Rumors are swirling over the possible introduction of a ballot initiative to bring casino-style gambling to Arizona’s racetrack industry. Officials with Bennett’s office late last week had heard tales of the initiative, as had other political observers.

Regardless of whether Horne and Kathleen Winn committed a crime, some political observers say Winn’s switch from Horne’s campaign to the IE she formed earlier in 2010 created a perception of coordination, even if there was none. One attorney said Winn’s knowledge from her time on the primary campaign that would have been useful to her pro-Horne IE, Business Leaders for Arizona.

Babeu today became the first CD4 candidate to hit the airwaves, launching what his campaign says is the first in a series of television ads that will run through the Aug. 28 primary. The first ad, titled “Hear it from me,” attempts to push back against the stream of negative press the sheriff has received since being outed by the New Times in a February story that alleged he abused his power and threatened to deport an ex-lover if he spoke publicly about their relationship.

Capitol observers and those with long memories may remember that Dybus played a starring role in what Rose Law Firm blogger Phil Riske yesterday described as the 2006 “political boil-over and resignation of Arizona Treasurer David Petersen.”

At about 6:30 last night, Horne’s office fired back against Don Dybus’ allegations, saying the prosecutor only filed the complaint with Bennett’s office to give himself whistleblower protection because he knew he was about to be fired.

The complaint also alleged illegal coordination by GOP consultant Nathan Sproul, who worked for BLA during the campaign. Dybus accused Sproul of providing regular campaign advice to both BLA and Horne himself, and credited him with securing the $350,000 contribution from RSLC, which was co-founded by Republican operative Karl Rove.

Fearing a deep and long-term divorce with Latino voters, Republican senators Kyl, Kay Bailey Hutchinson and Marco Rubio are engaging in private discussions to create legislation akin to the DREAM Act, Politico reported Friday.

A lengthy poll of GOP primary voters in CD4 earlier this month that has been quietly making the rounds shows that Babeu’s support has crumbled.

More details have emerged on the attempt to create a legislative referendum to counter the one-cent sales tax increase initiative introduced by the Arizona Education Network and the Associated General Contractors.

Brewer has sidestepped taking a position on the pending ballot initiative that seeks to make the Prop 100 sales tax increase permanent, but the same can’t be said for those close to her. Multiple sources confirm that consultant Chuck Coughlin has been attempting to persuade lawmakers to introduce a referendum to compete against the Quality Education and Jobs Act, a tax increase proposed by the AEA-affiliated Arizona Education Network and the Associated General Contractors.