by Matthew Holloway | Apr 7, 2025 | News
By Matthew Holloway |
In an exclusive interview with AZ Free News, Speaker of the Arizona House of Representatives Steve Montenegro revealed that Republican legislative leaders had been warning Governor Hobbs of her potential budgetary failure as far back as January. He further revealed that a notice from the Hobbs administration was only sent to House leaders two weeks prior to the funding crisis deadline and was sent to an incorrect email address.
Montenegro called out Hobbs for her administration’s “incompetence,” and explained the purpose of the House Ad Hoc Committee on Executive Budget Mismanagement, which met for the first time last week.
Montenegro explained, “The purpose of the ad hoc was literally on executive budget mismanagement and the failures that the Governor has demonstrated from the start. I mean at some point we understand that there are shifting numbers. There’s sometimes you budget for a certain amount of caseload or you budget for a certain amount of students or you budget for a certain amount of individuals that are going to have need of services in the state and that can fluctuate a little.
“We’ve seen that throughout the year it fluctuates. But the mismanagement that’s coming from this Governor’s office is startling—to see that they’re not factoring certain budgeting items in, completely ignoring it from start.
“In January, we pointed out there were failures in her proposal failing to include certain budget items. But now we’re seeing that in, specifically this latest debacle where we get an email sent to the wrong place and when we finally are able to see the email, there’s less than two weeks left before the Congregate Care program goes bankrupt. Then, the letter that she emailed states almost as a demand, ‘If this happens, kids will be sleeping in offices.’
“It’s almost as if there’s, first of all, no care, and second, no understanding that she should have let us know early on specifics on where we would need supplementals. So asking the question, is this a level mal-intent or incompetence?
“This is sheer incompetence in mismanagement of budgets, not understanding how to manage a budget, and when you’re talking about kids and the most vulnerable individuals in the state, it’s gross incompetence. Arizonans deserve better.”
Asked about the possible perception of the Ad Hoc Committee as having a political intent, Montenegro answered bluntly, “There are no games here. I haven’t even sat to consider politics in this subject. When we receive a letter, when our team receives a letter that kids are going to be sleeping in offices, there’s a certain level of indignation that I can’t ignore, especially when you’re saying kids will be sleeping in offices. And then we find out that the reasoning is because we can’t manage a budget.“
When asked about the potential intent of the Governor, Montenegro was equally direct:
“When we’re talking about kids here, I don’t care about the politics. What we do care about is making sure that these kids are taken care of and holding this Governor accountable because it’s gotten to a point now that we can’t ignore it. We genuinely can’t ignore the fact that we’ve got kids that are gonna be affected.
“We’ve got a Governor that decided to raise rates on the same program earlier this year. We know there’s an ongoing investigation, so we’re not gonna get in the middle of the investigation by Kris Mayes or Rachel Mitchell, County Attorney, or even others higher.
“But we want to find out, we want to get to the bottom of the budget mismanagement so that as we proceed forward in how we make sure these kids are taken care of and these vulnerable communities are taken care of, that from the legislature’s perspective, we’re putting safeguards and ending up some reforms that don’t allow the Governor’s incompetence to hurt these kids.”
Asked what recourse the House will have against a recalcitrant Governor, Montenegro answered, “Well, to start, that is why we’ve had our Appropriations Committee from the beginning asking the questions. Right now, the Governor refuses to give us access to her staff, to her policy advisors, to the people that know the numbers in these agencies. She refuses to make them accessible for us to talk to them, to understand where these numbers are.
“So what we’re doing is, we’re going to turn up the heat on holding her accountable. The Ad Hoc committee is formed to say, ‘Look, for weeks, we’ve been asking for your staff to sit down with our policy advisors on the numbers, on finding out where things are.’
“We get a letter two weeks out. We have been asking for weeks to sit down with them for numbers, to understand where these are. So, the whole purpose of this is now to take a deep dive in understanding where these numbers are so that Republicans can execute our plan. We are going to make sure that she’s using funds from her executive budget to fulfill these needs. And we’re going to make sure that, as we start stepping into the budget, we have the right reforms and we have the right safeguards for these kids.”
Referring back to the work of the Joint Legislative Budget Committee, he added, “If you go back and see the JLBC committee hearing that we had, that’s a preview of what we expect to happen with this Ad Hoc Committee on Executive Budget Mismanagement that I put together.
