PHOENIX — Arizona lawmakers are returning to the state Capitol today after taking an early recess, with leaders from both parties signaling they may be close to reaching a long-awaited budget agreement.
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The Legislature recessed in early May after Governor Katie Hobbs vetoed a Republican-backed budget proposal, which they referred to as a “skinny budget.” Hobbs called the plan “unbalanced and reckless,” arguing it failed to adequately fund key state priorities.
Since then, budget negotiations have continued behind closed doors while lawmakers remained away from the Capitol.
Now, both sides say progress is being made.
Senate President Warren Petersen recently said negotiators are “99 percent of the way” to a final agreement. Hobbs’ office has also told 12 News that the governor believes the two sides are “very close” to reaching a deal.
One sign of progress involves Proposition 123, a key education funding issue that Hobbs has pushed to include in the budget package. Petersen told KTAR that negotiators have reached a solution on the issue, though any extension of Proposition 123 would still require voter approval.
Hobbs has declined to publicly discuss the remaining sticking points in negotiations but acknowledged compromise will be necessary.
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“I put out my budget in January. That is my vision, my plan,” Hobbs told KTAR. “I know that there’s going to be compromise.”
The budget talks come after months of public tension between the Democratic governor and Republican legislative leaders.
In March, Hobbs walked away from budget negotiations. The following month, she imposed a bill-signing moratorium, refusing to act on most legislation until lawmakers returned to the negotiating table. In May, she vetoed the Republican-backed budget proposal before legislative leaders recessed to allow negotiations to continue privately.
Lawmakers now have until June 30 to pass a state budget before Arizona’s new fiscal year begins July 1.
State leaders have not announced when a final budget agreement could be unveiled, but both sides have expressed optimism that negotiations are nearing the finish line.
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