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TED: COMING UP NEXT ON "ARIZONA HORIZON," GOVERNOR KATIE HOBBS JOINS US IN STUDIO TO DISCUSS A VARIETY OF ISSUES INCLUDING THE LATEST LEGISLATIVE SESSION AND WHAT WAS AND WAS NOT INCLUDED IN THE STATE BUDGET.

GOVERNOR KATIE HOBBS NEXT ON "ARIZONA HORIZON."

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TED: GOOD EVENING, AND WELCOME TO "ARIZONA HORIZON."

I'M TED SIMONS.

ANOTHER STATE LEGISLATIVE SESSION RECENTLY WRAPPED UP WITH GOVERNOR HOBBS PRESENTED WITH A BUDGET SHE SAID SHE WAS, QUOTE, THRILLED TO SIGN.

FOR MORE ON WHAT THE BUDGET DID AND DID NOT INCLUDE AND TO DISCUSS OTHER ISSUES, WE WELCOME GOVERNOR KATIE HOBBS TO "ARIZONA HORIZON."

GOOD TO SEE YOU AGAIN.

THANK YOU FOR JOINING US.

>> YOU, TOO, THANK YOU.

TED: GOT A LOT TO TALK ABOUT HERE.

LET'S TALK ABOUT THE WORD THRILLED.

YOU WERE THRILLED TO SIGN THIS BUDGET, WHY?

>> THIS BALANCED BIPARTISAN BUDGET HELPS DELIVER ON THE ARIZONA PROMISE OF SECURITY, OPPORTUNITY AND FREEDOM FOR ARIZONANS.

WE ARE ABLE TO SECURE THE LARGEST INVESTMENT EVER SINCE THE GREAT RECESSION IN CHILD CARE, WHICH WILL HELP LOWER COSTS FOR ARIZONA FAMILIES.

WE GOT MUCH NEEDED PAY RAISES FOR STATE TROOPERS AND FIREFIGHTERS.

WE GOT AN INVESTMENT TO HELP ADDRESS ENDING VETERAN HOMELESSNESS AND SO MUCH MORE AND REALLY FOCUS ON THE ISSUES THAT MATTER TO ARIZONANS.

>> IT WAS PRETTY CHAOTIC AT THE END.

HOW CHAOTIC WAS IT FROM THE NINTH FLOOR VIEW?

>> WE HAD BEEN ENGAGING WITH BOTH CHAMBERS, THE HOUSE AND THE SENATE, AND BOTH CAUCUSES IN THE CHAMBERS, AND WE WERE VERY CLOSE TO A DEAL, AND THE SENATE REPUBLICANS AND THE DEMOCRATS STAYED WITH US ON THAT, AND FOR WHATEVER REASON, THE HOUSE REPUBLICANS DECIDED TO WALK AWAY.

THEY WERE WILLING TO FORCE A GOVERNMENT SHUTDOWN, WHICH WOULD HAVE JEOPARDIZED SERVICES FOR SO MANY ARIZONANS, AND WE STAYED AT THE TABLE AND WE SHOWED WHAT WE CAN GET DONE IF WE'RE WILLING TO PUT THE PARTISAN POLITICS ASIDE AND FOCUS ON THE ISSUES IN FRONT OF US.

TED: WERE YOU SURPRISED YOU WORKED AS WELL AS YOU DID WITH SENATE REPUBLICAN LEADERSHIP?

>> I THINK THIS WAS A GREAT LEGISLATIVE SESSION, AND I'VE ALWAYS BEEN SOMEONE WHO WILL WORK WITH ANYONE TO SOLVE A PROBLEM, I DID THAT IN THE LEGISLATURE.

I PASSED BIPARTISAN LEGISLATION AS A FRESHMAN LEGISLATOR WITH A SUPERMAJORITY OF REPUBLICANS, SO I KNEW WE COULD GET IT DONE, AND WE REALLY DEVELOPED A GOOD WORKING RELATIONSHIP AND HOPEFULLY THAT WILL CONTINUE FOR THE GOOD OF ARIZONANS OVER THE NEXT SESSION.

TED: WERE YOU SURPRISED IT WAS SO DIFFICULT TO DEAL WITH HOUSE REPUBLICAN LEADERSHIP?

>> WELL, YOU KNOW, THEY WERE ON BOARD UNTIL THEY WEREN'T, AND IT WAS A FEW EXTREME MEMBERS WHO REALLY DECIDED TO BLOW THINGS UP AND DERAIL THINGS, AND AT THE END OF THE DAY, I'M GLAD WE GOT IT DONE.

TED: WAS IT YOUR IMPRESSION THAT THE EXTREME MEMBERS IN THE HOUSE AND THE SENATE, REPUBLICAN LEADERSHIP, REPUBLICAN MAJORITY HERE, IS IT YOUR IMPRESSION THAT HAS BEEN SOFTENED A BIT OR ARE THE EDGES AS SHARP AS EVER?

