In what was perhaps, substantively, Governor Katie Hobbs’s best State of the State Address in her first term as Arizona’s Chief Executive, the driving issues of her and Democrats’ 2026 campaigns became crystal clear.
At a morning presser and an address that reaffirmed their commitment to smart government and Arizona’s Promise, Governor Hobbs and Legislative Democratic Leaders Priya Sundareshan and Oscar De Los Santos outlined an agenda that focused on affordability, public safety, water security, investments in public education, and Empowerment Scholarship Private School Voucher Account Reform.
Arizona’s Promise and Affordability
Reminding the audience of her financial struggles growing up and as an adult, Governor Hobbs called on the legislature to build on the achievements from 2025 (erasure of medical debt, investments in rural infrastructure, reducing housing, childcare, and prescription drug costs, expansion of commerce, veterans assistance, growth of apprenticeships, investing in post secondary education, reducing red tape on energy projects, and a rise in the state’s job numbers) and secure legislation to make lives more affordable for Arizonans, saying:
“Like so many Arizona families are doing right now, I know how to stretch a dollar. I saw my parents do it. I did it myself to help my family get by and support my kids. Affordability isn’t a joke or some hoax. It’s a real and consequential challenge that families across Arizona must grapple with every day. Pocketbooks are strained, and Arizonans need their elected officials to take action. Affordability is my top priority. I’m encouraged it’s yours as well.”
The Governor called on the Legislature to pass her proposed $200 million in middle-class tax cuts, commenting that:
“We can put more money in the pockets of Arizona families — money that will help them put food on the table, care for their children, and pay their utility bills…However, we should all agree that middle-class families deserve a tax cut now, so Arizonans can get that relief when they file their taxes this spring. Let me also say: If you think billionaires and big corporations should get a tax break before hardworking families, then you need to spend more time with real Arizonans who are struggling to get by.”
Later in the speech, the Governor announced a new Housing Acceleration Fund that “would build more affordable housing, faster” and called on the legislature to annually fund the program, saying “Let’s keep fighting to bring back the Arizona that I grew up in – one where a working-class couple could buy a house to call home and raise their family in.”
To meet the rising costs of utilities, the Governor proposed the creation of an Arizona Affordability Fund that would “help families manage the high cost of housing and utilities.”
Smart Government, Public Safety, and Water Security
Governor Hobbs spent a considerable portion of her address condemning the Trump Administration for their obtuse policy actions since returning to power last year.
Whether it is the misguided Big Beautiful Bill or denying vital disaster relief from FEMA or diverting border security and narcotics fighting resources from the border to “score political points in cities thousands of miles from the southern border,” the Governor blasted the federal government for “turning their back on Arizonans who are simply trying to get back on their feet.”
Saying “we show the political class in Washington, D.C. how to get things done,” Hobbs praised the bipartisan state budget passed in 2025, which invested in school meals for children and protected Medicaid.
She also cited her Operation Desert Garden program, which picked up the drug-fighting slack from the absent Trump regime, as an example of her team providing public safety, by:
● “Seizing more than one hundred and five million dollars worth of drugs.
● Confiscating more than sixteen thousand pounds of fentanyl.
● Taking twelve hundred illegal firearms.
● Making more than fourteen hundred arrests.”
Moving forward, the Governor advanced smart government fiscal policy through the proposed “Arizona Capacity and Efficiency Initiative: a series of cost savings measures that can save Arizona up to one hundred million dollars over the next three years,” and remarked that:
“We will not slash and burn with stunts that do more harm than good. We will not decimate important services that families and businesses rely on. We will streamline, consolidate, and cut costs to make government work for our people.”
The Governor’s smart government initiatives also extended her renewed calls to build on the achievements on water security over the last couple of years by announcing “an Active Management Area for La Paz County, to crack down on the out-of-state special interests that are pumping our state dry while Arizona families and farmers suffer.”
