- Associated Press - Tuesday, April 26, 2016

PHOENIX (AP) - A problem in the budget agreement between Republican leaders of the House and Senate and Gov. Doug Ducey appeared close to a solution Tuesday as the governor appeared ready to agree to changes demanded by a group of GOP House members concerned about several K-12 school funding issues.

The group of about a dozen Republican lawmakers is keeping House leaders from introducing the $9.58 billion spending plan for the year that begins July 1. They now expect that to happen Wednesday.

The Senate introduced its bills late Tuesday, setting the stage for what’s usually a rapid few days of action on the budget.

The House members’ concerns revolve around three issues - extra cash for smaller schools, a delay in cutting funds to district-sponsored charter schools and keeping funding stable for schools with declining enrollment.

That “hold harmless” provision for schools that lose students is funded with a $16 million patch in the budget proposal. But that money doesn’t go just to those schools, but to all K-12 districts statewide through a payment into a special account. Protecting the declining enrollment schools will cost about $31 million in all.

“Those are big enough for me to say I have to have those things to vote yes,” said Rep. T.J. Shope, R-Coolidge.

Republican Rep. Doug Coleman of Apache Junction said the declining enrollment issue alone will earn a no vote on the budget from him.

“I’m concerned that declining districts will get an extra hit because what they’ve proposed does not specifically go to declining districts,” he said Tuesday.

Ducey spokesman Daniel Scarpinato said the governor is open to changes in the deal.

“The governor believes that more money is needed,” Scarpinato said. “He wants to make sure that the trend line is going up.”

Senate President Andy Biggs appeared slightly surprised by news that the governor was ready to allow changes to address concerns raised by the House members, but said amendments are possible.

“These bills reflect the agreement that we made with the exec, House and Senate last Friday,” he said. “We all walked out knowing that there would be some members who want and ask for different provisions.”

Rep. Justin Olson, the House Appropriations Committee chairman, said with any complex budget proposal there’s going to be differences between some members.

“And the nature of politics is finding a solution that can meet as many of those desires and as many of those priorities as possible,” Olson said.

The bottom line budget plan includes $9.58 billion in spending, and includes extra cash for universities, K-12 schools and county and city roadbuilding. The plan also includes the end to some budget-balancing gimmicks dating to the Great Recession for universities and social service and child safety agencies, leaving only K-12 schools still subject to the years-old maneuver that shifts spending into the following budget year.

Other key issues likely to get attention include:

- $26 million in tax cuts, most going to businesses. They include $8 million to speed depreciation for new equipment, a $7 million expansion of a tax cut on power used by manufacturers, and a property tax break for Grand Canyon University, a private Christian college in west Phoenix. Another tax cut helps charities by increasing the amount people can donate and get a dollar for dollar tax credit, and there are several others.

- $5 million in funding for conservative think-tanks at Arizona State University and the University of Arizona: The so-called “economic freedom schools are now privately funded, mainly by conservative groups such as the Charles Koch Charitable Foundation. The universities didn’t ask for the extra funding for the centers, which don’t have degree programs.

- $19 million to be split between the three state universities. The schools wanted an additional $24 million to partially make up for a $99 million cut last year. Some of the new money is earmarked for a new veterinarian school at the UofA.

- Ducey’s proposed Border Security Strike Force gets $22.6 million in general fund money plus $4 million from other funds. That’s about $5 million less than the governor wanted for the new program. The force is budgeted to get $8 million a year in each upcoming year for operations.

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