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House, Senate leaders cut budget deal with Arizona governor

Arizona capitol
Posted at 3:27 PM, May 19, 2019
and last updated 2019-05-19 18:27:42-04

PHOENIX — Republican leaders who control the majority in the Arizona Legislature said Sunday they've reached a deal with GOP Gov. Doug Ducey on a spending plan for the budget year that begins July 1.

Senate President Karen Fann said four days of negotiations led to the deal that she and House Speaker Rusty Bowers will present to majority Republicans on Monday morning.

Bowers also confirmed the agreement. If the deal passes muster with Republican lawmakers, a budget could be approved by the end of the week.

Both declined to provide details before briefing their members, who could ask for changes. Bowers and Fann said last week they hoped to cut a final deal over the weekend and introduce budget legislation Monday.

Minority Democrats weren't involved in the negotiations. The governor proposed an $11.4 billion spending plan in January that mainly devotes a $1 billion surplus to state reserves and education funding. Republican lawmakers objected to several parts of the proposal, including Ducey's plan to keep a tax windfall the state got from the 2017 federal tax overhaul and his plan to make a $542 million deposit in the state's rainy day fund.

That is intended to boost the reserve account to $1 billion in an effort to prevent massive spending cuts if a recession hits.

Many GOP lawmakers instead wanted to refund that extra cash to taxpayers and pay down debt, with a smaller reserve fund deposit.

Arizona usually aligns its income tax code to the federal code, known as conforming, but doing that without adjustments would boost tax bills for some people and was seen by many in the GOP as a tax increase they could not approve.

Other issues included cutting a new $32 fee charged for vehicle registrations lawmakers approved last year but expected to only be $18 per car or truck. "There is an agreement on (tax) conformity and other issues with the governor," Bowers said Sunday.

"How that pans with the caucus we'll see tomorrow." Republicans hold just a 31-29 majority in the House, so they can lose just one vote and pass a budget without Democratic support. The Senate has a 17-13 GOP majority, but several members have said they won't vote for a budget unless they get what they want. Sen. Michelle Ugenti-Rita has said she wants the vehicle license fee cut. Sens. Paul Boyer and Heather Carter want an extension to the statute of limitations allowing child sex assault victims to sue or they won't sign off.

New legislation to address Boyer's concerns was introduced Thursday at Bowers' request, but Boyer said it didn't go far enough. Current state law allows only two years for someone to sue after turning 18.

Boyer had proposed up to seven years after someone realized they had been sexually assaulted. That drew opposition from other Republicans, who believed it was unfair to allow someone to potentially be sued many decades after an alleged assault.

Bowers said he was choosing a compromise. A draft of the legislation shows it increases the time to file a lawsuit to age 30, and restarts that clock if new criminal charges are filed for up to a year after the case concludes.