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ARIZONA STATE SENATE
Fifty-Fifth Legislature, First Regular Session
budget procedures; budget reconciliation; 2021-2022
Purpose
Makes statutory and session law changes relating to budget procedures necessary to implement the FY 2022 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. 1819 contains the budget reconciliation provisions for changes relating to budget procedures.
Provisions
Defense of State Elections Laws
1. Asserts, through January 2, 2023, that the Attorney General (AG) has sole authority in all election litigation to direct the defense of election laws, to appeal or petition any decision and to intervene on behalf of Arizona at any stage, regardless of whether any state agency, political subdivision or officer or employee of the state, a state agency or political subdivision is or seeks to become a party.
2. Prohibits the AG from representing or providing legal advice to the Secretary of State (SOS) or Department of State on any matters through June 30, 2023.
3. Allows the SOS to hire one full-time equivalent position to serve as legal advisor and represent the SOS.
4. Prohibits the SOS from making expenditures or incurring indebtedness to employ outside or private attorneys to provide representation and services.
5. Asserts that the:
a) Legislature intends that the AG make all strategic decisions regarding election litigation and be allowed to intervene on behalf of Arizona if the AG determines that the intervention is appropriate;
b) Legislature reaffirms that the legal defense of state election laws and procedures is of statewide importance;
c) AG has the sole authority to defend election laws and procedures pursuant to the legal authority established by the Legislature;
d) authority of the AG is paramount and is not shared or delegated to the SOS or any other state official; and
e) exercise of the AG's authority to defend state election laws is not limited by the AG's advisory duties to any other state officer or agency.
American Rescue Plan Act of 2021 Expenditure Reporting
6. Requires the following offices and agencies to report to the Senate President, the Speaker of the House of Representatives, the Chairpersons of the Senate and House of Representatives Appropriation Committees and the Director of JLBC on intended expenditures before spending monies in the amount of $10,000,000 or more for one designated purpose from specified funds as appropriated by the American Rescue Plan Act of 2021:
a) the Office of the Governor, before spending $10,000,000 or more for one designated purpose from the Coronavirus State Fiscal Recovery Fund and the Coronavirus Capitol Projects Fund;
b) the Superintendent of Public Instruction (SPI), before spending $10,000,000 or more for one designated purpose from the Elementary and Secondary School Emergency Relief Fund; and
c) the Arizona Board of Regents (ABOR), before spending $10,000,000 or more for one designated purpose from Higher Education Emergency Relief Fund.
7. Requires the Office of the Governor, SPI and ABOR, within 30 days after the last day of each calendar quarter through June 30, 2024, to report to the following on the actual expenditure of monies from specified funds as appropriated by the American Rescue Plan Act of 2021:
a) the President of the Senate;
b) the Speaker of the House of Representatives;
c) the Chairs of the Senate and House of Representatives Appropriation Committees; and
d) the Director of JLBC.
8. Requires the reports of intended and actual use of American Rescue Plan Act of 2021 monies to delineate expenditures by agency and program and include descriptions of the purposes of the expenditures.
9. Asserts that the:
a) Legislature intends that the Arizona executive branch report on its planned and actual use of any major additional federal aid to Arizona through federal legislation enacted by the end of FY 2022; and
b) timing and frequency of the reports should be the same as required for American Rescue Plan Act of 2021 expenditures.
10. Allows the Chair and Vice-Chair of JLBC to provide recommendations to the Arizona executive branch concerning qualifying major federal aid to Arizona through federal legislation.
State Permitting Dashboard
11. Requires the Governor to appoint a State Permitting Director and requires the State Permitting Director to establish and maintain an online permitting dashboard that displays the progress to completion for state authorizations for participating projects.
