the personal information of reportedly 143 million Americans. The information included just about everything needed to steal someone’s identity such as names, Social Security numbers and addresses. Freezing one’s credit was a recommendation given by the Federal Trade Commission in response. Doing so would make opening new accounts in a person’s name more difficult, though not prevent charges to existing accounts.
Those freezes could add up, with $60 in fees for the freezing and unfreezing of a married couple’s credit. Brophy McGee’s bill would eliminate that — and is one step closer to doing so. The bill received a “Do Pass” recommendation from the House Commerce Committee with a vote of eight in favor, one absence. It will now go to the House Rules Committee for another vote.
Erik Kolsrud is the Don Bolles Fellow covering the Legislature for Arizona Sonora News, a service provided by the school of journalism at the University of Arizona. Reach him at email@example.com.