The Governor also proposed building on the AG to Urban Water Security Legislation, stating:
“We can no longer sit idly by while our rural communities go without help. They deserve solutions and security, not another decade of inaction and uncertainty. And while we secure our water and stand up for our communities, we can grow our economy, build homes, and create the future that Arizona families deserve….This type of smart growth is our future. We can protect our groundwater supplies. We can build more housing and lower costs. We can continue to be the model for the nation when it comes to water conservation and economic development.”
Finally, the Governor called for a smart government end to the tax breaks for the water and utility abusing Data Centers, offering:
“Make data centers pay their fair share for the water they use. The average Arizona family pays one cent for every gallon of water used in their home. If data centers were to pay the same amount, we could make a multi-million dollar deposit into the Colorado River Protection Fund every single year.
It’s time we make the booming data center industry work for the people of our state, rather than the other way around. If we are to be successful, we must rethink our state’s approach to data centers more broadly. More than a decade ago, we made a strategic decision to grow data centers by creating a tax exemption for them – I voted for it. Now, Arizona is a national leader in this sector. We must ask ourselves: should taxpayers continue subsidizing the data center industry?
I know my answer. My executive budget will eliminate the Data Center Tax Exemption, putting an end to a thirty-eight-million-dollar corporate handout. And I’m glad legislators in both parties agree with me – I can’t wait to get to work and get this done.”
Arizona’s Promise Combined with Smart Government: Investing in Public Schools and Repeating her call for ESA Accountability.
Towards the end of her address, Governor Hobbs called on the legislature to advance Arizona’s Promise by putting a clean renewal of the pro-public education Proposition 123 on the ballot without the poison pill of trying to memorialize Empowerment Scholarship Private School Voucher Accounts (ESA)in the State Constitution, saying:
“When we revisit a renewal of Prop 123 this session, let’s end the partisan calls to add constitutional protections to the ESA entitlement program. The original ballot measure was successfully passed because it enjoyed the support of teachers, parents, business leaders, and Republican and Democratic elected officials. Let’s recapture that spirit and keep the divisive, partisan policies out of negotiations. Let’s get serious about our once-in-a-decade opportunity to invest in our state’s public schools without raising taxes. It is time to renew Prop 123 and stop the teacher exodus … to stop underfunding schools and letting them crumble … and to give our students the tools they need to thrive. Let’s show parents, the business community, and the nation that Arizona is serious about building the world-class public education system we need for the future, through every stage of education.”
On ESA accountability, the Governor stressed smart government common sense, stating:
“…If this Legislature truly wants to create opportunity for Arizona families, then it’s time to support public education and bring accountability to the ESA entitlement program. While other government entitlements have strict requirements and oversight, the ESA program continues to operate unchecked, squandering taxpayer dollars with no accountability. It seems like every day, we learn about new shopping sprees happening at the expense of taxpayers…diamond jewelry, high-end clothing, and furniture…who knows what taxpayers will be footing the bill for tomorrow? In my plan, the original mission of the ESA program – to help kids with disabilities and in military families – remains untouched. But even the program’s most ardent supporters must agree: it’s time we tackle the waste, fraud, and abuse to ensure taxpayer dollars are going towards true educational purposes.”
After her speech, the Governor and her team posted:
Democratic Legislative Leaders Offer Affordability Agenda and Praise for the Governor’s State of the State Address:
Before the Governor’s address, Arizona Legislative Democrats, led by leaders Priya Sundareshan and Oscar De Los Santos, gathered at the Capitol to advance an Arizona We Can Afford Agenda.
With Representative De Los Santos saying that Arizonans are facing, thanks to a “rigged” culture of corporate greed and MAGA-Trump Republican rob from the poor and middle class and give to the rich policies, “the worst affordability crisis working families and the middle class have faced in a generation,” where the people feel “no one is fighting for them,” the Democratic House Leader declared that “Democrats hear you and we will fight for you.”