>> WELL, WHEN WE GET THE BUDGET DONE, IT'S THE END OF SESSION AND EVERYONE'S TEMPERS ARE UP AND IT'S A GOOD THING FOR EVERYONE TO JUST GO HOME AND COOL OFF AND REGROUP FOR THE NEXT SESSION.

SO HOPEFULLY THE TEMPERS WILL HAVE COOLED BY THE TIME WE GO BACK.

TED: AS FAR AS THE BUDGET AND EVERYTHING IN THE SESSION, THE DEMOCRAT, THE CAUCUS IS NOT PLEASED.

NO ESA GUARDRAILS, YOU MEJSED THAT IN THE STATE OF THE STATE ADDRESSES.

NO GUARDRAILS FOR THE VOUCHER PROGRAM.

WHAT POINT WILL THAT NEED TO BE ADDRESSED?

>> IN STATE OF THE STATE, I CALLED THIS PROGRAM THE BILLION-DOLLAR BOONDOGGLE.

WE ARE SO FAR AWAY FROM THE ORIGINAL INTENT WHEN THE LEGISLATOR PASSED VOUCHERS TO HELP KIDS WITH SPECIAL NEEDS WHOSE NEEDS WEREN'T GETTING MET IN THE PUBLIC SCHOOL SYSTEM, AND NOW THEIR NEEDS ARE COMPLETELY NEGLECTED IN THIS NEW SCHEME OF UNIVERSAL ESAs, AND WE'VE SEEN REPORTING REPEATEDLY ABOUT THE LEVEL OF ABUSES THAT TAKE PLACE.

THE KIND OF EXPENSES THAT ARE ALLOWED THAT -- WHEN WE SEE TEACHERS HAVING TO PAY FOR CLASSROOM SUPPLIES OUT OF THEIR POCKET, WE SEE SCHOOL DISTRICTS FUND-RAISING FOR EXTRAS FOR THEIR STUDENTS, AND NOW WE SEE REPORTING THAT SAYS FAMILIES ARE USING THE ESAs TO GO TO CALIFORNIA THEME PARKS?

THAT SHOULD ALARM ANYONE.

THIS IS STATE TAXPAYER DOLLARS GOING TO THESE THINGS, AND THERE'S NO TRANSPARENCY OR ACCOUNTABILITY.

WE NEED TO BRING THIS PROGRAM UNDER CONTROL.

TED: AND YET, IT HAS NOT BEEN BROUGHT UNDER CONTROL AND HAS NOT GONE ANYWHERE.

IT'S THE THIRD RAIL IN THE SESSION.

ARE YOU WILLING TO GO TO THE WALL, ANOTHER METAPHOR THERE, GO TO THE WALL REGARDING THIS, THE DEMOCRATIC CAUCUS WANTS TO SEE SOMETHING DONE.

>> CERTAINLY, I WOULD LIKE TO SEE SOMETHING DONE TOO, AND IT'S THE REPUBLICANS IN THE LEGISLATURE WHO CONTINUE TO STAND BY THESE ABUSES.

SO I DON'T KNOW WHY THEY'RE WILLING TO CONTINUE TO DEFEND THEM, BUT MOST ARIZONANS I TALK TO ARE VERY FRUSTRATED WITH THE PROGRAM.

TED: THEY ARE ALSO, REPUBLICANS ARE ALSO WILLING TO PUT PROTECTION OF ESA INTO -- TIE IT INTO PROP 123.

YOUR THOUGHTS THERE?

>> WELL, THAT'S A WHOLE OTHER CAN OF WORMS.

PUTTING SOMETHING ON THE BALLOT THEN GIVES IT CONSTITUTIONAL PROTECTION, AND IT'S CONCERNING THAT WE WOULD ENSHRINE SOMETHING THAT IS OBVIOUSLY SO RIGHT FOR ABUSE IN THE CONSTITUTION, AND WE SHOULD SEPARATE THE TWO ISSUES.

WE NEED AN EXTENSION OF PROP 123 THAT INVESTS MORE MONEY INTO PUBLIC SCHOOLS AND WE'RE GOING TO WORK ON THAT, BUT SHOULDN'T TIE IT TO ESAs.

>> A DEFINITE NO THERE.

THE SESSION, 174, DID I GET THAT RIGHT?

>> YEAH.

TED: GIVE OR TAKE A COUPLE?

HOW DOES IT FEEL TO BLOCK SO MUCH LEGISLATION?

IS THAT A GOOD THING FOR ARIZONA?

