Republican leaders at the Arizona Legislature forced through their own plan to send emergency funding to a program that provides services to Arizonans with developmental disabilities, while also blocking a competing proposal that had the support of legislators on both sides of the aisle.
The Arizona Department of Economic Security’s Division of Developmental Disabilities needs a $122 million cash infusion to avoid running out of money in May. Without that funding, the providers who serve that community won’t be paid by the state for care they provide, which could force some to close, advocates and experts said.
Republicans and Democrats at the Arizona Capitol have long agreed that they should send the department emergency funding, but Republicans and Democrats have butted heads over what that funding should look like.
And that uncertainty is affecting families who use the program.
“We have seen emergency sessions skyrocket because parents are panicked. There are increased calls to crisis hotlines. This is unfair and it's unreasonable,” said Michele Thorne, who runs an organization that provides support for caregivers.
Republicans have argued new conditions and guardrails are needed to prevent cost overruns in the future, blaming the Hobbs administration for mismanaging the program. Specifically, they say Hobbs’ decision to make permanent a program that pays parents who work as caregivers for their children is the primary cause of the funding crisis.
On Tuesday, committees in the Arizona House and Senate passed identical bills that would provide $122 million to the DDD program with Republican-backed reforms.
House Bill 2945 would require the Hobbs administration to start the process to limit the payments in the parents-as-paid-caregivers program to 20 hours per child per week in October, rather than a 40-hour-per-week cap going into effect in July. It would also give the GOP-controlled Legislature veto power over Medicaid waivers sought by the state.
The state Medicaid system, with oversight from the governor’s office, submits those waivers to the federal government seeking permission to provide different types of services, such as expanding access to Medicaid for children.
The bill passed the Senate Appropriations Committee on a 6-4 party-line vote.
Democratic lawmakers and Gov. Katie Hobbs have long said the legislature should approve the emergency funding with no strings attached and work on new safeguards for the program heading into the next fiscal year, which starts on July 1. They argue it is increases in costs and enrollment, not mismanagement, that has caused the DDD budget to see substantial increases over the past few years.
The bill did not receive the same unified Republican support in the Arizona House, where it passed on a 11-10 vote. Republican Reps. Julie Willoughby, Justin Olson and Jeff Weninger joined all Democrats to oppose the bill.
Willoughby proposed amending the bill to keep the 40-hour-per-week cap on the parent caregivers program. She also suggested removing the section giving the Legislature final say over Medicaid waiver requests, instead opting to have those requests reviewed by legislative budget staff at the Joint Legislative Budget Committee.
“I do believe that in this community we do need some bipartisan support,” Willoughby said. “There does need to be some reforms to make sure that families aren’t in this fiscal cliff regularly.”
But some of her fellow Republicans Willoughby’s amendment doesn’t go far enough, because the Joint Legislative Budget Committee can’t actually block the administration from pursuing a Medicaid waiver.
“The JLBC review is window dressing, quite frankly,” Rep. Matt Gress (R-Phoenix) said.
Gress said the legislature needs more oversight of the governor’s office to ensure it’s making good on promises to control costs in the program. For instance, AHCCCS, the state Medicaid program, initially planned to implement a 40-hour-per-week cap on the parent caregiver program in October 2024 but now that cap isn’t going into effect until July 1.
Many of the families and advocates who showed up to the hearing implored lawmakers to reject the Republican bill, arguing it would be detrimental to families that rely on the parent caregiver program. That program is needed, they said, because a statewide shortage of providers means there is no one else to care for their loved ones.
“I have exactly the same level of training as those other people who come in and work to help my son, care for him, make sure that he is safe … I am just as valuable as they are, and I don’t have any turnover, I’m not going to leave,” parent Amy Haley said.
Willoughby’s amendment appeared to have enough support from Democrats and Republicans to pass the House Appropriations Committee, which usually includes eleven Republicans and seven Democratic members.
But, shortly before Tuesday’s meeting began, House Republican leadership added three new GOP lawmakers to the committee, giving Republicans a 14-7 advantage.
Willoughby’s amendment failed on an 11-10 vote. All three newly-added lawmakers on the committee — Reps. Selena Bliss, Michael Carbone and John Gillette — voted against the bill.
“We had a bipartisan solution, and they killed it,” Rep. Nancy Gutierrez (D-Tucson) said.
Gutierrez and other Democrats thanked Willoughby for reaching across the aisle to craft a compromise.
“More than being just disappointed, I think that’s all I am,” Willoughby said about the vote against her amendment.
Livingston left the door open to making further amendments down the road to incorporate parts of Willoughby’s amendment. But he stood by the decision to stack the committee, arguing that, due to legislative rules, the House and Senate committees needed to pass identical bills now to ensure the funding reaches the agency in time.
“We did what we had to do,” said Rep. David Livingston (R-Peoria), who chairs the House Appropriations Committee. “The bill had to pass to give an opportunity to fix the DDD situation the governor caused.”
Willoughby said she is hopeful that Republican leaders make good on that promise.
“I just hope that my leadership just honors those words that they’ve given me before,” she said.
Livingston declined to say which specific parts of Willoughby’s amendment could find their way into the final version of the bill.
“Unfortunately, I can’t yet, because we need to negotiate with the governor on this,” he said.
Over the course of the meeting, Livingston repeatedly accused the governor’s office and Chad Campbell, Hobbs’ chief of staff, of failing to come to the negotiating table.
But Campbell said Livingston is the one closing the door on negotiations.
“When Livingston introduced this bad amendment, he had a 3rd party deliver a message to me that this would be ‘the best & only bill the Governor would get on DD funding,’” Campbell wrote on social media. “That isn't collaboration. That is a threat.”
The bill still needs to pass final votes in front of the full House and Senate. It would then go to Hobbs' desk for final approval, though the governor has indicated she doesn’t support the legislation in its current form.
“Today, Republicans forced through their unserious proposal in a stacked committee to slash services for Arizonans with disabilities, threaten Medicaid programs for middle class children and people with severe mental illness, and gut down payment assistance for working families,” Hobbs said in a statement.
