Addressing Affordability in the 2026 Legislative Session
Arizona has hardly had an opportunity to recover from the aftershocks of Biden-omics. The trillions of dollars injected into the economy through the so-called Inflation Reduction Act continue to work their way through the system in the form of higher prices and eroded purchasing power. Open-border policies that expanded the labor supply at the lower and middle ends of the wage scale have depressed wages. And the Biden Administration’s unprecedented regulatory burden on industry, a nearly $2 trillion drag on the economy, will take far longer than a year to unwind and correct.
Unfortunately for Arizona, efforts to fix these problems at the federal level cannot be fully realized here at home because Katie Hobbs remains our Governor.
Hobbs has harmed Arizona’s recovery, overseeing a massive fall from 4th in the nation in job growth to 47th. She inherited a booming local economy after a Republican legislature and Governor ushered in a 2.5 percent income tax, incentivized entrepreneurs and small businesses, prioritized deregulation, and expanded choice and freedom in education. Yet Hobbs has managed to squander that opportunity. In fact, it takes a special skill set to be perfectly set up for success and then drive a working model into the ground.
And Hobbs knows she’s to blame. That’s why she’s now desperately trying to reinvent herself by pushing Trump-esque tax cut rhetoric while clinging to the same big-spending, high-tax policies that caused the damage in the first place. At her core, she remains a California-style Democrat who would rather govern Newsom-style than embrace the Republican solutions that actually work. That’s why, despite a Republican legislature that has delivered tax relief bills, more disciplined budgets, and common-sense deregulation, she has earned a reputation as the veto queen.
As a result, Arizonans are dealing with real affordability woes, and they best not hinge their hopes on Hobbs.
Despite responsible budgeting and repeated tax relief efforts by Republican lawmakers, affordability pressures continue to mount. Taxes are creeping higher at every level of government. Utility bills have surged. Housing costs are outpacing wage growth. And programs intended to help struggling families are losing billions to fraud, waste, and mismanagement.
That is why the 2026 legislative session must focus on Affordable Arizona. And Republican lawmakers already know how to confront the true drivers of cost, restore economic growth, protect taxpayers, and ensure Arizona remains a place where families can afford to live, work, and build a future.
Deliver Real Tax Relief, Not Hobbs Window Dressing
President Trump delivered historic tax relief for working families through the One Big Beautiful Bill. Arizona now has a choice: conform to the whole amount and pass that relief through to taxpayers or allow Hobbs to water it down and quietly raise taxes.
That means this session Republicans must unify behind a plan that delivers at least $420 million in meaningful tax relief, is tailored to Arizona’s needs by prioritizing workers, families, small businesses, and fixed-income retirees and ultimately avoids bad policy gimmicks like the SALT deduction, which benefits high earners in high-tax states.
Governor Hobbs has tried to rebrand herself as a tax cutter, but her conformity proposal doesn’t come close to covering the full impact of federal tax changes. Anything short of the full conformity box means Arizonans pay more in state taxes, even if they get a federal tax cut.
Stop the Local Tax Creep
Even as the Legislature has cut taxes, cities and towns across Arizona have been quietly raising them. Sales taxes, use taxes, fees, rates – local governments are stacking them year after year, erasing the gains families were supposed to feel from conservative reforms.
This local tax creep isn’t accidental. It’s the result of city councils that refuse to control spending and know taxpayers will be forced to foot the bill.
The Legislature must step in with the kinds of taxpayer affordability protections Republicans are known for such as a moratorium on local tax, rate, and fee hikes, voter approval for any local tax increase, absolute caps on local tax rates, and ending property tax hikes to support empty and underutilized schools.
Hobbs won’t be keen on choosing taxpayers over her local big-government allies, but Republican lawmakers should press ahead anyway. After all, affordability doesn’t end at the state’s income tax rate. It’s felt in every incremental tax and fee levied by local jurisdictions.
Lower Energy Costs by Stopping the Green New Scam
Arizona families are being crushed by rising utility bills. Ratepayers of the largest monopoly utility in the state have been shocked by three major rate hikes in four years with another 14% increase being proposed this year. And all of it is driven by utilities chasing expensive, unreliable “green” scam projects (and profits).
Ratepayers are paying for massive battery farms, wind, and solar projects that don’t reliably meet peak demand while pushing dependable energy offline. The result is an impending energy crisis with higher costs and less reliability.
Republicans have real solutions to this critical pocketbook issue. Reform utility resource planning to prioritize reliability and cost, allow large energy users to build their own power to reduce strain on the grid, and require utilities to meet dependable, dispatchable energy targets.
Despite Hobbs vetoing every prior attempt to protect ratepayers (and her consistent alignment with utility interests,) Republicans must make stopping these relentless rate hikes a priority. Affordable energy is the backbone of an affordable state and a major kitchen table issue for Arizonans.
Crack Down on Hobbs’ Welfare Fraud and Health Care Waste
Affordability is also undermined by billions of wasted taxpayer dollars. Arizona’s AHCCCS system alone has been rocked by more than $2 billion in fraudulent billing, including a single $650 million scheme that occurred under Katie Hobbs’ watch.
That money comes directly from taxpayers.
Whether Hobbs has been asleep at the wheel or distracted by manufacturing her own questionable pay-to-play arrangements, it’s up to Republicans to clean up her mess. That means strengthening oversight, improving fraud detection, enforcing eligibility rules, mandating regular independent audits – and continuing to investigate Hobbs’ alleged misconduct.
Every dollar stolen is a dollar that could have lowered taxes or reduced costs for families.
Hobbs is a Hinderance, But Help is on the Horizon
The 2026 legislative session is critical for Arizona.
One path leads toward California-style governance: higher taxes, higher costs, endless subsidies, and permanent dependence on government programs that only increase our state’s problems.
The other path builds upon Arizona’s proven conservative model: lower taxes, abundant energy, and accountability in public spending.
Republicans have the ideas. Republicans have the record. Now Republicans must make 2026 the session that decisively puts affordability first for today’s families and especially as we weather the last 12 months with Hobbs at the helm.
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