>> WELL, I DIDN'T COME TO THE GOVERNOR'S OFFICE TO BREAK VETO RECORDS, BUT I DID COME TO GET THINGS DONE.

I'M VERY PROUD OF THE WORK WE DID THIS SESSION.

I THINK IT WAS THE MOST SUCCESSFUL LEGISLATIVE SESSION SINCE I'VE BEEN GOVERNOR, I TALKED ABOUT THE THINGS THAT BUDGET DELIVERS, BUT WE ALSO GOT BIG THINGS DONE TO CONTINUE ECONOMIC GROWTH AND JOB CREATION.

THE MOST CONSEQUENTIAL WATER ACT, I GOT TO HAVE BREAKFAST WITH FORMER GOVERNOR BRUCE BABBITT WHO USHERED IN THAT ACT, AND HE WAS THRILLED WE GOT THIS DONE.

WE WERE ABLE TO BUILD ON THE LEGACY HE STARTED, AND, SO BIG THINGS GOT DONE, AND I ALSO SAID I'M GOING TO BLOCK THE THINGS THAT HARM ARIZONANS.

I'M GOING TO BLOCK THINGS THAT ATTACKS FREEDOMS THAT AREN'T GOING AFTER THE BIG CHALLENGES WE'RE FACING, AND THAT'S WHAT I'VE DONE.

TED: AT WHAT POINT DOES BLOCKING THINGS THAT YOU THINK ARE GOOD FOR ARIZONA LEAD INTO OBSTRUCTIONISM?

>> WELL, YOU'LL HAVE TO ASK THE REPUBLICANS WHO MIGHT WANT TO PAINT THAT PICTURE, WHO KEEP SENDING ME THE SAME BILLS OVER AND OVER AGAIN.

TED: YEAH.

SO YOU DON'T SEE OBSTRUCTION, YOU SEE BLOCKING FOR THE GOOD?

>> RIGHT.

TED: AS FAR AS YOUR AGENCIES ARE CONCERNED, HOW MANY AGENCY NEED DIRECTORS?

>> WE HAVE INTERIMS IN EVERY CASE EXCEPT FOR A COUPLE.

THERE'S FIVE DIRECTORS THAT HAVEN'T BEEN CONFIRMED, AND WE'RE GOING TO KEEP -- THESE ARE QUALIFIED PEOPLE WHO WERE SELECTED GOING BACK TO MY TRANSITION TEAM, BY A BIPARTISAN TEAM OF FOLKS AND WELL VETTED AND SERVING THE STATE, AND SO I'M HOPEFUL WE CAN GET SOME FOLKS CONFIRMED NEXT YEAR.

TED: AND YOU KNOW, OF COURSE, THAT THE REPUBLICANS, ESPECIALLY THE LEADER OF THE COMMITTEE THAT LOOKS AT THE NOMINATIONS, THAT THESE AREN'T WELL VETTED.

THEY AREN'T VETTED ENOUGH.

COULD THEY BE VETTED BETTER?

>> WELL, HE IS FOCUSED ON AN EXTREMELY PARTISAN AGENDA AND DOING THEM THROUGH THAT LENS.

HE TOOK SOME EXTREMELY WELL-QUALIFIED PEOPLE AND DRAGGED THEM THROUGH THE MUD.

THAT IS NOT FAIR TO PEOPLE WHO STEP UP TO BE PUBLIC SERVANTS, AND WE'RE DOING GREAT WORK ON THE BEHALF OF ARIZONANS.

TED: ONE LAST THING ON THE VETTING PROCESS.

IS IT POSSIBLE THAT YOU CAN ADJUST THE VETTING PROCESS SO TO GET PAST THIS PARTICULAR COMMITTEE AND THIS PARTICULAR COMMITTEE CHAIRMAN IN.

>> CERTAINLY.

I'D LOVE TO HEAR FROM INDICTED FAKE ELECTOR JAKE HOFFMAN WHAT CRITERIA WOULD MEET HIS GOALPOSTS THAT KEEP MOVING.

WE'RE GOING TO FOCUS ON DOING THE WORK OF THE PEOPLE OF ARIZONA, NO MATTER WHERE THOSE GOALPOSTS ARE.

TED: HOW DO THE VACANCIES IMPACT THE STATE?

>> IN CASES WHERE DIRECTORS ARE NOT CONFIRMED WE HAVE INTERIMS.

SO THEY'RE OPERATING.

HIS PARTISAN AGENDA REALLY HAS TIED THE HANDS SOMEWHAT.

IN TERMS OF JUST UNCERTAINTY AT THE AGENCIES, AND, YOU KNOW, I THINK A LOT OF ARIZONANS DON'T KNOW WHAT'S THE WORK OF ALL THE STATE AGENCIES, BUT IT'S GETTING GOVERNMENT DONE, SERVICES THAT PEOPLE NEED, AND SO WE WANT TO TRY TO MAKE SURE THAT WORK ISN'T HAMPERED AND I'M HOPEFUL THAT WE CAN GET THE REST OF THE FOLKS THROUGH NEXT YEAR.

