SB1527 - 532R

Be it enacted by the Legislature of the State of Arizona:

Section 1. Section 15-1650.03, Arizona Revised Statutes, is amended to read:

START_STATUTE15-1650.03. Arizona board of regents; resident undergraduate students; cost study; annual cost containment report

A. On or before December 15, 2017 and every five years thereafter, the Arizona board of regents shall conduct and complete a comprehensive cost study to determine the actual cost of educating a full‑time resident undergraduate student at each university under the jurisdiction of the board. The board shall submit the cost study to the governor, the president of the senate, the speaker of the house of representatives and the joint legislative budget committee and shall provide a copy to the secretary of state. The cost study shall include a detailed breakdown of the costs associated with educating a full-time resident undergraduate student and shall include at least the following:

1. The use of instructional fees at each university, including differentiating between mandatory fees, program fees and course fees.

2. Differentiated costs between programs of study, including differential tuition and program and course fees.

3. The costs of faculty and administration differentiated between the amount of time needed to instruct students and to conduct research.

4. A breakdown of where tuition dollars are allocated, including the amount that is not directly attributable to instructional costs.

5. An analysis of the marginal cost and the average cost of a student depending on the type of program in which the student is enrolled, including online programs.

B. On or before July September 1, 2018 and each year thereafter, the Arizona board of regents shall submit a comprehensive university cost containment report for each university under the jurisdiction of the board to the governor, the president of the senate, the speaker of the house of representatives and the joint legislative budget committee and shall provide a copy to the secretary of state. The report shall demonstrate the actions taken by each university to contain increases in the increased cost of attendance for full‑time resident undergraduate students and shall include at least the following:

1. Historical data on tuition and mandatory fee levels and percentage increases, including auxiliary fees and average on‑campus housing and meal plan fees, at the largest campus for each university for at least the past twenty years, and what those increases were used for at each university since at least 2009 during the PREVIOUS fiscal year and fiscal years 1999, 2004, 2009 and 2014.

2. The growth and cost of the faculty and administration at each university.

2. The number of FTES and total salaries of university employees differentiated between faculty, classified staff and administrators at each university during the previous fiscal year and fiscal years 1999, 2004, 2009 and 2014.

3. Actions taken by each university to contain costs at the university and the savings associated with those actions.

4. The allocation of faculty resources at each university based on the time needed to instruct students and to conduct other research activities.

5. The return on investment for diverting tuition dollars to noninstructional purposes.

6. The ability to reduce unnecessary coursework for educational programs.

7. The development of new, nontraditional and less expensive education programs.

5. The number of credit hours required for a baccalaureate degree for the previous academic year and the 2003-2004 academic year for the ten degree programs that had the largest increase in credit hours required for a baccalaureate degree between the 2003-2004 academic year and the 2017‑2018 academic year, and between the previous two academic years.

6. Detailed information on nontraditional or lower-cost degree options that each university currently offers, has recently developed or is pursuing.

Sec. 2. Section 15-1655, Arizona Revised Statutes, is amended to read:

START_STATUTE15-1655. Arizona teacher academy; tuition waiver; annual report

A. For the 2017‑2018 academic year, Universities under the jurisdiction of the Arizona board of regents shall implement an Arizona teacher academy to incentivize Arizona resident students to enter the teaching profession and to commit to teach in Arizona public schools. The Arizona board of regents, in consultation with universities under the jurisdiction of the board, shall develop:

1. Metrics to assess the efficacy of the academy.

2. A marketing and promotion plan to recruit students for the academy.

B. The Arizona teacher academy may include new or existing teacher preparation program pathways that are student-focused and that employ proven, research-based models of best practices already being implemented. Each university may develop a portfolio of teacher preparation programs to offer as part of the academy. Programs offered as part of the academy shall include accelerated models for:

1. High‑demand teacher specializations, including science, technology, engineering and mathematics.

2. Individuals seeking postbaccalaureate coursework that results in professional certification.

C. Each university shall develop formalized partnerships with public schools in this state to build commitments for teacher employment on completion of the Arizona teacher academy. The targeted deployment of teachers who have completed the academy shall be based on the needs of each school system and the community that is being served as well as the individual skills of each teacher.

D. Each university shall provide to each full‑time student who is enrolled in the Arizona teacher academy an annual waiver for all tuition and fees associated with the student's program of study, subject to the following:

1. If the student does not successfully complete the academic year in good academic standing, the student shall reimburse the university for the total amount of the waiver for tuition and fees the student received for that year.

2. For each academic year that the student successfully completes and for which the student receives a waiver for all tuition and fees, the student must agree to teach for one full school year in a public school in this state.

