>> NEXT ON ARIZONA HORIZON, CITIES IN ARIZONA ARE CONCERNED ABOUT THE LOSS OF RENTAL TAXES AND EVEN DESERTS ARE SUFFERING BECAUSE OF EXTREME HEAT.

WELCOME TO ARIZONA HORIZON.

I'M STEVE GOLDSTEIN IN FOR TED SIMONS.

IT LOOKS LIKE A HURRICANE COULD IMPACT ARIZONA.

IT'S INTENSIFYING THE PACIFIC OCEAN AND ON TRACT TO DELIVER FLOODING PARTS OF SOUTHWEST.

HILARY'S FORECAST TO GROW INTO A MAJOR HURRICANE AND COULD REACH CATEGORY 4 STRENGTH WITH WINDS OF 130 MILES PER HOUR.

HILARY'S RAINFALL COULD ARRIVE AS EARLY AS SATURDAY IN PARTS OF THE SOUTHWEST WITH THE WORST TO ARRIVE IN CALIFORNIA EARLY MONDAY.

THE NATIONAL WEATHER SERVICE IS ANNOUNCING A THREAT FOR WESTERN ARIZONA AND PARTS OF CALIFORNIA AND SOUTHERN NEVADA.

>>> AVERAGE MORTGAGE RATES IN THE U.S. ARE HIGHER THAN THEY HAVE BEEN IN 20 YEARS AND CAUSED BY A LACK OF SUPPLY.

MORTGAGE BUYER FREDDIE MAC SAID THE HOME LOAN JUMPED TO 7.9% FROM 6.96% AND THE HIGHEST SINCE APRIL OF 2002 WHEN IT CLOCKED IN AT 7.13%.

GLASS PRICES CLIMBED TO $3.88 AND THAT'S A SUMMERTIME SPIKE IN CUTS BY PRODUCTION IN RUSSIA AND SAUDI ARABIA.

NOW CITI GROUP SAYS THIS LEAD TO A DANGEROUS HURRICANE SEASON LEADING TO FUTURE PRICE HIKES.

IT COULD DISRUPT SUPPLIES FOR MONTHS.

>>> GOVERNOR HOBBS SIGNED A BILL TO ELIMINATE THE BILLS OF CITIES AND TOWNS AND THIS REDUCES THE REVENUES.

JOINING US TO TALK ABOUT THIS IS TOM BELSHE OF THE LEAGUE OF ARIZONA CITIES AND TOWNS.

THANK YOU FOR BEING HERE.

>> THANK YOU FOR HAVING ME.

>> THIS WAS VETOED EARLY IN THE LEGISLATIVE SESSION AND WHAT WAS DIFFERENT ABOUT THIS ONE AND WERE YOU SURPRISED?

>> WE'RE NOT QUITE SURE HOW THE TWO GOT LINKED AND HOW RESIDENTIAL RENTAL TAXES GOT LINKED TO THE PROP 400 BILL, BUT THEY BECAME LINKED AND IN ORDER TO GET THAT VERY IMPORTANT PIECE OF LEGISLATION ACROSS THE LINE, IT WAS NECESSARY FOR THE GOVERNOR TO SIGN THAT BILL.

NOW THAT DOESN'T MEAN THAT IT'S ANY EASIER FOR US.

WE WERE DISAPPOINTED BY THAT AND BECAUSE IT'S $230 MILLION, THE CITIES AND TOWNS ACROSS THE STATE.

>> WAS IT ANY DIFFERENT THAN IN THE SESSION AND ANYTHING IN THERE THAT COULD MAKE YOU SWALLOW EASIER?

WAS IT THE SAME THING EARLIER IN THE SESSION?

>> IT'S THE SAME THING EARLIER IN THE SESSION.

NO, THERE ISN'T ANYTHING THAT HELPS US TO OFFSET AND NO MAKEUP REVENUE, WHICH IS WHAT WE'RE TALKING ABOUT REPLACEMENT REVENUE.

>> WHAT DOES THAT REPLACEMENT REVENUE POTENTIALLY LOOK LIKE?

>> WE HAVE IDEAS BUT THE MESSAGE WE'RE TRYING TO GET TO THE LEGISLATURE AND THE GOVERNOR'S OFFICE IS THAT THIS WAS WASN'T THE ONLY REVENUE.

