Most of Arizona’s state agencies are hoping to claw back funding cuts from their budgets earlier this year, according to agency budget requests submitted for fiscal year 2026. 

Though lawmakers just wrapped up the fiscal year 2025 budget in June, planning for fiscal year 2026, which begins next July 1, has already begun now that agencies have submitted their budget requests to the Governor’s Office of Strategic Planning and Budgeting. Of the budget requests that are available online, a majority seek millions of dollars in increases to support agency objectives. 

The requests are the first step in the lengthy budget process. Gov. Katie Hobbs’ office will use them to create her proposal for the fiscal year 2026 budget that she will present to the Legislature at the beginning of next year to start negotiations. What agencies request now will likely not be anywhere near what they receive.

Hobbs told the Arizona Capitol Times that next year’s budget has been on her mind since this year’s passed.

“We’ve been thinking about budget priorities since I signed the budget in June,” Hobbs said. “We’re still digging through the agency budgets and figuring out what revenue is going to look like for next year and it’s a work in progress, and it will be all the way through the end of December.”

It’s currently unclear whether the budget cuts enacted by Hobbs and the Legislature this year will be enough to recover from the state’s budget deficit caused by lower-than-expected revenues and high spending from lawmakers and Hobbs. The latest Joint Legislative Budget Committee report shows that the state revenues are up from last year and beating projections, but that isn’t a guarantee of a surplus. 

That isn’t stopping agencies from requesting hundreds of millions of dollars from the state, but some did at least acknowledge the state’s financial situation and kept it in mind before asking for increased funding. 

A few agencies like the Department of Juvenile Corrections, the Governor’s Office of Highway Safety and the Department of Veterans Services did not request increased funding, indicating they are satisfied with their current budget. 

Several agencies, including the Arizona Commerce Authority, the Department of Education and the Department of Health Services have not yet made their budget requests available online, so it’s not known what those agencies will submit to the Governor’s Office. 

Here’s what some agencies are asking for.

Arizona Board of Regents

The Arizona Board of Regents submitted the biggest ask of any agency, according to budget request documents reviewed by the Arizona Capitol Times. ABOR wants an increase of over $632 million to its budget after it and the state’s three public universities saw major funding cuts in the budget passed by lawmakers in June. 

According to a statement released by ABOR on Aug. 29, after it voted to send the budget request to Hobbs, the funding increase will restore the funds cut from its budget this year while also providing funding for new medical schools, scholarships, building repairs and infrastructure. 

“This vote is more than a budget request, it affirms our promise to provide opportunities for Arizona students to earn a degree, have quality teachers in the classroom, more doctors at the clinic, and access to inventions and discoveries that provide solutions to some of the state’s largest challenges,” said ABOR Chair Cecilia Mata.

Department of Economic Security

The next highest request came from the Department of Economic Security, which asked for its budget to be increased by over $302 million. According to a letter submitted by the agency as part of its request, the additional millions in funding will help address skyrocketing caseloads for employees working with Arizona seniors and other vulnerable populations while also funding information technology support and software licenses. 

The letter cited the discontinuation of federal pandemic relief funding as a factor in its request for more money from the state. Programs aimed at providing access to child care that are administered by DES are at risk of being underfunded if the state does not fill holes left by the lack of federal dollars. 

Attorney General’s Office

The Attorney General’s Office is the only agency to request less money for FY 2026 than it was granted in FY 2025. Attorney General Kris Mayes did not offer much in the way of explanation in her letter attached to the budget request, but is anticipating needing $4.7 million less in funding for FY 2026.

According to budget request documents, the Attorney General’s Office is asking for increased funding from the state’s general fund and from the state’s Consumer Fraud Revolving Fund, but says it won’t need $9 million of the $49 million it was given from the Consumer Restitution and Remediation Revolving Fund in FY 2025 to carry over into FY 2026. 

Arizona Corporation Commission

Similar to the request from ABOR, the Corporation Commission is asking the Governor’s Office to reinstate the $1.2 million taken from its budget in FY 2025, and wants a total funding increase of $5.2 million.

Four of the five commissioners voted in favor of the budget request, with lone Democratic Commissioner Anna Tovar voting against it. In a letter included with the request, the Republican commissioners said the majority of the increased funding will go toward improving staff salaries and hiring more employees.  

“We need to retain our qualified staff and maintain our institutional knowledge; otherwise, our Arizona residents suffer from the learning gap when we lose expert staff members and those we have trained,” commissioners said in the letter.

Commissioners said they’re losing staff to better paying jobs at other state agencies or in the private sector because of stagnant wages, which has resulted in an annual turnover rate of 20%.

Judicial Branch

The Corporation Commission isn’t the only agency struggling with staff salaries – the Judicial Branch also named staff pay, retention and hiring as “pressing needs” in its budget request. It is requesting around $4.3 million to boost salaries and address a 15% turnover rate at the state Supreme Court, among other priorities. 

One of those priorities, according to a letter included with the request, is the continuation of over $10 million in one-time funding to prevent layoffs for up to 135 probation officers that could leave nearly 9,000 felons without supervision. The courts also need money to hire more support staff to assist various administrative functions of the Judicial Branch. 

Department of Corrections, Rehabilitation and Reentry

ADCRR is requesting at least $27 million more in funding to comply with a 2023 court order that requires the state to improve conditions for prison inmates, in addition to several other agency priorities. 

In a letter included with the budget request, the agency does not provide an exact number for funding needed to comply with the injunction in the Jensen v. Thornell case, but instead left it as a placeholder. The case is an ongoing class-action suit challenging the state’s medical and mental health care of prisoners. According to ADCRR, many of the court’s requirements do not have cost estimates available to calculate an exact funding need.

The $27 million more requested by ADCRR will go toward operating costs, prison security screenings and staff support – which includes meals, uniforms and transportation for prison staff.