Hobbs halts budget talks over Prop. 123
By Jeremy Duda
Published on March 25, 2026.
State budget talks are at an impasse after Gov. Katie Hobbs halted negotiations with Republican legislative leaders over disagreements over education funding and taxes. Hobbs and Republican lawmakers have until June 30 to decide how to spend around $17 billion next fiscal year, which could take them until late June. She also criticized the GOP for refusing to discuss the continuation of Proposition 123, a 10-year education funding program that provided several hundred million annually and was set to expire in 2025. The governor's office also accused Republicans of having no way to pay for their tax conformity plan. The other side accused Hobbs of "political theater" and said they will spend the next several weeks crafting a budget.
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