The coalition behind a ballot initiative to roll back the universality of Arizona’s school choice program is facing a campaign finance complaint.
On Thursday, the Protect Education Accountability Act Now Committee (PEANC) was made subject to a complaint, reviewed by AZ Free News. PEANC was accused of falsely claiming that out-of-state contributors amounted to a mere nine percent of funding.
PEANC filed the ballot initiative, “Protect Education Act” last month. If approved, the initiative would impose an income cap on enrollment in the Empowerment Scholarship Account Program, among other restrictions to include an elimination of funding rollover. The Protect Education Act superseded an earlier version, the “Protect Education, Accountability Now Act.”
In order to make the ballot, the initiative will need nearly 256,000 signatures. PEANC reported gathering over 150,000 signatures during a virtual press conference on Friday.
The complainant, Jack Johnson Pannell, cited a disclaimer posted to the bottom of PEANC’s website. That disclaimer reflects PEANC’s total out-of-state contributors account for only nine percent of its total funding.
Arizona law requires political action committee advertisements to disclose the aggregate percentage of out-of-state contributors as calculated at the time the advertisement was produced for publication, display, delivery, or broadcast.
Pannell’s complaint called for a declaration that PEANC violated Arizona campaign finance disclosure law and an action against the committee.
Pannell said on X that Arizona families deserve the truth behind PEANC. Pannell is the founder of Trinity Arch Prep School for Boys, a microschool.
“More than 100,000 families are choosing great options for educating their children,” said Pannell. “It’s a cheap shot to accuse hardworking people of cheating the system. It just ain’t true.”
I’m proud to file this complaint because AZ families deserve the truth. More than 100,000 families are choosing great options for educating their children. It’s a cheap shot to accuse hardworking people of cheating the system. It just ain’t true. #schoolchoicehttps://t.co/FFz9MkTWLh
Contrary to this disclaimer, campaign finance records reveal that 98 percent — $4.5 million, or nearly all of PEANC’s $4.6 million in funding — have come from special interest groups in Washington, D.C.
That $4.5 million came from the National Education Association in four allotments delivered throughout February and March. The first payments from the NEA (over $2.3 million) came on February 13 — exactly a week after PEANC registered their website domain.
The earliest available archived version of the site captured on February 12 reflected an out-of-state contributions disclosure totaled at 50 percent.
Other major donors included the Arizonans For Quality Education ($50,000), Nita and Phil Francis ($25,000), and Arizona Education Association ($10,000).
99 percent of AFQE’s funding has come from “shadow sponsors”: unnamed corporations and LLCs. The remainder of the funding, less than half of a percent, came from Christopher Kotterman on behalf of the Friends of ASBA.
Kotterman became a senior policy advisor for Gov. Katie Hobbs in late 2024.
Phil Francis is the retired chairman and CEO of PetSmart; Nita Francis formerly chaired the Valleywise Health Foundation board.
Correction: A previous version of this story incorrectly listed Justan Rice as the current chairman of Arizonans For Quality Education (AFQE). Rice left AFQE in June 2025 before the donation to PEANC was made.
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With Arizona’s legislative session scheduled to close this week, small business owners are still left in a lurch over a lack of tax conformity.
Twice this year Gov. Katie Hobbs has vetoed legislation that would have provided full conformity in the tax code with the One Big Beautiful Bill Act passed last summer. The governor maintains that the best path forward would not be full conformity, but rather partial.
Gov. Hobbs wanted the Republican-led legislature to get on board with the Democratic minority’s Middle Class Tax Cuts Package.
The Arizona Free Enterprise Club, a free market policy organization, said Hobbs’ preferred conformity package would require Arizonans to file taxes twice and increase taxes by $200 million.
File your taxes twice. Pay more. Welcome to Katie Hobbs’ Arizona.
After vetoing two full conformity bills, Hobbs helped turn what should have been a routine tax update into a full-blown mess in the middle of filing season. Her administration issued forms based on full… pic.twitter.com/eS5n6tiWfm
That threat of double-filing, per Senate President Warren Petersen (R-LD14), has been mitigated because the tax forms sent out by the state aligned with what the Republicans brought to the table (and Hobbs rejected).
