Legislature OKs $9.1 billion budget after overnight marathon

The Arizona Legislature early Saturday handed Gov. Doug Ducey the quick work he requested on the budget, wrapping up a nightlong marathon that sanded down some of the rough edges of the plan he had hammered out with Republican leaders.

The $9.1 billion plan delivers the shrunken government Ducey promised when he was running for governor, as well as providing the tax cuts he pledged he would push every year.

"This is a values-based budget that reflects key priorities for the state of Arizona," Ducey said in a statement delivered minutes after the Legislature completed work around 8:30 a.m. and three days after it was shown to GOP lawmakers in closed-door sessions. Ducey had watched the vote from his office, while noshing on cheese pizza, until he left before dawn

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The plan, for the budget year beginning July 1, "protects classrooms, child safety and public safety — all while eliminating the state's structural deficit by 2017 and protecting you, the taxpayer, from a tax increase," his statement read.

But the final product fell short of some of Ducey's goals. His plan to mandate that schools transfer 5 percent of their non-classroom spending into the classroom was softened to a suggestion in the face of fierce opposition from schools and key Republican lawmakers.

The budget struck a harsher tone, in some regards, than what the Republican governor outlined in his January budget presentation.

Lawmakers pushed the governor's call for a $75 million cut in university funding to $104 million, then cut it back to $99 million; increased a proposed cut to health-care providers to 5 percent from Ducey's 3 percent; zeroed out Ducey's request for $3.3 million in more funding for an anticipated increase in child neglect and abuse reports; and made Arizona the strictest state in the nation for assistance to poor families raising children.





They also rejected two ideas the governor had for increasing state revenue without raising taxes, including a doubling of the car-registration fee to $16.

But legislators delivered the smaller budget — an overall 2.4 percent cut from the current year — that Ducey wanted, and said the tough medicine of the budget should prevent deficits and avert future battles over cuts.

"We will not have to enact any additional cuts for the next two fiscal years," said Rep. Justin Olson, R-Mesa and chairman of the House Appropriations Committee.

The budget tackled a $1.5 billion deficit and is structured in such a way that the state should have enough money coming in to cover its basic obligations, such as education, health care and public safety, he said.

Democrats said the state could have achieved the same result by making choices that would not have hit programs, from education to the social-safety net, as hard.

"It's the dawn of a new day, but it's not a better day," Rep. Eric Meyer, D-Paradise Valley and the House minority leader said as the sun rose after a night filled with lengthy and sometimes heated debates over state priorities.

Meyer and Democrats argued if the Legislature instead postponed scheduled corporate tax cuts, estimated at $100 million next year, or stuck with Ducey's plan to increase the vehicle-registration fee, the budget could still balance without big cuts to education and health care.

And they complained the state was being penny-wise and pound-foolish by aiming to save $37 million by cutting the rate at which Medicaid providers are reimbursed for their health-care services. Those services, on average, draw down a 4-to-1 federal funding match, Meyer said.

The loss of that money punches a big hole in the economy and has prompted some of the providers to question whether they can continue to work.

Political consultant and former lawmaker Stan Barnes said the highlight of the budget was its reliance on tough cuts, instead of "Band-Aids, bubble gum, barbed wire and accounting tricks" to make it work.

"This budget deserves praise for not following that route, and instead making a real change in how monies are appropriated for people," Barnes said.

The budget passed the Senate on a 16-13 vote. Sen. Carlyle Begay, D-Ganado, crossed party lines to provide the crucial vote needed to pass the main spending bill, as well as supporting bills on K-12 and higher education.

Begay's vote was needed, as Republican Sen. Jeff Dial, R-Chandler, voted against the measures and Sen. Steve Pierce, R-Prescott, showed his disdain for the plan by skipping the entire seven-hour session.

In a statement issued after the vote, Begay acknowledged his fellow Democrats are upset with him, but said he was voting for his rural Arizona district, not his party. As the debate opened late Friday night, the Senate added $1.2 million to a spending bill for transportation projects on the Navajo Nation, which Begay represents.

On the House side, Republicans kept enough of their members in line to pass the budget bills without any Democratic support. Rep. Bob Robson, R-Chandler, was out sick and excused from voting, House staff said.

Republicans Christopher Ackerley of Tucson, Kate Brophy McGee of Phoenix and Heather Carter of Cave Creek voted against many of the bills in the budget package.

Their defections mirrored some of the discontent GOP lawmakers found as they started to digest the details of the compromise budget, unveiled Tuesday night.

Legislative leaders made tweaks to the plan to get renegade Republicans on board, such as reducing the hotly contested university cut by $5 million to $99 million, restoring extra funding for charter schools with enrollments under 600 and returning state support for Central Arizona College, Pinal County's community college system. However, they stuck with a plan to cut state support to the Maricopa and Pima county systems.

The budget passed on the first try, without the "false start" that typically sends the process underground after an initial rejection. The Legislature's vote was the earliest date for legislative action in recent history.

Political consultant Barrett Marson said the budget's passage marked a key victory for the first-term governor.

"This was his first real big test: could he get a budget through and keep Republicans together," he said. "And he did."

Want more?

Read the budget bills online at www.azleg.gov