By Shirley Dye, Payson Unified School District Board Member, Payson, Arizona, February 2014
Why do I tie these two topics together? Because Arizona used to have plenty of money for education (as if $9,000 per child and $225,000 per a classroom of 25 wasn’t enough), but the federal government overreach has led to a decline in tax proceeds from public land use for education funding. By acquiring the public lands that were supposed to be transferred to us in 1912 at Statehood, Arizona would have a lot more land under production. Tax revenues from these lands could fund our Schools without the use of Federal money and all the strings.
States east of Colorado received their Constitutionally guaranteed lands when they became states. Eastern states have an average of 5% federal lands, and 85% privately owned, with some state parks, state trust lands, and public buildings. The large percent of private lands provide taxable income for the state budgets.
Arizona has only about 14-16% private land for a tax base, with large portions of land under control of military bases, tribal lands, state trust lands, and federal public lands; all not taxable. Arizona and other western states have never had their public lands ceded to them. The Federal Government, Forest Service, and the environmentalists, have driven out the productive timber, cattle ranching and mining industries that used to generously fund education. Their policies have also led to costly fires that have devastated thousands of acres of land that could be productive. PILT funds (payment in lieu of taxes) from the federal government have also decreased over the years.
Arizona has a dedicated percentage of state trust lands(not the same as public lands) set aside by the Constitution specifically for education income. Recently very little of the trust land has been leased to private operations like cattle grazing, shopping centers, etc, whose lease proceeds go into the school coffers. The interest income on the trust funds from sold lands has been minimal due to the economic downturn, and the principal cannot be touched.
Since the 1970s revenue from taxes from public land use for schools has declined by over 50%! Part of the reason is that mines and utilities used to pay taxes based on 60% of their assessed valuation. In the 1980s due to regulations, the mines and utilities lobbied to have their base reduced to 30%. In 1995 they again fought to reduce the base another 1% a year down to 25%. Each 1% per year loss translated to a 15% loss per year in tax income from each mine and utility. That left the other taxpayers to bear the burden of taxes for schools.
In the 1980s, property owners’ primary and secondary property tax bonding rates were cut in half. The Schools Facilities Board (SFB) was supposed to equalize funding for new schools so rural districts could get the same quality facilities as richer districts. Since the SFB, funded by Arizona’s general fund budget, ran out of money due to recent hard economic times, a majority of legislators and the Governor chose to double the primary and secondary bonding rates for families and businesses.
Many critics say “just budget more money for education!”, but where would it come from? Arizona spends nearly the same percentage of its budget on education as other states, but our budget “pie” is a lot smaller. An obvious way to increase the money available for education and other budget items is to get more land to place under production.
We must demand our federal lands be transferred to us, and there is precedent! In 2009 the U.S. Supreme Court unanimously declared that Congress doesn’t have the authority to unilaterally change “the uniquely sovereign character of a State’s admission into the Union”, particularly “where virtually all of the state’s public lands are at stake.” Hawaii became a state in 1959 but was ceded all of its public lands in 2009, with the right to sovereign control, to access, and to manage all their resources as a result of this Supreme Court Case. There is a movement among the Rocky Mountain States led by Utah Representative Ken Ivory to demand that we receive title to our lands as promised. This would ensure education equality and economic self reliance of our State.
How can we help? A first step would be to support Arizona Representative Bob Thorpe’s HB2700. “The bill would create an inventory of all the Arizona lands (and their values) taken since we became a state in 1912, and would empower the AZ Attorney General to investigate the legitimacy of the takings, and to attempt to get lands returned to AZ, and to protect AZ lands from future federal takings.” Please share this message.
Search “American Lands Council”, “A Tale of Two States”. and “Are We Not A State?”; and Arizona School Boards Association September 2013 Law Conference: “School Funding, How We Got Here” with charts “Change in Assessment Ratios” and “Residential v. Mines/Utilities”.
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