Prior to the first veto, the Arizona Department of Revenue issued its advice on filing under the new changes to federal tax law.
Republican leadership in the legislature urged Arizonans to file their taxes, promising to not support any conformity package that would effectively “punish Arizona taxpayers” and require refiling.
“For tax year 2025 we will not support anything that forces Arizonans to refile,” said Petersen.
“Any outcome that requires you to amend your return or pay more is a nonstarter,” said House Speaker Steve Montenegro (R-LD29).
Gov. Hobbs justified her vetoes under the claim that Trump’s One Big Beautiful Bill would require poorer Arizonans to shoulder more of the tax burden.
“We should not hold tax cuts for over 88 percent of Arizonans hostage in order to force through tax breaks for special interests,” said Hobbs. “Other questions of tax conformity must be decided through budget negotiations, following the precedent set by Governor Ducey.”
Sen. Petersen rejected Hobbs’ view of the federal tax changes.
Petersen dismissed Hobbs’ claim as “a nice talking point” that ignored what he says is the reality of how the federal legislation impacts an overwhelming majority of the state’s business transactions.
“That’s just not true,” said Petersen. “We’re talking about tax on tips, we’re talking about tax on car interest loans, we’re talking about no overtime. These are not rich people. These are small business owners. 90 percent of business transactions are small business owners.”
“It’s a nice talking point, but it’s really not true.”
Arizona Senate President Warren Petersen joined @AZMorningNews to push back on Gov. Katie Hobbs after she vetoed Arizona tax conformity and tax-cut bills tied to federal changes.
Chad Heinrich, Arizona director of the National Federation of Independent Business (NFIB), toldThe Phoenix Business Journal that the lack of conformity will cause increased taxes on over 700,000 small businesses in Arizona. Heinrich blamed Hobbs.
“Not conforming with the key business provisions is, in practical effect, a tax increase on the Arizonans who can least absorb it — those who own and operate Arizona’s small businesses,” said Heinrich. “The Legislature has done its part. Governor Hobbs should finish the job, now, before one more small business owner has to guess about their future.”
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Rep. Eli Crane (R-AZ-02) introduced a bill to impose a three-year moratorium on H-1B visas while major reforms occur in the program.
The bill introduced Wednesday, the End H-1B Visa Abuse Act of 2026, proposes a laundry list of program reforms to include:
Reducing the annual H-1B cap from 65,000 (not including the 20,000 for advanced degree holders) to 25,000;
Eliminating existing exemptions;
Replacing the lottery system with a wage-based selection system;
Requiring employers to certify inability to source qualified American workers;
Requiring employers to prove no layoffs occurred;
Setting the minimum H-1B wage at $200,000 per year;
Barring H-1B workers from holding multiple jobs;
Prohibiting third-party staffing agencies from employing H-1B workers;
Prohibiting H-1B workers from bringing dependents into the country;
Prohibiting federal agencies from sponsoring or employing nonimmigrant workers;
Ending Optional Practical Training (OPT);
Prohibiting H-1B holders from adjusting status to permanent residency; and
Requiring nonimmigrants to depart the U.S. before changing to another nonimmigrant status.
Crane called the H-1B Program a “flawed process” that needed years of work to restore fairness in employment.
“The federal government should work for hardworking citizens, not the profit margins of massive corporations. We owe it to the American people to prevent the broken H-1B system from boxing them out of jobs they are qualified to perform,” said Crane. “The End H-1B Visa Abuse Act of 2026 would provide greater access to employment, strengthen protocols in the visa process, and prioritize the livelihoods of Americans.”
Rep. Paul Gosar (R-AZ-09) signed on as an original cosponsor, along with Republican Reps. Brandon Gill (TX), Wesley Hunt (TX), Tom McClintock (CA), Keith Self (TX), and Andy Ogles (TN).
Gosar expressed discontent with a program as a cost-saving measure for businesses at the expense of American employment rates.
