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TED: COMING UP NEXT ON "ARIZONA HORIZON," IT'S THE JOURNALISTS' ROUNDTABLE.

A LOOK AT WEEK'S TOP STORIES, INCLUDING THE JUST RELEASED BUDGET PROPOSAL FROM GOVERNOR KATIE HOBBS.

THE JOURNALISTS' ROUNDTABLE IS NEXT ON "ARIZONA HORIZON."

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

I'M TED SIMONS.

IT'S FRIDAY AND THAT MEANS IT'S TIME FOR THE JOURNALISTS' ROUNDTABLE.

AND JOINING US TONIGHT JEREMY DUDA OF AXIOS PHOENIX.

JEREMY'S WIFE IS EMPLOYED BY ARIZONA PBS.

ALSO WITH US CAMRYN SANCHEZ OF KJZZ RADIO AND WAYNE SCHUTSKY ALSO OF KJZZ.

PANEL, GOOD TO HAVE YOU HERE.

THANK YOU FOR JOINING US.

JEREMY, START WITH YOU, 17.7 BILLION SPENDING PLAN, ANY SURPRISES?

WHAT'S GOING ON HERE?

>> GOOD TIMES ARE HERE AGAIN.

REMEMBER AFTER KATIE HOBBS' FIRST YEAR AS GOVERNOR, SWIMMING IN CASH AND NEVER HAD ENOUGH MONEY TO SPEND.

HAD TO MAKE CUTS.

GOOD TIMES ARE BACK AND THE MONEY IS GOING TO A LOT OF DIFFERENT PLACES.

NOT BIG-TICKET ITEMS, GETTING SPREAD OUT OVER CHILD CARE, HOUSING, PAY RAISES FOR FRONTLINE LAW ENFORCEMENT, EDUCATION, OF COURSE, ALWAYS A BIG -- ESPECIALLY WITH THE POSSIBILITY THAT WE MAY HAVE TO WAIT FOR A PROP 123 RENEWAL THAT SOME OF THE MONEY WILL BE BACKFILLED IF THAT DOESN'T HAPPEN IMMEDIATELY.

GOING A LOT OF PLACES.

TED: CAMRYN, THAT'S QUITE THE SPENDING INCREASE, HUH?

>> NICE, MAKES IT FEEL LIKE THERE'S NOT A DOOMSDAY CLOUD HANGING OVER US.

I THINK THE CHILD CARE THING IS MOST INTERESTING NEW ITEM FOR THEM.

SHE EMPHASIZED IN THE STATE OF THE STATE SAYING SHE WANTED TO GET CHILD CARE COSTS DOWN FOR ARIZONA FAMILIES.

TED: WAYNE, FIRST YOUR THOUGHTS ON THE OVERVIEW OF WHAT THE GOVERNOR RELEASED TODAY?

>> I AGREE WITH BOTH OF THEM.

WE DIDN'T SEE THE SPLASHY ITEMS LIKE DOUG DUCEY WANTING TO THROW $3 BILLION INTO WATER, AND SHOWS THAT AS SOON AS THERE'S A BLACK MARK IN THE BUDGET, IT'S NOT IN THE RED, WE'RE GOING TO SPEND THAT MONEY.

TED: YEAH, YEAH, GOTTA GO.

CAMRYN, TO CHILD CARE, THE INITIATIVES TO CUT CHILD CARE COSTS AND GRANTS AND THESE SORTS OF THINGS, RIGHT?

>> THAT'S CORRECT.

THEY SAY IT'S GOING TO HOPEFULLY HELP THOUSANDS OF KIDS AND SOME OF IT IS NEW AND SOME FOR PROGRAMS I BELIEVE ALREADY EXISTING, AND THEY WANT TO INCENTIVIZE EMPLOYERS TO HELP OUT AND MAKE SURE PEOPLE CAN GET ACCESS TO CHILD CARE BECAUSE THEY THINK IT WILL HAVE POSITIVE EFFECT ON THE ECONOMY PARTLY BECAUSE IF YOU ARE IN NEED OF SPENDING TIME WITH YOUR KID AND TAKING CARE OF THEM BECAUSE YOU CAN'T AFFORD CHILD CARE, YOU ARE NOT CONTRIBUTING AS MUCH TO THE ECONOMY.

TED: TAX CREDITS TO HELP WITH THESE THINGS?

>> TAX CREDITS TO CREATE OPTIONS FOR EMPLOYEES, PUBLIC-PRIVATE PARTNERSHIP, A STATE MATCH.

UP TO $400 A MONTH, IF AN EMPLOYER WANTS TO PAY, A THIRD, THIRD, THIRD, STATE, EMPLOYER AND EMPLOYEE.

IT COULD BE IMPACTFUL FOR FOLKS WHO NEED IT.

THAT'S WHAT GOVERNOR HOBBS IS REALLY ANGLING AT HERE.

TED: THESE THINGS HAVE LIFE AT THE LEGISLATURE?