THE CITY OF PHOENIX IS $90 MILLION AND THEY HAVE 700 PUBLIC SAFETY VACANCIES THEY NEED TO FILL AND IT'S NOT SO MUCH THAT WE'RE GOING TO CUT PUBLIC SAFETY, BUT WE'RE NOT ABLE TO GROW PUBLIC SAFETY IN THE SAME WAY AND WE'RE GROWING AS A STATE OBVIOUSLY.

AND SO THOSE ARE THE THANKS CONCERN US.

AND SO, SOME OF THE IDEAS WE HAVE IS WE RECEIVE AS CITIES AND TOWNS, WE RECEIVE STATE SALES TAX AND IF THE STATES WANT TO CUT OUR REVENUE, THEY SHOULD BE WILLING TO REPLACE THAT REVENUE AND.

THEY THINK THEY HAVE ENOUGH MONEY AND WE HAVE ENOUGH MONEY AND WE THINK THEY SHOULD REPLACE THAT REVENUE.

WE THINK THROUGH THE SALE'S TAX SYSTEM WOULD BE THE BEST.

>> THERE'S A MANTRA FROM REPUBLICAN LAWMAKERS THEY'RE AVERSE AND EVEN PROP 400 WAS A TAX EXTENSION AND NOT A FRESH TAX BUT PORTRAYED THAT WAY.

IRONIC, ONE WOULD THINK THAT, PERHAPS, YOU WOULD HAVE TO LOOK TO INCREASE TAX REVENUE IN SOME WAY AND THE LEGISLATURE DOESN'T ENJOY TAXES.

SO THIS ALL SEEMS LIKE A KERFUFFLE.

>> WHAT THEY'RE FORCING US TO DO IS BE THE BAD GUY AND MAKE THOSE CHANGES.

IF WE CAN'T FIND A REPLACEMENT REVENUE, THE BIGGEST TAX AVAILABLE TO US IS SALES TAX AND THE ONE WE USE THE MOST AND THE WITHIN LOCAL TAX AND DIFFICULT TO GET A PROPERTY TAX PASSED HERE.

WE DEPEND ON A SALE'S TAX.

THE PEOPLE YOU LOOK TO HELP WILL PAY IF WE HAVE TO RAISE TAXES IN OTHER AREAS.

>> YOU MENTIONED PHOENIX, OF COURSE, AND THE LEAGUE REPRESENTS MANY, MANY CITIES AND TOWNS.

TELL US ABOUT SOME OF THOSE.

>> THE CITY OF PRESS PRESCOTT CALLED ME AND TALKED HOW THIS WOULD BE A MAJOR HIT TO THEM AND, AGAIN, THEY'RE ALL CONCERNED ABOUT THE VACANCIES THAT THEY HAVE IN VARIOUS POSITIONS IN THE CITY AND ESPECIALLY PUBLIC SAFETY AND THE OTHER VERY IMPORTANT SERVICES THAT WE PROVIDE.

CITIES AND TOWNS ARE BASICALLY SERVICE DELIVERY ENTITIES.

AND SO WHEN YOU HAVE REVENUE THAT DROPS, YOU KNOW, YOU HAVE TO HOLD THINGS IN PLACE OR CUT IN CERTAIN AREAS.

AND THERE'S A BELIEF SOMETIMES THAT THE LEGISLATURE THAT WE ARE SITTING ON PILES OF MONEY AND IT'S SIMPLY NOT TRUE.

WE ARE VERY CONSERVATIVE IN THIS STATE, CITIES AND TOWNS, ESPECIALLY WITH OUR BUDGETS.

WE'LL PUT OR BUDGETS UP AGAINST ANYONE'S.

SO IT'S VERY IMPORTANT WE FIND A REPLACEMENT.

>> THE LEGISLATIVE SESSION, BECAUSE IT WAS SO EXTENDED, JUST ENDED RECENTLY AND HARD TO SAY, HEY, WHAT DO YOU PLAN FOR JANUARY.

CAN YOU WAIT UNTIL JANUARY?

CAN YOUR CITIES AND TOWNS GET A PLAN TO BE READY FOR WHEN THE NEXT SESSION STARTS TO RECAPTURE THE REVENUE?

OR ARE YOU WORKING TO BUILD UP TO JANUARY?

