John --

Happy Monday! Welcome to our *final* update from the state capitol. This will be a longer update than normal, considering the events of the past week.

If you read my update last Monday morning, I shared with you that negotiations were ongoing, but I did not expect a budget to happen until the end of June.

It is no secret that I have been working closely on budget requests with one of my Republican colleagues, Senator Paul Boyer, since early this year. Paul and I have worked together the last four years in the Senate and have developed a close friendship. While we disagree on a great number of issues, we talk daily and work together closely on shared priorities.

One of those priorities was the budget this year. Neither of us were running for re-election, and both of us wanted to go out on a high note.

Even though Paul opposed Proposition 208 in 2020 (which would have raised taxes on wealthier Arizonans to help fund over $800 million on-going in K-12 spending), he felt it was right for the legislature to appropriate a similar amount on-going to our K-12 public schools, especially considering the large surplus we have this year. He felt that the voters made their voices heard in 2020, and he wanted to respect that. Very early in the session, the two of us decided to work together on a budget proposal that would dedicate significant dollars to our K-12 public schools, our three state universities, and our state housing trust fund.

Paul’s involvement was key because of the balance of power in the Senate. With a 16-14 majority, Paul could hold up the budget process provided the two of us stayed together and held out for our shared priorities. Republican leadership could always go around us and try to broker a deal with Senate Democratic leadership (and trust me, they tried), but at the end of the day, getting their votes would cost more money and pull additional Republicans off the budget.

Ever since February, we repeated the same message to ourselves: we are in a strong negotiating position here. In the end, they will have to work with us to get a budget passed. The plan was to wait them out, continue to gain concessions, and cut a deal when we felt we had secured enough policy wins.

The other key factor here, as I have pointed out in multiple updates, is the governor and Republican majority all wanted to spend money this year. The governor wanted $1 billion for water and other Republicans wanted substantial investments in infrastructure and paying down debt. The plan was to support their investments while also holding out for our financial asks as well.

Back in March, Paul and I met with Republican leadership from both chambers on multiple occasions to pitch our proposal. Our ask was simple: we wanted roughly $850 million ongoing for our K-12 public schools, with most of those dollars going into the “base,” along with separate pools for items like special education and an opportunity weight to provide additional support for lower-income districts. The numbers for our ask broke down like this:

-$550 million on-going for base-level funding, which is the most flexible and cannot be cut by future legislatures;

-$100 million on-going for special education;

-$100 million on-going for an opportunity weight for lower-income school districts;

-$100 million on-going for Career and Technical Education (CTE) grants

We also wanted on-going dollars for our state universities as well, both in direct investments and an expansion of our statewide Promise program scholarship for low-income families. This added up to about $1 billion in on-going spending.

We had planted our flag back in March: if you want us on the budget, these are our asks.  

We met with the governor’s office in early April and pitched them on the same proposal. At that point, it was just the two of us that were on board. The message we got from the governor’s team was that they were non-committal on our priorities and just wanted to make sure there were enough dollars left over for their priorities, which included the $1 billion investment in water infrastructure that I mentioned above.

As the calendar moved to May and into June, we stuck together. We would check in multiple times a day to see what each of us were hearing about the latest drafts and conversations. Republican leadership was not working with Democratic leadership in any substantive way, meaning the quickest path to a budget was still through us.

We knew that the eventual budget deal that would pass would include a significant amount of new spending and investment. Our goal was to try and secure as much for our priorities as possible.

Starting in April, we also met weekly with a group of K-12 public district superintendents over Zoom, where we would update them on our progress and share what we were hearing. These superintendents were writing letters of support and getting buy-in from their superintendent colleagues all over the state for our proposal.

On June 6^th, the first budget spreadsheet that majority staff had been putting together leaked, and it was nowhere close to what we were looking for on both K-12 and higher education investment. The amount of dollars going into the base for K-12 was less than $150 million, a far cry from our ask of $550 million. They did include $100 million for special education, which was good, but the opportunity weight we also wanted was nowhere to be found.

We both made it clear both publicly and privately: this was nowhere close to acceptable. The plan continued to be to wait them out until the end of June until we added more dollars to K-12 and higher education.

