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ARIZONA STATE SENATE
Fifty-Sixth Legislature, First Regular Session
general appropriations act; 2023-2024.
Purpose
Makes session law changes relating to general appropriations necessary to implement the FY 2024 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.
The Joint Legislative Budget Committee (JLBC) Baseline includes an estimate of spending necessary to meet requirements of statutory formulas and other obligations (FY 2024 JLBC Baseline).
S.B. 1523 contains the budget provisions for changes relating to general appropriations.
Provisions
FY 2024 Ongoing Fund and Major Footnote Changes
Ongoing General Fund (GF) and Other Fund (OF) Changes
|
Summary of Changes |
Source |
Comments |
FY 2024 Changes |
|
Building Renewal Grants (Onetime) |
GF |
|
183,000,000 |
Major Footnote Changes
1. Requires ADOA, by November 1, 2024, to submit a report to the Director of JLBC on expenditures made from the Cyber Risk Insurance Fund from the prior year.
Arizona Department of Corrections Rehabilitation and Reentry (ADCRR)
Ongoing General Fund (GF) and Other Fund (OF) Changes
|
Summary of Changes |
Source |
Comments |
FY 2024 Changes |
|
Private Prisons Contract Increase |
GF |
|
7,100,000 |
Department of Economic Security (DES)
Major Footnote Changes
2. Requires DES, before expending the appropriation for homeless youth services, to submit an expenditure plan to JLBC for review.
Major Footnote Changes
3. Requires ADE to submit an expenditure plan for JLBC review before spending the increase for early literacy programs for literacy coaches, kindergarten entry assessments, dyslexia training or science of reading exams.
Department of Health Services
Ongoing General Fund (GF) and Other Fund (OF) Changes
|
Summary of Changes |
Source |
Comments |
FY 2024 Changes |
|
Homeless Pregnant Women Services |
OF |
|
100,000 |
Major Footnote Changes
4. Requires the monies appropriated for local support for the Border Strike Task Force to be used to fund local law enforcement officer positions within the Border Striker Task Force that will deter and apprehend any individuals charged with drug trafficking, human smuggling, illegal immigration and other border-related crimes.
5. Removes the $500,000 cap on grants for cities, towns and counties for costs associated with prosecuting and detaining individuals charged with drug trafficking, human smuggling, illegal immigration and other border-related crimes.
6. Stipulates that the monies appropriated related to the Major Incident Division at least $7,000,000 must be dedicated to reimbursing regional law enforcement task forces and other law enforcement agencies to perform criminal investigations of any critical force incidents.
Arizona Department of Transportation (ADOT)
Major Footnote Changes
7. Removes the requirement that ADOT annually report to JLBC on the progress in improving the Motor Vehicle Division wait times and vehicle registrations renewal by mail turnaround times for the prior fiscal year.
8. Removes that the requirement the Arizona Strategic Enterprise Technology Office annually report on ADOT's plan to spend their portion of the authorized third-party electronic service partner's fee retention on the motor vehicle modernization project.
9. Removes that the requirement ADOT annually report to JLBC on the state's share of fees retained by the Service Arizona vendor from the prior fiscal year.
Universities
Major Footnote Changes
10. Declares the Legislature's intent that the monies allocated by Arizona State University (ASU) for the School of Civic and Economic Thought and Leadership, Northern Arizona University for the Economic Policy Institute and the University of Arizona for the Center for the Philosophy of Freedom in FY 2024 be consistent with the amount appropriated in FY 2023.
11. Declares the Legislature's intent that the monies appropriated by ASU for the Center for American Institutions in FY 2024 be consistent with the amount appropriated in FY 2022 and the appropriated monies must be used at the sole discretion, approval and for direct support of the Center for American Institutions.
FY 2023 Supplemental Appropriations and Adjustments
General Fund (GF) and Other Fund (OF)
|
Agency |
Fund |
Amount |
|
ADOA – Federal Government Disallowed Costs – Risk Management Revolving Fund |
OF |
3,107,700 |
|
ADOA – Transfer from Personnel Division Fund to Human Resources Information System Subaccount |
OF |
1,750,000 |
|
Department of Child Safety – Adoption Services Technical Adjustment (expenditure authority) |
OF |
11,100,000 |
Arizona Health Care Cost Containment System (AHCCCS)
12. Appropriates $58,487,600 from the Children's Health Insurance Program Fund and $3,307,915,900 from the expenditure authority in FY 2023 to AHCCCS for adjustments in formula requirements.
13. Reduces the appropriation made from the Tobacco Tax and Health Care Fund in FY 2023 by $55,000 to AHCCCS for adjustments in formula requirements.
Arizona Department of Education (ADE)
14. Appropriates $200,000,000 from the state GF in FY 2023 to the Superintendent of Public Instruction for additional basic state aid (BSA) formula costs.
