GOP lawmaker wants to abolish Arizona Commerce Authority

PHOENIX — Calling it a “problem-riddled agency,’’ a senator wants the state to abolish the Arizona Commerce Authority.

State Sen. Jake Hoffman, a Queen Creek Republican, says the agency has “ballooned into the epicenter for waste, mismanagement and luxury spending at a time when Arizonans are struggling in Democrats’ failing economy.’’

His legislation, Senate Bill 1044, would put the agency out of existence. But if it survives the legislative process it will meet with an almost certain veto.

Democratic Gov. Katie Hobbs praised the Commerce Authority for its work during her State of the State address on Monday. The authority is “critical’’ to the state’s booming economy and the creation of “good-paying jobs for middle class Arizonans,” Hobbs’ press aide Christian Slater said later.

But Hoffman doesn’t need his measure to pass to achieve its goal. The authority, like most state agencies, undergoes a periodic review and needs an affirmative vote of the Legislature, which is controlled by Republicans, to continue.

Hobbs is urging lawmakers to extend its life for another eight years. But if lawmakers do not approve an extension, the agency’s existence will automatically end at the end of June.

Ex-gov, Chamber oppose the bill

Besides Hobbs, a former Republican governor is among those pushing lawmakers to keep the Commerce Authority going.

“I think it’s unfortunate that they have decided to do something like that, after what I established and how much it has generated in revenue for the state of Arizona,’’ said ex-Gov. Jan Brewer, who worked with lawmakers to create the authority in 2011.

Brewer noted that Hoffman’s move to wipe out an agency that helps bring revenue-generating businesses here comes as the state is running a deficit for the current fiscal year as well as for the new one that begins July 1.

The Arizona Chamber of Commerce and Industry will also oppose any effort to kill the agency, said its chief executive, Danny Seiden.

Seiden credits the public-private partnership with helping rescue the state from the 2007-09 Great Recession. He said its work in promoting the state and attracting new businesses helped to diversify the Arizona economy and made it more resilient.

That success led to the fact that Arizona leads every other state in the nation in foreign investment, Seiden said.

He pointed out that the agency was created at Brewer’s request to replace the old Arizona Department of Commerce, and that it continued to flourish with the backing of Republican Gov. Doug Ducey, who held office from 2015 through 2022.

“Political jab”

Seiden said the ire of Hoffman — and of 10 other GOP lawmakers co-sponsoring his bill — appears political.

“It seems to suggest that everything they don’t like about the ACA happened in the first year of Gov. Hobbs’ administration,’’ he told Capitol Media Services.

“That’s not true,’’ Seiden continued. “The ACA and the things they’ve identified they don’t like goes back to decades of Republican administrations as well.’’

What makes the issue ripe right now is a review of the agency last year by Arizona Auditor General Lindsey Perry.

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Among her findings was that the Commerce Authority spent more than $2.4 million in taxpayer funds to wine and dine corporate CEOs and others at the Super Bowl and Waste Management Open over the past six years.

That included the agency spending $2.1 million sponsoring last year’s Super Bowl in the Phoenix area, a deal that came with 140 tickets for games and other events, most of which went to CEOs and business bigshots.

Hobbs took some heat for a related report, related to the ACA, that she gave half of the dozen free tickets the Arizona Office of Tourism got for the game to top aides.

Hoffman, in a press release, called those “troubling, potentially illegal handouts under the Hobbs administration.’’

But Seiden said that rewrites history about what have been called “CEO forums.’’

“Those things started” at the Super Bowl held in Phoenix in 2015, he said, saying Hoffman made “no mention of that.’’ That’s selective criticism, he said.

“It does seem very much like a political jab at Gov. Hobbs,’’ Seiden said. “And that’s unfortunate.’’

“Job-killer bill”

More on point to the chamber’s interests, Seiden said this is the “top job-killer bill’’ his organization ever has seen.

It’s not just that the agency would be gone if SB 1044 were to become law.

“It repeals all the programs — programs that people like Jake Hoffman have voted for,’’ Seiden said, including various financial incentives to lure businesses here.

Most recently, he said, there was legislation last year that increased the amount of money that would be given to cities, towns and counties to reimburse them for any public infrastructure improvements, including water and sewer lines and roads, they constructed to benefit a manufacturing facility. The measure was approved 21-9 in the Senate, with Hoffman voting in favor.

Seiden said that program is dependent on the Arizona Commerce Authority determining which facilities are eligible. If the agency is gone, the reimbursement program is too, he said.

The statutes that Hoffman’s bill would repeal also eliminate all of the competitive funds available to companies that relocate or expand here. Also gone would be laws granting tax relief to computer data centers, the office that coordinates expansion of broadband, and various incentives ranging from producing motion pictures in Arizona to engaging in activities to promote healthy forests.

Seiden said Hoffman’s own legislative district has benefited from Commerce Authority activities, including an announcement last year that LG Energy Solutions plans to invest $5.5 billion to build a battery complex in Queen Creek. “LG is here because of the Commerce Authority,’’ Seiden said.

He said there might be a legitimate debate about whether and what kind of growth Arizona needs.

“We can agree to disagree on that,’’ Seiden said. “But this attempt to just repeal it is irresponsible.’’

Seiden said the legislation, whose 10 co-sponsors, all Republicans, include one from Tucson, Sen. Justine Wadsack, has political implications that will be noticed by businesses that support the kind of economic development the authority promotes.

“It turns the Democrats into the ones protecting jobs now,’’ he said, with the GOP “giving up all their classic Republican strongholds.’’