12. Allows the project sponsor of an eligible project to submit a notice to the State Permitting Director stating that the project sponsor is initiating a proposed project and that includes:
a) a statement of the purposes and objectives of the proposed project;
b) a project description with geographic information, including the location of the proposed project and geospatial information;
c) a statement regarding the technical and financial ability of the project sponsor to construct the proposed project;
d) a list of agencies that may require authorizations for completion of the proposed project;
e) a statement of any authorization anticipated to be required to complete the proposed project; and
f) an assessment that the proposed project meets the definition of an eligible project and a statement of reasons supporting that assessment.
13. Requires the State Permitting Director, within 30 days of receiving the notice, to determine whether the proposed project qualifies as an eligible project and whether to include the proposed project as a participating project in the permitting dashboard.
14. Requires each agency identified by the project sponsor, within 45 days of the determination that the project qualifies as an eligible project, to submit all anticipated authorizations required for each participating project to the Director, including the:
a) steps required by the project sponsor and the agency to complete each authorization; and
b) target completion date for each step.
15. Requires an agency, if the agency requires authorization for completion of a participating project that was not included in the notice to the State Permitting Director, to provide the State Permitting Director with a written statement of cause for each additional authorization.
16. Requires an agency identified by the project sponsor to notify the State Permitting Director of any decision made that materially affects the status of a participating project and submit any significant document associated with the decision.
17. Defines an eligible project as an activity that requires agency authorization and that involves infrastructure construction for renewable or conventional energy production, electricity transmission, mining, land revitalization, surface transportation, aviation, water resource projects, wastewater projects, broadband, pipelines or manufacturing or any other activity determined by the State Permitting Director and that:
a) is subject to applicable state environmental laws, permitting regulations and other relevant government authorizations, the size and complexity of which make the eligible project likely to benefit from enhanced oversight and coordination; and
b) is likely to require a total construction investment of more than $25,000,000 or is under $25,000,000 and the State Permitting Director finds that other factors make the project likely to benefit from the enhanced oversight and coordination.
18. Requires the permitting dashboard to include a visual interface that tracks the status of each authorization required for participating projects.
19. Requires the State Permitting Director to coordinate with specified state agencies and any other agency that requires authorization for a participating project.
20. Prohibits an agency from requiring an eligible project to participate in the permitting dashboard.
21. Allows the State Permitting Director, for each participating project added to the permitting dashboard and to the extent consistent with applicable statutory requirements, to display on the permitting dashboard:
a) the notice submitted by the project sponsor of the eligible project;
b) the application and supporting documents, if applicable, submitted by a project sponsor for any required authorization or a notice explaining how the public may obtain access to documents not available on the website;
c) a description of any decision that materially affects the status of a participating project;
d) a list of roles and responsibilities for entities with authorization responsibility for the participating project;
e) a permitting timetable that sets forth a comprehensive schedule of dates by which all authorizations and state permits, reviews and approvals will be made to the maximum extent practicable; and
f) the completion status of the authorization included in the permitting timetable.
22. Requires each agency, to the maximum extent possible, to carry out the obligations of the agency with respect to a participating project under any other applicable law concurrently and in conjunction with other authorizations being conducted by other agencies or local governments, unless it is determined that doing so would impair the agency's ability to carry out its statutory obligations.
23. Requires the State Permitting Director, as necessary and in conjunction with the project sponsor and relevant agency, to mediate any dispute related to the permitting timetable.
24. Requires the State Permitting Director, if no resolution is reached, to notify GRRC and review the dispute with the relevant agency director.
25. Requires GRRC, within 30 days after the State Permitting Director's notification, to recommend a course of action regarding the dispute.
26. Allows the State Permitting Director to require agency action to resolve a dispute.
27. Allows GRRC to adopt rules relating to dispute resolution.
28. Requires the State Permitting Director to appear before JLBC, at the request of the JLBC Chairperson, to report on findings from administering the permitting dashboard.
