ARIZONA HOUSE OF REPRESENTATIVES

Fifty-fourth Legislature

Second Regular Session

House: WM DP 6-4-0-0

HB2779: state equalization assistance; rate; appropriation

Sponsor: Representative Petersen, LD 12

House Engrossed

Overview

Establishes the state equalization property tax rate for tax year 2020 is $0.2974. Also, appropriates $100,000,000 from the state general fund to the Department of Education for fiscal year 2021.

History

The board of supervisors in each county is required to levy the state equalization property tax each year and it is the county treasurer's responsibility to apportion the monies to school districts within the county. (A.R.S. § 15-994) The rate in tax year 2019 was $0.4566. (A.R.S. § 41-1276)

The current K-12 school finance system is based on a statutory formula enacted in 1980 and substantially modified in 1985. The established formula aims to equalize per-pupil spending among school districts, taking into account student enrollment and property values. Under the current school finance formula, school districts receive approximately the same amount of funding per pupil. Spending is also capped, preventing high-property value school districts from generating local revenues in excess of the funding formula and creating inequities. Some school districts with a very strong local property tax base are able to generate their entire formula funding entitlement. However, most school districts require revenues in the form of Basic State Aid in order to receive full funding under the statutory formula.

Provisions

1. Establishes the state equalization assistance property tax rate for tax year 2020 is $0.2974. (Sec. 1)

2. Appropriates, in addition to any other appropriation, $100,000,000 from the state general fund in fiscal year 2021 to the Department of Education for basic state aid. (Sec. 2)

3. Applies retroactively to July 1, 2020. (Sec. 3)

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7. Initials VP House Engrossed

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