Bonding time
Eat your bond vegetables … A new town is born … And those who can't, well, they get paid better.
For most of us, “bonds” is one of those words you politely nod at without really understanding. Or wanting to.
Most of the time, pretending works. But next month, Maricopa County is mailing voters a ballot to decide nearly $900 million in new bonds for Valleywise Health, so it’s a good time to try to understand what voting for a bond actually means.
Ballots for the all-mail Prop 409 election go out on Oct. 8, and should be mailed back by Oct. 28. Voters will decide if they want Valleywise Health, through the Maricopa County Special Health Care District, to use $898 million of their property tax dollars to build new facilities, like a behavioral health hospital, and upgrade old ones.
Valleywise Health isn’t a corporate chain like Banner Health or Dignity Health. It’s a public entity that traces back to 1877, when Maricopa County built a “pest house” to treat people with contagious diseases like smallpox. Voters approved a Special Health Care District in 2003 that gave an elected board taxing authority.
Valleywise is the largest public teaching hospital in Maricopa County, and it has 15 locations throughout the Valley. And since it’s publicly funded, the hospital is expected to absorb the cost of care for people who can’t pay.
But this isn’t Valleywise’s first trip to the ballot.
In 2014, county voters gave Valleywise a $935 million bond to build a 10-story medical center and dozens of other upgrades across its campuses. But Valleywise will likely collect more than $1 billion in property taxes to repay those bonds — well above the $935 million voters saw on their ballots.
That’s because bonds are basically fancy government loans that accrue interest. Last fiscal year, Valleywise spent $17.5 million on interest payments, per its latest audit.
The same concept applies if voters approve this year’s $898 million Prop 409 bond proposal, because the ballot amount covers only the money borrowed, not the decades of interest and investor premiums added on top.
Those are the kinds of hidden details that finance pros and government insiders understand, but most voters don’t.
That’s what we’re here for!
What the hell is a bond?
Government bonds are loans paid back with tax money.
Investors lend the money up front, and taxpayers pay them back over time, with interest. The idea is that taxpayers get some public benefit in return, like a hospital, school or road.
In Prop 409’s case, voting in favor means authorizing Valleywise to take out a huge loan now and pay it off with property taxes over 30 years.
The total cost is an estimated $1.4 billion worth of property taxes, because after investors (like banks and mutual funds) buy the bonds, they accrue interest.
It’s kind of like mortgaging your house, taking out student loans or putting something on a credit card. Valleywise will get the money up front, but will pay it back over time with interest.
What will it cost me?
General obligation bonds are funded through property taxes.
If voters pass Prop 409, the average homeowner would pay about $29 more per year on their property tax bill, and the average commercial property owner would pay about $295 more per year.1
That’s based on the estimated tax rate increase of about 11 cents for every $100 of assessed property value, or what the county decides your property is worth for tax purposes.
Technically, only those lucky enough to own property would fund the hospital’s improvements, but landlords aren’t above passing along higher costs through rent.
What are we buying?
The bond would pay for three major construction projects:
Replacing the 50-year-old behavioral health hospital with a new, 200-bed facility.
Upgrading outpatient facilities (like neighborhood clinics, the specialty care clinic and teaching centers) and building an outpatient surgery center.
Building out the 10th floor of the hospital (built with 2014 bond money), including adding observation beds to ease pressure on the Emergency Department.
Nearly 80 people submitted statements of support for Prop 409 for its information pamphlet, including former Gov. Doug Ducey, U.S. Sen. Mark Kelly and Secretary of State Adrian Fontes. No one opposed it.
Check your voter registration status here.
First day of school vibes: Arizona’s newest town — San Tan Valley — got its very first town council yesterday. The newly incorporated town is now the largest in Pinal County, and it fell to the Pinal County Board of Supervisors to pick the seven inaugural town council members. They’ll officially be sworn in next week.
More bad times ahead: Queer students at Arizona State University and the University of Arizona are bracing for a backlash over the murder of Charlie Kirk, LOOKOUT’s Annika Miyata reports. Meanwhile, Arizona Senate President Warren Petersen wants to rename Loop 202 after Kirk, Phoenix New Times’ Morgan Fischer reports. And President Donald Trump is coming to Arizona on Sunday to speak at Kirk’s memorial.
“I have friends who have been, you know, not attacked, but, like, harassed on the street just for looking a certain way,” ASU student Lillian Flottmann said. “After this past election, it already got worse, because, I don’t know, people felt more empowered to believe that way. Now, after this, when it turns trans people almost into an enemy, I can see it getting worse.”
¡Viva la independencia!: In the face of Trump’s mass deportation program, nearly 400 people showed up to the Arizona Capitol on Monday night to celebrate Mexican Independence Day, the Arizona Mirror’s Gloria Rebecca Gomez reports. In Mexico City, President Claudia Sheinbaum became the first woman to lead her country in El Grito, KJZZ’s Nina Kravinsky reports.
Eat the billionaires: Democratic Sen. Ruben Gallego is testing the waters of economic populism as he tries to push his party toward consumer protection and away from catering to Wall Street, the Republic’s Laura Gersony reports. Gallego also introduced a bill that would block Federal Reserve officials from simultaneously working at the White House, the Wall Street Journal reports. The issue came up as the Senate confirmed Stephen Miran, a White House official who is leading the Trump administration’s push to remake the Fed.