>> IT'S HARD TO TELL.

WHEN SHE BROUGHT IT UP DURING THE STATE OF THE STATE, SHE DIDN'T HAVE DETAILS.

I ASKED REPUBLICANS WHAT THEY THOUGHT, THEY SAID THEY NEEDED TO WAIT TO SEE WHAT IT IS.

IN TERMS OF TAX INCENTIVE FROM EMPLOYERS, THE 400, 400, 400 DEAL THAT JEREMY MENTIONED, THE STATE, THE EMPLOYER AND FAMILY SPLIT THE COST.

SOME CALL IT A SUBSIDY.

SEE HOW REPUBLICANS REACT TO THAT.

TED: PLEASE.

>> I THINK SHE'S BEING CLEVER ABOUT THE NEW PROPOSALS AND MAKING SURE IT'S STUFF HARD TO GET BASHED ON BECAUSE REPUBLICANS ARE COMING AT HER THIS YEAR AND NEXT YEAR, WHEN IT'S THINGS LIKE PAY INCREASES FOR POLICE OFFICERS AND HELPING HOMELESS VETERANS AND CHASING CHILD CARE COSTS, THAT MAKES IT HARD FOR REPUBLICANS TO MAKE HEADLINES IF THEY QUASH IT.

>> YOU CAN SEE ANGLING FOR BUSINESS COMMUNITY SUPPORT.

LOOK HOW MUCH MONEY THIS IS COSTING EMPLOYERS IN ADDITION TO WHAT IT'S COSTING THE ACTUAL EMPLOYEE.

YOU HAVE TO MISS TIME FROM WORK TO TAKE CARE OF SICK KID OR BABY-SITTER FALLS THROUGH.

I CAN SEE BUSINESS COMMUNITIES LINING UP SINCE IT'S NOT A HECK OF A LOT OF MONEY.

EASY TO SUPPORT WITHOUT GETTING BASHED FOR OVERSPENDING.

TED: JEREMY, YOU MENTIONED INCREASES FOR LAW ENFORCEMENT.

$20 MILLION FOR LOCAL EFFORTS FOR BORDER SECURITY.

THAT'S NOT A HECK OF A LOT HERE.

AND DOES THAT INCLUDE PROP 314, ANY FUNDS PROVIDED IT SURVIVES COURT'S CHALLENGE.

>> NOT SO FAR.

IT'S NOT GOING INTO EFFECT UNTIL THE COURTS UPHOLD THE TEXAS MODEL IT WAS MODELED ON OR SOMETHING SIMILAR.

WE DON'T KNOW IF OR WHEN IT WILL HAPPEN.

PRESIDENT PETERSEN SAYING WE DON'T NEED TO ENFORCE IT THATCHNOW THAT TRUMP IS IN OFFICE AND WE'RE GOING TO SEE A HEAVY FOCUS ON BORDER SECURITY, IF THE COURTS GREEN LIGHT THE TEXAS LAW AND ALL THESE BORDER AREA SHERIFFS AND LAW ENFORCEMENT OFFICIALS NEED MONEY TO DO THIS, WE'LL SEE RENEWED CONVERSATION, IT'S GOING TO BE OUT OF SIGHT, OUT OF MIND.

TED: WHAT ARE YOU MAKING OF THIS, WAYNE, AS FAR AS FRONTLINE LAW ENFORCEMENT FROM 81 TO $90,000?

>> IT'S A MUCH-NEEDED INCREASE.

WE'VE BEEN SEEING -- THIS IS FOLKS AT THE STATE LEVEL.

DPS OFFICERS AND OTHER LAW ENFORCEMENT OFFICERS AND CORRECTIONAL WORKERS.

DPS AND THE UNION HAS BEEN SOUNDING ALARM ABOUT THE SHORTAGE FOR A LONG TIME NOW.

LAST FALL THEY WERE DOWN 500 OPEN POSITIONS, ONLY MARICOPA AND PIMA COUNTY HAVING 24/7 COVERAGE BY DPS.

THIS IS ONE OF THE WAYS TO FILL THE EMPTY POSITIONS.

TED: IS THIS ONE OF THE IDEAS AND PLANS WHERE REPUBLICANS SAY THAT'S NICE, WE WANT MORE?

>> MAYBE, BUT HARD TO OPPOSE IT.

WHO WANTS TO BE THE ANTI-BORDER SECURITY GUY.

THERE ARE QUESTIONS WHAT THE FEDERAL GOVERNMENT IS GOING TO DO.

AS WE LEARNED FROM THE SB-1070 LAWSUIT, SECURITY BORDER ISSUE IS SUPPOSED TO BE AN ISSUE.

TRUMP MADE A LOT OF PROMISES WHEN IT COMES TO BUILDING THE WALL AND DEPORTATION AND DACA, AND HE WANTS THE NATIONAL GUARD.

WE DON'T KNOW.

TED: $10 MILLION INTO LOW-INCOME HOUSING TAX CREDITS.

