Triadvocates Navigator (June 13, 2026)

June 13,2026 | TRIADVOCATES LLC





June 13, 2026

Just before sunrise today, Arizona lawmakers adjourned for the year after a marathon of rapid-fire votes. Having just passed the $18.3 billion bipartisan budget on Thursday night (more on that below), most lawmakers arrived at the Capitol yesterday morning expecting to tie up loose ends on remaining bills before closing up shop for the year. But that’s not how things unfolded. Rather, last-minute dealmaking and a Hail Mary attempt to put guardrails on the state’s private school voucher program made for a long night of extremely contentious debate.

To fully appreciate the frantic events in the final hours of session, it must be acknowledged that the Empowerment Scholarship Account (ESA) program is widely considered the top priority for both sides of the aisle—Republicans want to protect school choice at all costs and consider it one of the party’s greatest accomplishments, while Democrats are demanding reform for a billion-dollar program they say is fraught with fraud, waste and abuse. Mid-morning yesterday, rumors began circulating that GOP leaders were nearing a deal with the state’s largest teachers’ union to put modest guardrails on the program (i.e., more stringent review of expenses, prohibitions on luxury spending, and a cap on the amount families can roll over for students with disabilities). Why would they do that, you ask? Because in exchange for putting those restrictions in place, the teachers’ union would have agreed to cease gathering signatures to place their own, much more restrictive measure on the ballot. Their initiative, according to some Republicans, would essentially unravel the ESA program we see today. Okay, but what was in it for the teachers’ union if early polling shows Arizona voters are supportive of the tougher ESA restrictions they intend to put on the ballot? Well, as part of the deal, Republican leaders also would have agreed to nix a separate ballot referral that would effectively ban teachers’ unions from using any school resources and would prohibit them from deducting union dues from an employee's paycheck. Alas, the puzzle pieces start to fit.

However, the house of cards collapsed around 8 p.m. when GOP Senator Jake Hoffman sided with Democrats (who deemed the proposal too weak) to kill the bill on the floor. Republicans then shifted to an alternative, retaliatory plan, unveiling HCR 2048 (the “Military Families College Savings and Scholarship Protection Act”). Embedded in the language is a clause that Democrats say would effectively bar any reforms to the ESA school voucher system—including, say, the one pushed by the teachers’ union expected to appear on the ballot in November. That bill passed along party lines and, because resolutions only require approval from both chambers, it bypasses the Governor to be placed on the ballot for voter consideration. In a divided government, the resolutions are really the only tactic Republicans have to get measures through that would otherwise be met with a veto from Governor Hobbs. As a result, Arizonans will be asked to consider at least 10 statewide ballot measures. This plan, however, does not come without its risks, as these initiatives, if passed, are virtually etched into stone. More on that below.



But first, let's talk budget.

 

 

FY 2027 Budget

With three weeks to go until the new fiscal year, lawmakers passed an $18.3 billion bipartisan budget package on Thursday evening. Governor Hobbs signed it late this afternoon.

What got off to a rocky start in budget negotiations between Republican leadership and the Governor earlier this year came in for a relatively smooth landing when the state saw an unexpected influx of money thanks to high capital gains. Here are the highlights:



Tax Conformity

  • The budget incorporates full federal tax conformity, making Arizona the only state to do so. Tax cuts to the tune of $1.45 billion over four years include deductions on tips and overtime, a higher standard deduction, a deduction for childcare expenses, and a new $6,000 deduction for seniors.
  • Notably, the agreement to comply with all federal changes means Arizonans will be spared from the frustration of having to refile their taxes this year.



HR 1 Implementation

  • $61 million to assist with HR 1 implementation to fight fraud, waste and abuse and ensure Arizonans can access Medicaid and SNAP benefits
    • This includes funding for 7 new positions at AHCCCS focused solely on high-tech investigations and cost avoidance
    • This also includes $20 million for 163 new full-time employees at AHCCCS and the Department of Economic Security to help administer the programs; as a result, healthcare coverage was preserved for 40,000 Arizonans enrolled in AHCCCS
  • Included in the budget deal are heightened eligibility checks for those who rely on SNAP and Medicaid per HR 1 requirements to reduce error rates (i.e., overpayment or underpayment) for these programs


Agency Cuts

The budget includes a 2.5% across-the-board cut to most state agencies, with some exceptions, including the Department of Economic Security, the Arizona State Schools for the Deaf and Blind, Arizona Department of Public Safety, and the Arizona Department of Corrections, Rehabilitation & Reentry. For reference, the Republican spending package initially proposed a 5% cut to all agencies.