“The H-1B program has been hijacked to replace American workers with cheaper foreign labor — plain and simple. This bill slams the brakes on a system that’s rigged against our own people and puts American jobs first again,” said Gosar. “If a company can hire an American, they should. No loopholes. No excuses. We’re done subsidizing the outsourcing of our own workforce.”
An overhaul of the H-1B Program has been a priority for President Donald Trump.
Last September, the president imposed a $100,000 entry fee for new H-1B visa recipients. However, this fee doesn’t apply to those residing in the U.S., meaning a vast majority of H-1B holders are exempt.
New data on lottery pool entries and entry fee payments reflected that the entry fee had minimal impact on reducing H-1B visas.
Last week, Financial Express reported that the lottery pool reduced by about 27 percent, from 470,300 to 345,000 entries — still far above the 85,000 cap on visas. Only 85 entry fees have been paid.
Attorney General Kris Mayes sued the Trump administration over the fee in December. Mayes cited the need for foreign labor to staff rural school districts and the semiconductor industry.
In December, the Department of Homeland Security announced it would be amending program regulations by replacing the random lottery for a weighted selection to prioritize skills and wages.
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The Arizona Democratic Party (ADP) is heading into the second quarter of this pivotal election year with a negative cash balance exceeding $720,000.
Their latest campaign finance report, filed last week, reflected total-to-date expenditures that nearly tripled their income: over $2.8 million compared to $1 million.
For this first period, ADP’s expenditures did fall below their income: about $67,500 compared to $151,500.
ADP experienced much stronger fundraising in the first quarter of 2022, the last midterm election year. The party’s reported income was over $370,000 and expenditures were $146,000 in that first quarter.
A stark difference was evident between ADP’s campaign finances for the last two off-years as well.
The party’s campaign finance report data for all of 2025 reflected income just below $857,000, but expenditures totaling over $2.7 million. In the first quarter of 2025, the party raised only about $210,000 and spent nearly $360,000.
Comparatively, by the end of 2023, ADP had $1.5 million more in income than expenditures. In the first quarter of 2023, ADP raised nearly $1 million and expended about $227,000.
Some among ADP leadership did warn last summer that the party would go broke by the end of the year. The party has dealt with publicized infighting for about a year.
Unlike other transfers listed, shared expenses with the Navajo County Democratic Committee (NCDC) were categorized as an “unlimited transfer” routing arrangement for ADP funds.
NCDC has a surplus of nearly $1.6 million. Since the beginning of last year, NCDC has sent over $61,000 to ADP.
In that same time period ADP sent back over $107,000 to NCDC, or $46,000 more than NCDC has sent. Their cycle to date reported a cash flow between the two totaling nearly $150,000.
Navajo County accounted for ADP’s second-largest expenditure last year.
AZ Free News contacted ADP about the state of their finances and their fiscal arrangement with NCDC. ADP didn’t respond to our inquiry.
Apart from NCDC, ADP’s number-one expenditure last year by far was $1.7 million last August to the Copper State Values PAC, established and run by Gov. Katie Hobbs’ campaign manager Nicole DeMont and treasurer Dacey Montoya. Since DeMont set up the PAC in December 2024, its primary function has appeared to be a funding arm for the Hobbs reelection campaign.
The PAC sent back $94,500 a few months later, last December.
Discounting the $49,000 received from NCDC last year, ADP’s biggest sources of income were:
United Food and Comm Workers (UFCW) Union Local 99, the largest private-sector union in the state: $100,000
Estate of the late Janet Delesanti: $49,000
Arizona Public Service: $30,000
Elevance Health Inc (formerly Anthem), an Ohio-based insurance company: $25,000
Donalyn Mikles, former attorney for the defunct Arizona Summit Law School and director of the California-based Kling Family Foundation: $20,000
Moms Fed Up, a D.C.-based political activist organization: $20,000
William (Bill) Roe, former chair of the Arizona Democratic Party: $15,000
Pam H. Grissom, founder and longtime (not current) board member for Arizona List: $15,000
AFSCME People, AFSCME’s D.C.-based political action arm: $15,000
The following donated about $10,000 each: University of Phoenix, PMI US Corporate Services, Nextera Energy Resources, Arizona Education Association Fund for Public Education, Arizona State Association of Electrical Workers, and Daniel T. Ling.