HE TALKED ABOUT THAT IN THE STATE OF THE STATE.

NOT A SURPRISE.

WHAT ABOUT THAT?

>> INCENTIVIZES DEVELOPERS TO SET ASIDE UNITS FOR LOW-INCOME FAMILIES AND FUNDED UNDER RONALD REAGAN.

IT HAS BIPARTISAN HISTORY AND LAWMAKERS AT THE CAPITOL, REPUBLICANS INCLUDED, WHO LIKE THE PLAN, OTHERS DO NOT, INCLUDING SENATE PRESIDENT WARREN PETERSEN IS NOT A FAN OF LIGHTEC.

SOMETHING SHE SAID IN THE STATE OF THE STATE SPEECH.

IT'S SUPPOSED TO HELP OUT WITH THOSE WORKING AND LOWER END INCOME FAMILIES.

TED: AND THE HOME FOR HEROES, $5 MILLION FOR HOMELESS VETS, MENTIONED THAT IN THE STATE OF THE STATE AS WELL.

>> ABOUT AS CROWD PLEASING AS YOU FIND IN THE STATE OF THE STATE.

WHO'S GOING TO OPPOSE THAT?

THAT'S BY FAR THE LEAST CONTROVERSIAL HOUSING PROJECTS.

WE'LL SEE MUCH MORE CONTROVERSIAL ONES.

NOT WITH THAT ONE.

TED: WHAT ELSE ARE WE GOING TO SEE, WAYNE?

>> SOMETHING THE GOVERNOR'S OFFICE MENTIONED IS THEY'RE GOING TO BE LOOKING INTO CUTTING THE RED TAPE.

A PHRASE WE HEARD A LOT.

THERE ARE A FEW BILLS THAT PASSED THROUGH THE LEGISLATURE, BASICALLY REMOVE MUNICIPAL BARRIERS TO BUILDING, LET BUILDING HAPPEN FASTER.

NOW SOME OF THOSE WERE VETOED BY GOVERNOR HOBBS, THE STARTER HOMES ACT.

WE'LL SEE IF THAT BECOMES THE NEXT BILL THAT SHE VETOES ONCE AND COMES BACK AROUND ON, BUT THEY SAY THEY'RE GOING TO LOOK AT THAT TYPE OF LEGISLATION.

>> AND THE LEAGUE OF CITIES, THE PRIMARY OPPONENT OF THE STARTER HOMES BILL LAST YEAR, THEY HAVE THEIR OWN VERSION OF THAT THAT THEY'RE PUSHING TO REDUCE COSTS, MAKING CHEAPER STARTER HOMES WITH PROVISIONS THEY HOPE WILL ENSURE THEY ARE SOLD TO FAMILIES, TO INDIVIDUALS, NOT INVESTORS.

NOT USED AS SHORT-TERM RENTALS OR ANYTHING LIKE THAT.

WE GOT A COUPLE OF THE PROPOSALS FROM THE LEAGUE, A BIPARTISAN CAUCUS OF LAWMAKERS WHO COME UP WITH ALL KINDS OF PROPOSALS THEY MAY NOT AGREE ON.

TED: WHAT'S THE BIPARTISAN -- WHAT IS THIS ALL ABOUT HERE?

>> MAKING IT OFFICIAL.

PEOPLE IN SUPPORT OF THE HOUSING PLANS AT LEGISLATURE AND THEY HAD A PRESS CONFERENCE THIS PAST WEEK HOW THEY ARE GOING TO COME BACK AND BRING THE STARTER HOMES ACT IS COMING BACK THANKS TO THEM.

MAYBE WITH MODIFICATIONS TO GET THE GOVERNOR ON BOARD BECAUSE THEY GENUINELY DO WANT THAT AND I DON'T THINK IT'S VETO FODDER.

THEY MADE ADJUSTMENTS THIS TIME.

TED: IS THAT VETO FODDER?

WOULD SHE VETO THIS AGAIN, DO YOU THINK?

>> MAYBE, ONE OF THE CONCERNS IS IT WOULD ALLOW HOUSING IN PLACES WHERE HOUSING HADN'T BEEN ALLOWED BEFORE, AND THERE WERE CONCERNS ABOUT FIRE CODES AND AIRPORT REGULATIONS AND I THINK THEY'RE TRYING TO MAKE IT EXTRA SUPER CLEAR, THESE ARE AREAS ALREADY ZONED FOR HOUSING.

>> IF YOU GET LEAGUES ON THEIR BILL OR OTHER LEGISLATION, IF THE LEAGUE IS WILLING TO SUPPORT IT, IF IT GETS TO GOVERNOR HOBBS' DESK, SHE WILL SIGN IT.

TED: WHAT DO YOU THINK, WAYNE?

ONCE IT COMES AROUND, WITH A COUPLE OF TINKERS HERE AND THERE, SHE COULD SAY ALL RIGHT.