“Because by forcing them to come to talk to us, to finally get somebody to speak, which I’ve told you before, she’s been preventing her staff from coming to speak with our staff about numbers. But by her folks having to come to the committee, we’ve learned a lot, specifically, by learning how they’re mismanaging DCS. We’ve learned a lot, and the goal is through the Ad Hoc to expose the rest of what’s happening in other areas of either DCS, or DDD, or in general DHS on the mismanagement.“
Matthew Holloway is a senior reporter for AZ Free News. Follow him on X for his latest stories, or email tips to Matthew@azfreenews.com.
by Matthew Holloway | Apr 1, 2025 | Economy, News
By Matthew Holloway |
Arizona State Senator JD Mesnard (R-LD13) is looking to reduce the size of government and the state income tax burden on Arizonans with dual bills: SB1318 and SCR1014. Both bills, which are moving through the House after passing the Senate in February, would require the Arizona Department of Revenue (ADOR) to reduce the individual income tax rate by 50% of the structural surplus for each Taxable Year (TY). If SB1318 passes the legisalture and is vetoed by Democrat Governor Katie Hobbs, SCR104 would put the issue on the Arizona ballot.
Both bills would require the Joint Legislative Budget Committee (JLBC) to determine the surplus for each Fiscal Year (FY), which would then be used to pro-actively reduce the income tax rate by 50% of the surplus amount, passing the tax savings onto the taxpayer more immediately than the issuance of a tax dividend.
Mesnard has a history of pursuing tax cuts. He was one of the lawmakers responsible for the historic 2021 tax reform that brought a flat income tax rate of 2.5% to individual taxpayers in Arizona. He also authored SB1783 the same year which lowered taxes on small businesses.
As reported by the AZ Capitol Times, Democrat Gov. Katie Hobbs expressed her opposition to SB1318, however should she veto it, the legislature would send SCR1014 to the Secretary of State, who would submit this proposition to the voters at the next election. Comparing the bill to the 1992 ‘TABOR’ or the Taxpayers Bill of Rights instituted by Colorado, Hobbs said, “I’m not interested in tying our hands like that. No. Not like TABOR. No. That’s not tax relief. That is tying the hands of future administrations.”
During hearings in February, Mesnard explained, “This is a proposal to essentially strike a balance. When you have a surplus, let’s split it between giving money to taxpayers and the other half allocating towards whatever you want.”
Democrat Sen. Brian Fernandez described the bill as an effort to “handcuff us so we can’t make decisions during a budget (negotiation).”
Mesnard responded, “So, ‘handcuff’; is an interesting choice of words. We can put parameters on ourselves. The voters put parameters on increasing taxes back in the 90s and also, more recently, when they’re on the ballot.”
Matthew Holloway is a senior reporter for AZ Free News. Follow him on X for his latest stories, or email tips to Matthew@azfreenews.com.
by Jonathan Eberle | Mar 24, 2025 | News
By Jonathan Eberle |
The Joint Legislative Budget Committee (JLBC), led by Representative David Livingston (R-28), convened on Thursday to address what it described as a financial mismanagement crisis within Governor Katie Hobbs’ administration. The focus of the meeting was the Department of Child Safety’s (DCS) Congregate Care program, which is reportedly facing imminent financial collapse.
The JLBC directed DCS to use existing funds within its budget to maintain services for vulnerable children without seeking additional taxpayer dollars. According to Chairman Livingston, Governor Hobbs’ approach to budgeting has resulted in repeated financial emergencies.
“Governor Hobbs’s repeated failures to manage the budget responsibly have pushed agencies into crisis after crisis. Her administration’s approach is to overspend, ignore reality, and then demand a last-minute bailout. That’s not leadership—that’s recklessness,” Livingston stated.
Republican legislators accused the Governor’s team of failing to disclose available federal funds that could have been used to stabilize the Congregate Care program. Instead, they said that those funds were redirected to a separate Kinship Support Services initiative that had not previously received state funding.
“That decision by the Governor is stunning,” Livingston said. “Instead of prioritizing the program on the brink of insolvency, she chose to send federal dollars elsewhere. This raises serious questions about her administration’s priorities and decision-making.”
Beyond the immediate concerns with DCS, lawmakers also raised alarms about the Developmental Disabilities (DDD) program, which they claim is on track to run out of funds by April. Speaker of the House Steve Montenegro announced the formation of a House Ad Hoc Committee on Executive Budget Mismanagement to investigate what Republicans see as a pattern of fiscal irresponsibility under Governor Hobbs’ administration.
“We care deeply about the children in DCS’ care. That’s why we acted quickly today,” Livingston stated. “The Legislature will not reward fiscal irresponsibility by throwing more taxpayer dollars at a crisis of the Governor’s making. Moving forward, the Governor must be more transparent and accountable about her agency budgets.”
The coming weeks will likely see further debate as lawmakers seek answers regarding the state’s financial outlook and agency funding priorities.
Jonathan Eberle is a reporter for AZ Free News. You can send him news tips using this link.
by Matthew Holloway | Aug 28, 2024 | Economy, Education, News
By Matthew Holloway |
The 2024 report from the Joint Legislative Budget Committee could potentially silence opponents of Arizona’s Empowerment Scholarship Account (ESA) Program once and for all. This week, Superintendent of Public Instruction Tom Horne called the myth that the ESA program was ever a threat to the budget: “utterly demolished.”
