Enacted Budget – Fiscal Year 2025
Arizona Governor Katie Hobbs signed the state’s fiscal 2025 budget into law on June 18. General fund spending in the enacted budget totals $16.2 billion in fiscal 2025, including $15.6 billion in ongoing spending and $616 million in one-time spending. This reflects a 5.6 percent decrease in total general fund spending and a 5.2 percent increase in ongoing general fund spending compared to fiscal 2024 levels. The enacted budget assumes ongoing general fund revenues (after urban revenue sharing and newly enacted revenue changes) of $15.6 billion (representing a 5.3 percent increase from fiscal 2024 ongoing revenue), a beginning balance of $639 million and other one-time revenues of $32 million. The fiscal 2025 enacted budget projects a $95 million general fund ending cash balance. The state’s rainy day fund, known as the Budget Stabilization Fund, had an estimated balance of $1.46 billion as of January 2024, and no withdrawal is planned in the enacted budget.
The bipartisan, balanced budget takes steps to close the state’s budget deficit, including reducing fiscal 2025 lump sum appropriations for most state agencies by 3.45 percent. Additionally, the budget cuts funds for new school construction, pauses state building renovations, and makes additional targeted spending reductions. At the same time, the budget preserves funding for critical services such as state aid to K-12 education and the Housing Trust Fund. The budget also makes targeted investments in the healthcare system, border security and fentanyl interdiction measures, affordable housing, and child well-being.