TED: YEAH, BUT AT SOME POINT, SOMETHING IS GOING TO HAPPEN BECAUSE YOU NEED A DIRECTOR AT THE AGENCIES.

THINGS GET HAMPERED IF THERE IS NO LEADERSHIP?

>> THE OFFICE OF ECONOMIC OPPORTUNITY, THE CLOCK RAN OUT ON THAT DIRECTOR IN JULY AND HE LEFT.

NOW WE'RE IN SEARCH OF AN INTERIM, SO THERE'S A YEAR -- PEOPLE CAN BE IN PLACE FOR A YEAR WITHOUT CONFIRMATION.

TED: LAST QUESTION ON THIS, IS THERE A WAY FOR THE COOPERATION AT THE END, ESPECIALLY WITH THE SENATE, THE SENATE REPUBLICAN LEADERSHIP, IS THERE A WAY TO GET THAT COOPERATION AS FAR AS AGENCY NOMINATIONS BOTH SIDES AMENABLE TO GETTING THIS DONE?

>> WELL, WE'RE CONTINUING TO WORK ON THAT FOR SURE.

I WILL SAY THAT THE SAME SENATOR WHO IS THE HEAD OF THE NOMINATION COMMITTEE IS THE SENATOR THAT TRIED TO BLOW UP THE BUDGET, SO IT'S REALLY UP TO THE PRESIDENT AND HE CONTROLS THE AGENDA, SO IT'S UP TO HIM TO MAKE THAT CALL.

TED: ALL RIGHT, WE TALKED ABOUT WATER BILL, AG-TO-URBAN, IT FAILED LAST YEAR, PASSED THIS YEAR.

WHY?

WHAT CHANGED?

>> WELL, LAST YEAR THERE WAS A LAST-MINUTE ATTEMPT TO SEND SOMETHING UP THAT WASN'T WELL VETTED, AND WE STARTED WORKING ON IT IMMEDIATELY AFTER SESSION LAST YEAR, AND YOU KNOW, THERE WAS A LOT OF NEGOTIATION.

WE WERE WILLING TO STAY AT TABLE, AND I THINK THIS IS JUST ONE OF THOSE EXAMPLES OF WHAT WE CAN GET DONE IF WE'RE WILLING TO PUT THE PARTISAN POLITICS ASIDE, AND FOCUS ON WHAT WE NEED TO ACCOMPLISH, AND EVERYONE WAS WILLING TO MAKE CONCESSIONS, NOBODY GOT EVERYTHING THEY WANTED, BUT THE END OF THE DAY, WE GOT A BILL THAT IS GOING TO SAVE WATER.

IT'S GOING TO CREATE JOBS.

IT'S GOING TO LOWER THE COST OF HOUSING, AND THAT'S REALLY CRITICAL.

TED: WHAT OTHER CONCERNS OF CONVERTING AGRICULTURAL LAND TO HOUSING LAND?

>> I THINK THERE WERE -- GETTING INTO THE NITTY-GRITTY OF THE NEGOTIATIONS, CONCERNS ABOUT HOW MUCH WATER WAS BEING SAVED AND HOW LONG OF A TIME COULD BE IN PLACE BEFORE THE LAND WAS CONVERTED.

AT THE END OF THE DAY, THOUGH, AGRICULTURAL USE IS MUCH HIGHER THAN RESIDENTIAL, SO THIS WILL SAVE WATER.

TED: IS THERE A GUARANTEE?

I KNOW REPLENISHMENT IS A BIG FACTOR, BUT A BIG CONCERN, IS THERE A GUARANTEE THAT WATER WILL BE REPLENISHED?

>> WE ARE -- WE'RE ENSURING THAT THIS LEGISLATION IS GOOD FOR THE FUTURE OF ARIZONA'S AQUIFERS, THIS WILL MAKE OUR AQUIFERS HEALTHIER.

TED: AS FAR AS GROUND WATER IS CONCERNED, WHAT DO YOU WANT TO SEE AS FAR AS GROUND WATER.

THAT IS A MESS AS WELL?

>> AT THE END OF THE SESSION, IT WAS REALLY UNFORTUNATE THAT REPUBLICANS AND REALLY JUST ONE REPUBLICAN BLOCKED BIPARTISAN LEGISLATION THAT WE HAD PROPOSED TO HELP MANAGE RURAL GROUND WATER.

THERE'S FOLKS IN THE RURAL COMMUNITIES THAT HAVE WORKED ON THIS LEGISLATION FOR YEARS.

