PHOENIX — A bill repealing a tax on home and apartment rentals that has been a key issue for Republicans in the Legislature for two sessions was sent to Democratic Gov. Katie Hobbs on Monday after sitting on the Senate president’s desk for the past seven weeks.

House Speaker Ben Toma said Hobbs has agreed to sign it as part of negotiations between her and Republicans legislative leaders to approve an extension of a transportation tax in Maricopa County.

The rental tax repeal was vetoed by Hobbs earlier this year after she said it suffered from “defects.”

One of the biggest, she said, is there is no “enforceable mechanism” to ensure landlords, who actually remit the tax to the cities, actually will pass along the savings to their tenants.

This new version is billed as having a better enforcement mechanism to protect tenants. It also has a delayed effective date of 2025.

Still, the legislation would take away more than $230 million a year in revenue that a majority of the state’s 91 cities and towns collect, according to a lobbyist for the League of Arizona Cities and Towns.

“The 75 cities that are going to be directly impacted by this, they’re only got two options should this bill be signed,” the League’s Tom Savage said. “They’re going to have to either cut services, or they’re going to have to increase local taxes to make up for this loss.”

But Senate Republicans, who called a news conference to crow about the bill, said cities were flush with cash and criticized them for not voluntarily eliminating the rental tax. And they said they wanted to help low-income renters during a period of high inflation by getting rid of the tax, which is levied on top of rents, at rates that average 2.4%.

“This is (money) to help people put food on the table, give them an extra tank of gas in the car,” said Senate President Warren Petersen, R-Gilbert. “And we are ready to provide relief.”

Former state Sen. Steve Kaiser, a Republican who resigned in June after championing the rental tax cut this year, criticized cities and the League for fighting the repeal.

“Multiple mayors came to the Capitol armed with their special interest lobbying group to kill this bill, a lobbying group ironically, that is paid for by the citizens of those cities,” Kaiser said at the news conference. “They did not come to the Capitol to advocate for their citizens but instead for their coffers.”

Neither Petersen nor Hobbs spokesman Christian Slater would confirm a deal to sign the tax repeal in return for legislative action on the transportation tax.

But it was an open secret at the Capitol in recent days. And Toma’s confirmation made it official.

Kaiser said the mayors who came to lobby against the repeal failed to mention “they had surpluses in the millions of dollars.”

But Savage, the League lobbyist, said those cities are spending that money to pay for services that benefit renters. And he said the small cut from eliminating the rental tax will not provide meaningful relief for those residents.

“Instead, what it does is take away the critical revenue that we have to pay for all the services that we provide to the same renters,” he said. Cities will either have to cut services or raise their general sales tax to make up the difference.

If signed by the governor, cities will be forced to stop collecting rental taxes in January 2025.

The bill actually got final legislative approval on June 13. But Petersen sat on the bill despite a 2009 state Supreme Court ruling that says legislation must be transmitted to the governor promptly after passage.

Asked at the news conference about ignoring the high court, Petersen said “there’s been no controversy on that.”