Starting with Nonstarters
A budget built on #HopesAndDreams ... Just trust us, DOJ ... And the end of the road for funny freeway signs.
Gov. Katie Hobbs laid out how she’s going to get Arizona out of the massive financial hole that she and lawmakers spent us into last year when she unveiled her executive budget proposal on Friday.
Unfortunately, Hobbs’ proposal is not a serious solution to solving the crisis — it’s a collection of hopes and dreams from the Democratic governor.
The proposal she presented is built on incredibly optimistic and increasingly unrealistic revenue projections as national economists warn of a looming potential recession.
It also hinges on the premise that Republican lawmakers will dramatically scale back school vouchers and eliminate private school tax credits, to name a few of the unlikely cuts she proposed to state spending. For a longer list of the cuts she’s considering, check out Stacey Barchenger and Mary Jo Pitzl’s roundup of proposed cuts in the Republic.
Meanwhile, the Governor’s Office has its own new spending wish list, even as mandatory expenses like prisons, schools and healthcare costs are still going up.1 Check out Howie Fischer and Bob Christie’s roundup of her spending priorities for more.
Some of those new spending proposals include:
$100 million from the General Fund to expand childcare availability
$46 million for state universities to expand medical, engineering and tech programs and health initiatives
$25 million to healthcare licensing reform designed to root out fraud, waste and abuse in long-term care and sober living facilities.
$16 million for border security programs
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Hobbs says her budget would leave Arizona $580 million in the black by the end of the fiscal year. But for two big reasons, that’s completely misleading. First, Republican lawmakers have made clear there is zero chance that they’ll scale back the Empowerment Scholarship Account to require students to have previously attended a public school to get a voucher, as Hobbs wants, or that they’ll eliminate School Tuition Organizations. Without those savings, Hobbs’ budget is unbalanced.
Second, and far more concerning, just minutes before Hobbs released her budget, the Joint Legislative Budget Committee put out its baseline budget with its most recent revenue forecast for the current and upcoming fiscal years.
The bottom line is the economists at the JLBC think that Arizona has a $1.7 billion problem on its hands, rather than the $900 million problem that Hobbs’ office thinks they’ll have. If JLBC is right, not even eliminating ESAs and STOs would solve our budget crisis.2
Assuming (safely) that lawmakers don’t want to scale down ESAs and repeal STOs, and assuming that the economists at JLBC are correct, enacting her budget would leave the state somewhere around a billion in the hole.
If that happened, Arizona would be forced to cut critical programs and personnel rapidly.
The Governor’s Office knows eliminating STOs and scaling back ESAs is a nonstarter. In the face of repeated questions, they assured reporters that they have a “Plan B.” They probably do. But given this budget is beyond dead on arrival, we don’t think it’s unreasonable for them to have to explain the real plan.
And sure, we understand that budgets (especially budget proposals) are moral documents meant to virtue-signal to the base more than solve a problem. They’re supposed to be full of hopes and dreams of what a leader would like to do if given a magic wand (or a legislative majority).
Last year’s executive budget proposal had its fair share of unrealistic wishes, including completely eliminating the expanded ESA program. We all knew it wasn’t going to happen, but it didn’t matter because Arizona wasn’t on the brink of financial crisis. Her budget proposal was balanced with or without the ESA repeal.
Hobbs signed the budget that put Arizona deep into the hole. She has some responsibility to come up with a realistic plan to fix it. The goal of introducing a budget should be solving the state’s financial problem, not winning an election.
Instead, it looks like her proposal will get the state about a third of the way toward solving its budget crisis (if we’re lucky), and count on legislative Republicans to come up with the other two-thirds of the cuts. She may regret that, considering legislative Republicans will have no shortage of programs they want to cut to make up the difference.
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Avoidance and advocacy: An attorney for Phoenix asked the Justice Department to forgo federal oversight or any independent oversight of the city’s police department after a two-and-a-half-year investigation into claims of police misconduct, the Republic’s Taylor Seely and Miguel Torres report. Phoenix officials promised to reform the police force and say the feds could just monitor their progress via a memo. Meanwhile, Sen. Anna Hernandez is pushing for a bill that would give family members of those killed by police access to investigation materials, the Republic’s Reagan Priest writes. Hernandez’s brother was killed by Phoenix police in 2019.
Speaking of policing problems: A review of about 400 major criminal cases in Tempe found eight fingerprint discrepancies, although a memo outlining the review says none of the errors caused the misidentification of a suspect, the Republic’s Sam Kmack and Elena Santa Cruz report. Recent reporting showed Tempe's Forensic Services Unit has been riddled with issues like inadequate training and broken equipment that led to the reexamination of old cases in July, and Maricopa County Attorney Rachel Mitchell said the impact to the faulty fingerprinting cases is unclear.