Additional FY 2024 Appropriations and Adjustments
Arizona Department of Administration (ADOA)
15. Appropriates $7,150,650 from the state GF in FY 2024 to ADOA for equal distribution to counties with a population of fewer than 900,000 persons according to the 2020 U.S. Decennial Census (2020 Census) to maintain essential county services.
16. Appropriates $500,000 from the state GF in FY 2024 to ADOA for distribution to Graham County to maintain essential county services.
17. Appropriates $3,000,000 from the state GF in FY 2024 to ADOA for equal distribution to counties with a population of fewer than 300,000 persons according to the 2020 Census in order to supplement the cost of the Elected Officials Retirement Plan (EORP).
18. Prohibits the counties from using the distributed FY 2024 $3,000,000 appropriation for anything other than employer contributions to EORP.
19. Appropriates $7,000,000 from the state GF in FY 2024 to ADOA for distribution to counties to establish a coordinated reentry planning services program.
20. Appropriates the following amounts in FY 2024 from the APF subaccounts to ADOA for the following automation and information technology projects:
|
Project |
Subaccount |
Amount |
|
Human Resources Information System |
HRIS Subaccount |
20,647,800 |
|
Integrated Tax System Modernization Project |
ADOR Subaccount |
19,369,400 |
21. Requires ADOA to submit a quarterly report to JLBC on implementing projects approved by the Information Technology Authorization Committee that includes the project expenditures, deliverables, timeline for completion and current status.
22. Exempts the FY 2024 appropriations from the APF from lapsing until June 30, 2025.
Department of Economic Security (DES)
23. Allows DES, beginning April 1, 2024, to use up to $25,000,000 from the Budget Stabilization Fund (BSF) to provide funding for reimbursement grants.
24. Requires DES, before using the BSF monies, to notify the Directors of JLBC and the Governor's Office of Strategic Planning and Budgeting.
25. Requires the BSF appropriation to be fully reimbursed by September 1, 2024, and to be reimbursed in full as part of the closing process for FY 2023.
26. Prohibits the BSF appropriation from being used for additional programmatic expenditures.
Debt Service Payments
27. Allocates $25,498,600 of state GF revenue in FY 2024 to the Arizona Convention Center Development Fund.
28. Asserts that the Rio Nuevo Multipurpose Facility District is estimated to receive $17,000,000 from a portion of state transaction privilege tax revenues in FY 2024 and the actual amount of distribution will be made as outlined in statute.
Fund Transfers
29. Transfers the following amounts in FY 2024 to the relevant APF subaccount from the following sources:
|
Project |
Fund Source |
Amount |
|
Human Resources Information System Replacement |
OF |
20,647,800 |
|
Integrated Tax System Modernization Project |
GF |
11,794,100 |
|
Integrated Tax System Modernization Project |
Integrated Tax System Project Fund |
7,575,300 |
30. Specifies that the transfers into the APF are not appropriations out of the APF and that only direct appropriations out of the APF are appropriations.
Payment Deferrals
31. Continues to defer $800,727,700 in BSA and additional state aid (ASA) payments from ADE in FY 2024 until after June 30, 2024, but no later than July 12, 2024, and excludes charter schools and school districts with a student count less than 4,000 pupils from the deferral.
32. Requires ADE to make the deferral by reducing the apportionment of state aid for each month in the fiscal year by the same amount.
33. Requires ADE to disburse the FY 2025 appropriations of $800,727,700 to the counties for the school districts starting July 1, 2024, and no later than July 12, 2024, in amounts equal to the reductions in the apportionment of BSA and ASA.
34. Requires school districts to include, in the revenue estimates used for computing their FY 2024 tax rates, the deferred appropriation monies that they will receive.
Statewide Operating Adjustments
General Fund (GF) and Other Fund (OF)
|
Area of Adjustment |
GF |
OF |
Total |
|
Employer Health Insurance Contribution Reduction |
(63,244,800) |
(32,224,200) |
(95,469,000) |
|
University Health Insurance Backfill Removal |
(40,033,000) |
|
(40,033,000) |
|
Employer Health Insurance Contribution Increase |
72,000,000 |
30,000,000 |
102,000,000 |
35. Provides statewide adjustment procedures and instructions.
36. Outlines the FY 2024 individual agency charges totaling $1,798,500 for general agency counsel provided by the Attorney General.
FY 2025 Appropriations
37. Appropriates $77,898,600 from the state GF in FY 2025 for a onetime deposit in the New School Facilities Fund.
38. Requires the School Facilities Division (SFD) to use monies only for facilities that will be constructed for school districts that received final approval from SFD by December 15, 2022.
Miscellaneous
39. Declares the Legislature's intent that all departments, agencies and budget units receiving appropriations continue to report actual, estimated and requested expenditures in a specified format.
40. Contains other reporting requirements.
41. Defines terms.
42. Becomes effective on the signature of the Governor.
Prepared by Senate Research
January 30, 2023
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