3. If the student does not fulfill the student's agreement to teach in a public school, the student must reimburse the university for the proportional amount of the waiver for tuition and fees that the student received that corresponds to the number of school years the student agreed to teach but did not teach in a public school in this state.

4. If the student is physically or mentally unable to fulfill the requirements of the academy, the university shall assess the student's ability to repay the financial assistance received and shall make a determination on any terms of repayment.

E. On or before July 1, 2018 and each year thereafter, the Arizona board of regents shall report to the governor, the president of the senate and the speaker of the house of representatives, and submit a copy to the secretary of state, on all of the following:

1. The total number of students enrolled in the Arizona teacher academy of each university.

2. The percentage of students who completed each year of the academy and who plan to continue to the subsequent year, delineated by each teacher preparation program offered by each university as part of the Arizona teacher academy.

3. The number of teachers who completed a program of study through the Arizona teacher academy.

4. The number of teachers currently teaching in a public school in this state as part of an agreement for receiving a full tuition and fee waiver.

5. The number of students who have defaulted on their agreement and who are in repayment agreements. END_STATUTE

Sec. 3. Section 15-1681, Arizona Revised Statutes, is amended to read:

START_STATUTE15-1681. Definitions

In this article, unless the context otherwise requires:

1. "Acquire" includes to purchase, lease, lease‑purchase, erect, build, construct, reconstruct, raze, remodel, repair, replace, alter, extend, expand, better, equip, furnish, develop, improve and embellish a project, and the acquisition, preparation and development of a site or sites therefor.

2. "Board" means the Arizona board of regents or its successor.

3. "Bonds" means any bonds issued pursuant to this article.

4. "Component unit" means an entity for which the nature and significance of its relationship with the board or institution is such that exclusion would cause the board's or institution's financial statements to be misleading or incomplete.

5. "Federal agency" means the United States of America, the president of the United States of America, the department of housing and urban development or such other agency or agencies of the United States of America as may be designated or created to make loans or grants, or both.

6. "Indirect or third party financing":

(a) Means an agreement between the board or an institution and a component unit of an institution, a nonprofit organization or a private developer in which the component unit, organization or developer pays for, issues bonds for or enters into lease or lease-purchase agreements for:

(i) Capital projects on the property of an institution.

(ii) Capital projects intended to house any institution activities.

(iii) Capital projects in which the board or institution guarantees revenues to the component unit, organization or developer or debt service payments on behalf of the component unit, organization or developer.

(iv) Capital projects, which may eventually become state assets.

(b) Does not include a project that is intended to be commercial in nature, and if the majority of the project's business is anticipated to come from the nonuniversity population.

7. "Institution" means the university of Arizona, Arizona state university and northern Arizona university or any other college or university under the jurisdiction and control of the board or its successor.

8. "Project" means and includes buildings, structures, areas and facilities which that, as determined by the board, are required by or necessary for the use or operational or financial benefit of each of such institutions, including, without limiting the generality of the foregoing, student, faculty or staff housing facilities, residence halls, dormitories and apartments; student union and recreational buildings and stadiums; other facilities for student, faculty or staff services; any facility or building leased to the United States of America; parking garages and areas; offices, classrooms, laboratories, dining halls and food service facilities, libraries, auditoriums, or parts thereof, or additions or extensions thereto; heating, lighting and other utility service facilities in connection therewith, or parts thereof, or additions or extensions thereto; whether heretofore acquired and now or hereafter used for any or all of the purposes aforesaid, or as may be hereafter acquired under this article, with all equipment and appurtenant facilities; or any one, or more than one, or all of the foregoing, or any combination thereof, for any institution, including sites therefor.

9. "System of building facilities" means such a project or projects as the board by resolution shall collectively designate to be included in a system of building facilities at each institution, either:

(a) Hereafter acquired for each of such institutions under the terms of this article.

(b) Heretofore acquired for each of such institutions prior to May 17, 1974 under the terms of any other law and now located on the campus of each of such institutions, whether unencumbered by or encumbered by a pledge of and lien on the income and revenues derived from the operation thereof for the payment of any bonds theretofore issued by the board for the acquisition thereof.

(d) Any combination of as provided in subdivisions (a), (b) and (c) of this paragraph. END_STATUTE

Sec. 4. Section 15-1682.02, Arizona Revised Statutes, is amended to read:

START_STATUTE15-1682.02. Indirect and third party financing; review; reporting

A. The board may secure indirect or third party financing for any project if the following conditions are met:

1. The term of the indirect or third party financing does not exceed the earlier of forty years or the useful life of the capital improvements.

