Hobbs, mayors celebrate Prop 400 compromise 

Update: This story was updated to include the effect of a Capitol light rail loop on the Arizona Capitol Times.

Gov. Katie Hobbs joined Democratic legislators and local officials from both parties in downtown Phoenix to hold a ceremonial signing of the bill that will put a transportation sales tax extension proposal before Maricopa County voters in 2024. 

Though Hobbs actually signed the bill earlier this month, the ceremonial signing on Aug. 10 served as a victory lap of sorts for the governor, local leaders and organizations that long called for the legislature to send the proposal to voters and praised it as a critical resource needed to support the region’s growing population. 

Hobbs thanked Democratic leaders Sen. Mitzi Epstein, D-Tempe, and Rep. Lupe Contreras, D-Avondale, along with state House Speaker Ben Toma and Senate President Warren Petersen, both Republicans, for helping move the deal across the finish line.  

“Had we not come together; had we thrown common sense out the window and let a fringe minority take control of our state’s future, all of that potential would have been in jeopardy,” Hobbs said. “Thanks to the bipartisan efforts of both Republicans and Democrats, we did not let that happen.” 

The mood at the signing was celebratory with Hobbs and Democratic legislative leaders declaring the compromise deal, which passed the legislature with bipartisan support despite ardent opposition from rightwing lawmakers.  

“This was a long time coming, and I have to admit that there were many of us that were pessimistic that the legislative route would actually bear fruit,” Mesa Mayor John Giles, a Republican, said. “And I gotta tell you, it feels really good to be wrong.” 

But supporters also acknowledged the concessions they made to bring most Republican lawmakers on board, including that no revenues will be used to extend the light rail public transit system and no more than 3.5% of the 37% of public transit funds can be used to maintain existing light rail if voters approve the tax renewal in 2024. 

Hobbs also agreed to sign a Republican-backed bill that banned the ability of cities and towns to levy a local sales tax on residential rentals. Hobbs vetoed a similar bill earlier this year, and cities and towns that currently impose those taxes have lamented the impact the new law will have on their budgets.  

“If the legislature wishes to push forward attempts to effectively defund our police and firefighters, I strongly urge them to come to the table and discuss how they can help us recoup the lost funding,” Phoenix Mayor Kate Gallego, a Democrat, said in a statement earlier this month. 

But Gallego struck a more pragmatic tone at the ceremonial signing event. 

“I think there’s not one person who would say it’s exactly what they would have wanted, but we worked together, and we came up with a plan that will improve life in Maricopa County,” she said. 

Hobbs indicated she will seek ways to help cities replace those lost funds, though she did not specify how she plans to bring legislative Republicans on board. 

“At the end of the day, this was a compromise, and it’s going to be a priority for me to come together with mayors and try to find a way to backfill,” Hobbs said. 

The Prop 400 compromise dealt another financial blow to the City of Phoenix, which agreed to abandon a planned light rail extension around the state Capitol at the behest of Toma and other Republicans who were adamantly opposed to the route.  

Gallego, the Phoenix mayor, said the city had spent years – and approximately $20 million – preparing for the Capitol rail extension. 

Phoenix Deputy City Manager Mario Paniagua said the city is still committed to extending light rail to 79th Avenue for access to Interstate 10, which was one of the primary goals of the Capitol light rail project. He didn’t specify where the line could end up, because it’s very early in pre-planning stages, but Toma suggested Phoenix could now route the line along Van Buren Street. 

The proposed loop would have affected the Arizona Capitol Times. City officials told the publication that the loop would have turned south onto 19th Avenue at Adams Street and required a small portion of the Arizona Capitol Times’ property to be taken.

Reporter Jakob Thorington contributed to this report.