Key Points: 

• Hobbs rejects GOP’s budget delay as political grandstanding

• State shutdown looms without budget by July 1

• Bipartisan support exists, but Montenegro blocks House vote

Calling his proposal a “farce” and “grandstanding,” Gov. Katie Hobbs is rejecting the request by House Speaker Steve Montenegro for an unprecedented “continuation budget” to give him a chance to negotiate an alternative state budget than the one already agreed on by her and the Senate.

The stalemate threatens to bring much of the state government to a halt by the end of the month.

The governor stated that negotiations have been ongoing for months with the leaders of both parties in the House and Senate. The result, she said, was a $17.6 billion spending plan for the new fiscal year, which the Senate approved on a 17-12 bipartisan margin on June 19.

The day after, however, Montenegro insisted that there weren’t the necessary 31 votes in the House for approval, and now the Goodyear Republican wants more time to come up with a different plan.

The current state budget self-destructs on July 1. And, except for certain core functions like prisons, without a new budget, there is no authorization to keep other state operations running or pay other state expenses like aid to public schools.

Montenegro’s solution has never been implemented in Arizona: adopt an interim budget that maintains the current level of state spending beyond June 30, providing more time for negotiations.

“I remain committed to having conversations about improving our bipartisan budget,” the governor said of the $17.6 billion plan. “But let me be clear: Any kind of partisan ‘continuation budget’ will immediately meet my veto pen, even if it has the votes to reach my desk.”

Hobbs made it clear she believes that Montenegro and other House GOP leaders have no one but themselves to blame for the impasse.

The governor said there have been talks for months with leaders of both parties in the House and Senate to craft a bipartisan budget that gives a fair share of money to both the Republicans, who control the Legislature, and to Democrats.

“Sadly, House Republican leadership abdicated their responsibility and refused to meaningfully participate in those bipartisan conversations,” Hobbs said. 

The House GOP instead adopted its own plan to spend $17.3 billion, or $300 million less, and change a variety of state laws not in the compromise plan.

“Now, to cover for their failures, they are attempting to jam through an irresponsible and partisan ‘budget,”’ the governor said.

But Montenegro said House Republicans are not to blame. He claims his chamber’s spending plan was balanced and “prioritized public safety, infrastructure, and government accountability,” even if it did not have the vote of a single House Democrat.

That plan was ignored by the Senate, according to Montenegro. 

Instead, he said, Hobbs and senators are trying to force the House “into a take-it-or-leave-it deal that doesn’t reflect the will of our members or the people we represent.”

Montenegro said this isn’t strictly a partisan issue. He said even some Democrats are opposed.

That is true. In fact, six of the 13 Democratic senators — including Minority Leader Priya Sundareshan of Tucson — voted against the compromise after arguing it short-changed Democratic priorities like education. And Rep. Oscar De Los Santos, her House counterpart, said as many as seven of the 27 House Democrats would vote against it.

But De Los Santos said that he’s convinced that, just like the Senate, there are sufficient votes from both parties who are convinced that, with a politically divided government, this is the best deal to be had. And he said there’s an easy way to check that out when the House convenes on June 23.

“Put it up on the board and have a vote,” he said, something Montenegro has so far refused to do.

He’s not the only one who believes there is sufficient support for what the Senate negotiated with the governor. Even Rep. David Livingston, who chairs the House Appropriations Committee, said last week he believes that there may be as many as 40 votes in the 60-member chamber for the package.

Some Senate Republicans who voted for the compromise are questioning why Montenegro is raising the specter of a government shutdown at all amid the negotiations. Sen. John Kavanagh, who chairs the Senate Appropriations Committee, said the speaker needs to acknowledge the political reality of the situation.

“It takes three to tango,” the Fountain Hills Republican said. 

Kavanagh said that what he and other Senate Republicans recognized is “one of the dancers has a big veto stamp hanging from her belt.”

And Sen. T.J. Shope is questioning if anything new would come from a temporary spending package. 

“I truly don’t know what (Montenegro) thinks can be negotiated after June 30th that couldn’t have been negotiated in January, February, March, April, May, and last week,” said the Coolidge Republican.

He, like Hobbs, also disputed Montenegro’s contention that House Republicans never had a chance to be part of what resulted in the $17.6 billion package.

“That’s quite a take that’s not based on reality,” he said.

Shope also said he takes particular offense at Montenegro’s idea of a continuation budget because it would wipe out agreements in the compromise package to spend money for priority projects that Republicans got inserted into the package. That includes making improvements to State Route 347 that connects the edge of the Phoenix area with the rapidly growing community of Maricopa.

“This tactic is a direct assault on the people of Pinal County and the city of Maricopa specifically, who have to deal with the most dangerous highway in the western U.S.” he said.

De Los Santos said the continuation budget would delay or outright eliminate other priorities, like pay raises for state troopers and fire fighters, as well as additional dollars for K-12 schools.

More than money is involved in the dispute.

The package approved by House Republicans includes a series of changes in state law that are not in the compromise, including:

– A 2.5% cut in university tuition with the state not picking up the dollars lost;

– Mandates that students not in this country legally must pay full out-of-state tuition regardless of their Arizona residency;

– New restrictions on the ability of the attorney general to pursue criminal charges in certain election cases;

– Financially compensating people who were wrongfully convicted and imprisoned;

– Freezing the salary of Family Court judges and employees for the next two years.