>> WE'VE SEEN IT BEFORE WITH THE TAMALE BILL, RIGHT?

AND SOMETIMES SUPERFICIAL TWEEKS ONCE YOU SEE THE BACKLASH TO A VETO IT CAUSES YOU TO RETHINK THINGS MORE.

I THINK YOU WILL SEE SOME TWEEKS TO CLARIFY THE ISSUES THE LEAGUE WAS OPPOSED TO.

TED: ESAS, THE GOVERNOR CAME UP WITH A CONVOLUTED AND COMPLICATED SITUATION, RELATIVELY CLEAR ONCE YOU GET INTO IT.

MAKE IT INCOME CAPS ON THOSE RECEIVING VOUCHERS.

>> PART OF HER BUDGET PROPOSAL IS ANNUAL ATTEMPT TO REIN IN THE SCHOOL VOUCHER PROGRAM.

THAT WILL NOT PASS AT LEGISLATURE.

IT'S GONE FROM TRYING TO REPEAL THE UNIVERSAL THING THAT ALLOWS EVERY STUDENT TO USE VOUCHERS TO INCOME CAPS.

ANYONE UNDER $100,000 A YEAR FAMILY WOULDN'T AFFECT.

IF YOU ARE OVER, THAT YOU SEE A LESSENING OF THE VALUE OF THE VOUCHER, IF YOU MAKE OVER $200,000 YOU ARE NOT ELIGIBLE FOR THE PROGRAM.

TED: INTERESTING 130 TO 160, 60% OF THE VOUCHERS.

MAKE 160 TO 200,000, 25% OF THE VOUCHERS.

TOM HORNE'S OFFICE CAN BARELY KEEP TRACK OF THE FRAUD.

ARE THEY ABLE TO KEEP TRACK OF SOMETHING LIKE THIS?

>> THEY DON'T HAVE TO BECAUSE IT'S NOT GOING TO GET A HEARING.

DIDN'T INCLUDE -- THEY WILL DISCUSS WITH THE STAFF DURING THE MORNING, THERE IS NO ADDITION OF EMPLOYEES TO THE DEPARTMENT OF EDUCATION TO LOOK AT THE ABUSE AND WASTE AND FRAUD WHICH IS POTENTIALLY SOMETHING THAT, OF ANYTHING YOU DO WITH ESAS, THAT'S MOST LIKELY TO NOT GET COMPLETELY REJECTED BY EVERY SINGLE REPUBLICAN IN THE LEGISLATURE, I DON'T KNOW IF IT CAN PASS.

THIS DEFINITELY WILL NOT GO ANYWHERE AND THE ANNUAL SIGNAL SHE'S GOT HER EYE ON THIS AND FOCUSING ON SOMETHING WHERE LOT OF MEMBERS IN THE PUBLIC SAY HEY, WHY ARE WE GIVING THE FOLKS THAT MAKE THAT MUCH MONEY PER YEAR.

>> THEY DON'T KEEP TRACK NOW OF HOW MUCH THE FAMILIES ARE MAKING, SO WE WOULD HAVE TO REQUIRE FAMILIES TO REPORT HOW MUCH THEY HAVE AT THE HOUSEHOLD IN ORDER TO IMPLEMENT THIS.

THAT WOULD BE ONE THING.

AND WE DON'T KNOW BECAUSE OF THAT, HOW MANY FAMILIES WILL BE AFFECTED.

I THINK IT WOULD BE AWKWARD IF THE GOVERNOR HAD COMPLETELY TAKEN OUT THE ESA FIGHT FROM THE BUDGET BECAUSE IT WOULD BE A DECLINE OR THREE YEARS, WE'RE GOING TO ELIMINATE UNIVERSAL VOUCHERS AND PUT THE GUARDRAILS UP, AND LIKE JEREMY SAID, THEY KNOW IT'S NOT GOING ANYWHERE, BUT YOU HAVE TO SAY SOMETHING.

>> AND TO JEREMY'S POINT, I SPOKE WITH MATT GRESS, THE TOP REPUBLICAN ON EDUCATION IN THE HOUSE.

THERE'S BEEN FRAUD ON THE PROGRAM, WHAT WILL REPUBLICANS LET HAPPEN?

HIS ANSWER IS MORE EMPLOYEES AS JEREMY DUDA SAID, TO LOOK AT THE FRAUD.

POSSIBLY MONEY FOR TECHNICAL SOLUTIONS, A.I., THAT THE DEPARTMENT IS LOOKING INTO THAT COULD FLAG PROBLEMATIC EXPENDITURES.

TED: WHAT COULD POSSIBLY GO WRONG THERE?

WATER, YOUR FAVORITE TOPIC, $3 MILLION FOR POTENTIAL LAWSUITS.

WHAT ELSE DO I SEE?

>> I THINK THE BUDGET SAYS DON'T PANIC BUT WE HAVE MONEY SET ASIDE IN CASE THINGS GO BADLY.

IT'S ABOUT THE COLORADO RIVER WATER NEGOTIATIONS.