In a press release from the Arizona Department of Education, Horne explained that for Fiscal Year 2024, which concluded on June 30th, the Basic State Aid payments for education programs at district and charter schools and the controversial ESA program all finished well under budget with a net savings to the state of $4.3 million. The news comes just days after the Goldwater Institute debunked the narrative that the ESA program harmed students and blew up the state budget as previously reported by AZ Free News.
Horne said in the press release, “Having a surplus of more than $4 million is proof positive that the critics who have claimed the ESA program will bust the not only the state’s education budget but the entire budget itself were always wrong. It was always a myth, and that myth is utterly demolished.”
The report revealed that out of $6,309,352,100 appropriated toward education funding, even with the ESA, the state only spent $6,305,050,851.55 leaving behind a $4,301,248.45 surplus.
Horne, who was previously State Superintendent of Schools from 2003 to 2011 before being elected State Attorney General, continued:
“Budget figures are stubborn facts and they do not stand up to the political posturing that ESA critics have consistently and wrongly thrown at the program. The universal ESA scholarships are a vital part of making sure that parents are able to choose the schools that best fit the needs of their children. For example, we have families with three children. Two are doing fine in the neighborhood public school, but the needs of the third are not being met. ESAs enable the parents to find a school that meets the needs of the third child. How can anyone be so immersed in ideology that they would deny the parents that ability?”
He concluded, “Having choices such as charter schools, open enrollment for district schools and ESAs are a valuable tool for Arizona parents. As today’s announcement shows, these choices do not result in any part of the budget deficit. It resulted from overly optimistic projections of state revenues. ESAs are enabling parents to find the best schools to meet their children’s needs. No rational person should oppose that.”
The revelation from the JLBC report could severely undermine the political arguments of Democrats running against the state’s ESA program in November such as Democrat John McLean who is seeking to gain a State Senate seat in Arizona Legislative District 17. McLean is challenging Republican Vince Leach.
In a statement to AZ Free News in early August, Leach warned, “John McLean is going to have to defend the actions of the Democrat party both at the state level and the national level. He owns the damage to the state of Arizona by Governor Katie Hobbs, and also the radical policies that President Joe Biden and Vice President Kamala Harris are inflicting on our country. If voters elect McLean to office, that will help the Democrats take over the state legislature, which means that taxes will increase, school choice will disappear, and commonsense election laws will be reversed.”
Matthew Holloway is a senior reporter for AZ Free News. Follow him on X for his latest stories, or email tips to Matthew@azfreenews.com.
by Corinne Murdock | Mar 4, 2024 | Economy, News
By Corinne Murdock |
There were over 800 illegal immigrant children released to sponsors in Arizona in the last fiscal year, which would result in an estimated cost of over $10 million to educate them.
This estimate comes from Joint Legislative Budget Committee (JLBC) data, in which average per-pupil spending in 2022 derived from state, local, and federal funding, adjusted for inflation, was over $11,700. The Office of Refugee Resettlement (ORR) reported that there were 861 unaccompanied children released to sponsors in the 2023 fiscal year, which runs from October 2022 to September 2023. Altogether, that amounts to over $10 million.
Per the latest immigration data, another 368 unaccompanied children were released to sponsors from last October to December. JLBC estimated per-pupil spending last year, adjusted for inflation, to sit at about $12,000, and spending in 2024 to sit at about $11,700.
Since the 2021 fiscal year, there have been over 2,600 illegal immigrant children released to sponsors. That’s about 1,000 more in four years than the entire total for the six years spanning the 2015 fiscal year to the 2020 fiscal year (just over 1,700).
Under 2022 costs, that amounts to over $28.6 million. The estimated 2023 costs, adjusted for inflation, amounts to over $31.2 million, with a return to about $28.6 million under 2024 estimated costs.
Nationwide, there were about 113,500 illegal immigrant children released to sponsors in the last fiscal year. That’s a decline from the 2022 fiscal year, about 127,500, but remains a significant increase from all other years prior.
In the first four months of this fiscal year, there have been about 46,300 unaccompanied minors encountered along the southwest border. Border encounter data reveals that there have been over 468,180 unaccompanied minors since President Joe Biden took office.
Encounter totals for accompanied minors register far lower. There have been just over 500 encounters of accompanied minors in the first four months of this fiscal year, and over 7,800 in total since Biden took office.
These latest estimates are just a portion of total migrant children in the education system, and consist of only those reported. In 2022, there were over 90,000 students characterized as English Language Learners (ELLs) in Arizona. Using 2022 education costs, that amounts to over $1 billion.
Corinne Murdock is a reporter for AZ Free News. Follow her latest on Twitter, or email tips to corinne@azfreenews.com.
