Last year, Katie Hobbs, by executive order, established a “task force” headed by her Office of “Sustainability” to develop a report on energy affordability and reliability. This month, her task force submitted their plan which would do the opposite of that: make energy more expensive and less reliable. This shouldn’t come as a surprise considering the “task force” called by Hobbs is made up of solar special interests, environmental activists, her own agencies, and utilities that have all committed to going Net Zero anyway.
Instead of reading 81 pages that brings nothing new to the table, the only questions that need to be asked (and answered) about the report are below.
Does it call for new natural gas generation? Not really.
Does it call on utilities to keep our coal plants open? No, they want to shut them down and “repower” them to “clean” energy.
Does it pave the way for new nuclear? Not until the mid-2040s, at the earliest.
What, then, does it advocate doing? Subsize special interests by blanketing state trust land and government buildings with even more solar, wind, and battery storage. The very thing causing utility rates to increase and leading to blackouts…
The Arizona Republican Party is questioning why Attorney General Kris Mayes hasn’t taken action against her fellow Democrat, Gov. Katie Hobbs, over an alleged pay-to-play arrangement.
Mayes is investigating Hobbs over allegations that she awarded a unique rate increase by the Department of Children Services (DCS) to Sunshine Residential Homes, a group home operator, following sizable donations to her gubernatorial campaign and the Arizona Democratic Party. Mayes asked to interview Hobbs this week, but it appears the governor may decline that invitation.
Republican support for Mayes investigating Hobbs has been a whiplash; certain lawmakers and state leaders contended it was best for Mayes to recuse herself given their close party ties.
Hobbs spokesman Christian Slater told the Arizona Republic that Hobbs declined to comment on her decision to sit for an interview. Slater said the lack of evidence proving Hobbs’ knowledge of the rate increase meant there was no proof of her guilt.
Sunshine Residential Homes donated more than $400,000 to Hobbs and the Arizona Democratic Party. After Hobbs took office, DCS awarded the operator a 30% rate increase. Officials say the details of DCS actions surrounding the rate increase were suspicious: no other group homes received rate increases; other group homes’ rate averages fell below Sunshine Residential Homes; and DCS ended state contracts with 16 group homes.
In a new statement released on Wednesday, the Arizona Republican Party called on Mayes to keep up the pressure on Hobbs by putting aside any political favoritism. The party also urged the governor to cooperate with investigators.
The party’s chairman, Sergio Arellano, said Hobbs’ actions were consistent with corruption.
“Governor Hobbs has spent years lecturing Arizonans about ethics while her own administration was allegedly steering millions in taxpayer dollars to a generous donor,” said Arellano. “The fact that her campaign manager was dining with the contractor’s CEO as the deal was finalized only adds to the stench of a pay-to-play scheme that puts special interests ahead of Arizona’s most vulnerable children in state care. Hobbs owes the people of Arizona full transparency and cooperation with this criminal probe, not more stonewalling and self-serving denials.”
The Republican-led Arizona House launched an independent investigation into the pay-to-play allegations earlier this year. They are working with Mayes and Maricopa County Attorney Rachel Mitchell on the investigation; Mayes and Mitchell began investigating nearly two years ago.
The results of the legislature’s investigation will go to the advisory team created in the aftermath of 2024 investigative reporting that outlined the alleged pay-to-play scheme. The advisory team will coordinate the parallel investigations from Mitchell and Mayes to work out a conclusion on the matter.
Hobbs derided the legislative investigation in a statement to The Center Square as the “same old partisan games” by “extremist legislators” spreading misinformation. The governor has repeatedly denied any involvement with the DCS decision.
“I’m looking forward to the conclusion of this investigation which I know will show what reporting has confirmed that I was not involved in the decision and that DCS acted in the best interest of Arizona’s foster children,” said Hobbs in a Tuesday statement.
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On Monday, House Republicans put forth what they called a balanced budget of $17.9 billion.
By Tuesday, Gov. Katie Hobbs said the proposal was all but dead.
The leaders of both chambers characterized their budget as uniquely reflective of total conformity with federal tax law — no other states adopted the entire slate of tax cuts — which Hobbs doubted could be accomplished. They estimated tax relief would amount to $1.5 billion over the next three years, and Republicans claim working families would feel the most benefit from the cuts.
“Politics are easy; governing is harder. We chose governing,” said Sen. President Warren Petersen (R-LD14). “We’re moving a budget that cuts taxes, funds core services, shrinks government, includes priorities both sides have raised, and gives Arizona a full path to finish the session.”
As budget talks have failed to progress in a meaningful way, the legislature stagnates under the weight of a bill moratorium.
In a statement issued Tuesday, Hobbs did acknowledge Republicans for working with her to adopt certain components of her preferred budget like middle class tax cuts and reductions to childcare cost. However, she disputed Republican leaders on their claims of fiscal responsibility.
She accused Republicans of siding with “billionaires, data centers, and special interests” as well as “kicking Arizonans off their healthcare and taking food off their tables.” The governor said she won’t engage in negotiations further unless they adopt her preferred budget.
Contentious aspects of the Republican-proposed budget included cuts to state agency budgets, and SNAP and Medicaid program funding.