WE'RE ONE OF SEVEN BASIN STATES WHO GETS WATER FROM THE COLORADO RIVER, AND WE HOPE WE DON'T HAVE TO TAKE SERIOUS CUTS, WHICH IS TRICKY, BECAUSE AS YOU MIGHT HAVE HEARD ON THE NEWS, A BIT OF A WATER ISSUE AND ALSO THIS CONSTANT BATTLE BETWEEN HOBBS AND THE LAWMAKERS OVER GROUND WATER.

SO ONE THING I WAS CURIOUS ABOUT IS THE WATER INFRASTRUCTURE FINANCE AUTHORITY IS SUPPOSED TO BE THE AGENCY FINDING NEW SOURCES OF WATER AND INVESTING IN BIG PROJECTS LIKE, FOR EXAMPLE, DESALLINIZATION PLANT.

I THINK THEY WANT TO INVEST A BILLION DOLLARS OVER THREE YEARS AND GOT CLAWED BACK.

LAST YEAR WHEN THEY MADE THE SIGNIFICANT CUTS, I THINK WIFA GOT HIT THE HARDEST AND TOOK HUNDREDS OF MILLIONS OF DOLLARS.

AND THE DIRECTOR SAID WE'RE HOPING THIS IS JUST A ONE-TIME THING BECAUSE OF THE DEFICIT AND TOLD BY CERTAIN OFFICIALS IT'S TEMPORARY, BUT THIS YEAR NOTHING.

TED: I WAS GOING TO SAY, NOTHING RESTORED AT ALL.

>> NO, THE GOVERNOR'S OFFICE SAID WIFA HAS MONEY IN THE BANK ACCOUNT, PLANNING HOW TO USE THAT.

NO RUSH TO RESTORE THE REST OF THE FUNDS.

TED: SURPRISED WATER GOT SUCH A SMALL MENTION HERE, JEREMY.

>> WE'LL SEE WHAT THEY COME UP WITH IN TERMS OF PROJECT AND TALK ABOUT THE POSSIBILITY OF MORE FUNDING, IF IT'S NEEDED.

I DON'T KNOW HOW YOU DO THAT WHEN PEOPLE SUBMIT BIDS BASED ON THE MONEY THEY ACTUALLY HAVE.

THAT'S PROBABLY NOT GOING TO HAPPEN, BUT GEARING UP FOR THE MOST LIKELY THING THAT'S GOING TO HAPPEN IS SOMEONE IS GOING TO SUE SOMEONE AT THE END OF THE COLORADO RIVER WATER NEGOTIATIONS, WHICH WILL BE THE END OF NEXT YEAR.

TED: THE GOVERNOR'S OFFICE IS FOCUSED ON DOING ITS OWN THING IN TERMS OF TRYING TO PRESERVE THE GROUND WATER WE DO HAVE IN RURAL AREAS, THAT'S MAKING THE REPUBLICANS IN THE LEGISLATURE UPSET.

TED: TALKED ABOUT HOUSING, CHILD CARE, WATER, BORDER SECURITY.

HOW DID ALL OF THIS GO DOWN?

REACTION FROM REPUBLICANS?

REACTION FROM DEMOCRATS?

>> REPUBLICANS, AS YOU WILL BE SHOCKED TO KNOW, ARE NOT IN FAVOR OF HOBBS MESSING WITH THE ESA PROGRAM AND CUTTING DOWN ON AMOUNT FAMILIES WHO CAN QUALIFY.

I THINK THERE'S BEEN RUMOR THAT THE REPUBLICANS WANT TO DO WHAT THEY DID A FEW YEARS AGO WHICH IS DOLE OUT CASH TO THE REPUBLICANS TO SPEND ON WHATEVER PROJECT YOU LIKE THE BEST.

THE GOVERNOR OBVIOUSLY DIDN'T MENTION THAT IN HER BUDGET.

I THINK WE HAVE TO SEE HOW THAT PLAYS OUT.

I DON'T KNOW IF THAT IS SOMETHING THE REPUBLICANS GET BEHIND.

WHAT HAPPENED AFTER THAT, A LOT OF THE PROJECTS COULDN'T HAPPEN BECAUSE THERE IS A DEFICIT.

MAN, I JUST WASTED MY MONEY.

TED: $12 MILLION, IS THIS FOR ALL LAWMAKERS OR REPUBLICAN LAWMAKERS?

>> RIGHT NOW THE COMMENT FROM SENATOR JOHN KAVANAGH, IT WOULD BE REPUBLICAN SENATORS SPECIFICALLY.

THE LAST TIME WE SAW THIS, THE SENATE REPUBLICAN SENATORS HAD THEIR OWN PLAN AND REPUBLICAN HOUSE MEMBERS HAD THEIR OWN PLAN AND EVERYONE HAD THEIR OWN POT THEY HAD TO PLAY WITH.

GIVE ENOUGH MONEY AND THEY ALL SAY YES.

