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The GOP has a bigger majority at the AZ Capitol. How the legislative session could shape up

Arizona Capitol copper dome statue Phoenix
Tim Agne/KJZZ
The dome at the Arizona Capitol in Phoenix.

Lawmakers are back at the state Capitol and a new legislative session has begun. This time, with an emboldened GOP in control of both chambers — and up against a Democratic governor who’s not afraid to use her veto stamp.

One of the top priorities on the Legislature’s to-do list may already be at a standstill: renewing Prop 123. That’s the measure voters narrowly approved back in 2016 to take money from state trust land to boost K-12 schools. It expires in July.

Gov. Katie Hobbs called for lawmakers to extend it in her State of the State speech on Monday. But Republican lawmakers aren’t rushing to renew it.

Wayne Schutsky and Camryn Sanchez of KJZZ's politics desk joined The Show to discuss how the new session is shaping up.

Camryn Sanchez (left) and Wayne Schutsky (right).
KJZZ
Camryn Sanchez (left) and Wayne Schutsky (right).

Full conversation

LAUREN GILGER: Good morning to you both. Happy new session. Everybody ready. OK. So Wayne, let's start with you and Prop 123 here. This is one of the things that lawmakers kind of have to do or should do this session, right, but it's already looking like it might be a tough road.

WAYNE SCHUTSKY: Yeah, as you mentioned, it was passed in 2016. It expires after 10 years at the end of this fiscal year and over the summer, and what has to happen to renew it is lawmakers have to come up with a proposal on how to craft the proposition and then send it to voters. It ultimately has to be approved by them in order to get passed before it expires. It actually has to go to voters in a special election in May.

And you know, elections can't just happen with a snap of your fingers, so they have to actually get this done in the next few weeks if they want to give election officials time to put that on the ballot.

GILGER: So it's actually something that has to be done pretty quickly.

SCHUTSKY: Yeah, but based on the comments they're making, it doesn't sound like they're in a rush to actually get that done. They've been working on this for over a year, but Democrats and Republicans have very different ideas on kind of how much money should be attached to this and exactly what it should be used for, whether it's just teacher raises or whether it's a whole host of educational expenses.

Lawmakers are not rushing to renew Proposition 123, the education funding mechanism set to expire in July.

GILGER: This was something they tried to do, couldn't agree upon last session either, right? Everybody kind of seemed to have their own plan or how this should be renewed.

SCHUTSKY: Yeah, Republicans actually introduced their idea in, I think, like November or December 2023 ahead of the last session, and then Democrats kind of came and Governor Hobbs came back with their own ideas. And like I said, they all seem to agree that it should be renewed, but how it's renewed and what that exactly looks like, they still seem to be a bit far apart.

GILGER: OK, what happens, Wayne, if they do not put this on the ballot for voters before it expires?

SCHUTSKY: So it's not like the money just goes away immediately. A piece of the law says that if it doesn't go to voters if it doesn't get renewed, then the approximately $300 million that would go to K-12 public schools next year if it were renewed, has to be backfilled by the general fund. And so for the non-budget wonks out there, essentially what that means, that's the big pot of money that most of the rest of the services from the government has paid for.

So they're going to be taken from a different pot of money. But what that means is that $300 million that maybe could have gone to some other expense somewhere else in the state government now won't be paid for.

Entering her third year in office, Democratic Gov. Katie Hobbs told lawmakers to focus on cutting costs for Arizonans who have faced an increasing cost of living in a state that used to be known for its affordability.

GILGER: Yeah, OK, OK. Camryn, let's turn to you and talk about one area where the governor and the GOP Legislature might maybe just might have some found some agreement. The governor talked a lot about affordable housing in her state of the state address on Monday and one program that she wants to extend, which is the low income housing tax credit. It sounds like she might have some GOP support there, is that right?

CAMRYN SANCHEZ: Yeah, just a glimmer of hope at the end of a long dark tunnel, I think. So this is the concept of low income housing tax credits, which is also commonly referred to as LIHTC, and that's something that's come up in recent sessions, but not been like the focus of housing policy.

And the reason it's maybe possible is because I know that at least one Republican, Jeff Weninger, is in favor of Lyte and that's something that he's talked about a lot in the past, and he gets to lead the House Commerce Committee. So the House Commerce Committee and the Senate Commerce Committee, they, well, Senate changed it up, but basically, they address the housing bills and so if a housing bill is making its way through the process of becoming a law, it really has to stop off there and the chairs have a lot of discretion about what gets to go through. And since he's a fan of LIHTC, it seems like a promising thing, and he said he's already been in touch with the governor's office about LIHTC in particular.

