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Lawsuit threatened over AZ budget sweep
State lawmakers have not yet started voting on the new state budget…but there’s already a threatened lawsuit over one of its provisions. From Phoenix, KJZZ’s Mark Brodie reports.
MARK BRODIE: Republican legislative leaders and Governor Brewer announced late last week that they’d reached a deal on a new spending plan. Among other things, the proposal would sweep into the general fund $50 million from a settlement Arizona reached with five banks over alleged abuses in the mortgage market. Part of the money the state received is meant to reduce preventable foreclosures, and prosecute mortgage fraud. The budget would take more than half of the $98 million the state got for those purposes. The Arizona Housing Alliance says it’s concerned money that was meant to help distressed homeowners might be used for other purposes, and that it’s considering legal action to prevent the $50 million sweep. Lawmakers are expected to approve the new budget early this week.