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Thu, Oct. 17

Arizona Gov. Doug Ducey signs $11.8B state budget

Gov. Doug Ducey delivers his State of the State speech Jan. 14, 2019 at the first day of the new legislative session. The governor signed an $11.8 billion budget Friday.  (Capitol Media Services photo by Howard Fischer)

Gov. Doug Ducey delivers his State of the State speech Jan. 14, 2019 at the first day of the new legislative session. The governor signed an $11.8 billion budget Friday. (Capitol Media Services photo by Howard Fischer)

PHOENIX (AP) – Republican Gov. Doug Ducey signed an $11.8 billion budget Friday that he said boosts education and public safety while preparing Arizona for economic headwinds.

With a $1 billion surplus, Ducey and the GOP-controlled Legislature had spending leeway they have not enjoyed since the Great Recession.

They devoted much of that extra money to savings and early debt retirement, frustrating Democrats who saw a missed opportunity to direct more money to schools they have said are still struggling to climb back from deep recession-era cuts.

"This is by far the best budget I have signed and such a contrast to where our state was just four years ago," Ducey said in a video message, referring to the state's dire financial shape in 2015 when he took office.

Republicans celebrated what they called a sizable but sustainable uptick in education-related spending. The budget has money to enact the second phase of a three-year plan to boost teacher pay 20 percent, hire more school counselors and police officers, help teachers pay for college and fund school construction.

The budget Republican legislative leaders negotiated with Ducey also boosts pay for state police, correctional officers and other public safety workers and includes funding to hire 49 Department of Public Safety officers to patrol a new section of the Loop 202 in the Phoenix area. It removes a provision that would have frozen enrollment in the KidsCare health insurance program for low-income families.

The budget also cuts $325 million in taxes to offset higher revenue the state expects to get from changes in federal law and a U.S. Supreme Court decision. That was crucial for many legislative Republicans who said the state should not see a windfall. And it cuts a new $32 vehicle license fee over two years that had drawn the ire of Republicans who backed it last year when it was sold as an $18 fee, bringing total cuts to state revenue to $386 million.

It also penalized the city of Flagstaff, whose voters in 2016 approved a minimum raise higher than the state wage, by charging the city for some increased state costs of providing services to the disabled. That proposal was watered down somewhat in the final budget.

Democrats said it was irresponsible to permanently cut taxes and starve the state of revenue it could use for schools, infrastructure, housing and a host of other needs they identified.

Arizona has seen its revenue rise as the U.S. economy has recovered in one of the longest periods of growth since World War II.

With an eye on an inevitable future downturn, Ducey and lawmakers more than doubled the state's main savings account to $1 billion by making a $542 million deposit in the fund. They paid down debt by $190 million, which will save money on bond payments.

The budget for the fiscal year beginning July 1 is up about 11 percent from the current year, including the money allocated to savings and debt relief.

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