Challenge to use of mortgage settlement rejected

PHOENIX (AP) - A judge has rejected a challenge to Arizona's use of $50 million, its share of a multi-state foreclosure settlement to help balance the state budget.

The ruling released Wednesday grants the state's motion to dismiss a lawsuit challenging how the state is using some of the settlement money paid by lenders.

Judge Mark Brain of Maricopa County Superior Court rejected housing advocates' argument that the state attorney general could decide how the money is used. The judge says the attorney general doesn't have that power and that the Legislature decides how to spend the state's money.

Critics of the Legislature's decision to put $50 million of the settlement money into the general state budget wanted the money to be used for programs and services benefiting borrowers and troubled homeowners.

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