REPUBLICANS AND DEMOCRATIC-ELECTED LEADERS WHO HAVE PUSHED FOR THIS CHANGE, AND WE WORKED REALLY HARD TO GET A PROPOSAL WE THOUGHT WAS A COMPROMISE PROPOSAL.

WE'RE NOT GIVING UP ON RURAL GROUND WATER.

IF YOU LOOK AT THE AMA, THE ACTIVE MANAGEMENT AREA THAT WE PROPOSE IN WILLCOX, WE'RE DOING INNOVATIVE THINGS AROUND CONSERVATION THERE AND WHAT YOU CAN DO IN A RURAL MANAGEMENT AREA, AND THOSE ARE -- THAT CAN SET THE MODEL FOR FUTURE ACTIVE MANAGEMENT AREAS AND THE RURAL AREAS.

TED: FOR THOSE SAYING THE DEPARTMENT OF WATER RESOURCE, THE GOVERNOR'S OFFICE, THAT THEY'RE NOT OVERREACHING, THEY DON'T UNDERSTAND THE LAND AND THE REGION, AND TO HAVE ACTIVE MANAGEMENT AREA IN THOSE PARTS OF THE STATE IS NOT GOOD FOR ARIZONA.

HOW DO YOU RESPOND?

>> THAT IS EXACTLY WHY WE PROPOSE WHAT WE PROPOSE IN THE RURAL GROUND WATER MANAGEMENT LEGISLATION, THAT THE SAME LEGISLATOR WHO IS SAYING THAT AMA IS AN OVERREACH BLOCKED.

SO PASSING THIS RURAL GROUND WATER MANAGEMENT ACT TO CONVERT FROM THE AMA TO THE RGMA TOOL THAT WASN'T APPROVED, SO WE STILL HAVE WORK TO DO.

TED: I WAS GOING TO SAY, STILL HAVE WORK TO DO SO NEXT SESSION, TALKING ABOUT SOFTENING THE EDGES HERE, POSSIBLE?

>> NOTHING IS OFF THE TABLE.

TED: OKAY.

SOMETHING THAT'S ON THE TABLE ARE IMPENDING CUTS TO MEDICAID.

HOW IS ARIZONA FACING THIS?

WHAT ARE THE PLANS?

WHAT DO YOU SEE IN THE FUTURE?

>> YEAH, YOU KNOW, THIS IS MAYBE THE MOST FRUSTRATING QUESTION I'VE BEEN ANSWERING FOR THE LAST SIX MONTHS OR SO, AND SOMETHING I HONESTLY HAVE BEEN CONCERNED ABOUT SINCE THE NOVEMBER ELECTION, WE KNEW THAT SEVERE MEDICAID CUTS WOULD BE ON THE TABLE, SO AS SOON AS THIS LEGISLATION WAS INTRODUCED, I WAS LOUD AND CLEAR, WE CANNOT ABSORB THE CUTS, WE CANNOT BACKFILL THE CUTS.

WE DON'T HAVE THE CAPACITY TO DO THAT, AND ANYTHING WE DO HAVE IN THE RAINY DAY FUND OR WHATEVER IS A BAND-AID, AND I THINK PROBABLY MOST STATES ARE IN THIS SITUATION OF NOT BEING ABLE TO BACKFILL THE EXTREME CUTS.

CUTS BY THE WAY, WHICH WERE MADE IN THE NAME OF GIVING BILLIONAIRES TAX BREAKS.

HUGE TAX BREAKS.

WE'RE STILL COMBING THROUGH THE BILL TO FIGURE OUT EXACTLY THE IMPACT AND WHAT WE CAN DO TO MITIGATE, BUT EVERY REPUBLICAN-LED CONGRESS PERSON FROM ARIZONA WHO VOTED FOR THIS BILL, AND THEY ALL DID.

THEY KNEW THE IMPACT.

THEY HAD THE NUMBERS.

HOW MANY OF THE CONSTITUENTS WILL LOSE HEALTH CARE BECAUSE OF THE BILL THEY VOTED FOR, AND THEY SHOULD BE THE ONES ENTERING HOW WE SHOULD SOLVE THIS PROBLEM.

TED: I HAVE ASKED THOSE WHO SUPPORT THE CUTS AND IF YOU FOLLOW THE RULES, IF THERE'S NO FRAUD, AND WASTE, FRAUD AND ABUSE IS CLICHE, BUT THAT'S WHAT THEY SAY.

IF THERE IS NO WASTE, NO FRAUD, NO ABUSE OF THE SYSTEM DOING THE PROPER WORK REQUIREMENTS WOULD HAVE CHANGED, YOU'RE NOT GOING TO BE OFF MEDICAID?