2. The project for which indirect or third party financing is secured is reviewed by the joint committee on capital review. Private entities are not required to divulge proprietary information to the committee for review.

B. For a project that is to be developed on board land, or institutional land, or on other land if a university or its component unit derives financial benefit as a party to a lease agreement or other contract that is related to the development or use of the project, that is intended to be commercial in nature and if the majority of the project's business is anticipated to come from the nonuniversity population, the board or institution shall report on the scope, purpose and estimated cost of the project to the joint committee on capital review at least two months before the anticipated execution of an agreement. A private entity is not required to divulge proprietary information to the joint committee on capital review. The joint committee on capital review may provide recommendations to the board or a university on the reported project.

C. The report prescribed in subsection B of this section shall include at least the following information:

1. The SCOPE, PURPOSE, ESTIMATED COST, PROPOSED FINANCING ARRANGEMENT AND PROJECT TIMELINE.

2. A DESCRIPTION OF THE OWNERSHIP ARRANGEMENT OF THE LAND AND ALL IMPROVEMENTS DURING AND ON COMPLETION OF ANY LEASE PERIOD OR PURCHASE AGREEMENT.

3. AN ACCOUNT OF ANY FINANCIAL RISK ASSUMED BY THE BOARD OR THE UNIVERSITY AND ITS COMPONENT UNITS AS A RESULT OF THE PROJECT.

4. THE ANTICIPATED REVENUES TO THE BOARD OR THE UNIVERSITY AND ITS COMPONENT UNITS, INCLUDING LEASE OR RENT PAYMENTS, PAYMENTS IN LIEU OF TAXES OR ANY OTHER FINANCIAL GAINS RESULTING FROM THE PROJECT.

5. A DESCRIPTION OF AND THE ESTIMATED VALUE OF ANY TAX REBATES ASSOCIATED WITH DEVELOPMENT OF THE PROJECT.

6. THE PLANNED USE OF ANY REVENUES GENERATED FOR THE BOARD OR the UNIVERSITY AND ITS COMPONENT UNITS RESULTING FROM THE PROJECT.

7. THE PROJECTED ASSESSED VALUE AND SQUARE FOOTAGE OF THE PROPERTY AND IMPROVEMENTS.

8. ANY PAYMENTS TO a MUNICIPALITy, SCHOOL DISTRICt OR OTHER PUBLIC ENTITy TO BE MADE AS PART OF THE PROJECT AGREEMENT BY THE BOARD, THE UNIVERSITY OR ITS COMPONENT UNITS OR THE PRIVATE ENTITY.

D. For the purposes of subsections B and C of this section, "project" has the same meaning prescribed in SECTION 15-1681 but ALSO INCLUDES BUILDINGS, AREAS, STRUCTURES AND FACILITIES NECESSARY FOR THE USE OR OPERATIONAL OR FINANCIAL BENEFIT OF A UNIVERSITY COMPONENT UNIT. END_STATUTE

Sec. 5. Title 15, chapter 14, article 1, Arizona Revised Statutes, is amended by adding section 15-1809.01, to read:

START_STATUTE15-1809.01. Tuition waiver scholarships; persons in foster care; requirements; definition

A. The Arizona board of regents shall provide a tuition waiver scholarship at any university under the jurisdiction of the Arizona board of regents and each community college district shall provide a tuition waiver scholarship at any community college in that district to a person who meets all of the following conditions:

1. Resides in this state.

2. Was or is currently in foster care in Arizona for a cumulative period of six months or more.

3. Either:

(a) Is currently in foster care and is at least thirteen years of age.

(b) Was in foster care when the person was at least thirteen years of age.

4. Is under twenty-six years of age.

5. Is either a United States citizen or a noncitizen who is lawfully present in this country.

6. Has total personal assets, not including scholarships or grants received by the person, that are worth less than ten thousand dollars.

7. Is accepted into or enrolled in a university under the jurisdiction of the Arizona board of regents or a community college under the jurisdiction of a community college district.

8. Has completed and submitted to the United States department of education a free application for federal student aid before each year in which the person receives a tuition waiver scholarship pursuant to this section.

9. Remains in good standing with the policies established by the university or community college at which the person is enrolled.

B. A tuition waiver scholarship provided by a community college pursuant to this section may be reduced by the amount of any other federal aid scholarship or public grant and any other public aid received by that person from or through the community college at which the person is enrolled, except that a tuition waiver scholarship may not be reduced by the amount of federal grants received by the person from the department of child safety under the Arizona education and training voucher program.