TED: YEAH.

>> SO THAT 12 MILLION WOULD JUST BE SENATORS BUT RIGHT NOW LIKE A BACK OF THE NOTEBOOK SCRATCH.

NOT ANYTHING FINAL.

TED: HOW SERIOUS DO YOU THINK THIS IS, JEREMY, TO DO THIS WITH $12 MILLION?

>> WE HAVEN'T STARTED TO SEE BUDGET NEGOTIATIONS.

DEPENDS HOW MANY VOTES THEY NEED, FIRST OF ALL.

THIS IS A PRACTICAL MATTER.

DO THEY HAVE THE VOTES?

WHOSE VOTES DO THEY NEED?

AND YOU GIVE OUT THE MONEY FOR THE ROAD IN THIS DISTRICT OR RODEO IN THIS DISTRICT OR WHATEVER.

TED: WHAT ABOUT COLLABORATION?

I'M SORRY, I KNOW THAT'S SILLY TO THINK ABOUT.

BUT THE IDEA OF WORKING AND GOING THROUGH THE PROCESS -- WORKING THESE THINGS OUT.

IT'S NOT DONE ANYMORE, IS IT?

>> THEY HAD TO DO IT LAST TIME BECAUSE THE FREEDOM CAUCUS REPUBLICANS WOULDN'T COME TO THE TABLE WITH HOBBS, THE REPUBLICANS HAD TO GET DEMOCRATS ON BOARD AND IT WAS A BIPARTISAN BUDGET.

I THINK TO A DEGREE THEY HAVE TO DO THAT BECAUSE HOBBS IS THE GOVERNOR, THEY HAVE TO DEAL WITH HER FOR TWO MORE YEARS BUT HAVE A BIG REPUBLICAN MAJORITY IN THE HOUSE AND THE SENATE.

MAYBE THEY'RE NOT GOING TO HAVE TO TRY TO GET THAT MANY DEMOCRATS.

TED: COULD THE FREEDOM CAUCUS BE AN ISSUE WITH REPUBLICANS?

>> THEORETICALLY, CAM AND I DID QUICK MATH THE OTHER DAY AND BELIEVE THE FREEDOM CAUCUS LOST NET MEMBERS THIS ELECTION, BUT THEY STILL HAVE ENOUGH, GIVEN THE GROWING, BUT STILL SMALL MAJORITIES THE REPUBLICANS HAVE TO THROW A WRENCH INTO THE OCCASIONS.

>> IN THE END, YOU HAVE TO GET SOME DEMOCRATS, A DEMOCRAT IS NOT GOING TO SIGN A BUDGET THAT DOESN'T HAVE A SUBSTANTIAL NUMBER OF DEMOCRATIC VOTES.

TED: INTERESTING.

JEREMY, STICK WITH YOU, HOW DID THE BUDGET RELEASE TODAY JIBE WITH THE MONDAY STATE OF THE STATE ADDRESS.

>> WE SAW NUMBERS AND DETAILS TO GO WITH THE VAGUER THINGS THE GOVERNOR TALKED ABOUT IN THE SPEECH.

CAMRYN TALKED ABOUT THE CHILD CARE THING, NOBODY KNEW WHAT TO MAKE OF IT BECAUSE WE HAD ZERO DETAILS, AND NOW THAT IT'S OUT, WE'LL SEE THE REPUBLICAN REACTION TO THIS PROGRAM OR THAT PROGRAM OR WHAT THE REPUBLICAN COUNTERPROPOSALS ARE GOING TO BE.

WHERE THE RUBBER MEETS THE ROAD AND WE'LL START SEEING NOT REAL MOVEMENT BECAUSE THAT WILL TAKE AWHILE IN THE BUDGET, MAYBE HINTS AT MOVEMENT.

TED: AND PROP 123 WAS MENTIONED IN THE STATE OF THE STATE ADDRESS, NOT MUCH HERE AS FAR AS A BUDGET.

WHAT'S GOING ON THERE?

>> IF THEY DON'T GET THEIR STUFF TOGETHER AND EXTEND PROP 123, WE'RE GOING TO BE OKAY, SO SAYS THEIR STAFF BECAUSE THEY PUT A BACKFILL IN.

THEY HAVE EDUCATION FUNDING, EVERYTHING WILL NOT COLLAPSE, BUT IF THE REPUBLICANS AND DEMOCRATS DO COME TOGETHER AND PASS PROP 123 EXTENSION THIS YEAR, THEN EVERYBODY IS HAPPY.

TED: IS THERE TALK OF TYING ANYTHING TO GET THAT ONTO THE BALLOT?

>> I HAVEN'T HEARD OF ANYTHING SPECIFIC YET, BUT DEMOCRATS SAY WE WANT A CLEAN EXTENSION, ESSENTIALLY.

WE DON'T WANT ANYTHING TIED TO IT, THEY'RE HEARING THE POSSIBILITY OTHER PRIORITIES COULD BE ATTACHED TO THAT.