None of the Democrats’ other legislative districts or county parties in the state have reported a negative cash balance, with the exceptions of Santa Cruz County Central Democratic Committee and La Paz County Democratic Central Committee.
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Since taking office last November, Congresswoman Adelita Grijalva (D-AZ-07) has made it clear that defending illegal aliens in her district against deportation will remain a priority.
Unlike her Republican colleagues, Grijalva treats those considered illegal aliens residing in her district as her constituents. To her, citizenship doesn’t determine who qualifies as an American.
“In my district, families span generations, borders, and cultures — but they are unequivocally American,” said Grijalva.
In my district, families span generations, borders, and cultures—but they are unequivocally American.
A president showing up to the Supreme Court to challenge that isn’t normal.
It’s an attempt to redefine who belongs in this country.
We won't let him.
— Rep. Adelita Grijalva (@Rep_Grijalva) April 1, 2026
In her criticism of President Donald Trump’s promise to prioritize the “worst of the worst” for deportation proceedings, Grijalva has indicated the need for additional justification when deporting those whose only apparent crime was crossing the border and remaining in the country illegally.
Of the approximately 50 press releases Grijalva has issued since taking office, nearly half were issued in defense of illegal aliens and opposition to Immigrations and Customs Enforcement (ICE).
Of her approximately 200 posts on X, nearly one-third were posts in defense of illegal aliens as valid Arizona residents, demanding the abolition of ICE, or opposition to immigration enforcement efforts.
Of her 14 remarks in the congressional record (excluding recognitions and honorings of individuals), three were focused on opposing ICE and stricter immigration enforcement.
Grijalva has made good on her repeated promise to investigate and provide oversight of ICE detention facilities. She has conducted three visits to the Arizona Removal Operations Coordination Center at the Phoenix-Mesa Gateway Airport, Eloy Detention Center in Eloy, and Florence Federal Detention Facility in Florence.
The congresswoman has participated in at least eight protests against ICE and this administration’s immigration enforcement policies.
Last month, Grijalva offered compromise on her refusal to pass DHS funding through her introduction of two amendments. These amendments, not adopted, would have required federal agencies to obtain tribal government approval for immigration enforcement actions on tribal lands, and prohibited the federal government from creating or maintaining lists of individuals protesting at immigration enforcement activities.
The same day, Grijalva demanded the dismantling of ICE.
Secretary Noem ran a department that terrorized our communities, trampled on constitutional rights, and murdered American citizens.
Still, removing Noem does not root out the lawlessness at ICE.
Dismantle ICE.
— Rep. Adelita Grijalva (@Rep_Grijalva) March 5, 2026
Grijalva’s commitment is reflected through her actions, notably the significant volume of her constituent work dedicated to illegal aliens.
The congresswoman has participated in at least three forums in her district addressing ICE activity. One forum that Grijalva co-hosted with Tucson Mayor Regina Romero focused on advising illegal aliens of their rights and best ways to avoid immigration enforcement activity.
Earlier this month, Grijalva and Congresswoman Yassamin Ansari (D-AZ-03) hosted one such forum to brief the community on ICE’s “mass detention centers” in Arizona. Grijalva and Ansari heard testimonies from several illegal aliens and their family members.
In February Grijalva visited and successfully advocated for the release of one Cuban illegal alien seeking asylum, Julia Benitez, who was detained at the Eloy Detention Center.
Then, Grijalva escorted Benitez to the airport. Benitez’s flight was arranged by the Phoenix-based nonprofit Helping With All My Heart (HWAMH).
The nonprofit’s website claims it has operated emergency shelters across the Valley for illegal aliens seeking asylum since 2018. However, tax filings reflect that, up until 2022, HWAMH’s mission statement only reflected work helping the homeless and those with addictions to “find a job and return to society.”
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