The following Monday, June 13^th, the two of us walked over to the Joint Legislative Budget Committee (JLBC) and, working with staff, put together our own budget spreadsheet that included our priorities. We included the K-12 items mentioned above along with additional investments in our state universities and the housing trust fund. Once we had the spreadsheet, we started sharing it with our colleagues.

Paul continued to meet with his Republican colleagues and reiterate the need for additional K-12 investment. By the end of that week, on June 17^th, we saw a revised spreadsheet from majority leadership that had added the following:

-Another $230 million for the base level for K-12;

-The addition of the $100 million opportunity weight that we had asked for initially;

-$58 million more in Additional Assistance funding (equally distributed to district schools and charter schools)

-A revision to the $50 million school safety fund to expand from just School Resource Officers (SRO’s) to add counselors and social workers (this was one of my requests)

Much better! But still not where we needed it to be. We continued to hold firm and knew that we could wait them out for a better deal. The base level was still under $400 million when we needed to grow that number to at least $500 million on-going.

Another important factor to mention here: it was around this time when some of my more conservative colleagues in both chambers started saying publicly that they would oppose the budget unless we CUT spending and drastically scaled back our investments this year.

This only increased our leverage: we knew it would be easier for the governor and leadership to work with Paul and me than it would be to work with these conservative members. We knew that as long as we were reasonable with our asks, and knew when to cut a deal, that we would win out in the end.

That now brings us to last week. On Monday, plans were to hold budget hearings in Appropriations on Tuesday and hold floor votes on Wednesday. The problem was we were not on the budget yet. While the June 17^th draft had made some improvements, we knew we could secure a little more if we continued to work.

We were getting a lot of pressure to get on the budget and were told in no uncertain terms that the alternative was a “skinny” budget where only core government spending would be approved, and all our hard work would be for naught. We continued to hold firm, knowing that if we were able to secure a little more, we would be successful.

On Tuesday morning our Senate Democratic members on Appropriations (including me) held a budget briefing with JLBC staff, going over the spreadsheet that was proposed. I had to keep leaving the briefing because my phone was ringing with calls from either the governor’s office or lobbyists working to close the deal. I would hear updates that we were able to secure more dollars for one area or the other. My message to everyone was the same: we’re making progress, but we aren’t there yet. Let’s keep working.

If you go back and watch the Appropriations hearing from Tuesday, I kept saying in committee that we were “close.” And we were! I stepped out of our hearing multiple times to take phone calls or speak to lobbyists or staff directly. We continued to make progress, but we still had to resolve two key components: getting the K-12 base amount to at least $500 million and increasing funding for ASU and NAU to make up for the UofA investments that were already in the budget.

It was Wednesday morning and early afternoon when things finally started to lock into place. At that point we had been able to get the K-12 base amount to around $465 million but had still yet to secure additional support for ASU and NAU. On Wednesday morning around 9:30am I texted Representative Michelle Udall, who is chair of the House Education committee and was also working to secure extra K-12 dollars. Paul and I headed over to her office in the House to see if we could lock this deal down.

We were joined by two of my other House colleagues, Representatives Diego Espinoza and Joel John. Also in the room was Meghaen Dell’Artino, who represented dozens of school districts around the state and was a key reason we got the eventual deal done.

We said to Michelle that we needed at least $500 million on-going for the K-12 base. Since we were being told that we didn’t have enough dollars in the budget left, we literally started going through the budget spreadsheet line by line to see what areas we could cut or where we could find savings. We reiterated our need for the university dollars as well. We met for about 30 minutes, going over different scenarios and possibilities, and agreed that if we could get the dollars for both K-12 and higher education where we needed them to be that we would sign off on the deal.

Meghaen, Paul, and I kept trading phone calls and text messages all morning. By the early afternoon, we had the outlines of a deal in place: we had secured $526 million on-going for the K-12 base and about $76 million one-time for the other state universities ($50 million for ASU, $26 million for NAU). I remember Paul and I looking at each other and coming to the same realization: we have come a very long way, and this is the best deal we are going to get. Let’s lock it down!

This $526 million on-going for the base was in addition to the other budget items already secured for K-12, like the $100 million on-going for special education, the $100 million on-going for the opportunity weight, and over $60 million on-going for Additional Assistance funding. Altogether, our K-12 public schools would receive over $800 million on-going in the first year and over $900 million on-going starting in year three. When you add on the $200 million in one-time funding for school facilities and maintenance in year one, it’s over $1 billion for our K-12 public schools this upcoming school year.