TED: YOU CAN'T ATTACH TOO MUCH BECAUSE YOU HAVE A SINGLE SUBJECT.

>> IT COULD MEAN, HEY, WE'LL LET THIS SEE THE FLOOR AND TAKE A VOTE ON IT IF WE HAVE X, Y, AND Z VOTES ON THIS THING.

>> WARREN PETERSEN SAID IT WOULD BE REASONABLE TO INCLUDE SCHOOL PROTECTIONS, YOU WILL HAVE TO SEE THE PUSH AND PULL BETWEEN THE REPUBLICANS AND DEMOCRATS, REMEMBER REPUBLICANS DON'T NEED DEMOCRATS OR THE GOVERNOR TO SEND SOMETHING TO THE BALLOT.

ONLY IF THEY WANT A SPECIAL ELECTION, AND I THINK GETTING THEIR WAY ON PROP 123 RENEWALS IS MORE IMPORTANT TO THEM SINCE THEY CAN JUST BACKFILL MONEY FOR A YEAR AND A HALF OR SO.

TED: TALK ABOUT THE REQUIREMENT.

THE GOVERNOR HAS TO CALL A SPECIAL SESSION, CORRECT?

>> I BELIEVE THE GOVERNOR HAS TO SIGN -- I DON'T KNOW IF IT'S A SPECIAL SESSION, DEPENDING ON THE VOTES.

YOU MIGHT HAVE TO CALL A SPECIAL SESSION AND HAVE LEGISLATION AUTHORIZING A SPECIAL ELECTION.

NOT LIKE THE REPUBLICANS AND LEGISLATIVE MAJORITY SEND SOMETHING TO THE BALLOT, PROP 123 EXPIRES IN JULY.

IF YOU WANT SOMETHING IN PLACE, YOU NEED DEMOCRATIC INPUT.

>> BUT AS WE'VE MENTIONED HERE, THEY'VE GOT THE BACKFILL SO REPUBLICANS SAID WE'RE IN NO RUSH TO GET THIS DONE, WHICH LEADS ME TO BELIEVE WE'LL PROBABLY NOT SEE A MAY SPECIAL ELECTION, AND THEY'LL USE THE GENERAL FUND MONEY TO BACKFILL.

TED: DID WE SEE ANYTHING IN THE BUDGET REGARDING HEALTH CARE?

>> THERE WAS SOME STUFF THEY KIND OF PERKED MY EARS UP OVER WHEN IT COMES TO MEDICAID FRAUD.

THEY WANT TO HIRE MORE PEOPLE AT THE ATTORNEY GENERAL'S OFFICE TO INVESTIGATE MEDICAID FRAUD THROUGH THE AHCCCS LOOPHOLE AND GIVE MONEY TO TRIBES TO HELP PEOPLE TO RECOVER WHO HAVE BEEN AFFECTED BY THAT.

IT'S SOMEWHAT FUZZY BASED ON WHAT WE'VE HEARD FROM ALL THE EXECUTIVE BRANCH HOW RAMPANT THE FRAUD STILL IS.

I THINK THEY WILL SAY IT'S NOT RAMPANT ANYMORE, BUT SO MANY PEOPLE BEING INVESTIGATED WE NEED TO HIRE PEOPLE TO HELP WITH THE INVESTIGATIONS AND PROSECUTIONS AND HELP PEOPLE'S RECOVERY FROM BEING ESSENTIALLY KIDNAPPED.

SO I THINK THAT IS SOMETHING TO KEEP WATCHING, AND I THINK THE LAWSUITS ON THAT ISSUE, BOTH THE PROSECUTIONS OF THE BAD ACTORS AND POTENTIALLY LAWSUITS AGAINST THE STATEMENT WE'VE NOT SEEN THE END OF IT.

TED: INTERESTING.

WE DID SEE A LITTLE MONEY IN THERE ALSO TO INCREASE ACCESS OR POSTPARTUM CARE AND REPRODUCTIVE PLANNING.

TED: SOME OF THAT WAS MENTIONED IN THE STATE OF THE STATE.

>> THERE IS MONEY EARMARKED TO EXTEND OUT POSTPARTUM CARE FOR THOSE ON AHCCCS, AND LIKE I SAID, THE FAMILY PLANNING TYPE OF SERVICES.

TED: WILL THAT EAR BE CUT OFF, JEREMY?

>> UH -- [LAUGHTER] >> DEPENDS WHAT DO THEY NEED TO TRADE FOR?

HOW ARE THE BUDGET NEGOTIATIONS GOING TO GO?

WHAT'S IT WORTH TO THE REPUBLICANS TO GET THE GOVERNOR GET THAT IN EXCHANGE TO SOMETHING ELSE.

TED: COMES DOWN LATER IN THE NEGOTIATION PROCESS.

>> AND CAN YOU TRADE FOR FASTER ELECTION RESULTS DEBATE THEY'RE HAVING.