GILGER: What exactly would this do? How would it help folks?

SANCHEZ: Well, LIHTC means tax breaks for developers who set aside units for affordable housing. So you have a certain amount of units set aside for people who make a certain income, which is low, and the idea is that it would increase the affordable housing supply and help out with Arizona's affordability crisis.

Republicans and Democrats at the Arizona Capitol both want to address the cost of living and border security this year, but the parties differ on the policies they want to implement to achieve those goals.

GILGER: OK. So we are really looking at a divided session here, obviously, not just between the governor and the legislative majority, it sounds like, but also within the Republican Party itself, even though they have this kind of even bigger majority than they did last session. We saw the Freedom Caucus hold its own press conference this week to announce its own agenda. It sounds like they really kind of talked about themselves as their own entity, right?

SCHUTSKY: Yeah, they kind of came out and they, you know, they did not show up to the House Republicans press conference as you mentioned, and they laid out their own priorities which seemed to squarely center on disrupting Governor Katie Hobbs's agenda and getting her unelected or beat her in the next election and same with Adrian Fontes and Kris Mayes.

They also put up their own person that they want to run for chair of the party. So, yeah, a lot of divisions within the Republican Party stemming from that Freedom Caucus split with, I guess, the more traditional Republicans, the major wing of the party.

GILGER: Right. And that's nothing new, but how might it affect the session GOP priorities going forward. Like, can they come together to do what they want to do when they have such a majority?

SCHUTSKY: I, well, what happens is Republicans increased their majority. They have a few seats now. But yeah, if they can't get those Freedom Caucus members on, on board in either house, they account for several seats in both chambers, then they're going to have to turn to Democrats to get those votes if we're looking to pass something like the budget, which they've had to do in years past because Freedom Caucus members wouldn't get on board.

So even though it looks like Republicans have kind of solidified control of both chambers,, this kind of fraction nature of their caucus shows that as Democrats pointed out at the start of the session, they might have to turn to Democrats for votes again.

GILGER: OK, and we'll talk about Democrats in just a moment, but let me ask first about what you mentioned there briefly, which is that there are reports now that there are, you know, sort of internal battles going on for who will be elected the next chair of the Arizona GOP. What does that look like and what might it mean for the party going forward?

SANCHEZ: Well, the current chair is Gina Swoboda, and she is thought to be somewhat successful because the Republicans just had this huge sweeping victory in the last election. They won almost everything significant that they went for, but that doesn't mean that everyone is behind Swoboda to be the next chair of the party, even though she had that, and even though she had Trump's endorsement, there is still some division and fracturing and the so-called Freedom Caucus-type Republicans are putting up their own candidate, and that is, you know, it remains to be seen.

It also, I think it's worth mentioning that the Freedom Caucus put up their own candidate to run against Leo Biasiucci and Steve Montenegro for House speaker. So even within like the state House leadership elections, there was a fracture and they had their own candidate run.

GILGER: OK, OK. So let's end with a question or two about the Democratic Party as well and what they're looking like heading into this session. They're coming off pretty major losses in November. Where do they stand?

SCHUTSKY: Yeah, and so we're kind of seeing the Inverse they have coalesced behind Chair Yolanda Bejarano, who oversaw the party during those, you know, several key losses and legislative races and some other races across the state. But, you know, we're not seeing the same talk like we're seeing on the Republican side where an alternative candidate is being put up.

The last time around, there was kind of a fight between Maricopa County Supervisor Steve Gallardo and Bejarano to see who would lead the party with officials backing both, but now we're seeing basically all major Democrats backing Bejarano.

GILGER: Is that going to help them? Are they expecting to be able to, you know, do much when they don't have a majority in either chamber here?

SCHUTSKY: I think, well, there are two separate things. I think the idea is that, you know, consistency will breed success, that, you know, infighting and all that kind of stuff is only going to them more going into the future from the party standpoint.

And as I mentioned before, Democrats at the Legislature believe they have an end to kind of apply some leverage for their own priorities given that they have a fracture on the Republican side. So if you want our votes to pass your budget, Speaker Montenegro and Senate President Peterson, then you're going to have to give in on some of the things we want to get done.

GILGER: All right, we will see how it all plays out.

KJZZ's The Show transcripts are created on deadline. This text is edited for length and clarity, and may not be in its final form. The authoritative record of KJZZ's programming is the audio record.

Lauren Gilger, host of KJZZ's The Show, is an award-winning journalist whose work has impacted communities large and small, exposing injustices and giving a voice to the voiceless and marginalized.