29. Requires the State Permitting Director, by December 1, 2023, to submit a report of findings from administering the permitting dashboard to the:
a) Governor;
b) President of the Senate;
c) Speaker of the House of Representatives;
d) Chairpersons of the Senate Appropriations Committee and Senate Natural Resources, Energy and Environment Committee, or successor committees; and
e) Chairs of the House of Representatives Appropriations Committee and House of Representatives Natural Resources, Energy and Water Committee, or successor committees.
30. Requires the report submitted by the State Permitting Director to include:
a) authorization completion times by agency;
b) permitting completion times for participating projects; and
c) frequency of statements of cause for additional authorizations.
31. Requires a copy of the report to be submitted to the Secretary of State and JLBC.
32. Asserts that the State Permitting Director position does not result in an additional full-time equivalent position and is included in the Office of the Governor full-time equivalent positions.
33. Defines agency, authorization, director, participating project, permitting dashboard and project sponsor.
34. Repeals the state permitting dashboard and related requirements on January 1, 2029.
State Capitol Museum Transfer
35. Transfers the oversight of the State Capitol Museum from the Secretary of State (SOS) to the Arizona Legislative Council, including:
a) the authority, powers, duties and responsibilities of the State Capitol Museum;
b) all administrative matters, contracts, and judicial and quasi-judicial actions;
c) equipment, records, furnishings and other property, data and investigative findings, obligations and appropriated monies remaining unexpended and unencumbered monies regarding the State Capitol Museum; and
d) personnel employed regarding the State Capitol Museum.
36. Requires the Director of the Arizona Legislative Council to direct and manage the State Capitol Museum.
37. Asserts that all certificates, licenses, registrations, permits and other indicia of qualifications and authority issued by the SOS regarding the State Capitol Museum retain their validity for the duration of their terms of validity.
38. Requires the Director of the Arizona Legislative Council, rather than the Director of the State Library, to administer the Museum Gift Shop Revolving Fund.
Public Retirement Systems
39. Requires the following reports and information to be annually provided by December 1, rather than December 31:
a) the Elected Official's Retirement Plan Board of Trustees final report on the Elected Officials Retirement Plan contribution rate for the ensuing fiscal year provided to the Governor and Legislature;
b) the Public Safety Personnel Retirement System (PSPRS) Board of Trustees (PSPRS Board) annual report on the status of the Elected Officials' Defined Contribution (EODC) Retirement System provided to the Governor, Legislature and Joint Legislative Budget Committee (JLBC);
c) the PSPRS Board's detailed report on the EODC Disability Program operation and investment performance and contribution rate for the ensuring fiscal year provided to the Governor and Legislature;
d) the PSPRS Board's final report on the PSPRS contribution rate for the ensuing fiscal year provided to the Governor and Legislature;
e) the PSPRS shared cost structure of employees and employers, the funding status and the rate of return the PSPRS Board provides to the Legislature;
f) the status of the Public Safety Personnel Defined Contribution Retirement Plan the PSPRS Board reports to the Governor, Legislature and JLBC; and
g) the PSPRS Board's final report of the contribution rate of the Corrections Officer Retirement Plan for the ensuing fiscal year provided to the Governor and Legislature.
40. Subjects contracts for goods and services approved by the PSPRS Board to the Arizona Procurement Code by removing the contracts from the list of exemptions.
41. Limits the type of contracts the PSPRS Board may enter into to exercise its investment responsibilities to contracts to receive market data and other market information from securities, commodities, options and monetary exchanges.
42. Requires, effective July 1, 2022, the PSPRS Board to establish and administer an Administration Account consisting of all monies for administrative purposes for all retirement plans and systems administered by the PSPRS Board.
43. Requires the following monies to be deposited in the PSPRS Board Administrative Account:
a) all monies appropriated by the Legislature to pay administrative expenses of all retirement plans and systems administered by the PSPRS Board;
b) all monies received for proportionate shares of the administrative expenses from participating employers paying employer contributions and from all departments that pay officer and employee salaries wholly or in part from monies received from sources other than state General Fund (state GF) appropriations; and
c) monies that the PSPRS Administrator transfers from the investment account and that are necessary to pay specified expenditures.
