What a Democratic Majority in the Arizona Legislature Would Look Like: Cutting Costs

(The Center Square) – If they win in November, Arizona Democrats plan to introduce legislation they say will lower costs for Arizonans. Republicans say the measures would only hurt Arizona’s economy and lead to higher taxes.

Just two seats away from giving Democrats a majority in Arizona’s legislature for the first time in six decades, the Democratic Caucus has come up with a plan they say will get them off the ground in 2025 if they take control of the legislature. This story is part of an ongoing series on what a Democratic trifecta would look like for Arizona taxpayers.

“In the event of a reversal, we want to be ready to govern,” Sen. Christine Marsh, a Democrat from Phoenix, said in an interview with The Center Square.

Paid family and medical leave

One of the Democratic Caucus’ priorities is to provide all Arizonans with paid medical and family leave. This legislation would mirror a bill that was introduced in this year’s legislative session but has been placed in committee.

Senate Bill 1632, introduced by Sen. Juan Mendez, a Tempe Democrat, says that starting in 2027, family and medical leave benefits can be paid to people who meet one of the bill’s qualifications: caring for a new child, whether through birth, adoption or foster care; caring for a family member with a “serious health condition” who is pregnant or recovering from childbirth; who has an injury, disability or physical or mental condition that requires hospitalization; emergency leave due to a family member’s active duty service; or if someone needs a safe leave of absence.

In addition, the bill states that a person will be entitled to 26 weeks of paid leave. However, a person cannot receive more than $1,000 per week. The commission would set the amount that employers and employees would pay on a 1:1 basis, depending on how much is paid out of the Family and Medical Leave Insurance Fund, which will be established.

Republicans say it would hurt the economy, and economic analysis of the idea backs that up.

More than 70 bills rejected during the last session of the Legislature could hurt the economy, including SB 1632, according to a report by the Common Sense Institute of Arizona.

The report compares Arizona to Colorado, where similar laws have been proposed but have been effectively passed. Colorado has had the law since 2019, according to the report, and it has cost the economy more than $3 billion.

“If we look at the biggest economic impacts, it’s not necessarily tax increases,” said Katie Ratlief, executive director of the Common Sense Institute, “it’s imposing incredibly burdensome regulations on employers about how they manage their workers.”

Affordable childcare

Another important issue for Democrats is creating more affordable child care.

“We have some goals to lower costs for Arizonans by making child care more affordable and ensuring people have access to reliable child care,” Marsh said.

Examples of such efforts include SB 1389, sponsored by Sen. Lela Alston, D-Phoenix, which would eliminate the current waiting list for government-funded child care. The current statute states that people who reach 100 percent of the state poverty level will have priority to move up 10 percent, regardless of time spent on the waitlist. Democrats want to allocate enough money from the state’s general fund to eliminate the waitlist.

The total funding amount had not yet been set when the bill was rejected by Republicans, who control both chambers of the Arizona Legislature.

Sen. John Kavanagh, a Fountain Hills Republican, said the Democratic policy would lead to higher taxes for Arizonans.

“We would lose the checks and balances if there wasn’t at least one Republican standing up to the more radical left-wing agenda,” Kavanagh said.

Sen. Priya Sundareshan, chairwoman of the Democratic Caucus’ campaign to win the majority, said the Republican majority “left us in a budget hole” and that Democrats are interested in building revenue for the state. She also said Democrats are unlikely to raise taxes soon after winning the majority.

“Raising taxes is hard, so I don’t think Democrats getting a majority automatically means we’re going to raise taxes,” Sundareshan said. “In this state, you need at least a two-thirds majority to raise taxes. So unless we can get a two-thirds majority or we can get Republicans in, their claim that we’re going to raise taxes right away rings pretty hollow.”

Reducing the Cost of Prescription Drugs

The final measure Democrats have mentioned as a way to cut costs is lowering the cost of prescription drugs.

Sen. Eva Burch, D-Mesa, sponsored two bills this legislative session, both of which were blocked. One, Senate Bill 1532, would require anyone who buys a prescription drug that is subject to a “maximum fair price” set by the federal government not to be required to pay more than that price.

The second, SB 1533, would establish the Division of Prescription Drug Affordability within the Department of Insurance and Financial Institutions. The division would study and promote mechanisms to save consumers money on prescription drugs, approve or disapprove prescription drug price increases — a requirement for pharmacies set forth in the bill — and ensure that state-regulated health insurance premiums accurately reflect the true cost of prescription drugs.

House Bill 2558, introduced by Rep. Judy Schwiebert, a Phoenix Democrat, aimed to put tighter limits on prescription drug prices but also went to committee.

The Act provides that “a manufacturer or wholesale distributor shall not engage in price gouging in the sale of an essential off-patent drug or a generic drug.” It further defines price gouging as “an unfair increase in the price of a prescription drug,” an essential off-patent drug, or a generic drug as a prescription drug that meets multiple criteria.

This means that all exclusive marketing rights have expired, the drug is on the World Health Organization’s Model List of Essential Medicines or has been designated an essential medicine by the Secretary of the U.S. Department of Health and Human Services, is actively manufactured and marketed in the United States by three or fewer manufacturers, and is available for sale in Arizona.

Schwiebert’s stalled bill is cited in a Common Sense Institute report as a bill that would hurt the economy. The report says that while it saves consumers money, it could lead to shortages of essential medicines by imposing price controls on essential drugs.

Economic concerns

According to Kavanagh, there are a number of legislative measures aimed at lowering costs for Arizonans that would actually hurt the economy and exponentially raise taxes. He’s most concerned about bills that would expand Medicaid availability, provide health benefits to non-US residents and require government health programs to pay for gender reassignment surgeries.

Ratlief said Democratic initiatives appear to be a sincere attempt to solve problems, but government regulations affect the state’s economic lifeblood.

“It’s that overregulation that can kill innovation, kill jobs and make job creators want to take those jobs elsewhere,” Ratlief said. “They can be incredibly well-intentioned and very well-intentioned, but if they’re not balanced with allowing job creators to grow and the economy to grow, they can have a very damaging effect very quickly.”