>> WELL, THE BILL DOESN'T TAKE EFFECT UNTIL, I THINK, IT'S '25 OR '26.

I'M NOT QUITE SURE.

>> I THINK IT'S '25.

>> WHAT WE'RE PLANNING ON DOING IS TALKING ABOUT, YOU KNOW, WE HAVE SOME TIME, BUT WE'RE STARTING NOW AND STARTING TO TALK ABOUT IT SPECIFICALLY.

SO THAT'S WHY WE CAME UP WITH A PLAN AND WE INTRODUCED OUR PLAN AND SHOWED HOW MUCH EACH CITY AND TOWN THAT HAD RESIDENTIAL RENTAL IN PLACE, HOW MUCH THEY'RE LIKELY TO LOSE AND TALKING ABOUT A WAY JUST TO MAKE THEM WHOLE.

JUST THE CITIES THAT HAD THE NEED FOR THE REPLACEMENT REVENUE.

>> THIS DOESN'T SEEM LIKE IT SHOULD BE A PARTISAN ISSUE.

AND YET, WE'VE SEEN BEFORE THIS, I'M GOING TO SAY "BITTERNESS" BETWEEN LAWMAKERS AND WELL, THE FEDS SHOULDN'T STEP ON THE STAGE.

THE IRONY IS THE STATE SOMETIMES STEPS ON THE CITIES AND BIGFOOTS AAND HOW MUCH IS THAT?

>> THAT'S THE WHOLE REASON THE LEAGUE EXISTS.

MY MENTOR AT THE LEAGUE, KATHY CONNELLY, USED TO SAY THAT THE GOVERNMENT ABOVE ME NEEDS -- OR THE GOVERNMENT ABOVE ME IS OPPRESSIVE AND THE GOVERNMENT BELOW ME NEEDS WATCHING.

SO THAT IS HOW WE FEEL AND SO, WE ARE JUST TRYING TO MAKE SURE THEY UNDERSTAND THAT WE HAVE DULY ELECTED OFFICIALS.

THEY ARE ELECTED BY THE SAME CONSTITUENTS THAT THEY HAVE AND SO, LOCAL DECISIONS REST BEST AT THE LOCALITIES, ESPECIALLY THE LOWEST LEVELS, WHICH ARE CITIES AND TOWNS.

>> HOW DO YOU FIGHT THAT WITHOUT IT BEING HOSTILE?

>> THERE'S A FEELING THAT THERE'S A LOT OF HOSTILITY AND THERE'S A LOT OF LEGISLATORS WHO ARE SUPPORTIVE.

WHEN WE HAVE DIFFERENCES OF OPINION, WE GO OVER AND TALK WITH THEM.

IT'S VERY IMPORTANT THAT THEY NEED INFORMATION ABOUT HOW WE EFFECT THE OUTCOME.

WE HAVE A LOT OF LEGISLATORS THAT SUPPORT US.

>> ONE MORE QUICK QUESTION ABOUT THE RENTAL TAX ITSELF.

SOME WHO ARE ARGUING EVERY LITTLE BIT HELPS CONSIDERING HOW AFFORDABLE HOUSING IS DIFFICULT TO FIND IN THIS STATE AND THE SAME TIME, THE RENTAL TAX DOESN'T LEAD TO A PERCENTAGE DECREASE IN IN TERMS OF WHAT RENTERS END UP PAYING.

>> I WOULD NEVER TELL SOMEONE THAT MONEY IS TAKEN OUT OF THEIR POCKET DOESN'T MEAN ANYTHING TO THEM.

I WOULD SAY THERE'S INFORMATION THAT PEOPLE ARE PAYING $200 A MONTH IN RENTAL TAXES.

I FIND THAT HARD TO BELIEVE BECAUSE LET'S SAY WE'RE TALKING AGAIN ABOUT THE CITY OF PHOENIX WHICH IS A GOOD EXAMPLE, THEY HAVE A 2 2.3% TAX.

IF YOU PAY $2,000 IN RENT, THAT'S $23.

IN ORDER FOR IT TO BE $200, IT WOULD HAVE TO BE IN EXCESS OF A $10,000 PRECEDENT.

$10,000 RENT WOULD GET YOU A PRETTY NICE PLACE.

