AZ Legislative Update 01-27-2023

It was a quiet week at the Capitol, but behind the scenes, Republican leaders are busy with plans to fast-track their baseline budget to the Governor. The package would continue the current state budget into the next fiscal year, eliminating any new spending except for formulaic growth in schools and AHCCCS. House and Senate Republican leaders believe the baseline budget is a necessary line to draw on spending. It’s a plan unlikely to be enacted, however, even if it passes with the support of every Republican lawmaker. Governor Hobbs has signaled her intention to veto the baseline budget if it reaches her desk.

The dispute is an example of the political dynamics we’ll see at the Capitol throughout the session, but it could be a step toward real budget negotiations between Republican leaders and the Governor.

Attention Turns to the School Spending Limit

A House subcommittee hosted a discussion on the state’s aggregate expenditure limit (AEL) on Thursday, highlighting the cap on how much school districts can spend. Superintendent of Public Instruction Tom Horne (R) testified in the hearing, warning of the significant impacts schools would experience if the legislature doesn’t lift the cap before a March deadline. (This conversation isn’t new. Here’s a history of the AEL and decades of school funding debates.)

Some Republicans announced they won’t vote to lift the cap unless they can enact other education policy changes, as well, but many legislative Republicans support lifting the cap without other policy debates. All legislative Democrats prioritize this as an important issue, as well, and there is enough bipartisan support to meet the two-thirds majority required to lift the AEL for another year.

Priority Bill Update

On Tuesday, the House Education Committee will vote on HCR 2001 (school district expenditures; authorization).

What’s Next?

There will be a rush of new bills on Monday when the Senate faces a bill introduction deadline. (Members of the House can introduce bills until February 6.) Meanwhile, policy committees will consider some of the more than 900 bills already eligible for consideration this year. Floor debates could center on budget priorities if Republican leaders follow through on their plan to advance a baseline budget package through the legislative process next week.

On the Bright Side…

These Arizonans are going to the big game.