>> I THINK THAT IS AN EASY WAY FOR THEM TO FRAME IT SO THEY CAN SLEEP WELL AT NIGHT, BUT THESE WORK REQUIREMENTS ARE SO ONEROUS, THEY WILL COST THE STATE OF ARIZONA MILLIONS OF DOLLARS JUST TO IMPLEMENT, JUST TO BE ABLE TO ADMINISTER THE WORK REQUIREMENTS.

THAT'S COSTS WE HAVE TO ABSORB THAT THE FEDS AREN'T GOING TO PAY FOR, AND REQUIRING PEOPLE TO JUMP THROUGH PAPERWORK HOOPS.

CUTS OR MORE FREQUENTLY TO SAY THAT THEY'RE WORKING, AND THE REQUIREMENTS ARE SO ONEROUS, THAT'S WHAT'S GOING TO CAUSE PEOPLE TO LOSE THE HEALTH CARE, AND AT THE END OF THE DAY, THOSE CUTS OR SAVINGS OR ELIMINATION OF WHATEVER NONEXISTENT FRAUD IS GOING TO COST MORE BECAUSE THOSE PEOPLE WILL END UP DELAYING CARE THAT THEY NEED, GOING TO EMERGENCY ROOMS FOR BASIC CARE BECAUSE THEY CAN'T GET IT ANYWHERE ELSE, AND THAT COSTS ALL OF US MORE.

IT COSTS ALL OF US MORE.

RURAL HOSPITALS WILL LOSE FUNDING AND THEN WHOLE COMMUNITIES WILL LOSE THEIR HEALTH CARE.

TED: IS THERE ACTION AFOOT, AGAIN, WE'RE LOOKING AT THE NEXT SESSION ALREADY HERE.

ARE THERE PLANS, A, B, C, WHATEVER, TO NOT COMPLETELY BACKFILL, TO GET THINGS STARTED AND HELP FOLKS YOU SAY ARE LEFT HIGH AND DRY?

>> WE ARE ABSOLUTELY LOOK AT WHAT WE CAN DO WITHIN THE FRAMEWORK OF THE BUDGET THAT WE HAVE.

TED: YEAH, BUT WITHIN THE FRAMEWORK, IS THERE ENOUGH THERE?

>> THAT'S A VERY GOOD QUESTION, AND I'VE SAID FROM THE GET-GO THAT THERE'S NOT, AND WE'LL HAVE TO SEE WE'RE JUST BEGINNING THE PROCESS OF LOOKING AT NEXT YEAR'S BUDGET.

TED: OBVIOUSLY, WE'RE LOOKING AT THE PROCESS OF NEXT YEAR'S SESSION.

LOOK AT THE PROCESS OF NEXT AREA'S ELECTION, ARE YOU RUNNING FOR RE-ELECTION?

>> YES, I'VE NOT MADE THAT A SECRET AT ALL.

TED: WHY DO YOU THINK SO MANY POLLS SHOW SO MUCH DISSATISFACTION WITH REPUBLICANS, BUT WITH THE DEMOCRATIC PARTY IN PARTICULAR?

>> YOU KNOW, I AM NOT REALLY FOCUSED ON THE PARTY.

I'M FOCUSED ON MY JOB AS GOVERNOR, AND WHAT I NEED TO DO TO KEEP DELIVERING FOR ARIZONANS, AND I THINK THE BEST CASE FOR ANYONE TO BE MADE FOR RE-ELECTION IS POINTING TO THE THINGS THAT YOU'VE DONE TO MAKE THEIR LIVES BETTER AND ALSO ACKNOWLEDGING THAT THERE'S MORE TO BE DONE, AND I HAVE PLANS TO CONTINUE TO ADDRESS OUR AFFORDABLE HOUSING SHORTAGE TO CONTINUE TO REFORM WATER SO WE ENSURE WE'RE SECURING OUR WATER FUTURE, CONTINUE TO GROW THE ECONOMY AND JOBS AND SECURE THE BORDER IN PARTNERSHIP WITH THE FEDERAL GOVERNMENT, AND THOSE ARE THE THINGS THAT WE SHOULD BE TALKING ABOUT TO EARN FOLKS' SUPPORT AND TO JUSTIFY STAYING IN OFFICE.

TED: SWING VOTERS, WORKING-CLASS VOTERS, IS THAT WHAT THEY WANT TO HEAR?

>> WHEN I TALK TO ARIZONANS ACROSS THE STATE, NO MATTER WHERE THEY ARE, WHAT PARTY THEY ARE, THEY WANT OUR ELECTED LEADERS TO WORK TOGETHER TO GET THINGS DONE.

THAT'S WHAT I'M FOCUSED ON DOING.

TED: I ASK BECAUSE THE DEMOCRATIC PARTY, AND YOU ARE A DEMOCRAT, YOU'RE THERE WHETHER YOU LIKE IT OR NOT.

