Editorial: Prop 123 is bad, alternative is worse

Proposition 123 is a bad idea.

Even so, I'm probably going to hold my nose and vote for it.

The proposition, if approved on Tuesday, would increase the amount of money taken out of the state land trust fund, formally known as the State Land Trust Permanent Endowment Fund.

The money goes to schools. Proponents say it will increase education funding for Arizona's public schools by $3.5 billion over the next 10 years. There's no doubt the funding is needed; Arizona consistently ranks at the bottom of U.S. states in terms of school funding, which makes it hard to recruit and retain teachers and doesn't make us attractive to companies who otherwise might love to relocate to our state.

There's also the not-at-all-insignificant factor of the lawsuit filed against the state because lawmakers didn't honor a voter-approved pledge to maintain school funding.

Prop 123 would be a way out of that lawsuit, but it also imperils one of the state's assets, one that was established when Arizona gained statehood and is meant to last as long as the union endures.

Think of it this way: If you hit a Powerball jackpot, would you re-enact part of the plot from "Brewster's Millions" and blow the cash? No, you wouldn't. You would set up trusts and endowments and other such financial vehicles so that you have a steady, ample income for the rest of your life, and your good fortune could be passed on after you're gone.

That's the idea behind the state land trust, and Prop 123 would toss all that smart financial management aside. When you have an investment like this, you don't spend the principal. You live off the interest. That's what Arizona has been doing, but passage of this measure threatens the future of the trust.

Arizona State Treasurer Jeff DeWit makes this same case. "Prop 123 is a short-term fix that will leave a long-term scar on our schools and state finances," he wrote in his opposition statement. "The more than 100-year-old trust fund has been entrusted in our care for all of Arizona's children, not just the children of the next 10 years."

He also notes that passage of this proposition could lead to - guess what? - more litigation, since it apparently violates many legal standards of how the fund is supposed to be handled. Maybe Arizona should change its nickname. Instead of the Grand Canyon State, we could be, "Arizona: No Lawyer Left Behind."

DeWit has a plan he says he'll pitch after the vote. Arizona is running some pretty significant budget surpluses, so he's going to argue that we should leave the land trust alone and use the surplus to fund the state's education obligations. I wish him well. A big part of the future of this state is our education system, and investing in it will return dividends many times over.

Still, I'm pretty sure I'll pull the "yes" lever for Prop 123. DeWit may not succeed with his plan, and these days we've all been browbeaten with the "Taxes Bad! Taxes Bad!" mantra that we can't expect to get any traction for a tax increase. Schools need the money, and at least this proposition will provide that.

But boy howdy, this ain't how a state should be run.