Assigned to APPROP FOR
COMMITTEE
Assigned to APPROP FOR
COMMITTEE
ARIZONA STATE SENATE
Fifty-Third Legislature, Second Regular Session
higher education; budget reconciliation; 2018-2019
Purpose
Makes statutory and session law changes relating to higher education 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.
S.B. 1527 contains the budget reconciliation provisions for changes relating to higher education.
Provisions
University Project Reports
1. Modifies the definition of a project to include those that provide an operational or financial benefit to a university, or its component unit.
2. Requires university project reports to include non-university owned land, provided that the university or its component unit derives financial benefit from the lease agreement related to a project.
3. Expands the contents of these reports to include the following:
a) the scope, purpose, estimated cost, proposed financing agreement and timeline of the project;
b) a description of the ownership agreement of the land and all improvements during and on completion of any lease period or purchase agreement;
c) an account of any financial risk assumed by the Arizona Board of Regents (ABOR) or the university and its component units as a result of the project;
d) the anticipated revenues resulting from the project, including lease or rent payments, payments in lieu of taxes or any other financial gains;
e) the estimated value of any tax rebates associated with project development;
f) the planned use of any revenues resulting from the project;
g) the projected assessed value and square footage of the property and improvements; and
h) any payments to a municipality, school district or other public entity to be made as part of the project agreement.
4. Requires universities, when compiling Capital Improvement Plan lease reports, to include all current property leases in which a university component unit is a lessee or lessor.
5. Requires Capital Improvement Plan lease reports to include the following:
a) the use, acreage, square footage and parcel number of each leased property;
b) the total annual lease or rent payments, payments in lieu of taxes and other payments made to or from ABOR, a university, or component unit under the agreement in the prior fiscal year; and
c) a separate list of the status of incomplete projects that have been reviewed by, approved by or reported to the Joint Committee on Capital Review, including third party and commercial projects involving non-university land.
University Cost Containment Report
6. Modifies reporting requirements for historical data on tuition and fees by:
a) requiring tuition and fee levels for the previous fiscal year, FY 1999, FY 2004, FY 2009 and FY 2014 be included in the report, rather than data for each of the last 20 years;
b) removing the requirement that the purpose of increases since at least 2009 be included in the report;
c) specifying that only mandatory fees must be included in the report;
d) removing auxiliary fees;
e) removing percentage increases in tuition and fee levels; and
f) specifying that housing and meal plan fees be considered on an average, on-campus basis at a university's largest campus.
7. Specifies that the growth and cost of faculty and administration should be measured by way of accounting for the number of full time employees and total employee salaries, differentiated between faculty, classified staff, and administrators, for the previous fiscal year, FY 1999, FY 2004, FY 2009 and FY 2014.
8. Requires the report to include the credit hours required for the 10 baccalaureate degrees that experienced the highest increase in credit hours required between the 2003-2004 academic year and the previous academic year, as well as between the previous two academic years.
9. Requires the report to include detailed information on nontraditional or lower-cost degree options being offered or developed by the university.
10. Removes the following required provisions from the report:
a) the return on investment for diverting tuition dollars to noninstructional purposes; and
b) the ability to reduce unnecessary coursework for educational programs.
11. Requires that each cost containment report be submitted by September 1 of each year, rather than July 1.
Community College District Tax Levy
12. Allows a community college district to submit a proposed primary property tax increase for voter approval if the initial levy was established at least 20, but not more than 35, years prior.
13. Caps the proposed levy increase at two times the otherwise authorized levy for the same year.
14. Requires the additional tax levy, upon voter approval, to be implemented over a three-year period in one-third increments.
15. Stipulates that if voters disapprove a tax levy, a district is prohibited from resubmitting another proposed tax levy for at least two years.
Foster Care Tuition Waiver
16. Continues, retroactive to July 1, 2018, the tuition waiver scholarship for persons in foster care and incorporates the following changes to the program:
a) decreases, from 16 to 13, the minimum age that a person must be while either currently or previously in foster care, or when their adoption was finalized, in order to qualify for the tuition waiver;
b) increases, from 23 to 26, the maximum age that a person may be in order to qualify; and
c) removes the requirement that a person who receives the tuition waiver complete 30 hours of volunteer work annually; and
d) removes the requirement that an individual demonstrate continuous progress toward a degree or certificate in order to remain eligible.
Miscellaneous
17. Continues, for FY 2019, to allow the Legislature to appropriate less than a two-to-one match to student registration surcharges deposited in the Financial Aid Trust Fund.
18. Funds community college district science, technical, engineering, and mathematics programs and workforce programs for FY 2019 as specified in the General Appropriations Act.
19. Funds community college district operating expenses for FY 2019 as specified in the General Appropriations Act.
20. Clarifies that the Arizona Teacher Academy is established for years beyond the 2017-2018 academic year.
21. Makes technical and conforming changes.
22. Becomes effective on the general effective date, with a retroactive provision as noted.
Prepared by Senate Research
May 1, 2018
ZD/lb