C. A tuition waiver scholarship provided by a university pursuant to this section may not be reduced by the amount of any other federal aid scholarship or public grant or any other public aid received by that person from the department of child safety under the arizona education and training voucher program or through the university at which the person is enrolled.

D. For the purposes of this section, "tuition" means tuition and mandatory fees charged by a university or community college. END_STATUTE

Sec. 6. Section 41-793, Arizona Revised Statutes, is amended to read:

START_STATUTE41-793. Building systems; capital improvement plans

A. The department of administration, the Arizona board of regents and the department of transportation shall each be considered as a separate building system. Subject to approval by the joint committee on capital review, the director of the department of administration shall establish additional building systems for the purpose of computing and funding building renewal. Subject to approval by the joint committee on capital review, each building system shall designate an agency that is responsible for computing building renewal needs for each fiscal year pursuant to the formula approved by the committee and for allocating appropriated building renewal monies within the building system.

B. The agency responsible for each building system established pursuant to subsection A of this section shall prepare each year a capital improvement plan that contains proposals for state spending on land acquisition, capital projects, energy systems, energy management systems and building renewal for the building system. Copies of the plan shall be submitted to the governor no later than October 15. Each plan shall include:

1. A detailed list of all land acquisition and capital projects that are recommended to be undertaken or continued for the building system during the next fiscal year, an explanation as to the need for each acquisition or project, the effect of the recommended acquisition or capital project on the future operating expenses of this state, recommendations as to the priority of recommended acquisitions or capital projects and the means of financing those acquisitions or projects.

2. Forecasts as to the requirements for land acquisition and capital projects for the building system during the two fiscal years following the fiscal year provided for in paragraph 1 of this subsection and for any additional periods as may be necessary or desirable for an adequate presentation of the capital projects and a schedule for the planning and implementation or construction of those capital projects.

3. A report on the status of all ongoing or recently completed land acquisitions and capital projects for the building system, with a summary of monies expended for each acquisition or project.

4. A report on the condition, maintenance and utilization of all buildings within the building system that were inspected during the prior fiscal year.

5. A report on the building renewal activities undertaken during the past fiscal year, including the specific purposes for which monies were expended, proposed activities for the current fiscal year and a prioritized schedule of renewal projects proposed for the following fiscal year.

6. The amount of appropriation required in the following fiscal year for building renewal as determined by the building renewal formula set forth in section 41‑793.01.

C. On or before June 1 of each year or thirty days after the state legislature adjourns its regular session sine die, whichever is later, each state agency under the department of administration building system and not later than August 1 of each year each agency under the Arizona board of regents building system shall provide to the agency responsible for its building system:

1. A detailed list of land acquisition and capital projects the agency seeks to undertake or continue in the next fiscal year, an explanation as to the need for each acquisition or project, the effect of the acquisitions or capital projects on future operating expenses of this state, including energy systems and energy management systems, and other relevant supporting data requested by the agency responsible for the building system.

2. Forecasts as to the requirements for land acquisition or capital projects of the agency for the two fiscal years following the fiscal year provided for in paragraph 1 of this subsection and for any additional periods as may be necessary or desirable for the adequate presentation of the capital projects and a schedule for the planning and implementation or construction of those capital projects.

3. A report on all ongoing or recently completed land acquisitions and capital projects of the agency and its component units, with a summary of monies expended for each acquisition or project, and energy consumption and expenditure information.

4. Any other information requested by the agency responsible for the building system.

D. EACH UNIVERSITY under the jurisdiction of the arizona board of regents in complying with subsection C of this section SHALL REPORT ALL PROPERTY LEASES IN EFFECT IN WHICH THE UNIVERSITY OR ITS COMPONENT UNIT IS A PARTY. THE REPORT SHALL INCLUDE at least the following INFORMATION:

1. THE USE, ACREAGE, SQUARE FOOTAGE AND PARCEL NUMBER OF EACH LEASED PROPERTY, AS APPLICABLE.

2. THE TOTAL ANNUAL LEASE OR RENT PAYMENTS, PAYMENTS IN LIEU OF TAXES OR ANY OTHER PAYMENTS MADE TO OR FROM THE BOARD, UNIVERSITY OR COMPONENT UNIT UNDER THE AGREEMENT DURING THE PRIOR FISCAL YEAR.

3. A SEPARATE LIST that contains THE STATUS OF ALL OF ITS PROJECTS REVIEWED BY, APPROVED BY OR REPORTED TO THE JOINT COMMITTEE ON CAPITAL REVIEW THAT HAVE NOT YET BEEN COMPLETED. THE PROJECTS LISTED SHALL INCLUDE THIRD PARTY AND COMMERCIAL PROJECTS REPORTED OR REVIEWED PURSUANT TO section 15-1682.02.

