A closer look at the "Invest in Ed" initiative

Posted at 5:33 PM, Oct 05, 2020

Editor's note: This is the first in a series of stories focused on the "Invest in Ed" initiative. We'll be going in-depth on multiple angles related to this measure, to make sure voters are well-informed when they cast their ballots.

The debate over education funding is heating up as we get closer to Election Day.

Supporters of the "Invest in Ed" initiative or Prop 208 say it will generate nearly $1 billion for teachers, students and schools. Those against it, say it is bad for business.

Two years after tens of thousands of teachers stormed the state capitol and one failed attempt to get on the ballot; voters will now have the final say on "Invest in Ed" in November.

"This is building off of a really critical movement," said Dave Wells, research director for the Grand Canyon Institute. It is a non-partisan think tank focused on how policies affect Arizona's economy.

"If nothing else it is a transfer of income from wealthy people to middle-income people because teachers are going to be the primary beneficiaries of this," said Wells.

If passed, Prop 208 would enact a 3.5% income tax surcharge on individuals making more than $250,000 a year, or joint filers making more than $500,000. It takes their tax rate from 4.5% to 8% on any income above those dollar amounts.

The Joint Legislative Budget Committee, or JLBC, estimates the surcharge would impact about 100,000 people in Arizona. However, Wells estimates that number is closer to 35,000 people when taking taxable income into account, and distinguishing single from married filers.

One of the initiatives' biggest supporters, the Arizona Education Association, claims it will generate $940 million. An analysis by the JLBC estimates that number is closer to $827 million.

A small amount of that generated revenue would initially go toward administrative costs of the Treasurer, Auditor General, AZ Department of Education (ADE), Department of Revenue (DOR), and State Board of Education, associated with making the tax changes.

The remaining funds would be distributed as follows:

  • 50%- Hiring and increasing base compensation for teachers and classroom support personnel (social workers, librarians, nurses, counselors)
  • 25%- Hiring and increasing base compensation for student support services personnel (academic interventionists, transportation, media specialists, health assistants)
  • 10%- Mentoring and retention programming for new classroom teachers
  • 12%- CTE Workforce Fund
  • 3%- AZ Teachers Academy

"It's not a massive increase in funding, it is the most significant increase in independent funding we’ve had for schools if it passes since Prop 301 in 2000," said Wells.

Right now, Grand Canyon Institute is digging deeper into the potential impacts of Prop 208, both in the classroom and on Arizona's economy.

"One possibility is that people would move, that they might decide well I’m going to move to Idaho or someplace else where they decide the taxes are less," said Wells.

The Institute's full analysis should be released by early October.