The Arizona Supreme Court on Thursday refused to temporarily block a voter-approved minimum wage boost approved by voters, a decision that means hundreds of thousands of low-wage workers will get a raise on New Year's Day.
The high court decided against granting a stay intended to block the increase until justices decide whether to take up a full challenge to the new law at their February conference.
Proposition 206 was approved by 58 percent of Arizona voters in November. It raises the minimum wage from $8.05 an hour to $10 an hour on Jan. 1 and to $12 in 2020.
The Arizona Chamber of Commerce and Industry sued, saying the measure didn't have a funding source for new state costs and illegally included a second subject, mandatory sick pay.
Gov. Doug Ducey and the incoming House and Senate leaders filed a friend of the court brief Wednesday urging the court to block the measure, saying they were "gravely concerned about the new demands it will place on the general fund and the Legislature's ability to meet those demands."
A trial judge previously rejected the arguments by opponents of the higher wage in a ruling that was appealed by the Chamber.
Tomas Robles, chairman of the group that backed the initiative, said the last-minute effort by the governor and Legislature to weigh in on behalf of the Chamber efforts showed a disdain for the will of the voters.
"I think it just goes to show that the governor does not care about the workers of the state of Arizona," Robles said.
"And to me it showcases their true colors, what they actually care about -- which isn't Arizona's workers or Arizona's voters, it's their own pocketbooks," he added.
Ducey spokesman Daniel Scarpinato said the governor's office will review the court order.
"We are going to continue to work through the budget numbers and ensure that our agencies are complying with the law as it stands," Scarpinato said.
The state Supreme Court order was just one sentence, saying the request for a stay was considered by five justices and denied. Two new justices that joined the court earlier this month under an expansion law signed by Ducey didn't participate.
Chamber lawyers urged the high court to overturn the lower court judge's ruling, saying that if it were allowed to stand, crafters of initiatives would be able to ignore a state constitutional provision requiring a funding source for new expenditures.
The measure exempts the state from having to pay the higher minimum wage, but the state Medicaid agency said it would be forced to boost pay for nursing home and other contracts. The increase would cost $48 million for six months, more than $11 million from the state, $3 million from counties and the rest from the federal government.
Agencies charged with enforcing the measure also said they would have higher costs.
Proposition 206 backers said the judge was right when he rejected the single-subject argument and found that the measure didn't trigger mandatory state spending. Even if it did, they argued that blocking the entire law isn't warranted because the state isn't obligated to spend any additional cash.
By the time the wages hit $12 an hour, an estimated 30 percent -- more than 700,000 workers in Arizona would see an increase in pay, according to an analysis by the Grand Canyon Institute.
Arizona was one of four states where voters approved minimum wage increases in November. Colorado and Maine voters also passed measures phasing in a $12 an hour minimum wage, while voters in Washington state approved one raising that to $13.50 an hour by 2020.
The actions came after Congress was unable to agree on an increase in the federal minimum wage of $7.25 an hour