Education

  • $37 million to continue a public education budget mechanism referred to as "opportunity weight" that boosts funding for low-income schools
  • $2 million to continue a program that eliminates co-pays for students who qualify for reduced price school lunches
  • The budget deal does not include plans to renew Proposition 123, an education funding measure that expired last year. Approved by voters back in 2016, it has been the subject of ongoing partisan conflict—Democrats want a clean ballot referral simply renewing the now-expired funding measure, while Republicans have advocated to include other priorities, which would then be constitutionally protected, if passed by voters.


Border Security

  • $2 million to combat drug cartels through Operation Desert Guardian
  • $13.2 million is to help local border enforcement stop drug trafficking


Data Centers

  • The bipartisan state budget plan puts a three-year moratorium on new tax breaks for data centers. The moratorium does not apply to existing data centers or ones that have already been approved as of June 30, 2026.


Public Infrastructure

  • The budget also includes language designed to preserve and extend a program to support local municipalities who are making substantial investments to support massive manufacturing investments in their communities, including Chandler, Queen Creek, Peoria and Phoenix. Failure to amend that statute would have cut off the availability of funding that was being redirected from sales taxes generated by mega projects in those communities. 


Other notable spending:

  • $112 million for corrections operations, including a 4% correctional officer stipend
  • $58 million for child safety operations, including foster care coaching and guardian contract costs
  • $45 million for childcare assistance
  • $25.5 million for county support programs, probation services, reentry efforts and sheriff’s assistance
  • $10 million for wildfire suppression efforts
  • $10 million for emergency relief funding for Gila County after historic flooding last fall
  • $6 million for the Colorado River Litigation Fund
  • $4.3 million to help rural hospitals
 

Forever? Forever, ever?

Arizonans will be asked to consider at least 10 statewide ballot measures in November. If passed, they'll be nearly impossible to amend. Here's why: In 1998, Arizona voters passed the Voter Protection Act (VPA) to ensure the state Legislature could not easily overturn future voter-passed initiatives. Technically, the VPA is an amendment to the state constitution that prohibits legislators from altering, redeveloping, or repealing ballot initiatives. Thus, the only way the state Legislature can amend a voter-created initiative is if it “furthers the purpose” of the initial measure. After that, the amendment must receive a three-fourths vote in the House and Senate. Only if it passes both criteria can the state Legislature alter a ballot initiative, meaning it’s almost impossible—even if there are unintended consequences or technical changes that need to be addressed down the line.

This adds even more weight to the flurry of contentious late-night votes that will put Republican initiatives on the ballot. Here’s a quick rundown of those that passed last night:

  • HCR 2001 - citizenship; identification; contributions; early voting (Constitutional Amendment): Requires that only U.S. citizens may register and vote in Arizona elections and prohibits foreign nationals from making contributions or expenditures to influence Arizona elections. The measure also requires voters to present government‑issued identification when casting a ballot, with acceptable identification provided to qualified electors at the state’s expense. It further revises election administration by ending early voting at/moving the deadline for mail-in ballots from Election Day to 7:00 p.m. the Friday before Election Day (while allowing mailed early ballots to be delivered by the voter until polls close), limiting post‑closing voting to people already in line, and allowing mail‑in ballots only if a voter affirmatively requests one before each biennial general election, confirms a mailing address, and provided documented proof of citizenship when registering. Critics of the initiative believe this could threaten mail-in voting, which roughly 75% of Arizonans use to cast their ballot.

  • HCR 2003 - interscholastic; intramural athletics; biological sex (Statutory Ballot Referral): Requires school and interscholastic or intramural athletic associations, beginning January 1, 2027, to designate athletic teams by sex defined as the biological sex recorded on an individual’s original birth certificate and bars athletes of the male sex from participating on teams designated for females. The provisions expand coverage from students to all “athletes,” apply compliance and liability rules to athletic associations as well as schools, and permit participation only on teams aligned with an athlete’s sex or on coeducational or mixed teams. The changes also restrict use of athletic-related restrooms, locker rooms, showers, and similar private spaces to those designated for an individual’s sex and expand enforcement and private causes of action against schools or athletic associations.

  • HCR 2007 - instructional expenses; operational spending enforcement (Statutory Ballot Referral): Requires certain school districts to devote at least 60% of operational spending to direct instructional expenses. Districts with at least 7,500 students or operating in a county with a population of 500,000 or more that fall below the threshold must increase their instructional spending share by at least 0.5 percentage points annually beginning in fiscal year 2027–2028, with provisions allowing limited banking of excess increases and restricting credit after reductions. Enforcement is tied to escalating reductions in Classroom Site Fund allocations for continued noncompliance, with limited one‑year waivers authorized and definitions of key spending terms assigned to the Auditor General.

