Arizona’s Budget Crosses the Finish Line — But What Kind of Victory Was It?
Guest post by Linda Brickman
Tax relief, school choice, data centers, agency cuts, and Sine Die all collided in one divided-government PHOTO FINISH…
What if I told you that a governor of a major western State, running for re-election based on a record of incompetent staff, bureaucratic mismanagement, major program fraud investigations – even one under investigation by her own party’s Attorney General, vetoing more bills than any other Arizona Governor including bi-partisan ones, and failing to fulfill her statutory obligations to submit a state-wide budget to the legislature for consideration and then refusing to participate in budget negotiations with the legislature until after they wrote a budget for her, while vetoing bills submitted to her until the legislature caved in and drafted her a budget?
Would you believe me or call me crazy?
Welcome to Wacky World of the Deranged Arizona Governor Katie Hobbs!
But the conundrum for the Legislature, where Republicans hold slim majorities in both the House and Senate, is that Arizona’s regular session had already stretched well past the traditional 100-day benchmark and that ran out in April…
So faced with the “Hobson’s Choice” that offers no real alternatives (no relationship to Gov. Hobbs), either the Legislature lets the State shut down as no new budget and declare Sine Die and work on re-election campaigns; or bail the Governor out and do her job and produce your own budget version, filled with your policy priorities?
Legislative Leaders Chose a Horse Race…
With their ranks thinning out from members taking already planned vacation time, others in contested primaries needing time to campaign especially with June early voting for July primaries, leadership instructed their top budget and appropriations members to quickly draft a fair, but one-sided Republican policy backed formal budget for the upcoming fiscal year and then give the Governor and her staff a limited time to review, try to negotiate, but let her know if she didn’t approve a budget in time they would declare the session over (Sine Die), and wait and see if she would call a Special Session after the Primary or General Election to fund the State government.
And to limit additional “Spite” or “Revenge” vetoes by the Governor – her only remaining leverage, or so she thought – Legislative leaders did a Straits of Hormuz BLOCKADE, and stopped ANY bills passed jointly by the House and Senate from being sent to the Governor’s desk for vetoing.
And the Strategy WORKED!
So here we are some two months past the 100 Day Legislative Session, and the Governor pretty much caved in, although the Legislature did give her a few things so she wouldn’t veto the budget and immediately cause a State Government shutdown.
For Republicans, Tax Relief was the #1 Trophy!
In plain English – Letting Arizonans keep more of what they earn.
As radical as it may sound to ALL the DEMOCRATS who supported the Governor’s “Long Shot Bet” that she could get all other spending and policy priorities in a budget bill she had no part in formulating, they voted down the last minute budget to keep government open, and deny ALL Arizonan’s money saving policies.
So, after passing the budget late on Friday and the Governor committing to sign it AFTER the Legislature adjourned “Sine Die”, Legislators rushed to bring up all their remaining priority bills for votes during a marathon session lasting into the early hours of Saturday morning…
AND most, but unfortunately not all key bills, finally crossed the legislative finish line, including a key election integrity bill in a dramatic PHOTO FINISH!
The Real Question Is: Who Was Riding the Winning Horse?
Despite the anticipated “political spin” from the Governor and Democratic Legislators, after weeks of negotiations, vetoes, political jockeying, and doom and gloom narratives and messaging from the grassroots, the Republican Legislature not only passed an approximately $18.3 billion budget package and sent it to Governor Katie Hobbs, but they delivered on key policies, too!
And in this marathon horse race, the Republicans and their mobilized, grassroots activists were riding the Winning Horse across the Finish Line…
But in a world of divided-government and political realities, claiming victory and demonstrating to the public and voters that government sometimes can produce fair results, public messaging should reflect that although neither party in photo finishes won everything they wanted, ALL the citizens are the TRUE WINNERS holding their ticket stubs.
- So, was this a Republican victory?
- So, was this a Democrat victory?
- So, was this a Hobbs compromise victory?
The Answer Is: All of the Above — But Not Equally.
For Republicans, Tax Relief & Election Integrity Were the Big Winners!
Republican legislative leaders secured roughly $1.4 to $1.45 billion in tax relief over several years by conforming Arizona’s tax code to major provisions of President Trump’s federal tax cuts in the Big Beautiful Bill!