SO I DON'T THINK IT'S AS BIG OF A HIT ON THE POCKBOOK AS PORTRAYED.

NOT TO SAY THAT IT'S NOT SIGNIFICANT.

IT'S SIGNIFICANT BECAUSE TO US, EVEN THOUGH IT MAY SEEM -- IT'S SIGNIFICANT TO US BECAUSE IN THE AGGREGATE, IT'S A LOT OF MONEY FOR CITIES AND TOWNS.

>> I KNOW THE LEAGUE HAS A BIG CONFERENCE COMING UP LATER THIS MONTH, BUT WILL THE RENTAL TAX DISCUSSION BUT ON THE AGENDA AND IF SO, WHAT ELSE WILL BE ON THERE?

>> DEFINITELY WILL BE.

ONE OF THE THINGS AT OUR CONFERENCE AND IT'S IN TUCSON AT THE MARRIAGE STAR PASS RESORT AND THE 28th THROUGH SEPTEMBER 1st.

WE HAVE ABOUT 1300 PEOPLE THAT ATTEND.

WE WILL HAVE THAT ISSUE.

ALSO WE'LL BE TALKING ABOUT A NUMBER OF THINGS.

HOMELESSNESS, HOUSING ISSUES AND THINGS TO DO AS CITIES A AND TOWNS TO INCREASE THE HOUSING SUPPLY AND A VARIETY OF THINGS.

THERE'S RELATED HEAT RESILIENCY AND THINGS THAT ARE TOPICAL RIGHT NOW AND THE SESSIONS ARE REALLY MEATY AND THEY HAVE A LOT OF EXPERTS AND OUR CITIES AND TOWNS AND LOTS OF OTHER FOLKS INCLUDING STATE LEGISLATORS.

OUR SENATORS WILL COME AND THE GOVERNOR WILL ATTEND.

WE'RE PROUD.

>> THANKS FOR BEING HERE AT ARIZONA HORIZON.

>> APPRECIATE IT.

>> NEXT, WE'LL TALK ABOUT WHAT'S HAPPENING TO SAGUAROS IN OUR INTENSE HEAT.

>> RECORD HEAT HAS BEEN DANGEROUS NOT ONLY FOR PEOPLE BUT DESERT PLANTS AS WELL.

MANY SAGUAROS ARE SUFFERING HEAT RELATED STRESS AND AT THE DESERT BOTANICAL GARDEN, MANY HAVE LOST AN ARM AND IT'S HIGHLY UNUSUAL.

TODAY WE TALKED TO KEVIN AND THANK YOU FOR BEING HERE.

IS IT CACTUSES OR CACTI?

>> IT COULD GO EITHER WAY.

FOR SOME IT'S CACTUSES AND SOME CACTI AND EITHER/OR WORKS.

>> SO LET'S TALK ABOUT WHAT'S GOING ON BECAUSE THERE ARE SOME PEOPLE WHO SAY IT'S ALWAYS HOT IN THE SUMMER HERE AND WHAT IS HAPPENING TO SOME OF THE SAGUAROS AND IS IT ATTRIBUTABLE TO THE EXTREME, LET'S SAY, JULY WE HAD OFF THE CHARTS OR A BUILD-UP OF DROUGHT AND OTHER YEARS OF HEAT?

>> I THINK THE STORY STARTS IN 2020.

REMEMBER WE'VE BEEN CALLING IT THE MONSOON AND NOT QUITE AS HOT IN 2020 BUT STAYED HOT AND DRY THROUGH OCTOBER AND WE SAW A LOT OF PLANTS THAT FAILED.

NOT JUST DURING THAT PERIOD, BUT IN THE YEARS SINCE AND SO, UNFORTUNATELY, THESE LONG-LIVED PLANTS, SOMETIMES IT TAKES YEARS TO FIGURE OUT WHAT THE IMPACTS ARE.

SO WE KNOW THESE EVENTS WILL IMPACT SAGUAROS.

FAST-FORWARD TO JULY, WE STARTED TO SEE A REPEAT OF WHAT HAPPENED.

OF COURSE, JULY ITSELF, THINK,, I THINK, WAS 102° AND THE WARMEST MONTH ON RECORD.

AND SO WE'LL HAVE TO WAIT AND SEE WHAT THE IMPACT WILL BE LONG-TERM.

