Assigned to APPROP FOR
COMMITTEE
Assigned to APPROP FOR
COMMITTEE
ARIZONA STATE SENATE
Fifty-Third Legislature, Second Regular Session
capital outlay; appropriations; 2018-2019
Purpose
Makes statutory and session law changes relating to capital outlay necessary to implement the FY 2019 state budget.
Background
The Arizona Constitution prohibits substantive law from being included in the general appropriations, capital outlay appropriations and supplemental appropriations bills. However, it is often necessary to make statutory and session law changes to effectuate the budget. Thus, separate bills called budget reconciliation bills (BRBs) are introduced to enact these provisions. Because BRBs contain substantive law changes, the Arizona Constitution provides that they become effective on the general effective date, unless an emergency clause is enacted.
For the purposes of capital management and planning, the state is divided into three building systems: 1) the Arizona Department of Administration (ADOA) Building System; 2) the Arizona Department of Transportation (ADOT) Building System; and 3) the Arizona Board of Regents (ABOR) Building System. Capital appropriations are typically made through the Capital Outlay Act but may be made through other bills as well.
Building renewal appropriations provide for the major maintenance and repair of state‑owned buildings. The appropriations are based on support of a formula determined by the Joint Committee on Capital Review (JCCR). The formula accounts for the replacement value, age and life-cycle of a building.
S.B. 1522 contains the budget reconciliation provisions for changes relating to capital outlay.
Provisions
Building Renewal
1. Appropriates the following amounts in FY 2019 to the following agencies from the specified funds for major maintenance and repair activities for state buildings:
|
Agency |
Fund Source |
Amount |
% of Formula |
|
State Department of Corrections (ADC) |
Department of Corrections Building Renewal Fund |
$5,464,300 |
24.5% |
|
Arizona Game and Fish Department (AGF) |
Game and Fish Fund |
$1,001,400
|
100% |
|
Arizona State Lottery Commission |
State Lottery Fund |
$126,300 |
100% |
|
ADOT |
State Highway Fund |
$5,250,000 |
40.6% |
|
State Aviation Fund |
$242,000 |
93.5% |
2. Appropriates $11,000,000 in FY 2019 to ADOA from the Capital Outlay Stabilization Fund (COSF), rather than from the state General Fund.
3. Continues to allow ADOA to allocate up to $275,000 of its appropriated amounts to personal services and employee-related expenditures for up to five FTE positions each fiscal year until the building renewal projects are completed.
4. Continues to prohibit ADOA from spending other appropriated monies for personal services, employee‑related expenditures, or maintenance contracts on building components and equipment without review by JCCR.
5. Continues to require ADOA to allocate monies to state agencies for necessary building renewal.
6. Reduces the appropriation to ADOA if monies in the COSF are insufficient to fund the appropriation to ADOA for building renewal. Funding is reduced by the difference between the appropriated amount to ADOA and the balance in the COSF.
7. Allows ADOA to use monies appropriated for building renewal in FY 2019 for building demolition.
8. Requires ADOA to report to the Joint Legislative Budget Committee (JLBC) staff the status of all building renewal projects and expenditures on or before January 31 and May 30, 2019.
9. Requires ADOA to report to the JCCR on a plan to relocate state agencies on the capitol mall and to renovate capitol mall buildings for submission on or before November 15, 2018. Stipulates that the report must identify:
a) agencies selected to move from privately leased space;
b) the planned disposition of vacant state buildings;
c) the number of FTE positions relocating to the capitol mall; and
d) the total square footage needed to accommodate those FTE positions.
10. Requires ADC, AGF and ADOT to report to JLBC staff the status of all building renewal projects and expenditures on or before January 31 and July 31, 2019.
11. Prohibits ADC from spending any of the appropriation on personal services or overhead expenses relating to the management of the funded projects.