44. Requires Administration Account expenditures to be made in accordance with PSPRS Board directives and subject to legislative appropriation, except that the following expenditures are continuously appropriated and paid in an amount deemed necessary by the PSPRS Board:
a) investment management fees and related consulting fees necessary to meet the PSPRS Board's investment objectives;
b) rent; and
c) actuarial consulting fees.
45. Allows the PSPRS Administrator, with PSPRS Board approval, to spend Administrative Account monies from the for staff expenses and related consulting fees necessary to implement PSPRS statutory requirements.
46. Requires the PSPRS Administrator, with PSPRS Board approval, to pay the cost of continuing education programs for the PSPRS Board of Trustees and legal counsel from the Administration Account.
Advisory Committee on the Formation of a Southern Arizona Regional Sports Authority
47. Establishes the 13-member Advisory Committee on the Formation of a Southern Arizona Regional Sports Authority (Advisory Committee) consisting of the following members:
a) three members of the House of Representatives appointed by the Speaker of the House of Representatives;
b) three members of the Senate appointed by the President of the Senate;
c) three public members appointed by the President of the Senate and three public members appointed by the Speaker of the House of Representatives who are knowledgeable about regional sports authorities, economic development and fiscal and other problems that currently exist or may exist in the future;
d) one member appointed by the Governor.
48. Prohibits more than two of the members appointed from each of the Senate and the House of Representatives from being from the same political party.
49. Requires the President of the Senate and Speaker of the House of Representatives to designate one of the members as Co-Chairs of the Advisory Committee.
50. Requires the Advisory Committee to research and report on the economic development and fiscal and related impacts of the formation of a Southern Arizona Regional Sports Authority.
51. Deems a majority of the members of the Advisory Committee to constitute a quorum and requires the Advisory Committee to meet at any place the co-chairpersons deem necessary and convenient.
52. Allows the Advisory Committee, in consultation with the Office of Tourism, to employ a private group or outside professional to study the economic development and fiscal and other problems that currently exist or may exist in the future as a result of the development of the regional sports authority.
53. Requires a state agency or political subdivision, on request of the Advisory Committee, to provide its service, equipment, documents, personnel and facilities to the extent possible without cost to the Advisory Committee.
54. Requires the Advisory Committee, by June 30, 2022, to submit a report of findings and recommendations to the Governor, President of the Senate and Speaker of the House of Representatives and provide a copy of the report to the SOS.
Major Events Fund
55. Establishes the Major Events Fund consisting of monies appropriated by the Legislature and private donations and directs the Arizona Commerce Authority (ACA) to administer the Fund.
56. Specifies that monies in the Major Events Fund are continuously appropriated and exempt from lapsing.
57. Allows monies in the Major Events Fund to be used:
a) to support the planning and operation of the competitive bid process for major events in coordination with the Office of Tourism, destination marketing organizations and local organizing committees;
b) to negotiate and make grants to local organizing committees or equivalent organizations for the operating costs of major events; and
c) for other economic development activities associated with major event operations.
58. Prohibits Major Events Fund monies from being used to supplant routine operating expenses of any political subdivision.
59. Caps the grant for any event at 25 percent of the operating expenditures required under the event support contract between the host organization and the local organizing committee or equivalent organization.
60. Requires the ACA, before awarding a grant from the Major Events Fund, to prepare a written statement signed by the chief executive officer that:
a) assesses the direct economic impact of the grant; and
b) contains a finding that the award of the grant is in the best interest of the state.
61. Requires the ACA to submit a Major Events Fund semi-annual report to JLBC by July 15 and December 15 that includes the amount of actual expenditures by purpose and an expenditure plan for all remaining monies by purpose.
