PHOENIX — On Wednesday, educators and the Arizona Education Association rallied at the state capitol for Prop 123, a measure that would give additional funding for education in the state.
As the critical teacher shortage continues in Arizona, lawmakers are looking at ways to increase their pay, but how they want to do that differs between political parties and ultimately may be decided by the voter.
Proposition 123 is expiring this year. The initiative was passed 10 years ago, allowing 6.9% of the State Land Trust to go toward K-12 education. That is estimated to be about $300 million.
Lawmakers had proposals last year, but none passed the legislature.
We've heard from Republicans on their proposal for Prop 123. Both Rep. Matt Gress and Sen. JD Mesnard proposed mirroring bills that would allow the continued 6.9% to fully go toward teacher pay. Democratic Sen. Eva Diaz proposed a bill that would keep the withdrawal amount at 6.9% but let public schools have the discretion in using those funds however they’d need.
Earlier this month, Gov. Hobbs released an outline of a Prop 123 plan that includes $216 million for teacher pay in 2026, also making a portion of it a permanent source of funding. It would:
- Enshrine a permanent 5.5% State Land Trust distribution rate:
- Maintains the 2.5% base distribution requirements (Classroom Site Fund (CSF) and Basic State Aid).
- Places proceeds from the 3% distribution into the CSF to provide increases to teacher pay.
- FY 2026 projected increase of $216 million or $158 per pupil.
- Adds an additional ten-year distribution rate of 1.4%.
- Funds will be used to increase Base Level funding, adding approximately $101 million in school funding in FY2026.
- Reform the Prop 123 triggers that allow the Legislature to not fund inflationary increases by requiring a 2/3 vote.
ABC15's Elenee Dao listened to educators at the Wednesday rally and heard from Republican lawmakers in response to the proposal from Hobbs. Watch the full story in the video player above.
To get Prop 123 on the ballot, both the House and the Senate, both of which have Republican majorities, need to pass a resolution and then voters would need to pass it. The Governor’s support is not needed for that. It is currently unclear when it would go to voters if it is passed.
If no resolution comes forward for the voters, it’s possible the state land trust distribution could go back from 6.9% to the original 2.5% before voters approved the increase. Republican lawmakers have previously told ABC15 that if no resolution passes, there would be no “funding cliff” for education. State Rep. Matt Gress said lawmakers backfilled the budget with these funds for the coming year.
