The pressure is off state lawmakers after Gov. Katie Hobbs signed a $17.8 billion budget package and negotiations on critical housing and transportation issues will continue during a near month-long recess of the Legislature.
Both the House and Senate gaveled out for a four-week break until June 12 on May 15, following a marathon session of House members voting on almost 100 bills to allow for the break.
“We cleared the deck of almost everything that’s workable in the House so we’re not under pressure to come back,” said House Speaker Ben Toma, R-Peoria.
Many of the bills passed May 15 on party lines, and House Republicans were unable to pass these bills through most of April when their slim 31-member majority was cut on April 12 due to former Rep. Liz Harris’ expulsion from the House.
Republican leaders also said lawmaker absences and vacations were another reason for the extended break. Toma said legislative leaders identified June 12 as the best day to come back for both House and Senate members’ schedules.
House Minority Assistant Leader Lupe Contreras, D-Avondale, said in a May 15 Democratic caucus meeting that only Republican members’ schedules were considered for the break, and he has never been asked about his schedule by majority leadership in his 11 years at the Legislature.
“We’re coming back on their schedule, not our schedule,” Contreras told his members.
Upon announcement of the break, several Republican and Democrat House members groaned in frustration of the decision, and Democrats delivered a loud “nay” voice vote to the motion of recessing.
Before the House and Senate adjourned, each chamber discussed housing bills introduced by Sen. Steve Kaiser, R-Phoenix, that would reform municipal zoning with the intent of creating more affordable housing.
Over the past two years, Kaiser has been trying to pass legislation that will create more housing in Arizona, but he has faced strong opposition. Last session, Kaiser’s most expansive housing bill failed, and he spent the summer chairing a Housing Supply Study Committee on the issue.
This session Kaiser tried to pass another comprehensive housing bill but it was killed and opposed by the League of Arizona Cities and Towns. Undeterred, Kaiser split elements of that bill into a handful of smaller bills which are still making their way through the legislative process.
Kaiser came to an agreement with Democrats on Senate Bill 1161, and Rep. Oscar De Los Santos, D-Laveen, offered an amendment to his proposal to get House Democrats’ support of the bill. The measure would require cities to allow low-income multifamily residential rental properties in any existing commercial, mixed-use or multifamily residentially zoned district near a light rail or streetcar stop.
De Los Santos’ amendment would have adjusted the deposit to the Housing Trust Fund to 30% of unclaimed property revenues and required 40% of that deposit to be used to develop housing in rural areas. He said this effectively added a permanent source of revenue for the fund without raising taxes.
Not a single Republican in the House supported the amendment and Kaiser’s bill didn’t come up for a vote in the chamber.
Rep. Matt Gress, R-Phoenix, said he was concerned the amendment exempted Tucson from the bill’s zoning requirement. Rep. David Livingston, R-Peoria, also said he didn’t like using unclaimed property as revenue for the Housing Trust Fund.
“Didn’t go through appropriations. Didn’t go through the budget. Tens of millions of dollars (into the housing trust fund),” Livingston said. “If this is the way that we need to try to find a way to get 1161 in a passable format, I am disappointed.”
In the Senate, another of Kaiser’s housing bills, House Bill 2536, came up in the Committee of the Whole and was amended, but then had to be retained at the last minute because some of the “yes” votes dropped off – according to Kaiser.
“We had the votes but at the last minute a few people peeled off wanting some more changes. So, we will continue to work with members to find consensus,” Kaiser said in a text on May 15.
Because the bill was retained before the report of the committee of the whole was adopted, the bill will have to go through the committee all over again before it can pass the Senate.
Some lawmakers are still undecided on Kaiser’s bills.
Sen. Brian Fernandez, D-Yuma, said, “I don’t like to preempt cities. I think cities know their citizens and they know their cities best – mayors and councils. I, generally speaking, like to have government as close to the people as possible but we have a housing shortage, and we need to figure out a solution.”
The League of Arizona Cities and Towns is actually in agreement with Kaiser on some pieces of the housing bills.
HighGround lobbyist and league representative Nick Ponder said they’re alright with provisions on short-term rentals, duplexes and triplexes and “mostly fine” with shot clocks and accessory dwelling units. There’s still strict opposition to other parts of the housing bills, like stopping design review standards and severely limiting parking requirements.
“They’re not actually listening to the cities, they handle this stuff every day,” Ponder said. He said the duplexes, triplexes and quadruplexes section – what Kaiser calls the “missing middle” – is OK because cities still get to pick where those go. As for accessory dwelling units, Ponder said they’d like those to be limited to backyards, but are otherwise fine with them.
Toma said lawmakers will use their four weeks off to continue negotiating Kaiser’s housing bills, as well as another measure that many are watching.
One of the most talked-about bills that’s still hanging in the balance is a measure that would allow for an election to extend Proposition 400 – the Maricopa County transportation tax that’s been used to fund the light rail.
On May 15, Hobbs said, “Certainly 400E is something that we’re still in active discussions about as it’s moving forward. And that’s a huge priority for Maricopa County, but not just for the region – for the whole state.” (The “E” stands for “extension,” as the measure would extend an existing transportation tax.)
But there are some significant sticking points in the ongoing negotiations, particularly over how much of the tax revenue would go to different types of transportation projects. The Maricopa Association of Governments has proposed setting aside 40% of the funds for mass transit – like the light rail. That’s something that a number of GOP lawmakers have balked at.
MAG Executive Director Ed Zuercher said the association is committed to the 40% number for mass transit because that plan was proposed with input from Maricopa County voters and numerous public meetings over the last four years. He also said Hobbs is committed to 40% also going to mass transit.
“We have been very flexible on different parts of the plan,” Zuercher said. “We even went so far as to concede to the demand on light rail – there (would) be no light rail extensions funded from the tax, which was a big concession for the cities to make.”
An extension of the half-cent sales tax would raise an estimated $15 billion over 20 years.
Tony Bradley, president of the Arizona Trucking Association, said he’s “optimistic” a Prop. 400 deal will eventually make it through the Legislature. Bradley said he has been in most of the negotiation meetings this year but then, about two weeks ago, legislative leaders and the Maricopa Association of Governments (MAG) settled on a plan to continue talks without lobbyists present.
“Now that there are the principal decisionmakers in the House, Senate and the Governor’s Office, and MAG… working out those final details, I think we’ll get something, across the finish line before they adjourn,” he said.
Chuck Coughlin, a longtime GOP strategist, said that Republicans who are skittish about supporting Prop 400 might be enticed to cut a deal if the extension was packaged up with eliminating the rental tax – something that
Republican lawmakers pushed for this year, only to see their bill vetoed by Hobbs.
With a few tweaks to the details, Coughlin said, “it sounds like something that could be done.”
Arizona Capitol Times reporter Nick Phillips contributed reporting.