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Arizona Gov. Jan Brewer has vetoed a hot-button measure that would have permitted businesses in the state to deny service to gays and lesbians for religious beliefs.

At a news conference at the State Capitol Wednesday evening, Brewer said the bill "could result in unintended and negative consequences."

"I sincerely believe that Senate Bill 1062 has the potential to create more problems than it purports to solve," Brewer said.

Gay rights advocates gathered outside the Capitol broke out in loud cheers immediately after Brewer's announcement.

The controversial bill had sparked outcry from LGBT activists and drew vocal criticism from civic leaders, business interests and state economic groups.

"I sincerely believe that Senate Bill 1062 has the potential to create more problems than it purports to solve."

Sen. John McCain, R-Az., who urged Brewer to veto the bill, said Wednesday evening that he hopes "we can now move on from this controversy and assure the American people that everyone is welcome to live, work and enjoy" the state.

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At an event at the University of Miami, former Secretary of State Hillary Clinton said that Brewer's veto of what Clinton called "discriminatory" legislation recognizes "that inclusive leadership is really what the 21st century is all about."

Opponents of the bill applauded Brewer's decision.

“Discrimination has no place in Arizona, or anywhere else,” said Alessandra Soler, executive director of the ACLU of Arizona. “We’re grateful that the governor has stopped this disgraceful law from taking effect, and that Arizona will remain open for business to everyone.”

Sarah Kate Ellis, president of GLAAD, said Brewer "demonstrated that basic respect for LGBT people extends across party lines, and anti-LGBT bias isn't just bad politics, it's bad for business."

Defenders of the measure had said it was a key safeguard of religious freedom. The lawmakers who backed it said it was intended to add another layer of protection from lawsuits to individuals who assert their religious beliefs in refusing service to gays and lesbians.

The Center for Arizona Policy, a prominent social conservative group and an architect of the bill, said in a statement: "Today's veto of SB 1062 marks a sad day for Arizonans who cherish and understand religious liberty."

In recent days, major corporations had come out strongly against the proposal. Apple, Inc., which recently announced plans to build a new manufacturing plant in Mesa, Az., was joined by American and Delta airlines, Marriot Hotels, Intel, PetSmart, Yelp, Major League Baseball and others in announcing their opposition to the bill.

The bill threw Arizona's stint as host of next year's Super Bowl into jeopardy, too. The NFL had been mulling moving the game from the Phoenix-area city of Glendale if the bill were signed into law, Sports Illustrated reported.

"Basic respect for LGBT people extends across party lines, and anti-LGBT bias isn't just bad politics, it's bad for business."

And several Republicans — from McCain and Sen. Jeff Flake to former GOP presidential nominee Mitt Romney, and even three state lawmakers who voted for the proposed law initially — pressed her to veto the bill.

The Republican-controlled state legislature passed the measure last week. At the time, Brewer was in Washington, D.C., for the National Governors Association meeting, and she did not return to Phoenix until Tuesday.

The bill would have permitted any business, church or person to cite the law as a defense in any legal action brought by the government or individual claiming discrimination.

Proponents called the bill a slight adjustment to the state's existing freedom law, which does not grant protections to people based on sexual orientation. But the law would have trumped local ordinances that offer protections for LGBT individuals in places like Phoenix, Flagstaff and Tucson.