BUT THERE'S A GOOD CHANCE THAT WHEN YOU COMBINE WHAT HAPPENED IN 2020 AND THE STRESSES THAT THAT CREATED, NOT JUST SAGUARO BUT MANY PLANTS THROUGHOUT THE REGION AND WHAT HAPPENED IN JULY, IT'S KIND OF A WAIT-AND-SEE WHAT THE IMPACTS ARE.

I WILL SAY THAT, YOU KNOW, WHAT HAPPENS IN AUGUST, SEPTEMBER, WILL PLAY A MAJOR ROLE.

WE END UP WITH A NORMAL MONSOON SEASON THROUGHOUT THE REST OF THE YEAR, PERHAPS THE IMPACTS OF JULY WILL BE MITIGATED.

BUT FOR SURE, WE'RE STARTING TO SEE SOME REAL STRESS, LOST ARMS AND SOME PLANTS.

WE'VE GOTTEN A LOT OF STORIES FROM PEOPLE AROUND TOWN.

PLANS HAVE JUST FALLEN OVER AND I WOULD ATTRIBUTE THAT TO THE CONDITIONS THE PLANTS IN.

>> NOT TO PUT YOU ON THE SPOT BUT WITH SAGUARO CACTI, AND MAYBE A 100-YEAR-OLD SURVIVE WOULD100-YEAR-OLD SAGUAROWOULD HAVE A BETTER CHANCE THAN A 1-YEAR-OLD SAGUARO.

>> JUST THE OPPOSITE.

WHEN THEY HAVE A LOT OF ARMS, IT'S REALLY -- THE STRUCTURAL INTEGRITY IS MORE LIKELY TO FAIL.

THINK OF A SAGUARO AS ONE BIG LEAF AND LIKE A LEAF WHEN IT GETS DEHYDRATED, IT HITS THE WILTING POINT AND LEAVES DROOP.

SAGUARO CAN DO THE SAME THING AND THEY HAVE THE ADDED NEED TO ALSO PROVIDE STRUCTURAL INTEGRITY FOR THE PLANT.

SO WHEN HITS THE WILTING POINT, IT STARTS TO LOSE THAT STRUCTURAL INTEGRITY.

THE FIRST THING TO FAIL WILL BE WHERE THE JUNG IS JUNCTION IS WHERE THE ARMS MEET THE MAIN STEM AND ARMS FALL OFF PLANTS.

YOU MIGHT SEE ENTIRE PLANETS FALLING OVER.

IT'S THE LARGE PLANTS THAT ARE MOST IN DANGER OF STRUCTURALLY FAILING.

AGAIN, BECAUSE THERE'S SO MUCH MASS INVOLVED.

>> CAN THE DBG GENERALLY OR FOLKS IN YOUR PROFESSION MORE SPECIFICALLY, IS THERE PREPARATION TAKEN KNOWING THAT THE SUMMER WILL BE BRUTAL IN SOME WAY?

I WAS WONDERING, DO YOU TALK TO CLIMATOLOGISTS AND SAY, HEY, WHAT DOES THE SEASON LOOK LIKE AND AFFECT HOW YOU PREPARE THE PLANS APLANTS AND CACTI?

>> OUR HORTICULTURE DEPARTMENT WAS PREPARING FOR ANOTHER MONSOON.

YOU HAVE A LARGE PLANT AND NOT MUCH YOU CAN DO EXCEPT INCREASE THE WATER.

THAT'S ANOTHER STORY OF, YOU KNOW, HOW MUCH WATER DO WE HAVE AVAILABLE TO USE TO KEEP PLANTS WELL HYDRATED.

BUT YEAH, WE WERE PREPARED AND WE KNEW THERE WAS A GOOD CHANCE FROM THE FORECAST THAT WE COULD HAVE A DRY, HOT SUMMER AND SO WE STARTED TO PREPARE FOR THAT.

AGAIN, TOO EARLY TO TELL WHETHER THOSE MEASURES ARE GOING TO HAVE A POSITIVE IMPACT ON THE PLANTS.

BUT I DO TIP MY HAT TO OUR HORTICULTURE DEPARTMENT FOR BEING PREPARED AND READY FOR THESE KINDS OF IMPACTS, KNOWING THIS IS A POSSIBILITY, BASED ON WHAT THE FORECAST WAS INTO THE SUMMER.