Miscellaneous
62. Exempts monies appropriated to the Department of Public Safety for body cameras in FY 2022 from:
a) requirements relating to review and approval by the Information Technology Advisory Committee;
b) independent third-party validation and verification requirements; and
c) Project investment justification reporting requirements.
63. Requires the Governor's Regulatory Review Council (GRRC) to review an existing agency practice, substantive policy statement, final rule or regulatory licensing requirement at a public meeting if:
a) GRRC receives any information, rather than receives information in a petition from a person, that the existing agency practice or substantive rule does not meet statutory rulemaking requirements or that the existing agency practice, substantive policy statement, final rule or regulatory licensing requirement is not authorized by statute, is unduly burdensome or is not demonstrated to be necessary to specifically fulfill a public health, safety or welfare concern; and
b) at least four GRRC members request that the matter be heard in a public meeting.
64. Allows liabilities incurred against the state GF by the Arizona Department of Forestry and Fire Management (DFFM) during an emergency arising from a major disaster to be reimbursed with the approval of the Governor and State Emergency Council.
65. Requires the reimbursement for liabilities incurred by DFFM to be made according to rules adopted by the State Forester for administering fire suppression monies or, if no rules are adopted by the State Forester, according to rules adopted by the Director of the Division of Emergency Management in the Department of Emergency and Military Affairs.
66. Exempts the Department of Liquor Licenses and Control from rulemaking requirements for one year for the purposes of House Bill 2773, 55th Legislature, 1st Regular Session, relating to the sale of mixed cocktails for off-premises consumption and the lease of off-sale privileges associated with certain liquor licenses.
67. Requires, by January 1, 2023, the Department of Gaming to convert a dog racing permittee's permit to a harness racing permit if the permittee meets the qualifications for a harness racing permit.
68. Requires, effective on April 15, 2021 and subject to the conditions prescribed in Laws 2021, Chapter 234 relating to fantasy sports betting and event wagering, the Department of Gaming to deposit, on the 25th of each month, 90 percent of monies deposited in the event wagering fund, rather than any monies remaining in the Fund on the 25th of each month.
69. Limits the Arizona State Library, Archives and Public Records exemption from Arizona Procurement Code requirements for purchases and contracts for goods and services to only contracts of $150,000 or less.
70. Allows monies in the State Monument and Memorial Repair Fund to be used to alter or modify monuments and memorials.
71. Reverts all unexpended and unencumbered monies remaining in an Automation Projects Fund agency subaccount to their fund of origin upon completion of an automation and information technology project.
72. Requires the Arizona Department of Administration (ADOA), by September 1 of each year, to submit a report to JLBC on each reversion made from an Automation Projects Fund agency subaccount.
73. Requires the annual JLBC report on state debt and obligations to include outlined information for the next fiscal year, rather than most recent fiscal year.
74. Removes the requirement that the annual JLBC report on state debt and obligations be based on data available from the ADOA online accessible and searchable database of all incurred state and local government debt.
75. Removes the requirement that a link to the online accessible and searchable database of all incurred state and local government debt maintained by ADOA be posted on the JLBC website.
76. Continues to require, retroactive to July 1, 2021, any unrestricted federal monies received by AZ in FY 2022 to be deposited into the state GF and used to pay essential governmental services.
77. Continues to set the Capital Outlay Stabilization Fund square-footage rental rates for state-owned buildings at $17.87 for office space and $6.43 for storage space in FY 2022.
78. Allows ADOA to approve whole or partial rent exemptions in FY 2022 without recommendation from the Joint Committee on Capital Review.
79. Requires ADOA to report to joint legislative budget staff on each proposed agency rent exemption before approval.
80. Asserts that the Legislature is not required to appropriate monies to or transfer monies from the Budget Stabilization Fund in FY 2022, FY 2023 and FY 2024.
81. Makes technical and conforming changes.
82. Becomes effective on the general effective date, with retroactive provisions and a delayed effective date as noted
Prepared by Senate Research
May 24, 2021
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