>> UH-HUH.

TED: LOST A LOT OF SWING VOTERS, LOST A LOT OF WORKING-CLASS VOTERS.

AGAIN, IN THE GRAND SCHEME OF THINGS, WHAT DO YOU AS A MEMBER OF THE PARTY, HOW DO YOU WIN THOSE FOLKS BACK?

>> I THINK WE WEREN'T TALKING ENOUGH ABOUT WHAT PEOPLE NEEDED TO HEAR.

EVERYONE TALKED ABOUT THE GREAT ECONOMY AND ARIZONA'S ECONOMY IS GROWING.

WE'RE CREATING JOBS, HIGH-PAYING JOBS AND PEOPLE AREN'T FEELING THAT, THEY'RE STRUGGLING.

WHEN THEY HEAR SOMEONE NOT ACKNOWLEDGING THEIR STRUGGLE, NOT ACKNOWLEDGING THAT GAS IS STILL EXPENSIVE, THAT GROCERIES AREN'T GOING DOWN, THAT THEY'RE STRUGGLING TO PAY FOR HOUSING, THEY DON'T WANT TO HEAR WHAT YOU'RE SELLING.

WE HAVE A PRESIDENT WHO RAN ON LOWERING COSTS.

WE'RE NOT SEEING THE RESULTS OF THAT YET, AND CERTAINLY THIS TRADE WAR IS DOING JUST THE OPPOSITE, SO I'M FOCUSED ON WHAT I CAN DO AS ARIZONA GOVERNOR TO DO THAT.

TED: YEAH, AND I ASKED THE QUESTION BECAUSE A LOT OF PEOPLE HAVE A LOT OF PROBLEMS WITH THE PRESIDENT RIGHT NOW, AND YET THE DEMOCRATS DON'T SEEM TO BE GAINING THAT MOMENTUM.

YOU NEED THAT MOMENTUM NEXT YEAR IN A VARIETY OF WAYS.

YOU TOLD ME HOW YOU'RE GOING TO GET IT.

JUST SEND THE MESSAGE OUT.

GOT TO BE MORE THAN THAT, DOESN'T THERE?

>> WELL, IT'S NOT JUST TALKING, IT'S DOING.

I'M ABOUT TO GO ON A THREE-DAY TOUR AROUND THE STATE TO TALK ABOUT THE WORK WE'VE DONE, POINT TO INVESTMENTS IN LOWERING DRUG COSTS IN SCHOOL MEALS AND IN SECURING THAT WATER FUTURE, ALL KINDS OF THINGS, BUT THEY NEED TO SEE WHAT WE'VE DONE AND WHAT WE'RE FOCUSED ON CONTINUING TO DO.

TED: IS IT BETTER FOR THE STATE TO TRY TO WORK AS BEST AS POSSIBLE WITH THE TRUMP ADMINISTRATION?

>> ABSOLUTELY.

TED: OR TO FIGHT THE TRUMP ADMINISTRATION WHEN YOU SEE WRONG?

>> I THINK IT'S BOTH, RIGHT?

I DON'T THINK THERE'S -- I DON'T THINK IT'S THIS OR THAT.

IT'S BOTH.

I'M GOING TO STAND UP TO THE TRUMP ADMINISTRATION.

I'VE BEEN PRETTY CLEAR ON MY POSITION ON HIS TRADE WAR, WHICH IS HARMING ARIZONANS, BUT WHEN THERE'S OPPORTUNITY TO WORK WITH WITH THEM, LIKE ON SECURING THE BORDER, I'M GOING TO DO THAT.

I WAS VERY CRITICAL OF THE BIDEN ADMINISTRATION, WHO ESSENTIALLY IGNORED THE ISSUES AT OUR SOUTHERN BORDER, AND WE FOUND OPPORTUNITY TO FIND COMMON GROUND WITH THE TRUMP ADMINISTRATION.

WE LAUNCHED OPERATION DESERT GUARDIAN GOING AFTER CARTEL ACTIVITY, COORDINATING WITH LOCAL, STATE AND FEDERAL OFFICIALS AND THAT'S GOING VERY WELL.

>> I WOULD BE REMISS IF I DIDN'T ASK YOU ABOUT THE GRAND CANYON FIRES.

YOU TOURED UP THERE.

YOU WANT AN INVESTIGATION.

ARE YOU GOING TO GET AN INVESTIGATION?

AND WHAT KIND OF INVESTIGATION DO YOU WANT?

.

>> I THINK THAT WHAT WE ASKED FOR AND WHAT I'VE HEARD COMMITMENT FROM INTERIOR SECRETARY BURGUM ON IS AN INDEPENDENT REVIEW THAT LOOKS AT THE WAY THIS FIRE WAS INITIALLY MANAGED.

