Proposed Arizona Ballot Measure Would Freeze Municipal Rate Hikes for Four Years Amid Rising Cost of Living
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Gilbert Water Rate Hike Sparks Push for Statewide Tax and Fee Moratorium
Phoenix, Arizona — Some Arizona lawmakers are considering a proposed ballot measure that would impose a four-year moratorium on municipal hikes to sales taxes, fees, and utility rates, in response to growing concerns about the rising cost of living across the state.
The measure, known as HCR 2016, would block cities, towns, and counties from raising these charges from July 1, 2026, to June 30, 2030, with the exception of increases based on inflation or those approved directly by voters.
The proposal comes as Gilbert residents face a 25 percent water rate hike, the third such increase in three years. The rate hike, which went into effect in April 2026, was approved by the town council to help the city reduce its reliance on Colorado River water by investing in new wells and multimillion-dollar improvements to its water treatment plant.
State Rep. Justin Olson, a Republican representing Legislative District 10, had initially proposed the temporary ban on tax, fee, and utility rate increases earlier in the legislative session. The bill failed to advance out of the House at that time, but the measure was later resurrected on March 25 as a strike-everything amendment to another bill.
"What we're doing with this bill is we're saying ... 'Don't add to the problem. Let's prevent government from increasing tax rates for the next four years,'" Olson told ABC15.
If passed by the Legislature, HCR 2016 would go to voters in November's general election. The measure is one of at least 25 ballot measures that state lawmakers are still considering.
What the Measure Would Do
HCR 2016 would prohibit cities, towns, and counties from raising sales taxes, fees or utility rates from July 1, 2026, to June 30, 2030. The only exceptions would be:
- Increases based on inflation
- Tax increases approved directly by voters
Olson said the proposal comes from feedback he has received from residents across Arizona who are struggling with high inflation and rising living costs.
"I've heard from folks from all across Arizona that are saying, 'We need this protection,' he told ABC15.
Critics Warn of Impact on Essential Services
State Sen. Lauren Kuby criticized the proposed ballot measure during a Senate Government panel hearing, saying it would restrict local governments' ability to maintain essential services.
"This bill is dangerous. It's a dangerous ballot referral. It will restrict local governments and their ability to maintain essential services," Kuby said.
The strike-everything amendment, which entirely replaces the text of a bill with another, was introduced in the Senate Government panel two weeks ago. The committee advanced legislation on a party-line vote.
A Crowded November Ballot
If HCR 2016 passes the Senate, the House will need to hold a final vote in order for the measure to go to the ballot.
Like in 2024, when Arizonans decided on 13 ballot measures, voters could see a crowded ballot in November. Maricopa County election officials are already preparing for the possibility of another two-page ballot.
The November ballot already has at least three referendums, which the Legislature referred to voters last year. Additionally, two groups are collecting signatures for competing initiatives to reform the state's ESA school voucher program.
What's Next
The outcome of this measure could have significant implications for how Arizona cities, towns, and counties manage their budgets and finances in the coming years. While supporters argue it would provide much-needed relief to taxpayers, critics warn it could impact local governments' ability to fund essential services.
Olson said the proposal gives voters the ability to put protections in place during a difficult economic period.
"This gives the voters the ability to put some restrictions in place, some protections in place," Olson said.
The measure reflects growing concerns among Arizona taxpayers about the rising cost of living, including recent municipal rate hikes across the state. If passed, it would be in effect for four years, providing a temporary pause on non-inflation-related increases to local taxes and fees.