Arizona faces possible government shutdown due to Republican budget rift

PHOENIX – A disagreement among Arizona Republicans over the 2025-26 budget could result in a state government shutdown next week.

Last week, the Republican-led Senate passed a bipartisan spending plan that apparently has the support of Democratic Gov. Katie Hobbs.

However, Republican House leadership indicated over the weekend the $17.6 billion state budget package doesn’t have enough votes to pass through its chamber.

Meanwhile, the state-mandated deadline to pass a budget for the next fiscal year is next Monday (June 30).

House speaker floats temporary plan to avoid government shutdown

House Speaker Steve Montenegro proposed a continuation budget so negotiations can continue without a government shutdown.

“The House is not going to be forced into a take-it-or-leave-it deal that doesn’t reflect the will of our members or the people we represent. We will do what responsible legislators should do: take action to keep government running and protect Arizona taxpayers,” Montenegro said in a statement Saturday.

But Hobbs alleged that House leaders “abdicated their responsibility” during the negotiation process.

I've worked with bipartisan legislators to negotiate a balanced and fiscally responsible budget.

Instead of meaningfully participating in those conversations, House Republicans are attempting to jam through an irresponsible and partisan budget. My full statement is here: pic.twitter.com/2ylvwONTTf

— Governor Katie Hobbs (@GovernorHobbs) June 21, 2025

“I remain committed to having conversations about improving our bipartisan budget, but let me be clear: Any kind of partisan ‘continuation budget’ will immediately meet my veto pen, if it even has the votes to reach my desk,” she said in a statement responding to Montenegro’s proposal.

Senate president says budget ‘about as good as you can get’

The House is set to convene Monday afternoon to determine its next move.

To make matters more complicated, the Senate voted to adjourn after passing its budget plan in a marathon session that went past midnight Thursday.

Senate President Warren Petersen told KTAR News 92.3 FM’s The Chris and Joe Show on Friday that he was under the impression there was enough support in the House to pass it.

He explained that a funding pool was divided three ways during negotiations, essentially one-third for each GOP-controlled chamber and one third for the governor and Democrats.

He said the state budget has to be bipartisan when there’s a divided government, noting that the governor can erase Republican priorities she doesn’t like through line-item vetoes.

“This was a good budget. … It wasn’t uber conservative, but it leans right, which is about as good as you can get,” Petersen said.

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