Pretty darn close to our original budget goal back in March, right?

We also secured two other policy wins that we asked for: we removed an expansion of STO’s (school tuition organizations) and re-balanced the Additional Assistance dollars to be based on per-pupil amounts rather than splitting dollars equally between District Additional Assistance and Charter Additional Assistance (a huge win for our district schools).

Two more items to highlight: we secured $60 million for our state Housing Trust Fund to help fund affordable housing projects around the state, and another $12.5 million on-going for the Arizona Promise program scholarship that funds scholarships for low-income families to better afford tuition at our three state universities (bringing the total amount to $20 million on-going per year). Huge!

Staff spent the next several hours working on amendments to align with the changes we secured. Later that evening word had started to trickle out that we had a deal (you also started to see certain legislators taking credit for something they had nothing to do with, claiming that they were the ones who had “negotiated” a bipartisan agreement).

What followed afterwards was rather calm in retrospect: we voted on the budget bills that evening and into Thursday morning, finally finishing around 5:30am. I voted for every single budget bill, as did several of my Democratic colleagues. I had arrived at the Senate at 7am on Wednesday morning, meaning I spent about 22.5 hours at the capitol as we worked to lock this budget down.

In my speech explaining my vote on the K-12 budget portion, I outlined the dollars that would be going to our K-12 schools and thanked my colleague Senator Boyer for his leadership. We would simply not be here without him and his perseverance. In our final year, in our final budget, we had secured significant long-term investments for our K-12 public schools and state universities and accomplished something that is rarely done in our state: help negotiate and pass a bipartisan budget.

Back in March, we talked about wanting to go out on a high note. People doubted us and told us it couldn’t be done. We continued to think it was doable based on the shared bipartisan intent to spend our surplus dollars and the continued recalcitrance from some of the more conservative members. The path was there, and we were able to help forge an agreement that in the end over two thirds of the legislature supported.

This budget is not perfect. There are some items I wanted that I was not able to get, including my Earned Income Tax Credit I advocated for all session. In the end, I was given a choice: you can get your EITC, but it means $75 million less on-going for K-12. Ultimately, I chose to dedicate those dollars to our schools.

There are also items included in the budget that I did not like, including some investments in border security and a very large investment in the rainy-day fund (over $400 million) that could have been used for other things. But at the end of the day, the good far outweighs the bad.

One of the pieces of very bad news from last week, however, was the vote to universally expand Empowerment Scholarship Accounts (ESA’s). I worked very hard to try to limit this expansion to Title I students only but was not successful. It became clear last week that the ESA expansion was going to happen regardless of what happened with the budget. At that point, I worked to secure as many on-going dollars for our schools as possible.

This bipartisan budget deal involved a lot of moving parts and happened because of a couple people that I want to thank. My colleague Senator Paul Boyer is obviously at the top of this list. His leadership and his willingness to work with me all session to help move this further and further towards the goal line was the key driver in making this happen.

I worked with several of my House Democratic colleagues all session to check in and make sure we were all on the same page to drive towards the same goal. The main leader in the House was my good friend Representative Diego Espinoza, who continued to insist on at least $500 million on-going for the K-12 base and helped whip additional Democratic votes as we got closer to the finish line.

I also checked in regularly and worked closely with Representatives Morgan Abraham, Jennifer Jermaine, and Jennifer Pawlik as well. Their pragmatism and commitment to working towards a deal helped secure more Democratic votes in the House and enthusiasm for the eventual deal.

And a huge thank you to my friend Meghaen Dell’Artino, who served as the conduit between Paul and me, the governor’s office, and Republican leadership. She fought for our asks and was honest with us about what was gettable and what was not. We spent many hours together last week working to get this deal done. She was just as big a part of this as anyone else, and the overall deal would not have happened without her.

Thank you for your patience in reading through all of this! As you may have heard, we adjourned our session early Saturday morning. I will have more for you later this week, including a link to my farewell speech and some details about what REALLY happened Friday night when protestors arrived at the Senate doors.

Until next time!

Yours in the fight,

Sean

http://www.seanbowieforaz.com/