Tuesday, March 27, 2018

Prop. 123 Lawsuit Far From Over, Judge Wants To Know How Congress' After-the-Fact Blessing Last Week Effects Past/Future School Payments (READ: OPINION)

SUBHEADLINE: Judge Slaps Down McCain/Flake/Salmon Argument That Congress Gave Arizona Carte Blanche

Arizona's peripheral arguments are showing "desperation rather than inspiration", declared U.S. District Court Judge Neil V. Wake in finding Monday that Arizona's 2012 and 2016 decisions to increase usage of state land trust funds were improper.

After denying Arizona's Motions to Dismiss the lawsuit, Judge Wake told the parties to explain whether Congress' after-the-fact blessing of Arizona's voters' validates the excess payments from 2012-2015 and 2016-2017.

There is little question that the measure slipped into last week's omnibus spending bill that President Trump (eventually) signed makes future payments under 2016's Prop. 123 okay. The parties have until next week to come up with a new briefing schedule.

In his 35-page opinion (below), Judge Wake also slapped down Arizona's two U.S. Senators and former Rep. Matt Salmon, who had argued that Congress had given Arizona carte blanche to make changes to the state's school land trust back in 1999 - thereby meaning that no federal approvals were necessary before Arizona voters amended the state Constitution in 2012 and 2016 to dip into the principal of the trust.

The amici curiae brief (also below) filed by Sens. McCain and Flake, and fmr. Rep. Salmon was filed one year ago. It argued that both Sen. McCain and then-Rep. Salmon received assurances - from Sen. Lisa Murkowski and the Congressional Research Service, respectively - that no Congressional action was necessary before Arizona voters considered Prop. 123.

Although no Answers have yet been filed and there are no substantive motions still pending, Judge Wake has asked for further briefing on the effects of Congress' new action. (When the state of Arizona was created, the federal government placed lands in trust, with the income to benefit Arizona's schools. The state is the trustee of the trust and has had to get Congress' approval to dip into the principal of the trust itself.)

Phoenix attorney Paul Weich contributed this article.

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