Arizona Capitol Times

In his second year as Arizona’s House speaker, Rep. Steve Montenegro, R-Goodyear, helped lead a bipartisan budget deal that includes President Donald Trump’s tax cuts and passed the Legislature with a supermajority of votes. In a recent interview with the Arizona Capitol Times, Montenegro discussed the recent legislative session and reflected on this year’s activities from lawmakers. The questions and answers have been edited lightly for style and clarity.

House Minority Leader Oscar De Los Santos, D-Laveen, spent his second year as minority leader navigating a divided government at the Arizona Legislature. He helped negotiate a bipartisan budget that freezes new data center tax subsidies for three years and includes tax cuts aimed at middle-class Arizonans. In a recent interview with the Arizona Capitol Times, De Los Santos reflected on the session’s wins, losses and unfinished work.

Key Points: Republican and Democratic lawmakers pushed for a tax cuts package in the 2026 legislative session The tax cuts are intended to help middle-class earners while reducing state revenue by $1.5 billion over three years Housing affordability remains a key issue for many Arizonans Lawmakers across both sides of the aisle opened the 2026 legislative session with affordability top of mind – and closed it claiming credit for making Arizona cheaper to live in, chiefly through tax cuts.

Gov. Katie Hobbs is now on the other side of four legislative sessions on the Ninth Floor. And while the final session of her first term as governor did not feature the uproarious political battles over immigration, abortion and disability rights that defined her previous years, it did still bring plenty of clashes between an incumbent Democrat seeking a second term and a Republican Legislature doing everything it can to regain a trifecta in November’s election.

Key Points: Gov. Katie Hobbs is already campaigning on $1.4 billion tax cut from bipartisan budget She managed to secure a data center tax moratorium and avoid setting a new veto record The governor will now set her sights on the Nov. 3 election in which she hopes to be reelected For Gov. Katie Hobbs, the fourth and final legislative session of her first term in office serves as a model for how Arizona’s divided government forces state leaders to work across the aisle and compromise.

Arizona Capitol Times – June 26, 2026 [dflip id="499146" ][/dflip] June 26, 2026

Key Points Prison oversight funding failed despite court pressure Bipartisan reforms eased court fees, modified probation Advocates plan renewed prison oversight, confinement reforms next session Despite facing a takeover of the prison healthcare system, the state failed to fully fund court costs and again declined to cover start-up costs for an independent prison oversight office.

Key Points Negotiations on Empowerment Scholarship Account collapsed Competing measures headed to voters Ballot measures face legal, language and campaign battles in runup to election Legislators twice tried to iron out a deal to reform the Empowerment Scholarship Account program this session, but now, voters will have the final say.

Key Points: Proposition 123 renewal failed for third consecutive legislative session Republicans, Democrats remained divided over education funding priorities 2026 elections likely determine Prop. 123’s future direction, fate Lawmakers drew the same lines in the sand after a third consecutive failure to renew or reconfigure Proposition 123 and rework one way the state funds education, leaving Arizona’s land-trust-backed K-12 funding stream in limbo for another year.

Change is in the air in our Arizona newsroom. As Arizona prepares for another high-stakes election cycle, we’re investing in the future of Arizona Capitol Times by welcoming two accomplished journalists who bring decades of experience, deep newsroom leadership and a shared commitment to producing the kind of journalism our readers have come to expect.