The House speaker described the 2025 legislative session as one filled with significant challenges, often facing crucial issues that needed immediate attention from legislators.

Despite some issues popping up just days before the Legislature found a solution, lawmakers stepped up to meet those challenges. In the end, the 2025 legislative session can be framed as a year of three significant mini-crises, or issues that could have abruptly derailed state politics if not solved in the final hour. 

The Division of Development Disabilities shortfall

First in the session, lawmakers needed to address a $122 million budget shortfall within the Division of Developmental Disabilities at the Department of Economic Security. 

The division serves more than 60,000 Arizonans with disabilities, and some feared that bickering at the Legislature over a supplemental funding bill would persist into May, ending vital services with no funding available. 

Republicans largely disagreed with Gov. Katie Hobbs and Democrats on how the supplemental funding bill would look.

Hobbs wanted a “clean” funding bill that just provided the division with the funding to cover the shortfall and remove the threat of lost services, but Republicans had concerns over potential fraud within the Parents as Paid CareGivers program and wanted to include reforms on the department that Democrats largely disagreed with. 

The bill that passed, House Bill 2945, initially proposed using nearly $40 million from the Housing Trust Fund to cover the shortfall. It would have also required the Arizona Health Care Cost Containment System to request a waiver to reduce the number of hours parents can work as paid caregivers to a maximum of 20 hours per week, which was unpopular with many DDD parents.

The persistence of Republicans on reforms throughout the session led to weeks of bickering among lawmakers and a recall campaign that started against four key House Republicans: Speaker Steve Montenegro, R-Goodyear; Majority Leader Michael Carbone, R-Buckeye; Rep. Matt Gress, R-Phoenix; and Rep. David Livingston, R-Peoria. 

After Hobbs declared a moratorium on signing any bills on April 17, with just under two weeks to go until funding for the DDD expired, lawmakers reached consensus and a supermajority passed the funding bill with amendments on April 24.

The bill fully funded the shortfall while maintaining a 40-hour weekly cap per child for the Parents as Paid Caregivers program, with some guardrails from Republicans, including the establishment of an electronic visit verification system from DES and funding for a special audit of the program. 

Leaders of both caucuses in the House viewed the supplemental bill as one of their major accomplishments of the session. 

“Without House Democrats, you don’t have DDD being saved,” House Minority Leader Oscar De Los Santos said in a July 14 interview with the Arizona Capitol Times. 

The two representatives who were predominantly  credited with leading both sides of the aisle together in reaching consensus on the bill were House Majority Whip Julie Willoughby, R-Chandler, and House Assistant Minority Leader Nancy Gutierrez, D-Tucson.

Hobbs and several DDD community members expressed gratitude during the bill’s signing toward the two women for coming together and leading the House in passing a supplemental bill that could garner a GOP majority while still securing Hobbs’ signature.

“It was two women who did not allow ego to get in the way of what was right,” Gutierrez told the Arizona Capitol Times after the bill passed the House. 

The state budget standoff

The standoff that arose while solving DDD’s funding shortfall could be considered a prelude to the calamity that would arise amid state budget negotiations, which also saw House Republicans making a stand against the governor just days before an important funding deadline. 

Senate President Warren Petersen, R-Gilbert, said the whole issue could have been avoided, and an approved state budget could have been had by April, but House Republicans were not willing to accept the Senate’s budget, which was negotiated without their consent with Hobbs. That prompted the House to propose two alternatives to Hobbs in June, just days before the deadline and a possible government shutdown. 

One $17.3 billion proposal was largely supported by Freedom Caucus Republicans. It received partisan Republican approval, but Democrats refused to attend the vote. The other was a continuation budget, a plan to prevent a shutdown and allow more time for negotiation between the chambers, which limited new spending to the bare minimum. It was largely a last resort from the House which remained, until that point, staunchly opposed to the Senate budget. 

Both budgets were pushed through the Senate, but faced quick vetoes from Hobbs. That rejection forced the House to again resume negotiations with the Senate. 

Some lawmakers, like De Los Santos, said the exercise from House Republicans was pointless because the Legislature ultimately passed a slightly modified version of the original $17.6 billion Senate budget.

However, Montenegro told the Arizona Capitol Times that pushing back against the Senate and Hobbs led to more public safety House requests being included in the budget, such as 5% raises for law enforcement officers. While Petersen aired his frustration toward some members of the House at the end of the session, Montenegro said the relationship between the two chambers is fine and “friendly” and that legislative tension between them was always intended. 

“The House was the one that was fighting tooth and nail to make sure we got the 5% raise for law enforcement and firefighters,” Montenegro said. 

The House passed the bipartisan Senate budget with a supermajority on June 26, just five days before the end of the fiscal year. 

Axon and Chase Field 

Two other significant bills that became laws this session both required intervention from the Legislature under threat of two major businesses relocating to another state – the Scottsdale-based law enforcement technology company Axon and the Arizona Diamondbacks. 

The Legislature passed Senate Bill 1543 to allow Axon to build multifamily residential apartment units at its Scottsdale headquarters without needing a local public hearing, but the bill faced strong opposition from the Scottsdale City Council and other residents who called it special legislation meant to circumvent the will of voters who collected signatures to send the zoning proposal to the ballot. 

The Diamondbacks’ lease at Chase Field in Phoenix expires next year, and the team ownership has sought approximately $500 million in funding assistance for stadium renovations through House Bill 2704.

Several Democrats criticized House Bill 2704 as a gift to the team Forbes values at $1.6 billion, but lawmakers were able to reach an agreement with the city of Phoenix and garner enough support to pass the measure. 

Hobbs signed both bills, and both Axon and the Diamondbacks are set to stay in Arizona, bringing the economic impact they both provide to the state, and closing this year’s chapter of mini-crises in the Arizona Legislature.