AZ Legislative Update 06-10-2022

After weeks of closed-door negotiations, Governor Ducey and Republican legislative leaders have a budget deal – they just don’t have the votes to pass it. While most Republican lawmakers say they could support the proposal with a few tweaks, several Republicans staunchly oppose it because they believe it spends too much or too little. Democrats say they can’t support it because it does not include their priorities, including more education funding and a new earned income tax credit.

Negotiations will continue, though it’s unclear how Senate President Karen Fann (R-Prescott) and House Speaker Rusty Bowers (R-Mesa) can address the diverging demands from their Republican colleagues. In addition to the budget agreement, the negotiations will also include new proposals that would significantly alter education funding and expand access to Empowerment Scholarship Accounts.

There are just three weeks left in the state’s fiscal year.

Legislators convened short floor sessions this week to advance bills that are not connected to the budget talks. Their votes were complicated by ongoing absences; attendance will continue to pose logistical challenges as several lawmakers leave town for other commitments.

Some bills that advanced were controversial – including proposals to require high schools to teach about political ideologies, collect DNA from anyone arrested for a felony offense, change school transportation options, and allow large housing properties to qualify for an affordable rental housing property tax exemption.

Not everything was divisive, though. Legislators of both political parties voted to seal eviction records if the eviction doesn’t happen, create a new license plate for beekeepers, and designate the month of May as Asian American and Pacific Islander Month.

What’s Next?

There is no clear path to the successful end of this legislative session, which remains overshadowed by interpersonal feuds and significant policy disagreements. Fewer than 100 bills await final action in the House and Senate, apart from those connected to budget talks. Republican leaders will continue to talk with their colleagues to find a way to enact a budget and close the legislative session. This is the 152nd day of the session, and it is tied for the 12th longest session in Arizona.

Arizona’s New Laws

Governor Ducey signed 16 new laws this week. He has enacted 283 bills so far this year and vetoed one.

Budget Update: What’s In the Proposed Spending Plan

The Republican leaders’ $15.1 billion spending plan includes some big priorities, like tax cuts and a one-time $425 million deposit in the state’s savings account. It pays off $1.3 billion in state debt and retiree pension shortfalls. It directs $322 million toward state building improvements and repairs and invests nearly $1 billion in transportation projects.

Many of the details are still unclear, since the legislature has not introduced budget bills, but summaries of the proposal show that it includes:

• Tax Cuts

The proposal eliminates the statewide equalization tax rate – a property tax that is part of the state’s complicated education funding system. The state General Fund would backfill more than $330 million a year that was previously generated through that property tax. The budget also expands the School Tuition Organization tax credits.

• Education

The budget adds a 2.5% increase to school funding but eliminates the teacher experience index and teacher compensation funds. It boosts special education funding by $100 million – an amount that will grow in future years – and adds $30 million a year in additional assistance for both charter schools and school districts.

It covers bus transportation costs for 95 more students at the Arizona State School for the Deaf and the Blind.

The proposal directs $50 million more each year for school resource officers in school buildings and provides a one-time $20 million for a School Safety Interoperability Fund.

It eliminates the K-12 rollover budgeting tactic for school districts with up to 4,000 students and adds funding for a code writers initiative, adult education programs, and education programs in jails.

The plan has some one-time funding for community colleges and state universities and allocates one-time funding to specific programs and priorities at the universities. It creates tuition waivers for spouses of military veterans and adds $12.5 million to the Arizona Promise Program tuition assistance.

Under the budget plan, the state would end the next fiscal year with a $1.3 billion cash balance.

In the Elections

Arizona’s 2022 elections matter on a national scale. Some legislative races are especially interesting this year. The Senate’s ballot recount has cost almost $5 million. This survey shows Arizonans care about more than campaign talking points.

In the Courts

A Mohave County Superior Court judge rejected the Arizona Republican Party’s effort to end mail-in voting. Representative Mark Finchem (R-Oro Valley) still wants courts to block the use of electronic voting machines, and election officials say his lawsuit is “legally and factually flawed.” The judicial complaint process is hard to follow.

In the News

Arizona’s getting more electric vehicle charging stations. School Superintendent Kathy Hoffman (D) wants legislators to address mental health and school safety. Arizona isn’t the only state with a budget surplus, but it’s one of the few still in legislative session. The Arizona Corporation Commission wants private briefings. Democrats are frustrated by the legislature’s approach to climate change policies. minimum wage could go up next year. The Auditor General has suggestions for the Arizona Naturopathic Physicians Medical Board. Arizonans are still betting big on sporting events. AZ On Track Summer Camps are starting. There are still good signs about Arizona’s economy. Frank Lloyd Wright had lofty ideas for the state Capitol buildings.

On the Bright Side…

Molly set a new record, and Aliyah spelled it out.