De Los Santos vowed that Democrats “will fight to lower costs for working families and the middle class, take on the greedy corporations, fight for affordable health care, and we will protect our public schools, which are the engine of economic opportunity for working families.”
On the Governor’s State of the State of the State Address, De Los Santos praised it, commenting:
“Governor Hobbs is right to center this session on building an Arizona We Can Afford. House Democrats stand ready to deliver Gov. Hobbs’ Arizona Affordability Fund to bring relief to families struggling with high utility costs, and to end special corporate handouts for data centers that are driving up electricity bills.”
“As families across Arizona struggle with the rising cost of living, we applaud the creation of the Housing Acceleration Fund to bring down housing costs and look forward to delivering Gov. Hobbs’ Middle-Class Tax Cuts that provide real relief for seniors and hardworking families.”
Senator Sundareshan spoke after De Los Santos and said of her colleague’s remarks, “What we just heard is the reality families across Arizona are living every day.”
On the Democratic “simple, focused, and urgent” agenda, Sundareshan echoed many of De Los Santos’ points on corporate greed and policy priorities, saying, “Affordability isn’t just a slogan or phrase we use lightly. It’s whether a parent can buy groceries. Whether a senior can afford their prescriptions. Whether a young family can stay in the neighborhood that they love or whether they’re being priced out by forces completely beyond their control.”
During her remarks, the Senator outlined several legislative proposals to reduce health care costs, provide housing assistance, create a state Consumer Protection Agency, invest in public schools, expand apprenticeships, and reform the ESA program.
Senator Sundareshan also commended the Governor on her State of the State Address, stating:
“Governor Hobbs’ State of the State address laid out a clear and urgent vision for An Arizona We Can Afford, where families can live, work, and thrive. Senate Democrats are ready to act. Our agenda this session is focused and urgent, Arizonans cannot afford to wait.
Families across our state are being squeezed by rising costs, from housing and utilities to healthcare and groceries. Senate Democrats are committed to delivering immediate relief, including working with Governor Hobbs to provide real, meaningful relief for working class Arizonans who are feeling the pressure of today’s economy.
This session, we will advance policies that lower everyday costs, rein in corporate greed, expand access to affordable housing, and strengthen public education. We will continue to protect our natural resources and invest in the infrastructure that supports long-term economic stability and opportunity in every community.
Arizonans deserve a Legislature that moves with purpose and delivers results. Senate Democrats are ready to partner with Governor Hobbs to turn this vision into action and build an Arizona where opportunity is within reach for everyone.”
Both Democratic Legislative Leaders also expressed their goals and hopes for the affordability agenda in a social media post in Spanish.
While Horne busts a gut, Save Our Schools Arizona praises the Governor’s commitment to ESA reform
Superintendent of Public Instruction Tom Horne was not one of the people applauding the Governor during her State of the State Address.
When she spoke about renewing Proposition 123 and holding ESA Private School Voucher Accounts accountable, he did not applaud that which people should consider odd considering he was elected to further the interest of public schools.
He also did not applaud when the Governor called for an end to political violence.
If a person can not applaud that, what is wrong with that individual.
After the address, Horne issued a statement that read:
“Arizona parents have made it clear they believe in being able to choose the best education for their children, whether districts, charters or Empowerment Scholarship Accounts. By their loud display today, Democrats proved they want to take that power away from mothers and fathers who know their children’s needs best and return education to a government monopoly that parents do not want.”
No, Mr. Horne. Democrats want to take power away from the people, committing waste, fraud, abuse, and theft on the state coffers by creating phantom students, hoarding funds for post-secondary education, and non-educational expenses.
In contrast to Mr. Horne busting a gut over the Governor’s comments, Save Our Schools Communication Manager Tyler Kowch said to Blog for Arizona:
“Save Our Schools Arizona, and over two-thirds of Arizona voters, stand with Governor Hobbs’ call to end the rampant waste, fraud, and abuse in the universal ESA voucher program. It is far past time to add much-needed accountability to this off-the-rails program!”
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