When Gallego gets a bill through to tax the rich to support the local news ecosystem, we’ll stop asking. Until then…
Vote at home, skip the crazies: A federal appeals court ruled Arizona Secretary of State Adrian Fontes can’t enforce rules on voter intimidation at polling locations, Capitol scribe Howie Fischer reports. A three-judge panel at the 9th Circuit Court of Appeals said on Tuesday that the measures Fontes put in the election handbook are too broad and could chill speech. And Trump’s call to eliminate mail-in voting is putting Arizona GOP gubernatorial candidates Andy Biggs and Karrin Taylor Robson in a tough spot as they try to appeal to voters who prefer to mail in their ballots, the Associated Press reports.
In other, other news
Measles cases are growing in Mohave County, pushing the statewide total to the highest it’s been since 1991 (Stephanie Innes / Republic) … Phoenix officials have started building the first of three treatment plants to turn wastewater into drinking water (Heidi Hommel / KTAR) … This year has been so dry that Colorado River experts are saying a repeat next year could drop water levels in Lake Powell to the federally recommended minimum (Tony Daivs / Arizona Daily Star) … And failed cooling systems during intense summer heat led to 270 deaths over the past five years in Maricopa County, mostly elderly residents on fixed incomes (Caitlin McGlade / Republic).
T-minus eight days until Arizona’s general effective date. It’s the once-a-year moment when the bulk of new legislation actually becomes law. Next Friday, most of the 265 bills that Hobbs signed into law will hit the books.
Some bills already kicked in because of emergency clauses or budget ties, and others won’t start until 2026. But we’re giving you a heads up on what will take effect in just over a week.
We’re doing a series of webinars you can pop into to hear from your colleagues about how Skywolf, our legislative tracking software, can help your legislative workflow.
If you work for a state agency, join us today at 10 a.m. to see Skywolf in action and hear from a state agency about how it’s benefiting their public policy work.
If you’re a lobbyist or policy pro for a nonprofit or advocacy group, join us tomorrow at 10 a.m. to hear from a lobbying pro about how they use Skywolf to stay on top of the madness at the Capitol.
On Thursday, September 25, we’ll show you a workflow designed specifically for policy professionals working at municipalities, and on Friday, September 26, we’ve got a webinar designed specifically for associations.
Who says journalism doesn’t pay?
Well, we do. All the freaking time. (Subscribe!)
But apparently, we’re just in the wrong sector of journalism.
Teaching — that’s where the real money is.
After the Republic dropped its annual public employee salary database,2 a reader (and former journalist) couldn’t help but look up how much cheddar ASU is paying Mi-Ai Parrish.
In case you don’t remember, we’ve picked on Parrish — the former Republic publisher turned ASU professor, “media innovator“ and political consultant — a few times here in the Agenda.
She was in the middle of ASU’s decision to break from Clean Elections and host a one-on-one interview with Katie Hobbs during the 2022 gubernatorial election, which exposed the myriad conflicts of interest she has while running Arizona PBS and working as a consultant for a bunch of politicians and political organizations. She never disclosed those conflicts, despite telling us she had filled out the required conflict of interest forms.
Anyway, Parrish is pulling in $408,000 per year of Arizona public money. (Not including her consulting side-hustle. The director of the UA School of Journalism, for comparison, earns $169,000.)
Cronkite Dean Battino Batts is making $369,000. Nicole Carroll, the leader of the nonprofit ASU Media Enterprise, makes $305,000. And there are several others cracking or approaching the quarter-million-dollar-per-year mark.
No wonder tuition is so high!
We know this because the Legislature passed a law in 2015 requiring bond election pamphlets to include standardized estimates of how much the proposed tax would cost typical homes and businesses.
As long as we’re on the topic, we’d also like to point out that Republican Sen. David Gowan somehow got paid $193,000 of taxpayer dollars for a part-time job that allegedly pays $24,000 per year.
Nice explainer on the Valleywise bond election this November. As a bond attorney representing 20+ school districts Statewide in their respective bond elections, I often use the mortgage analogy to help folks in thinking about a bond. Another valid point is that a bond allows the bond issuer (whether a school district, health care system, fire district, city, etc.) to spread the capital costs of new construction and building renovation over many years (up to 40 years in some cases) so future users of the facilities pay a share as well and current users aren't stuck with the entire bill. In reality, a bond is the least expensive alternative for AZ political subdivisions needing to raise funds for capital expenditures.
1. Great explainer of the nuts and bolts of bonds. Beyond that, IMO, the primary reason to vote for this bond is Valleywise is the primary provider, and the provider of last resort for those who cannot afford to pay, of mental healthcare in Maricopa County - which, based on the recent tragic occurrences associated with untreated mental health issues, is a critical need. My only critique of Valleywise is they are monolithically focused on the healthcare mission (no surprise given that it is run by doctors) and do not seem to have the bandwidth to broaden their focus to other areas where they could have a massive positive impact - for example, deploying their significant stock of unused property for affordable workforce/senior housing (resident, patients, hospital staff, etc.).
2. Did you know, globally, that heat is one of the leading causes of death? (although, elsewhere, it is largely the result of climate activism, which has discouraged or prohibited the use of AC) https://open.substack.com/pub/noahpinion/p/europes-crusade-against-air-conditioning?r=1pv2jp&utm_medium=ios