>> WHEN YOU MENTIONED IF AUGUST AND SEPTEMBER SORT OF GIVE US A NORMAL MONSOON PATTERN, FROM THE STANDPOINT OF PRECIPITATION OR HUMIDITY, WHAT ABOUT THE TEMPERATURES DROPPING?

LET'S SAY WE GO TO AVERAGE HIGH TEMPERATURES OF 103 103, 104 AS OPPOSED TO 112, 115?

IT CAN MAKE A HUGE DIFFERENCE.

THE IMPACT ON CACTUS, THERE'S A DOUBLE WHAMMY.

THE NIGHTTIME TEMPERATURES IMPACT THE PLANTS WITH GAS EXCHANGE.

UNLIKE MOST PLANTS, CACTUS TAKE UP CO2 AT NIGHT AND IT'S NOT AS HOT AND LOSING LESS WATER A AND THE WARMER THE TEMPERATURES, THE MORE WATER IT LOSES FOR THE CO2 IT TAKES IN.

THE DAYTIME TEMPERATURES, THOSE ARE THE TEMPERATURES IMPACTING IN DEGRADING THE PHOTO SYNTHETIC TISSUES.

WHEN YOU COMBINE THE TWO, WE SEE LONG-TERM IMPACTS ON THE PLANTS.

SO I THINK IF HIGHER HUMIDITY, LOWER TEMPERATURES, THERE'S A POSITIVE IMPACT ON PLANTS AND ESPECIALLY IF WE GET RAIN ON TOP OF THAT.

>> A BROADER ECOSYSTEM QUESTION FOR YOU.

BECAUSE SAGUAROS ARE SO IDENTIFIED WITH THIS PLACE IN THE SONORAN DESERT -- I'M ACTING AS IF CACTI AND PLANTS TALK TO EACH AND MAYBE THEY DO AND MAYBE THEY DOOR -- DON'T -- CAN THEY SEE SAGUAROS HAVING UNFORTUNATELYING SAGUAROS STRUGGLING AND A TRICKLE-DOWN EFFECT IN.

>> THE ENTIRE ECOSYSTEM -- I SAY THE BEST INDICATORS SPECIES OF EXTREME DROUGHT IS THE CRESO BUSH.

WHEN YOU WALK AROUND RIGHT NOW AND YOU SEE THAT A LOT OF THEM FAILING, THAT'S A CLEAR INDICATER THAT FRANKLY, WE'RE IN A FAIRLY UNIQUE SITUATION.

AND SO, IF THEY'RE FAILING, UNDOUBTEDLY, YOU SEE OTHER PLANTS LIKE SAGUAROS HAVING A HARD TIME.

>> JUST A FEW SECONDS LEFT, HAVE YOU SEEN PEOPLE DENYING SOME OF THE THINGS ABOUT SAGUAROS OR THE EXTREME HEAT AND THE EFFECT ON THAT?

IF SO, DOES THAT FRUSTRATE YOU AS A SCIENTIST TO REALIZE HOW HOT IT IS AND THE EFFECT IT HAS?

>> I THINK NO.

I THINK PEOPLE HAVE COME FORWARD AND SAY, HEY, LOOK, I'M WORRIED ABOUT ANY SAGUARO.

IT CLEARLY DOESN'T LOOK GOOD.

YOU THINK ABOUT IT, SAGUAROS WON'T DISAPPEAR, BUT IN THE CITY OF PHOENIX, THERE MAY BE SOME REAL IMPACTS AS LONG WE HAVE THESE WARM, ESPECIALLY NIGHTTIME TEMPERATURES IN THE FUTURE.

>> THANK YOU FOR BEING HERE.

>> THANKS, STEVE.

>> THAT'S IT FOR NOW.

I'M SITTING IN FOR TED SIMONS TONIGHT.

PLEASE ENJOY THE REST OF YOUR EVENING.

♪♪ >> WELCOME TO THE ARIZONA FINANCE STUDIOS.

I HOPE YOU ARE APPRECIATING ARIZONA HORIZON TONIGHT BECAUSE THIS TYPE OF PROGRAM, ARIZONA HORIZON IN PARTICULAR IS SO IMPORTANT TO OUR COMMUNITY.