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State of the State 2024: Hobbs sets collision course with GOP lawmakers

Gov. Katie Hobbs delivered her State of the State speech Monday, setting her priorities for the upcoming year — many of which will be staunchly opposed by the Republican lawmakers who control the narrowly-split Arizona Legislature. 

Hobbs will have to convince Republicans to get behind her plans if they have any chance of passing the legislature, and she acknowledged that will be complicated by the fact that she is a Democratic governor working with many Republican lawmakers with eyes on the campaign trail in an election year.

“I’ve been really clear that I’ll work with anyone who wants to tackle the tough challenges that I think we’re laying out clearly in the state of the state, and I’ll continue to do that,” Hobbs said.

The governor delivered several proposals designed to conserve Arizona’s existing water supply that could garner support from at least some Republicans. That includes  new rules preventing so-called “wildcat” housing developments that led to a water crisis in Rio Verde Foothills last year.

The "wildcat” subdivision refers to a loophole where developers divide property into fewer than six lots in rural areas and skirt a state requirement to prove the homes will have enough water for 100 years.

Hobbs acknowledged that many of her proposals, including the wildcat legislation and efforts to more tightly regulate rural groundwater, have faced opposition from key Republican leaders in the past. But she says the reforms are needed.

“Our water rules give families and businesses confidence to invest in our state,” Hobbs said. “And we cannot continue to let individuals and corporations exploit these loopholes and rob us of our water future.”

The specifics of that proposed legislation will determine whether it can pass through Rep. Gail Griffin’s Natural Resources, Energy and Water Committee.

Griffin (R-Hereford) has not shied away from blocking legislation in the past, including proposals to create Rural Management Areas to give rural communities greater authority to manage their groundwater. Griffin called previous bills to create those management areas flawed legislation that would have given unelected bureaucrats too much power over rural water, but said that Republicans plan to introduce omnibus water legislation soon to address similar concerns. 

Griffin also said she supported going after “bad players” skirting existing laws that ban large lot splits, but does not support expanding the prohibition to ban smaller lot splits.

“We need to go after bad players, and leave everyone else alone,” Griffin said. “They’re not breaking the law.”

The governor appeared to find some common ground with Republicans on a proposal to provide developers alternative paths to secure the water needed to build new homes. Senate President Warren Petersen (R-Gilbert) previously laid out a similar goal ahead of the new legislative session, though Hobbs plans to accomplish the goal administratively without the need for legislative approval.

That is one tool to help encourage home building and combat the state’s housing affordability crisis, Hobbs said.

But the governor’s overall housing plan this year is less ambitious than last year when the legislature invested $150 million into the state’s Housing Trust Fund. This year, Hobbs is asking for less than $10 million to help low and middle income families with things like down payment assistance and mortgage insurance relief. 

The more modest proposal is the result of Arizona’s budget shortfall as projections show the state faces a $850 million deficit over the next two years.

“We didn’t get here overnight and we’re not going to get out of it overnight,” Hobbs said. “So do we need to do more? Probably. This is what we can do now.”

Republicans are staunchly opposed to many of the priorities highlighted in the governor’s speech, including a proposal to expand abortion rights and a package of reforms to the state’s school voucher program.

Last year, during Hobbs’ first state of the state speech, several Republicans stood and turned their backs to her, then walked out. 

This year, all the Republicans kept their seats apart from Sen. Anthony Kern (R-Glendale) who stood and turned his back to Hobbs’ twice – when she reiterated her pro-choice stance, and called for guardrails on the state’s private school voucher program.

The governor also called for a series of legislative actions to expand access to abortion in Arizona that are unlikely to see the light of day at the legislature. She called for the repeal of Arizona’s territorial era abortion ban — which is currently before the state Supreme Court after an appeals court ruled a new 15-week ban is in effect — and a new law legalizing abortion in Arizona.

Republican lawmakers passed the 15-week ban in 2022 and several have voiced support for the more restrictive statewide ban.

Ultimately, Arizona voters could have the final say as groups that support the right to abortion are gathering signatures to put the issue on the ballot in November.

The governor’s healthcare agenda also includes proposals to tighten regulations and oversight of sober living homes and long term care facilities, including bills that would increase transparency around facility violations, increase fines for violations and standardize inspections.

The package of proposals come as the state goes after  fake sober living homes that victimized patients, including many from Native American tribes, and  reports of abuse and neglect in long term care facilities.

Republicans also oppose Hobbs’ proposal to rein the school voucher system.

Those reforms include requiring the Arizona Department of Education to manually approve all voucher purchases exceeding $500, and giving the Auditor General more oversight of private school spending.Hobbs also wants to ban private schools that receive voucher money from increasing tuition at a rate higher than inflation. The plan would also require that a student attended a public school for at least 100 days before they are eligible to receive voucher money.

Republicans said the package was designed to undermine the voucher program they expanded to all students in the state in 2022, with Sen. Jake Hoffman (R-Queen Creek) calling it “death by a thousand cuts.” 

“Any effort to eliminate or undermine parental choice in education will not succeed in this legislature,” House Speaker Ben Toma (R-Peoria) said before Hobbs even gave her speech.

