PHOENIX — With bipartisan support, and bipartisan opposition, senators gave final approval early Friday to a $17.6 billion state spending plan for the coming year.
And then they went home, declaring the legislative session that began Jan. 13 to be over and done.
Only thing is, they did not bother to tell the House, which hasn’t taken up the budget the Senate approved.
Absent both chambers approving a spending plan, the authorization for state agencies to operate self-destructs at midnight on June 30.
The Senate move came as a surprise to House Republicans, who less than a week ago had approved their own version of the budget, one with a price tag of $300 million less. They spent much of Friday behind closed doors, airing anger at their Senate counterparts, according to several members.
Now House Speaker Steve Montenegro has pronounced the Senate plan dead.
“The House is not going to be forced into a take-it-or-leave it deal that doesn’t reflect the will of our members or the people we represent,’’ the Goodyear Republican said late Friday.
But recognizing the upcoming deadline — and the fact that Democratic Gov. Katie Hobbs is supportive of the Senate-approved budget — Montenegro said his staff is drafting a “continuation budget,’’ one that will keep state operations going past June 30. That will provide “the time we need to continue negotiations on other balanced spending proposals,” he said.
Whether the Senate, which adopted its plan on a 17-12 margin, is willing to go along, is unknown. The only thing clear is that the House is set to reconvene Monday morning.
The House is set to reconvene Monday morning.
The Senate vote to adjourn for the year, meanwhile, came over the objections of several senators.
Sen. J.D. Mesnard called it “entirely inappropriate for one chamber to do that to another.’’
The Chandler Republican has some experience in this area: He was a member of the House in 2015 when Andy Biggs — now a congressman but then the Senate president — shut his chamber down even as the House was voting on bills.
It may be unconstitutional, Mesnard said.
“We don’t have the authority to adjourn for more than three days’’ without the consent of the other chamber, he told Capitol Media Services on Friday. Even Senate President Warren Petersen, while earlier Friday declaring the motion to adjourn had passed, appeared to recognize that: He instead declared the chamber in recess.
That still leaves the question of what the House will do, as time is running out to enact a new state spending plan.
Earlier this week there were indications the House eventually would go along with the Senate’s budget, which Senate Republican leaders negotiated with Hobbs.
Rep. David Livingston, who chairs the House Appropriations Committee, had said he was convinced there were sufficient votes in the House from Republicans and Democrats to approve the Senate plan. That was due to the recognition that no budget gets signed without the consent of Hobbs, which means cooperation and compromise are called for, Livingston said.
But that sentiment fell apart quickly Thursday night.
“The governor, with the help of RINO Senate President (Petersen), is pushing a Democrat budget,’’ Livingston wrote on social media, using an acronym for “Republican in Name Only.’’
Petersen rejected the criticism. He said the plan approved Friday recognizes the political realities that a Republican-controlled Legislature has to deal with a Democratic governor who has the last word.
“We have one job to do down here at the Capitol,’’ Petersen wrote in a social media post. “Pass a real budget. Not a fake budget for optics and talking points that will be gutted by a line item veto pen, but a real budget that has a consensus of conservative Republicans and gets a signature.’’
In a separate written statement, he pointed out the Senate spending plan includes a 5% pay raise for Department of Public Safety officers, a 4% one-time bonus for correctional officers, $30 million for fire suppression and a 15% pay hike for state firefighters.
Also in the package is $113 million for transportation projects, with nearly half of that dedicated to finishing improvement on SR 347 that runs from the edge of Phoenix to Maricopa, considered by some to be the most dangerous stretch of road in the state. Money is also included for local projects such as wells in Gilbert and Kingman.
There also is a tax break for business owners, exempting more of their equipment and office furniture from property taxes. The plan includes an exemption from property taxes for veterans who are 100% disabled. And it doubles, to $10,000, the deduction that parents can take for adoption expenses.
Senate Minority Leader Priya Sundareshan also claimed some victories in the budget for Democrats, including an extra $200 million needed to supplement aid to K-12 schools; and the waiving of the constitutional limit on schools’ spending, a move necessary to allow them to use the dollars being provided to them in the budget.
Yet Sundareshan, a Tucson Democrat, was one of seven members of her party who did not vote for the package, saying it failed to deal with issues that have slashed revenues, making it difficult to pay for needed services.
Those include the decision by GOP lawmakers in 2021 to create a flat 2.5% income tax. Prior to that, Arizonans earning the most were paying a 4.5% rate.
Various groups have estimated the change reduced collections from what they would have been by anywhere from $700 million to $2 billion a year. But supporters note that overall revenues have continued to rise, saying the tax cut has stimulated economic growth.
Another issue was the 2022 legislative vote to allow any parent to get a voucher of state funds to send a child to private or parochial schools or to pay for expenses of homeschooling. The price tag for that program is now close to $1 million a year.
Friday’s Senate vote came over the objections of the Arizona Freedom Caucus, a group of Republican lawmakers headed by Sen. Jake Hoffman, R-Queen Creek, who have fought for lower taxes and smaller government. They are trying to get the House to reject the Senate plan outright, calling it “stuffed full of pork and Democrat policy victories.’’
“The Republican-controlled Legislature is supposed to hold the power of the purse, but unfortunately that power was handed over to Katie Hobbs,” they said in a written statement.
But Coolidge Republican Sen. T.J. Shope, who is not a member of the caucus, said they are ignoring political reality.
Lashing out at Hobbs, who supported the plan, isn’t a path to victory with most voters, he said.
“They may not be fans of Katie Hobbs,” he said. “But every poll I’ve seen shows they’re not fans of us, either.’’
What does matter to most voters, Shope said, are not the fights over political philosophy but whether lawmakers are paying attention to their needs. And that means funding of things that directly affect them, like local road construction projects, he said.
The budget wasn’t the only thing senators approved before shutting down. They also voted to:
- Allow the Arizona Diamondback to divert $500 million in sales tax revenues to make repairs at Chase Field. That came over the objections of foes who said “billionaire’’ team owners should not be subsidized by Arizona taxpayers.
- Widen the scope of existing animal cruelty laws to make it a crime to fail to get medical care for a pet. The same bill also requires suitable shelter for dogs.
- Put a measure on the 2026 ballot to limit the ability of cities and towns to impose a sales tax on groceries intended for home consumption. Going directly to voters bypasses Hobbs, who had vetoed a similar measure in 2023.
- Raising the minimum age to buy or possess cigarettes and tobacco products in Arizona from 18 to 21. Federal tobacco laws make it illegal to sell tobacco products to anyone under 21, but that restricts only retailers.
The Senate went home without approving a plan to extend Proposition 123, which provides extra money for K-12 education by taking funds from a state land trust account. Prop. 123, first approved by voters a decade ago, expires this year.
Also failing to get action before adjournment was a proposal to limit citizens and entities from certain “enemy’’ countries from owning land in Arizona. Hobbs vetoed an earlier version but said she would consider something different.
There’s another piece of fallout if, for whatever reason, the Senate does not return.
Mesnard pointed out that some measures that started in the Senate have been approved by the House, but not in the same form.
Those include a bill making changes in what qualifies as a service performed by a “qualifying charitable organization’’ that entitles contributors to claim a tax credit. Unless the Senate approves the House changes, that bill is dead.
But Shope said he’s not terribly concerned about what gets left on the table — assuming a budget deal is reached with the House.
“There’s always next year,’’ he said, noting that the same legislators who are serving this year will be back again in January and can reintroduce their proposals.
