Arizona Budget: Hoodwinked By Charlatans?

Petersen’s Rebuke, Hobbs’s Record‑Shattering Vetoes & Montenegro’s Mic Cut

Rep. David Livingston (R-LD28) said: “I just set the record for our great State of Arizona. 28 budget bills Vetoed in one day!”

A snarky reference to Hobbs vetoing both the continuation and the House budget.

There has been tremendous drama around the House budget this year. Strange allies posturing, and the political amnesia and whiplash dominating this legislative session.

Let’s recap.

Yesterday, the Arizona House passed a bare-bones “continuation budget,” despite Governor Katie Hobbs vowing to veto the stopgap plan.

But Hobbs’s so-called tough stances have been anything but consistent this session. A fact that the republicans may have been banking on.

Earlier this year, she declared she was done sending agency director nominees to the Senate, blaming the “circus environment” created by Senator Jake Hoffman (R-LD15). Then she backtracked—sending up Karen Peters, who was ultimately advanced after Senator T.J. Shope (R-LD16) crossed the aisle to vote with Democrats.

ICYMI: We’ve got Shope’s full explanation, [here].

In a surprise, the Senate not only passed the continuation but also the Republican Majority and Freedom Caucus budget. More to come about that later in this report.

But first, what happened yesterday in the house?

Floor Drama: “This is a waste of time.” House Minority Leader Oscar De Los Santos (R-LD11) didn’t hold back. Yesterday, on the House floor, he addressed the public directly: “To the people of the State of Arizona, I’m sorry. There is zero percent chance this gets signed into law. Zero. This is a waste of time.”

But House Speaker Steve Montenegro (R-LD29) defended the continuation budget as a reasonable step forward: “We are providing stability and time—not abandoning the process. This protects the state while we work through the larger budget.”

Speaker Montenegro cut the mics of both De Los Santos and Representative Alex Kolodin (LD-3) during the floor session.

What Exactly Is a Continuation Budget? Think of it as a temporary life raft—a no-frills plan to keep Arizona’s government functioning while lawmakers hash out a full-year budget.

Unlike the $17.6 billion bipartisan proposal passed by the Senate, this Republican-led House stop gap would have provided basic operational funding to avoid shutdown.

Arizona has never had a state-level shutdown. If no agreement is reached by July 1, this could become historic but avoidable.

Democrats Blame ESAs… Again. Democratic lawmakers wasted no time blaming the Empowerment Scholarship Account (ESA) program, as if that’s the root of the current budget mess. Rep. John Gillette (R-LD30) wasn’t having it. He took to the floor with facts.

In his floor speech he reminded the public of the money lost or wasted under Hobbs.

Nearly $178 million is unaccounted for at AHCCCS

$231 million vanished from DES

Attorney General’s pay-to-play scandal is still under investigation.

$2 billion sober living fraud currently under review

State agencies failure to provide the Auditor General reports

Watch it here:

Today, the Arizona Senate swiftly passed two budget measures proposed by the House—one a full-year conservative budget and the other a “continuation” budget designed to maintain current funding levels beyond the fiscal year-end—both along strict party lines. Swiftly, Hobbs vetoed both bills, denouncing them as “partisan and reckless” and a “sham” that would gut critical programs—cutting hundreds of millions from healthcare and education, stripping raises for troopers and firefighters, underfunding childcare and veterans services, and undermining infrastructure and public safety. She urged the House GOP to abandon political posturing and collaborate on the $17.6 billion bipartisan budget that Senate Republicans and her office previously agreed to.

On the Senate floor, President Petersen delivered a pointed statement on the ongoing budget saga:

Andy Biggs was called a RINO while he was Senate President. Why? Because he had to build a consensus with his members. He had to represent his caucus. He had to LEAD.

And that was with a Republican governor and legislature. That was for a partisan budget.

We have to pass bipartisan budgets.

It doesn’t take competence or courage to pass a budget that only has Rs on it. Because that is how you score short‑lived political points. And with the help of shock jocks and troll farms you can fool some of the people, some of the time.

It takes leadership, competence and courage to pass a bipartisan budget.

I have been at the legislature for 13 years. Every year I think the culture of politics cannot become more polarized or toxic, but somehow it does. New communication methods like social media provide a platform for the most vile exchanges and Machiavellian tactics. Misinformation can spread at the speed of light. False narratives, half‑truths and false lights, distort and confuse. People publish things they would never dare say in person, especially when done with unaccountable anonymity.

Under the current state of things it is amazing we can find any decent, competent, sane people to run who are able to endure the certain malaise that awaits them. The most talented and competent serve under incredible sacrifice as they forgo other opportunities.

My leadership focus has been on uniting the senate, our party and our state. Sadly we have a few people who would rather divide, than multiply. Apparently the drama benefits them. Optics matter more than substance and actual work accomplished. Chaos is preferred to progress. A few of the inexperienced legislators have been hoodwinked by charlatans. But it has been mind‑boggling to witness experienced legislators allow the emperor to wear no clothes. One of the consequences of the charades is that we diminish our chances for success in the future. Another consequence is the waste of our most precious resource, our time.

Members, let’s stop wasting time.

Here is the Senate President’s speech:

The political blame game continues. Democrats and Gov. Hobbs accuse Republicans of “wasting time,” while GOP leaders say Hobbs refused to negotiate the budget until Proposition 123 was resolved. Yet Prop 123 — the voter‑approved education funding measure — still hasn’t been settled. It’s also set to expire June 30.

Photo Credit: Arizona Capitol Times

The House Speaker said the following:

I’m disappointed the Governor has now vetoed two responsible budgets passed by the House—each of which would have prevented a government shutdown and kept essential state services running.

The House has done its job, twice. We passed a balanced budget that prioritized responsible spending and core needs. When that plan was rejected, we advanced a continuation budget to avoid disruption and allow time for further negotiations. Both were rejected.

Despite the Governor’s actions, House Republicans will continue working to keep government operating and protect Arizona taxpayers from the consequences of political brinkmanship.

With the fiscal year ticking down and an historic shutdown looming, Arizonans deserve to know: who in the Capitol is looking out for them — and who’s playing politics?

President Petersen may have been responding to Livingston’s jab—when policy expert Livingston labeled Petersen, a “RINO.” Petersen is one of the Legislature’s most conservative leaders, while Livingston, a policy wonk, doesn’t always carry that same reputation. Even Freedom Caucus Hoffman said that “Petersen was one of the most conservative legislators” on his recent episode on the Gaggle.

Livingston’s remark (among other comments) likely sparked Petersen’s pointed remarks on the floor.