That includes provisions such as:
- No tax on tips.
- No tax on overtime.
- Increased standard deductions.
- A new senior deduction.
- Childcare-related tax relief.
- Expanded family and taxpayer relief provisions.
HCR2001 – One of the last Resolutions to Pass, a Key Election Integrity Winner!
As discussed below, HCR2001 delivered on critical election integrity reforms previously vetoed by Governor Hobbs during her administration, despite bipartisan support.
But there were other Republican and citizen wins, as well: Affordability, responsible spending, public safety, school choice, and stopping new taxes and fees.
School Choice Also Survived
Another major Republican victory is what did not happen.
Governor Hobbs had pushed for limits on Arizona’s Empowerment Scholarship Account program that gave parents the right to choose which schools to send their children to, as opposed to teacher unions dictating “failing” public schools only.
That matters…
In a year when budget negotiations were tense and every issue seemed to become a bargaining chip, school choice remained protected.
And for families who rely on educational freedom, that is not a small detail. That is a Major Policy Win.
Hobbs Did Not Get Everything She Wanted
Governor Hobbs also came into last-minute negotiations with her own priorities…
Several of them did not survive the final deal:
- Her proposed short-term rental fee was left out.
- Her proposed sports betting fee was left out.
- Her proposed ESA income cap was left out.
- Her broader spending wish list was scaled back.
In that sense, the Governor lost several major policy fights.
But she did not walk away empty-handed.
What Hobbs and Democrats Protected
Arizona still has divided government: Republican-controlled Legislature, Democrat Governor.
That means the final budget had to be something Governor Hobbs could still sign.
Democrats secured several priorities, including:
- A three-year moratorium on new data center tax exemptions.
- Food assistance funding.
- Free school meals for two years.
- Childcare assistance.
- Public school support for items such as textbooks, technology, and transportation.
- Protection from deeper Medicaid reductions.
- Additional staffing for AHCCCS and the Department of Economic Security.
- Some reduced agency cuts of only 2.5% compared to earlier GOP proposals.
That is why Democrats are calling this a compromise:
- They did not stop the tax cuts.
- They did not cap ESAs.
- They did not get all of Hobbs’ proposed revenue sources.
- But they did protect enough priorities to say they had a hand in shaping the final deal.
The Controversial Data Center Deal
One of the biggest Democrat talking points is the three-year pause on new tax incentives for data centers.
This has become a hot issue in Arizona because of concerns over water, power usage, infrastructure, and whether taxpayers should subsidize large data center development.
Democrats are celebrating the moratorium as a major win.
Republicans appear to have accepted it as part of the broader compromise while securing their larger tax package.
In budget terms, the data center freeze is significant politically, but smaller financially than the overall tax relief package.
That distinction matters.
The data center moratorium may be the Democrats’ most visible policy win, but the tax conformity package is the larger fiscal win.
What Is Actually in the Budget?
Beyond the political scoreboard, citizens should know what is actually in the spending plan that relies on their hard-earned taxpayer dollars.
The budget includes:
- Approximately $18.3 billion in total spending.
- Roughly $1.4 to $1.45 billion in tax relief over several years.
- Full or near-full conformity with Trump federal tax saving provisions.
- A three-year pause on new data center tax exemptions.
- Protections for school choice and ESAs.
- Medicaid and SNAP eligibility verification reforms.
- Funding for corrections operations.
- A 4% stipend for correctional officers.
- Funding for victims of crime assistance.
- Funding for child safety operations.
- Funding for wildfire suppression.
- Funding for rural hospitals.
- Funding for food assistance.
- Childcare assistance.
- Free school meals.
- Public school support.
- Water-related funding and litigation preparation.
Like every budget, it is not just one thing.
It is a stack of policy decisions, spending choices, tax changes, reforms, compromises, and tradeoffs.
What Got Cut or Left Behind?
Here is where the horse race becomes less cheerful.
To make the deal work, negotiators had to find money.
That meant cuts, sweeps, reductions, and priorities left on the table.
Among the reported concerns:
- 2.5% reductions for many state agencies.