I KNOW THAT RIGHT NOW ALL OF OUR PRIORITY IS GETTING THE FIRE UNDER CONTROL.

IT'S STILL GROWING.

IT'S EXPECTED TO CONTINUE TO GROW, BEFORE IT STOPS, AND THEN THERE'S ALSO A VERY MUCH INTENT ON HOW WE RECOVER AND REBUILD.

WE LOST THE ICONIC GRAND CANYON LODGE, SMALL BUSINESSES ARE STRUGGLING FOR THE REST OF THE SEASON, SO WE'RE LOOKING AT HOW WE CAN PROVIDE SUPPORT THERE, BUT AN INDEPENDENT REVIEW.

WHEN THIS FIRE STARTED ON JULY 4, IT WAS A LIGHTNING STRIKE, AND THE DECISION WAS MADE.

THIS WAS A FEDERAL DECISION, TO MANAGE IT AS A CONTROLLED BURN, UNDER WHAT WOULD SEEM TO MOST PEOPLE TO BE REALLY NOT IDEAL CONDITIONS FOR THAT HOTTEST, DRIEST PART OF THE SUMMER, NO MONSOON ACTIVITY, AND WE'RE AT 120,000+ ACRES NOW.

TED: THE PRESIDENT'S CONSOLIDATION ORDER INVOLVES MANY THINGS, INCLUDING THE INTERIOR DEPARTMENT, ARE YOU CONFIDENT THAT THE INTERIOR DEPARTMENT CAN HANDLE, A, THIS.

B, WHAT CHANGES NEED TO BE MADE?

>> I THINK WHEN YOU LOOK AT ANY TYPE OF WILDFIRE SITUATION, THERE'S ALL KINDS OF PLANS.

INTERIOR OVERSEES SOME OF THEM.

USDA OVERSEES SOME OF THEM.

WE HAVE TO HAVE COLLABORATION, AND WORK WITH ALL THE ENTITIES INVOLVED.

THERE HAS TO BE STATE AND FEDERAL COLLABORATION, EVEN THOUGH THIS FIRE IS MOSTLY CONTAINED ON FEDERAL LAND.

THE FIRE DOESN'T KNOW THE BOUNDARIES AND WE HAVE TO WORK TOGETHER.

TED: YOU HAVE CONFIDENCE YOU CAN WORK TOGETHER WITH THE INTERIOR DEPARTMENT?

>> WELL, WE HAVE TO.

WE'RE COMMITTED TO, YES.

TED: LAST QUESTION HERE.

LET'S GO BACK TO THE FACT THAT NEXT YEAR IS A VERY BUSY YEAR FOR ALL OF US.

>> YES.

TED: ONE OF YOUR REPUBLICAN CANDIDATES FOR GOVERNOR, YOU MIGHT MEET IN THE GENERAL, WHO KNOWS?

ARIZONA IS JUST IN GENERAL HEADING IN THE WRONG DIRECTION, AND HE POINTS AT YOU.

HOW DO YOU RESPOND?

>> WELL, CONGRESSMAN BIGGS, YOU SAID HE, SO THAT'S WHO I ASSUME YOU ARE TALKING ABOUT, HE VOTED TO RIP HEALTH CARE AWAY FROM MILLIONS OF AMERICANS TO GUT NUTRITION ASSISTANTSES ARE TO GET RID OF FEDERAL INVESTMENTS THAT ARE LOWERING ENERGY COSTS FOR ARIZONANS, AND I'M NOT SURE HOW, AS GOVERNOR, HE WOULD ANSWER ALL THE PEOPLE SAYING WHAT ARE YOU GOING TO DO ABOUT THIS?

AND I AM REALLY PROUD OF WHAT WE'VE DONE TO LOWER COSTS FOR ARIZONANS TO SECURE THE BORDER TO ADDRESS THE CHALLENGES MOST PRESSING FOR THEM, AND I'M FOCUSED ON CONTINUING TO DO THAT.

TED: AS FAR AS YOU ARE CONCERNED, ARIZONA IS HEADING IN THE RIGHT DIRECTION?

>> I THINK THAT THERE'S STILL WORK TO BE DONE, BUT I HAVE A LOT OF THINGS TO POINT TO WHERE WE'VE BEEN FOCUSED ON THE CONCERNS THAT ARIZONANS HAVE.

>> ALL RIGHT, ARIZONA GOVERNOR KATIE HOBBS.

THANK YOU SO MUCH FOR JOINING US, ENJOYED THE CONVERSATION, THANK YOU.

>> THANKS.

>> THAT IS IT FOR NOW.

I'M TED SIMONS.

THANK YOU SO MUCH FOR JOINING US.

YOU HAVE A GREAT EVENING.