Nov. 18--Even as the governor continues to push for a sales tax increase to help erase some of the state's red ink, a new report shows Arizona has a 30-year trend toward more heavy reliance on sales taxes.

On the spending side of the ledger, university funding has plummeted over that time while spending on prisons has doubled. Health and welfare spending also has seen a big jump. And although a lot of attention has focused on cutting school budgets this year, funding for kindergarten through 12th grade has been flat over the decades.

A historical look at revenue and spending priorities over the past three decades was released Tuesday at the "Governing Arizona" economic conference in Phoenix. The event was designed to encourage state policymakers to come up with bipartisan solutions to the state's somber fiscal problems.

The forum, sponsored by the Thomas R. Brown Foundations and The Communications Institute along with other partners, including the Arizona Daily Star, was intended to frame a big-picture discussion for state leaders, starting with how the state gets its money and where it spends those dollars.

Arizona faces a $2 billion shortfall in its current budget. The next year is expected to be worse, with a projected $3 billion hole.

Public-policy consultant Alan Maguire found the sales tax was the largest source of tax revenue in 1980, accounting for 47 percent of general fund revenues. Over the years, the tax was removed from food and the rate was raised. The net result is that sales taxes now contribute 56 percent of the general fund "pie."

The other big shift came from property taxes, which accounted for 6 percent of general fund in 1980. For the state, that take is all but zeroed out now.

Income taxes, both individual and corporate, went from 34 percent to 37 percent. As a share of the state budget, however, corporate income tax dipped from 9 percent 30 years ago to 7 percent today.

University of Arizona economist Marshall Vest said the analysis should set off some warning bells.

Sales taxes might be politically expedient, he said, because consumers don't see one big bill at the end of the year the way they do for property or income taxes, but it's fairly volatile, climbing and dipping with consumer confidence.

The most stable tax systems rely on three components, he said -- taxes on income; taxes on wealth, largely through property; and taxes on transactions.

"The state is highly over-reliant on the sales tax. It doesn't use the property tax at all, so you see this three-legged stool is quite unbalanced.