On Dec. 15, 2016, the Greater Phoenix Chamber of Commerce joined the Arizona Chamber of Commerce & Industry and other local chambers to challenge the constitutionality of Proposition 206. While the Chamber respects the will of the voters, all ballot initiatives must be passed in compliance with rules set forth in the Arizona Constitution. Given the harmful effects this initiative has on small businesses and the overall business community in general, we feel that these serious constitutional issues have to be challenged in the court.

The decision to join the suit by our fellow chambers was not taken lightly or without thoughtful deliberation of the following facts: First and foremost, our board members, took a strong and unambiguous position in opposition to Prop 206 prior to the election. Second, the Chamber played a fundamental role in the effort to defeat the initiative.  Third, this Chamber has a long track record of opposing unfunded General Fund mandates. And, lastly, the decision to join the lawsuit also had the support of our Public Affairs Chairman Jaime Molera.

Please read the Q&A below for more information.

Why bring this suit now? Didn’t you have these same arguments before the election?
These challenges can only be brought after the election results. They could not have been brought prior due to case law.

Will there be additional plaintiffs?
We anticipate that additional plaintiffs will join the suit.

Does the business community have legal standing to bring this challenge?
Yes, the plaintiffs are taxpayers and represent taxpayers, which is what is required in order to bring suit.

Why are chambers of commerce and a restaurant suing?
We are deeply concerned about the measure’s effect on employers, employees and the state’s overall economic competitiveness, which we argued throughout the campaign on Proposition 206. However, despite our stark disagreements with the proposition’s proponents on policy grounds, our lawsuit is over the proposition’s constitutionality.

What will happen if Proposition 206 is implemented on January 1, 2017?
We argued throughout the campaign that we believe that if Proposition 206 is implemented on schedule that prices will rise, employers will reduce their employees’ hours, employers will implement layoffs and that some businesses will close their doors. We know now, for example, that state-contracted care providers to the developmentally disabled cannot continue to operate under current state-funding levels after the proposition is implemented. By not following the Revenue Source Rule, the backers of Proposition 206 are harming the state’s most vulnerable individuals and those who work to serve them.

The interests behind Proposition 206 must at least follow the Arizona constitution when implementing the proposition.
If the state Legislature were to respond to Proposition 206 by appropriating new dollars to impacted agencies, that could have negative funding implications for other budget priorities, including K-12 and higher education. Is that what the state and national teachers unions had in mind when they made their big-dollar contributions to the pro-206 campaign?

PDF: Plaintiffs’ Joint Verified Complaint for Special Action
PDF: Joint Application for Order to Show Cause and Joint Motion for Temporary Restraining Order

Questions? Contact Public Affairs Vice President Mike Huckins at mhuckins@phoenixchamber.com or 602.495.6474.

 

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