“Until they also engage in good-faith negotiations rather than attempting to force through a partisan budget, I will be closely monitoring the situation in the coming days to determine whether the legislative majority is willing to negotiate in good-faith bipartisan negotiations and have the bill moratorium lifted,” said Hobbs.
NEW: @GovernorHobbs reacts to the newly released Republican budget: “Just like in Washington, they’re paying for tax breaks for billionaires, data centers and special interests by kicking Arizonans off their healthcare and taking food off their tables.” pic.twitter.com/8UlFIqa5S1
Hobbs also discussed the budget talks during a press conference for a separate topic on Tuesday, Reentry 2030. Hobbs tentatively praised Republicans for some concessions on their part, but generally was critical of them for balking at her $18.7 billion spending plan. A key part of that plan Hobbs hopes to win through in budget talks concerns draining the public land trust to boost K-12 education funding.
“I’m glad to see the Republicans have shown their budget proposal, there’s some things I’m encouraged about in their proposal, but across-the-board agency cuts is not one of them,” said Hobbs. “I’m hopeful that we can get back to the table and start having real conversations about a budget that works for Arizona.”
Legislative leaders have said Hobbs’ proposal is a nonstarter because the Public Land Trust was intended for long-term funding. Hobbs’ plan intends to renew funding through the yet-approved Proposition 123. Senate President Petersen said Hobbs’ plan wasn’t feasible and would push the state $1.5 million further into debt.
“We’re spending about $800 million less than what the governor has proposed, and the governor has proposed to raise taxes,” said House Speaker Montenegro (R-LD29) in an interview with Fox News.
“[H]er math doesn’t work,” said Petersen.
Hobbs has vetoed tax conformity efforts and walked away from budget negotiations multiple times since the start of the year.
The legislature began hearing budget bills on Tuesday during a joint hearing of the Senate and House Appropriations Committees.
AZ Free News is your #1 source for Arizona news and politics. You can send us news tips using this link.
The housing moratorium crippling new construction in the Valley imposed by Gov. Katie Hobbs’ administration may not go on for much longer.
The Maricopa County Superior Court struck down the moratorium on Tuesday in Home Builders Association of Central Arizona v. Arizona Department of Water Resources, et al.
Under Hobbs, the Arizona Department of Water Resources (ADWR) issued new groundwater regulations rolled out in November 2024 dubbed the “Unmet Demand Rule” and the “Depth-to Water Rule.”
Per the court, these rules went impermissibly beyond the longstanding obligation for builders outlined in Arizona law, which required assurance of sufficient groundwater supply in order for each development to take place (100 years’ worth).
ADWR imposed the rules based on a groundwater model claiming that unmet demand and exceedance of the 1,000-foot depth-to-water limit existed throughout Phoenix. In other words, their regulations meant a developer seeking a certificate for one subdivision had to answer not just for their development area, but for the water status of the entire Valley. This resulted in ADWR’s indefinite suspension on granting certificates to any developers.
The consequence of these regulations brought new home construction to a halt throughout Maricopa County. The Home Builders Association of Central Arizona (HBACA), a trade association for the residential construction and development industry, challenged ADWR’s authority to impose new rules.
ADWR attempted to style the Unmet Demand Rule as a new implementation of an old rule, but the Maricopa Superior Court Judge Scott Blaney rejected that view as an undoing of the necessary limitations of administrative agency powers.
“‘To permit this would neuter all statutory limits on agency rule-making[,]’” stated Blaney in his ruling, quoting HBACA’s argument.
Blaney also found that ADWR didn’t follow state law on agency rulemaking under the Administrative Procedures Act. Blaney invalidated both rules.
“ADWR acted unlawfully by implementing two agency rules without first complying with the mandatory provisions of the APA[,]” wrote Blaney.
The Arizona Free Enterprise Club (AFEC) called the court ruling a win and criticized ADWR’s model justifying the overturned regulations as flawed.
“The Maricopa County Superior Court has struck down the Hobbs Administration’s attempt to impose a sweeping housing moratorium based on its flawed water model — a stinging loss for Katie Hobbs and a ruling that the state failed to follow proper legal procedures,” stated AFEC. “This is a major victory for transparency, accountability, and Arizona homeowners.”
🚨BREAKING🚨: The Maricopa County Superior Court has struck down the Hobbs Administration’s attempt to impose a sweeping housing moratorium based on its FLAWED water model—a STINGING LOSS for Katie Hobbs and a ruling that the state failed to follow proper legal procedures.
Jonathan Riches, vice president for litigation and general counsel for the Goldwater Institute, represented the Home Builders Association of Central Arizona. Goldwater Institute’s vice president for legal affairs, Timothy Sandefur, hailed the ruling as a necessary check on an administrative state attempting to impose greater burdens than that which the law requires.
“The case is also a reminder of the dangerous power that the pervasive ‘administrative state’ wields over our daily lives — as unelected and unaccountable bureaucracies exert authority over every detail of construction, business, and property ownership, to cite just a few examples,” said Sandefur. “The only solution to the arbitrariness and lawlessness of these agencies is to rein in their power — and for courts to ensure that they obey the law.”
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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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