Capital Projects
12. Appropriates the following amounts in FY 2019 to the following agencies from the specified funds for capital projects:
|
Agency |
Purpose |
Fund |
Amount |
|
ADOA |
Demolition of 1275 West Washington Street |
Capital Outlay Stabilization Fund |
$1,000,000 |
|
ADOA |
Renovation of state-owned buildings |
Capitol Mall Consolidation Fund |
$10,000,000 |
|
Department of Emergency and Military Affairs (DEMA) |
Construction of a readiness center |
State General Fund |
$3,759,000 |
|
Arizona Exposition and State Fair Board |
Capital improvements |
Arizona Exposition and State Fair Fund |
$1,000,000 |
|
AGF |
Dam maintenance |
Capital Improvement Fund |
$150,000 |
|
AGF |
Property maintenance |
Capital Improvement Fund |
$300,000 |
|
Arizona State Parks Board |
Capital improvements to Oracle State Park |
State Parks Revenue Fund |
$4,000,000 |
|
Arizona State Parks Board |
Capital improvements to Buckskin Mountain State Park |
State Parks Revenue Fund |
$1,500,000 |
|
Arizona State Parks Board |
Capital improvements |
State Parks Revenue Fund |
$2,000,000 |
|
Arizona Pioneers' Home |
Capital improvements |
Miners' Hospital for Miners with Disabilities Land Fund |
$600,000 |
|
Department of Public Safety (DPS) |
Remote housing replacement |
State General Fund |
$1,200,000 |
|
State Highway Fund |
$800,000 |
||
|
ADOT |
Construction of a new truck barn and office in Keams Canyon |
State Highway Fund |
$1,790,000 |
|
ADOT |
Replacement and repair of spreader rack bays at statewide locations |
State Highway Fund |
$1,720,000 |
|
ADOT |
Construction of a new materials lab in Kingman |
State Highway Fund |
$2,250,000 |
|
ADOT |
Planning and construction of state highways |
State Highway Fund |
$363,017,000 |
|
ADOT |
Planning and construction of state, county, city or town airports |
State Aviation Fund |
$18,798,500 |
|
Department of Veterans' Services |
Construction of a veterans' home facility in Flagstaff
|
State Home for Veterans Trust Fund |
$4,000,000 |
|
Department of Veterans' Services |
Construction of a veterans' home facility in Yuma
|
State Home for Veterans Trust Fund |
$4,000,000 |
13. Requires ADOA, DEMA, the Arizona Exposition and State Fair Board, AGF, the Arizona State Parks Board, the Arizona Pioneers' Home, DPS, ADOT, and the Department of Veterans' Services to provide the scope, purpose and estimated cost of specified projects to JCCR for its review prior to spending the appropriation.
14. Requires DPS to submit a report on its procurement process for new modular units to JCCR for review.
15. Exempts the monies appropriated to the Department of Veterans' Services from lapsing.
16. Permits the Department of Veterans' Services to use the appropriated amount from the State Home for Veterans Trust Fund in FY 2019 to construct veterans' home facilities in Flagstaff and Yuma.
17. Specifies that the amount appropriated for highway construction from the State Highway Fund (SHF) and any balances and collections in the SHF in excess of the specific amount appropriated are appropriated to ADOT for the planning and construction of:
a) state and interstate highways within the state;
b) state and county primary or secondary system and urban rural routes;
c) acquisition of rights-of-way;
d) the cost of contracted field administration; and
e) field engineering on construction projects and debt service payments on bonds.
18. Requires ADOT, on or before November 1, 2018, to report on its actual prior year, estimated current year and upcoming budget year highway construction expenses from all fund sources to the directors of the JLBC and the Governor's Office of Strategic Planning and Budgeting (OSPB). Specifies that the report must be in the same format as the prior year unless modifications have been approved by the directors of the JLBC and the OSPB.
19. Requires ADOT, on or before November 1, 2018, to report capital outlay information for FYs 2018, 2019 and 2020 to the directors of the JLBC and the OSPB and establishes a format for the report.
20. Requires ADOT, on or before November 1, 2018, to report its estimated outstanding debt principal balance at the end of FY 2020 and the estimated debt service payment amount for FYs 2020, 2021, 2022 and 2023 to the directors of the JLBC and the OSPB.
21. States that the ADOT estimated outstanding debt principal balance report is intended to be comparable to the information in the FY 2018 appropriations report and requires the report to include:
a) SHF statewide construction bonds;
b) Arizona Highway User Revenue Fund bonds;
c) Maricopa Association of Governments and Pima Association of Governments controlled access bonds;
d) Maricopa Regional Area Road Fund bonds; and
e) grant anticipation notes.
22. Directs that the State Aviation Fund (SAF) appropriation and any balances and collections in the SAF that exceed the specific amounts appropriated are appropriated to ADOT for the planning, construction, development and improvement of state, county, city or town airports as determined by the State Transportation Board.
23. Replaces $12,753,500 from the state General Fund with $12,753,500 from the SHF for Interstate 10 widening projects.
Miscellaneous
24. Prohibits the use of appropriated monies for personal services or employee-related expenditures of state employees, unless otherwise specified and excludes inmate construction services for correctional facilities.
25. Reverts the following appropriations remaining unexpended on June 30, 2020, to the fund from which the monies were appropriated:
a) $120,000 to repair the 1938 Works Progress Administration Civic Building on the state fairgrounds made by Laws 2016, Chapter 126; and
b) FY 2019 appropriations, except as outlined.
26. Reverts the appropriation of $3,867,000, made to AGF for capital improvements by Laws 2016, Chapter 126, that remains unexpended on June 30, 2019 to the fund from which the monies were appropriated.
27. Specifies that appropriated monies for statewide highway construction and airport planning and development do not lapse until the project is complete, abandoned or if a full fiscal year passes without an expenditure or an encumbrance.
29. Makes technical and conforming changes.
30. Becomes effective on the general effective date.
Prepared by Senate Research
May 1, 2018
JO/lb