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2026 budget

Arizona Legislature Strikes $17.6B Budget Deal at Last

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Arizona House, Senate finally come to $17.6B budget agreement

Just days before a potential government shutdown, Arizona’s House and Senate Republicans, alongside the Democratic governor, reached a bipartisan budget agreement. On Thursday evening, legislators voted a third time on a package of 15 budget bills, largely passing with a bipartisan majority of 41-15. The Senate is set to finalize the budget on Friday morning, with Democratic Governor Katie Hobbs poised to sign it afterward.

This resolution came after weeks of intense political drama marked by infighting and accusations among Republican factions. During pre-vote discussions, legislators exchanged sharp critiques regarding the budget’s adequacy.

Opposition stemmed primarily from nine Republicans, mainly part of the far-right Arizona Freedom Caucus, who claimed the $17.6 billion expenditure was excessive and too accommodating to Governor Hobbs. Representative Alexander Kolodin voiced his disappointment with party members who supported the budget, stating, “There is a lack of backbone in this supposedly Republican body.” He expressed shame towards Speaker Steve Montenegro for cutting him off during a critical speech on the vote.

Similarly, several Democrats expressed discontent, particularly regarding a $24 million allocation for border safety, which they believe could contribute to harmful practices against communities. Tucson Democrat Consuelo Hernandez criticized the funding as a means facilitating deportation efforts.

Despite its imperfections, supporters asserted the budget reflected a necessary compromise to avert an unprecedented government shutdown, anticipated just days away. The bipartisan agreement included provisions such as 5% pay raises for state troopers and firefighters, tax cuts for small businesses, and an increase of $100 million in K-12 funding.

The budget also pledges $119 million toward infrastructure projects, including significant upgrades along I-10. Furthermore, it secures financing for the universal school voucher program, a contentious topic among Democrats.

Compromise only materialized after extensive conflict between House Republicans and Senate negotiations with Governor Hobbs. The Senate previously advanced its comprehensive budget, as House leaders opted for an alternative plan, which lacked the support necessary to avoid a veto.

Amid tempers flaring and accusations flying, Senate President Warren Petersen criticized the House for contributing to a toxic atmosphere. House Republicans retaliated, accusing Senate members of capitulating to the governor’s demands.

Weeks of disagreements culminated in a strained session filled with procedural disputes, particularly as amendments were proposed to steer the budget back toward House preferences. These attempts to insert favored measures proved contentious, extending discussions late into the night.

In a further development, issues surrounding Maricopa County elections emerged as a point of contention. Kolodin addressed the challenges faced by County Recorder Justin Heap, who is currently embroiled in a dispute over election oversight. A recent mix-up involving mailed notifications to voters exacerbated concerns over election administration in the county.