Arizona faces historic shutdown as House passes doomed continuation budget

By Jerod MacDonald-Evoy, Arizona Mirror. Originally published June 24, 2025. Read the original.

Republicans in the Arizona House of Representatives passed a continuation budget that Gov. Katie Hobbs has promised to veto, setting the stage for a government shutdown next week as Republicans continue to battle each other over the state’s checkbook.

The current fiscal year ends on June 30, and lawmakers have until then to approve a spending plan to ensure state agencies can keep their doors open. But Republicans in the House have been feuding with the GOP Senate majority over how to allocate the state’s money.

The state Senate struck a $17.6 billion deal with Gov. Katie Hobbs after House Republicans abandoned negotiations. That spending plan was panned by House GOP leaders, who decided instead to pass their own budget chock-full of conservative spending and policy priorities.

But Hobbs promised it would be “dead on arrival,” and negotiations resumed. The result as the Senate amending its budget to include a number of House Republican priorities, but the tentative deal to get the House on board ultimately fell apart. So, the Senate passed its bipartisan budget and moved to end the annual legislative session, leading the House to shift its strategy to extending the window for hammering out a deal.

They want to do that by passing a “continuation budget” that would ensure state government won’t shut down on July 1 if a full-year spending plan isn’t in place. On Tuesday, House Republicans approved that budget along party lines, saying it is the only way to allow for further negotiations between the two chambers and the executive. Hobbs has already dismissed the idea and promised to veto it.

When asked Tuesday night about the House passing the continuation budget, a spokesperson for the Governor’s office said her previous statement still stands.

The Senate is set to reconvene on Wednesday, and Senate President Warren Petersen said his chamber would take up the continuation budget. He said he expects it will pass and be sent to Hobbs for her to veto.

“Out of respect to our colleagues in the House, we will pass out the budget they send over,” Petersen said in a text to the Mirror. “Trying to respect the wishes of the House, not waste my members’ time and put something together that can get 16, 31 and 1 requires unbelievable dexterity, patience and diplomacy in the face of divided government.”

‘Rangers won’t respond’

The House’s short-term budget were flew through the House Appropriations Committee earlier Tuesday, where Democratic legislators and lobbyists voiced their concerns about the lack of funding the House budget has versus the Senate budget.

“Currently, I don’t know what will happen with this ‘skinny’ budget,” Jeff Hawkins, president of the Arizona State Troopers Association, told the committee. He noted that funding for repairs for the Arizona Department of Public Safety’s fleet of aircraft would not be included in the House budget, meaning the aircraft would likely be grounded. “If you have an emergency and need rescue, don’t call DPS. Rangers won’t respond.”

DPS has been lobbying lawmakers for an increase in funding due to retention issues and many of its substations needing updates in the more rural areas of the state. The continuation budget does not include any new funding for DPS.

House Appropriations Chairman David Livingston said he would push for a special session to address the concerns brought up by Hawkins and others if the continuation budget is passed.

“I apologize, I cannot do any of those today,” Livingston told Hawkins.

The state has never endured a government shutdown before, unlike at the federal level where they have happened multiple times under various administrations.

Tensions boil over

It wasn’t until late Tuesday evening that lawmakers eventually voted on the continuation budget, with Democratic members decrying the process and Republican lawmakers calling it a “fiscally responsible” budget.

“To the people of the State of Arizona, I’m sorry,” Minority Leader Oscar De Los Santos said. “There is zero percent chance this gets signed into law. Zero — this is a waste of time.”

De Los Santos urged the House to instead vote on the bipartisan Senate budget, which includes a number of Democratic and Republican priorities such as pay raises for DPS and increased childcare funding.

“We were elected to be the adults in the room…this is a political partisan tantrum that is going nowhere,” De Los Santos said. “Any government shutdown is 100% the fault of House Republicans. Period. Full stop.”

Republican lawmakers shot back saying that the short-term budget is fiscally responsible and will help keep the state from falling into economic troubles like the state did in the early 2000s.

“This continuation budget is one of the simplest budgets that this body has ever passed,” Livingston said. “Sometimes, people just can’t wrap their head around simple.”

Some Republicans, while supportive of the “conservative nature” of the plan to hold spending steady, decried the process and drew up conspiracies.

“The purpose of this bill is to go over to the Senate to be voted out of the Senate and be vetoed by Katie Hobbs at the eleventh hour so that the Senate and others involved can wash their hands of the Senate-Hobbs budget,” Rep. Alex Kolodin, R-Scottsdale, said. “That is the game that is being played here, my folks.”

Kolodin claimed that the continuation budget is being used as a way for the Senate bill to be pushed through, adding that it gives Hobbs and Democrats “the state in 2026.”

“Anyone who works to put that Senate budget on the board and send it up to Katie Hobbs will be the enemy of the people of Arizona,” Kolodin said during a fiery vote explanation that ultimately led to Speaker Steve Montenegro cutting off his microphone.

Kolodin wasn’t the only one who had his microphone cut.

Montenegro turned off De Los Santos’ microphone after he made remarks about Republican lawmakers leaving the Capitol for vacations and weddings. One of the architects of the previous House budget, Rep. Matt Gress, R-Phoenix, flew to Italy over the weekend for his wedding to political consultant Daniel Scarpinato.

“We do not indulge in personalities,” Montenegro said after cutting off their microphones.

During his explanation of his vote on the budget continuation Tuesday, Montenegro said that it is about allowing “serious deliberations” to continue and said that no lawmaker wants a government shutdown to occur.

The Arizona Senate will take up the continuation budget Wednesday.

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