  • HCR 2044 - preferential treatment; discrimination; prohibited acts (Constitutional Amendment): Expands the state’s ban on race‑ or sex‑based discrimination or preferential treatment in public employment, education, and contracting by adding new limits on certain diversity, equity, and inclusion–related requirements and activities. The section prohibits compelling applicants, employees, students, or contractors to endorse race‑based preferential treatment or related ideological statements as a condition of admissions, hiring, promotion, or contracting, and bars public higher education institutions from using public funds for offices, programs, or trainings that promote race‑based preferential treatment or influence participation based on race or similar characteristics. It also prohibits race‑based disciplinary practices, narrows the federal‑program exception to certain outreach or communications, and establishes several exceptions for academic instruction and research, student organization activities, health services, compliance trainings, tribal‑membership programs, and other specified activities.

  • HCR 2048 - military families; scholarship accounts (Constitutional Amendment): Subject to voter approval, constitutionally prohibits the state from confiscating monies from any scholarship account of a student who is a child of a military family if outlined conditions are met. Stipulates that, if a law or measure approved by the voters on or after November 1, 2026, violates the prohibition, the entire law or measure is void. Designates this resolution as the Military Families College Savings and Scholarship Protection Act. If a bill enacted into law or a measure approved by the voters on or after November 1, 2026 violates subsection a of this section, the entire bill or measure is void. A court may not sever any portion of a bill or measure that violates subsection a of this section.

  • HCR 2040 - school districts; labor organizations; resources (Constitutional Amendment): School districts are prohibited from using public money, resources, or systems to support labor organizations or their activities. The changes bar payroll deduction of union dues, prohibit use of district communication systems, facilities, paid leave, or other public resources for union recruitment, political materials, or other labor‑organization business during working hours, and prevent employees from distributing union communications if doing so uses public resources. The section also defines key terms and provides that these restrictions override conflicting contracts, agreements, or policies.



Campaigns seeking to place measures on the November ballot through the state's citizen initiative process must collect valid voter signatures by July 2, 2026. The following citizen initiative is expected to qualify:

  • PROTECT EDUCATION ACT (Statutory Ballot Initiative): The proposed Protect Education Act would significantly reform Arizona’s Empowerment Scholarship Account (ESA) program by adding a $150,000 household income cap for most participants, while preserving eligibility for students with disabilities, military families, and certain other groups. It would require greater accountability and transparency by mandating background checks for ESA-funded educators and service providers, academic oversight, and restrictions on non-educational or luxury purchases. The measure would also direct unused ESA funds back to public schools and impose additional reporting and testing requirements on participating schools and providers. Supporters argue it reins in costs and prevents misuse of taxpayer dollars, while opponents contend it would roll back school choice and limit educational options for families.


Once we clear the July 2 deadline, we will put together an overview of all initiatives Arizonans can expect to see on the ballot in November.

 

Agency Director Confirmations

Just hours before adjournment, two more of the Governor’s agency director nominees were confirmed by the Senate following Thursday's confirmation hearings.

  • Chuck Bassett has been confirmed as Director of the Arizona Department of Insurance and Financial Institutions (DIFI). A veteran public policy attorney with more than 30 years of experience, Bassett began his career in the Arizona House of Representatives as Rules Attorney. He joins DIFI following a long tenure at Blue Cross Blue Shield of Arizona (BCBSAZ), where he served as Vice President of Government Relations and Public Policy since 2004.
  • Debbie Johnston has been confirmed as Director of the Arizona Department of Health Services (ADHS). Johnston spent more than 20 years with the Arizona Hospital and Healthcare Association (AzHHA), having most recently served as executive vice president. She began her career in the Arizona State Senate as a Research Analyst and later served as Research Staff Director. Hobbs’ previous two ADHS nominees, Dr. Theresa Cullen and Jennie Cunico, were rejected by Senate Republicans for their views on and actions during the COVID-19 pandemic.


While a total of 18 nominees have now successfully passed the Senate Director Nominations (DINO) Committee and full chamber, Hobbs still faces ongoing confirmation battles as the leaders of several other major state agencies remain unconfirmed, including AHCCCS (Arizona’s state Medicaid agency).

 

Now that session has officially ended, we know the effective date for legislation passed this session will be September 12, 2026, unless otherwise specified. 



And, with that, we are adjourned.

 

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