Arizona Republican leaders said on March 20 that Governor Katie Hobbs left ongoing budget negotiations, raising concerns about her proposal to increase withdrawals from the Arizona Public Land Trust. The trust is a voter-protected fund intended to support K-12 education in the state.
The dispute centers on Hobbs’s plan to raise distributions from the trust to 10.9 percent for the next 20 years, compared to a previous rate of 6.9 percent over ten years. Republican lawmakers said this approach would reduce the trust from about $9.7 billion to $4.7 billion over two decades and threaten future funding for schools. “This is not a solution. It is a long-term raid on a critical resource,” they said in their statement.
Republicans also criticized assumptions in Hobbs’s proposal, saying it relies on sustained high investment returns without economic downturns while increasing withdrawals beyond historical levels. They argued that the broader budget plan includes $1.5 billion in new debt, higher taxes and fees, and questionable revenue projections, which they say does not result in a balanced budget.
“We have shown the Governor’s Office a balanced budget with tax conformity,” Republican leaders said. “We’ve put forward a responsible plan that cuts taxes for working families and funds schools without gimmicks.” They added that if Hobbs vetoes their proposed budget, it could mean continued uncertainty for families, schools, and the economy.
Michael Carbone, who was elected as a Republican representative to Arizona’s State House in 2023 for District 25 after replacing Michelle Udall, is among those voicing opposition to Hobbs’s proposals according to Ballotpedia.
Republican lawmakers concluded by stating their intention to work toward what they describe as an honest and sustainable budget: “In the next several weeks, we will work to build a responsible, balanced budget that cuts taxes for Arizona families, funds our schools, keeps government operating, and protects the long-term stability of our state.”