"Cases don’t rest on one single piece of evidence and so the impact of it, I don’t know yet," Mitchell said.
Lawmaker’s cancer diagnosis: Republican Sen. David Farnsworth, 72, revealed he has stage 4 prostate cancer and is responding well to treatment, per KLZZ’s Kirsten Dorman. The longtime lawmaker told the news to a Senate committee last week.
“I am running for reelection, just so nobody will wonder about that,” he said. “I will be here for a long time. So, we have work to do together.”
Battle of the ballot: A new campaign called “It Goes Too Far” has emerged in opposition to the initiative to legalize abortion access in Arizona, the Arizona Mirror’s Gloria Gomez reports. The campaign trying to get abortion access on the ballot this year through the Arizona Abortion Access Act is close to getting enough signatures to qualify, so the dissenters have their work cut out for them. The political director of the group, Olivia Escobedo, refused to tell Gomez the group’s campaign strategy or members.
Future-proofing politics: Rep. Alexander Kolodin is thinking ahead in new legislation that would carve a path for political candidates to get video or audio of them declared by a judge as AI-generated deep fakes, Capitol scribe Howie Fischer reports. The candidate would have to prove to a judge the media is altered, and the judge would be required to rule within two days. The lawmaker said his primary concern is to protect the First Amendment but still address the issue with the limited relief of a court declaration.
Groundwater worries: All signs point to the Arizona Department of Water Resources’ incoming designation of Marana’s 100-year water supply, carving a path for rapid growth in the town northwest of Tucson, the Star’s Tony Davis reports. Dissenters of the 100-year status project steep declines in the area’s groundwater are coming and say the designation would rely too much on a dwindling groundwater supply.
Border strains: A new report shows the Tucson and Yuma border patrol sectors saw an uptick in migrant crossings compared to earlier years, leading to insufficient staffing and resources that cause Mexican cartels to route migrants toward the overwhelmed sectors, AZPM’s Danyelle Khmara writes. Meanwhile, Border Patrol is ending street releases of migrants in Nogales and instead worked out a plan with the county to bus asylum seekers to Tucson, Nogales International’s Angela Gervasi reports.
Adios Ortega: After an eight-year run as the longest-serving city manager in Tucson, Mike Ortega is stepping down from his position as soon as next year’s city budget is in place, per Tucson Sentinel’s Dylan Smith. Ortega doesn’t have other job prospects, but said Tucson’s in a good place and “it’s just time.”
If you want to geek out on Arizona’s budget disaster, today is your lucky day!
The Joint Appropriations Committee will get the lowdown on the executive budget proposal starting at 10 a.m. We expect Gov. Katie Hobbs’ optimistic budget proposal to meet a pretty critical eye from Republican lawmakers.
After a quick lunch at your desk, you can tune in to the Senate Appropriations Committee hearing at 2 p.m. for a breakdown of the “baseline budget.” That’ll be a more sobering assessment of the national forecast and the state’s chances of making it out of this without serious cuts.
The witty freeway message boards from the Arizona Department of Transportation are being crushed under the bureaucratic boot of the federal government.
KJZZ’s Kirsten Dorman reports the Federal Highway Administration updated its manual for traffic signs to restrict “popular culture references, unconventional sign legend syntax, or that are intended to be humorous,” in other words, the best part of driving through our chaotic freeways. Every state has two years to fall in line.
In the spirit of premature mourning, here’s some of our favorite work from ADOT:
The Governor’s Office, attempting to look like it was also tightening its belt, proposed a one-time 1% cut to its budget. It was the very first bullet point in their presentation. If the structural deficit were applied evenly across all state government, every agency would need to take about a 3% cut.
JLBC is traditionally more cautious in its projections and pessimistic about the economy than the governor’s office, but this is a massive discrepancy in the two entities’ economic outlook for the next 18 months.
Last Leg session I “voted” against a GOP bill to stop humorous signs on the freeway. Anything that can get people’s attention to do the right thing should be encouraged. Sad that the Fed govt wants to limit bright spots in our day when we need a little laughter or smiles. Or a Dad joke now and then.
Can’t the Governor equally credibly say that a budget that lacks ESA reform is dead on arrival unless there are votes to override a veto? The state has taken a last in, first out approach to resolving budget shortfalls in the past. Full day kindergarten funding for schools was added and then immediately removed in 2008 - 2010 or so.