Governor Katie Hobbs vetoed a budget bill on Tuesday that the Arizona Legislature sent her to sign into law. The bill included provisions that halted the taxation of tips for servers and others in the service industry, brought retirement tax relief for seniors, full funding for education, support for public safety, and “responsible spending without runaway government growth,” the Arizona House Republicans said on X.
The GOP-controlled legislature’s proposed budget came to $17.9 billion, $800 million less than Hobbs’ proposal. The state has been unable to achieve its expected revenues in recent weeks, raising concerns about overspending.
The Republicans’ budget cut funding for most state agencies by 5%. Budgets for agencies like Child Protective Services, the Department of Public Safety and the Department of Corrections Rehabilitation and Reentry were not cut. It ended tax incentives for renewable energy projects. It requires state employees to contribute 20% to their healthcare plans.
“It’s a hell of a deal,” House Appropriations Chairman David Livingston (R-Peoria) said. “I think most of us would agree that our state employees are not paying their fair share.” Currently, state employees cover roughly 7% of their healthcare costs, according to Republican lawmakers.
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