D. E. Each state agency in complying with subsection C, paragraph 1 of this section and the agency responsible for each building system in complying with subsection B, paragraph 1 of this section should give priority to fire and life safety projects.

E. F. The agency responsible for a building system shall inspect the condition, maintenance and utilization of each building within the building system not less than once every four fiscal years and shall report its findings pursuant to subsection B of this section. For purposes of complying with this requirement, the agency responsible for each building system shall inspect approximately fifty per cent percent of its buildings within the first two years of the four year four-year cycle. The agency shall inspect the other fifty per cent percent of the buildings in the remaining two years of the four year four-year cycle.

F. G. The governor shall prescribe standard forms in accordance with the provisions of this section to be used by state agencies in preparing and submitting capital improvement plans. The forms prescribed shall be so constructed so as to allow each building system to adequately provide information pertinent to its manner of operation.

G. H. Each plan, forecast and report required for two or more fiscal years in this section shall be delineated separately for each year. END_STATUTE

Sec. 7. Section 42-17056, Arizona Revised Statutes, is amended to read:

START_STATUTE42-17056. Initial base levy limit if no primary property taxes were levied in the preceding tax year; subsequent levy amount

A. If a county, city, town or community college district did not levy primary property taxes in the preceding tax year, the governing body shall submit a proposed amount to be raised by primary property taxes for approval of the voters.

B. The election shall be held on the third Tuesday in May before the beginning of the fiscal year in as nearly as practicable the same manner as prescribed by title 35, chapter 3, article 3. The ballot shall state that if the amount is approved by the voters, it will be the base for determining levy limitations for the county, city, town or district for subsequent fiscal years.

C. If a majority of the qualified electors voting approve the proposed levy amount for primary property taxes, the levy applicable for the county, city, town or district for the next fiscal year shall be an amount not exceeding the approved amount.

D. On acceptance by the voters, the governing body shall send a copy of the approved resolution to the property tax oversight commission.

E. If the proposed levy amount is not approved, the county, city, town or community college district shall not levy a primary property tax for that year.

F. At least twenty but not more than thirty-five years after the date of an initial approval pursuant to this section, a community college district with a primary property tax levy that was initially established pursuant to this section may resubmit a proposed amount to be raised by primary property taxes for approval by the voters. the proposed amount must be less than or equal to two times the otherwise authorized levy amount for the same year. The election shall be conducted as prescribed in subsection b of this section. If a majority of the qualified electors voting:

1. Approve the proposed levy amount, the levy applicable for the district for:

(a) the first tax year following approval pursuant to this PARAGRAPH must be less than or equal to the previously approved amount plus one-third of the difference between the previously approved amount and the amount approved pursuant to this PARAGRAPH.

(b) the second tax year following approval pursuant to this PARAGRAPH must be less than or equal to the previously approved amount plus two-thirds of the difference between the previously approved amount and the amount approved pursuant to this PARAGRAPH.

(c) the third tax year following approval pursuant to this PARAGRAPH and each subsequent tax year must be less than or equal to the amount approved pursuant to this PARAGRAPH.

2. Disapprove the proposed levy amount, the district shall levy a primary property tax based on the previously authorized levy and may not resubmit another proposed amount until at least two years after the proposed levy amount was disapproved.

F. G. This section does not apply to community college tuition financing districts formed pursuant to section 15‑1409, except that the property tax oversight commission shall set a property tax levy limit that is not less than the amount required pursuant to section 15‑1409, subsection C. END_STATUTE

Sec. 8. Financial aid trust fund; required state match; reduction

Notwithstanding section 15-1642, subsection C, Arizona Revised Statutes, for fiscal year 2018-2019, each dollar raised pursuant to the surcharge on student registration fees assessed pursuant to section 15‑1642, subsection A, Arizona Revised Statutes, may be matched by less than two dollars appropriated by the legislature.

Sec. 9. Community college districts; state aid for science, technology, engineering and mathematics and workforce programs

Notwithstanding section 15‑1464, Arizona Revised Statutes, state aid for science, technology, engineering and mathematics and workforce programs for community college districts for fiscal year 2018‑2019 is as specified in the general appropriations act.

Sec. 10. Community college districts; operating state aid; eligibility; limits

Notwithstanding section 15‑1466, Arizona Revised Statutes, operating state aid for community college districts for fiscal year 2018‑2019 is as specified in the general appropriations act.

Sec. 11. Retroactivity

Section 15-1809.01, Arizona Revised Statutes, as added by this act, applies retroactively to from and after June 30, 2018.