Republicans also oppose proposals the governor called common-sense safety measures like a new rule that would require teachers in private schools that receive voucher money to pass background checks.

“What Gov. Hobbs has proposed is designed to look good on the surface, but it’s a camel’s nose under the tent when it comes to the regulatory scheme to regulate these to death,” Hoffman said. “We do not believe that we should be forcing private schools to do something that they’re already doing simply because the governor is trying to virtue signal to her base.”

A separate education proposal could gain traction with Republicans, though.

Hobbs called for the extension of Proposition 123, a 2016 voter-approved measure that increased the amount of money schools received from the state land trust fund to pay for education related expenses. She said the state needs an “even stronger” Prop 123 to support raises for teachers and other school employees along with school safety. 

But, again, the devil will be in the details.

Republicans introduced their own Prop 123 extension plan late last year, but wanted all that money reserved for teacher raises, and Hoffman gave Hobbs no credit for her similar proposal.

“Hobbs’ initial proposal from Prop 123 had nothing to do with teacher pay raises, because that’s the thing Katie Hobbs doesn’t want the people to know,” Hoffman said. “Her initial proposal was all about giving schools more building funding, so she wants to build… more buildings for a shrinking student population.”

State of the State preview

Arizona Governor Katie Hobbs, a Democrat, says she is optimistic about working with the Republican-controlled Legislature, as she delivered her second State of the State speech on Monday.

At the start of the new legislative session, Arizona faces a steep budget deficit caused by plummeting tax revenues and escalating school voucher costs. Also in the mix of issues is a growing housing crisis where more builds are needed, but there’s also a simultaneous water shortage.

Veto stamp remains ready

Speaking to Capitol Media Services, Hobbs acknowledged the divisiveness of last year’s session, which included a record-shattering 143 vetoes, or more than 40% of the bills sent to her desk.

And she says she’s ready to use that stamp again if lawmakers pass bills that target “culture war” issues or undermine the integrity of elections.

“I'm going to continue to keep my promise of vetoing legislation that doesn't protect fundamental freedoms or solves tough problems. So if that's what they want to send me, that's what I'll keep doing," Hobbs said. 

The address was at 2 p.m.

For a preview of what to expect Monday — and over the course of the next several months — The Show spoke with Howard Fischer of Capitol Media Services and the conversation began with how much of what Hobbs and GOP leaders hope to accomplish is reliant on finding solutions to the budget shortfalls they’re facing.

Election law changes

Hobbs said she wants to solve the problem created by a change in federal election laws that ultimately could result in the state not meeting the deadline for submitting the results of the 2024 presidential race, a move that would mean Arizona's 11 electoral votes would not be counted, regardless of who wins the race here.

But the governor made it clear she would not accept any fix it if it is tied to other changes, ranging from hand counting ballots to who gets an automatic early ballot and new signature verification requirements.

"I'm not going to sign something that's bogged down with a bunch of other stuff that the Republicans want on this,'' she said.

Housing and commerce

Hobbs also said she has no interest in signing legislation being pushed by some GOP lawmakers to block the citizens and corporations of certain foreign countries from leasing or owning farm land in Arizona.

She called it unnecessary, noting the state already is terminating its leases with Fondomonte, a Saudi company growing alfalfa in La Paz County. And all that, the governor said, can be done based on deciding what is the "highest and best use'' of state land — and without regard to the nationality of the tenant.

“You’ll hear a proposal in our State of the State around mortgage assistance, which obviously is not the same as building new houses, but for first time homebuyers and middle class families that are being priced out of purchasing homes right now," Hobbs said. 

Republican plans

"There's a lot less interest this time around in just sending a bill out just to get a veto,'' said House Speaker Ben Toma.

"I think it's pretty clear at this point where everybody is politically on some hot-button issues,'' said the Peoria Republican. "So there's really no reason to continue that.''

Senate President Warren Petersen said there's been no formal decision made by his caucus. But it has been discussed.

"We have talked about the obvious, which is: same product, same people, same outcome,'' said the Gilbert Republican.

"I don't know what members are going to do,'' he continued. "But I feel like you won't see as many of the same bills introduced.''

Still, Petersen said that doesn't mean he will use his powers to sideline legislation by other GOP lawmakers just because it might be a sure-fire veto.

"If there's a reason or a benefit for them where they feel like they want to continue to push their bills, if their constituents have asked them to run a bill or push a bill, that's a member decision,'' he said.

But Hobbs, even before the session begins Monday, already is picking a fight with the GOP majority.

Fight over school vouchers

She announced this past week a list of changes she wants in the system of universal vouchers that allows any student to get taxpayer funds — the typical grant is $7,300 — to attend private or parochial schools or have home-schooled children use the dollars for other educational expenses. The governor was unapologetic.

"I don't think this is a new fight,'' she said, noting she was a first-term lawmaker when the whole concept of vouchers became law. At that time, the program was limited to students with special needs. 

"And one of the things we said is, this is the camel's nose under the tent, it's going to keep expanding every year until we get to this point,'' Hobbs said. "And here's where we are.''

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Greg Hahne started as a news intern at KJZZ in 2020 and returned as a field correspondent in 2021. He learned his love for radio by joining Arizona State University's Blaze Radio, where he worked on the production team.