THAT'S NOT REALLY A BUDGET ISSUE BUT COULD BE LIKE HEY, WE WANT FASTER RESULTS IN THE WAY THAT YOU DON'T SUPER LOVE, BUT WE'LL GET YOU FREE CONDOMS OR WHATEVER IT IS THAT YOU WANT WITH THE CONTRACEPTION STUFF.

I DON'T KNOW WHAT IT WILL BE.

TED: THAT WAS QUITE AN IMAGE.

DO YOU AGREE WITH THAT?

>> I HAVE A SNEAKY SUSPICION WITH THE VOTING ISSUE, REPUBLICANS WANT THAT TO BE ON THE BALLOT IN 2026.

THEY WANT HOBBS TO VETO THAT, THEY WANT IT TO BE AN ISSUE.

TED: REALLY?

>> HAVE HER ON THE BALLOT NEXT TO THE ITEM THAT SHE VETOED THAT THEY THINK IS POPULAR.

>> NOT HAVE TO DEAL WITH PAY TWO-WEEK COUNT AGAIN.

THIS MAY MATTER TO THEM THAN IT MATTERS TO THE AVERAGE VOTER, JUST BECAUSE EVERYBODY CARES ABOUT SOMETHING AT THE CAPITOL DOESN'T MEAN REGULAR PEOPLE CASTING BALLOTS CARE ABOUT IT OR FEEL THE SAME WAY AS THE LEGISLATIVE MAJORITY.

TED: THERE'S A LOT OF STUFF IN HERE THAT REGULAR PEOPLE DON'T CARE ALL THAT MUCH ABOUT, BUT THEY SHOULD AND WILL SOME WAY, SHAPE, OR FORM DOWN THE ROAD.

WAYNE, HOW MUCH IS NEXT YEAR'S ELECTION FOR GOVERNOR HOBBS ESPECIALLY BUT WARREN PETERSEN, THE ATTORNEY GENERAL'S RACES, HOW MUCH IS THAT SHADOWING WHAT'S GOING ON?

>> A WHOLE HECK OF A LOT.

EVERYONE IS THINKING ABOUT 2026 WHETHER THEY ADMIT IT OR NOT.

AND HOBBS WOULD NOT SAY SHE'S BEING POLITICAL WITH THE BUDGET, BETTER TO SAY YOU'RE PRACTICAL BECAUSE IT'S TAXPAYER MONEY AND THAT MAKES SENSE, YOU HAVE TO THINK ABOUT CAN YOU GET RE-ELECTED IF YOU ARE FALLING PREY TO REPUBLICAN HEADLINES, EVEN TWO YEARS OUT, ABOUT THINGS THAT YOU ARE VETOING THAT MAKE YOU LOOK BAD OR INCLUDING IN THE BUDGET WHICH MAKES YOU LOOK SILLY.

YOU DON'T WANT HOT-BUTTON ISSUE STUFF GETTING FUNDED AND LIKE JEREMY MENTIONED HOMELESS VETERANS BECAUSE WHO CAN HATE A HOMELESS VETERAN.

>> SECURITY IS TOP PRIORITY OF MY ADMINISTRATION OR KAREN TAYLOR ROBSON IS THERE IN THE AUDIENCE AND HARD TO IMAGINE IT'S NOT SOMETHING HOBBS IS SAYING WITH AN EYE TO NEXT YEAR'S ELECTION.

TED: EVERYONE IS GLANCING TOWARDS THAT DIRECTION?

>> THE FREEDOM CAUCUS HAD THEIR OWN PRESS CONFERENCE AND MENTIONED NUMBER ONE PRIORITY IS DEFEATING ALL THE STATEWIDE DEMOCRATS, GOVERNOR HOBBS INCLUDED, IN THE NEXT ELECTION.

TED: I THINK THE FREEDOM CAUCUS IS MAYBE BEING A LITTLE BIT OF A PROBLEM ON THE REPUBLICAN SIDE IF THEY DON'T GET WHAT THEY WANT?

>> THEY ALWAYS ARE.

TED: BUT ESPECIALLY NOW WITH THE ADDED MEMBERS.

>> I THINK THEY'VE LOST MEMBERS.

TED: ADDED MEMBERS OF THE REPUBLICAN MAJORITY.

>> SURE.

IT COULD WORTH OPPOSITE WAY BECAUSE NOW THAT THE REPUBLICANS INCREASED THEIR MAJORITIES, THEY CAN'T AFFORD TO LOSE MORE VOTES THAN THEY COULD IN THE PAST.

THE FREEDOM CAUCUS, IT MIGHT BACK THEM INTO A CORNER, THEY MIGHT START GETTING LOUDER.

TED: IF THEY GET LOUDER, WE'LL HEAR THEM.

THAT'S IT FOR NOW.

THANK YOU FOR JOINING US.

I'M TED SIMONS.

THANK YOU FOR JOINING US.

YOU HAVE A GREAT EVENING.

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