- Cuts affecting universities.
- Cuts involving the Arizona Board of Regents.
- Reductions connected to the Arizona Promise Program.
- Sweeps of certain existing funds back into the General Fund.
- Adult education funding concerns.
- Missing or reduced funding for some oversight and social service priorities.
- Unfinished bills that died as lawmakers rushed toward Sine Die.
This is where the phrase “small potatoes” becomes dangerous.
One lawmaker may call certain budget details “small potatoes,” but those potatoes may look very different to the people affected by them.
A reduction on paper can mean a lost program.
A swept fund can mean a delayed project.
A missing appropriation can mean a community need goes unmet.
And a bill left behind at Sine Die may mean an issue must wait another year.
Was This a Republican Victory or a Democrat Victory?
So, what is the honest answer?
This budget is mostly a Republican policy victory wrapped in a divided-government compromise.
Republicans secured the biggest prizes: major tax relief and conformity with President Trump’s tax cuts, and also passed a promised election integrity bill.
- They protected ESAs.
- They stopped several Hobbs revenue proposals.
- They secured Medicaid and SNAP eligibility reforms.
- They held spending growth below the combined rate of population growth and inflation.
Those are substantial Republican wins.
But Democrats secured enough to prevent this from being a purely Republican budget.
- They got the data center moratorium.
- They protected food assistance and school meal funding.
- They reduced the severity of proposed agency cuts.
- They protected healthcare-related priorities.
And they forced a budget Governor Hobbs could sign, rather than the earlier GOP-only budget she vetoed.
That makes it a compromise.
But if we are judging by the size of the policy prizes, Republicans appear to have won the larger race.
Once the Budget Crossed the Line, the Midnight Ride to Pass Key Bills Before the Session Ending Sine Die
The budget may have been the favorite horse that finally crossed the finish line late on Friday, but it was not the only horse on the track.
As lawmakers moved toward Sine Die, citizens should pay attention to what happened next in the late Friday evening and early Saturday morning gallop.
Those final hours of session often determine which bills survive, which bills are abandoned, and which important issues are left behind for another session.
Some bills make it to the Winner’s Circle.
Others collapse inches from the finish line — not because they lacked merit, but because the clock ran out.
That is why Sine Die matters.
It does not merely end the legislative session.
It decides what becomes law, what goes to the ballot, what waits another year, and what quietly dies without much public notice.
Tax relief, school choice, data centers, agency cuts, and Sine Die all collided in one divided-government photo finish.
And just when it looked like the budget horse might be the only priority crossing the finish line, HCR2001 came charging through the gate.
With a quickly organized group of Paul Revere-like riders, the grassroots worked the phones, texting, emails, and even showed up for the marathon final laps at the Legislature! And that herculean effort paid off:
The citizenship measure first passed out of Senate COW on a 16–12 vote, but since the Senate version slightly differed from the earlier House passed version, it was sent back to the House for a concurring vote Saturday morning as the Sine Die clock was ticking down sending supporters into a frenzy as they waited for the House Leadership to decide how many more bills they would allow to get through – and then it happened as leadership called up HCR2001 for debate and vote.
IT PASSED!
Even with Democratic votes the Resolution crossed the Finish line – giving the sponsor, Rep. Alex Kolodin and supporting grassroots patriots a hard fought, and well-earned victory lap.
Final Takeaways
✓ Arizona’s budget crossed the legislative finish line and is expected to receive Governor Hobbs’ signature as early as today, Saturday.
✓ Taxpayers won meaningful relief.
✓ Republicans secured major policy victories, including Election Integrity.
✓ Democrats protected several priorities.
✓ Governor Hobbs avoided a GOP-only budget and negotiated enough into the package to call it a bipartisan compromise.
But citizens should not stop watching just because the budget horse crossed the line, and Sine Die was called.
Now, as we turn to the election season, citizens must remain engaged and actively vet their legislators and ask:
- What made it into the budget?
- What was left out?
- Which bills survived?
- Which bills died?
- Who voted yes?
- Who voted no?
- And what will citizens have to fight for again next year?
The Session Race May Be Over, But the Scoreboard Still Matters.
©2026 Linda Brickman All Rights Reserved.
