SB1229 - 512R

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

Section 1. Section 15-1466, Arizona Revised Statutes, is amended to read:

START_STATUTE15-1466. State aid; eligibility; limitations

A. Subject to legislative appropriation, the legislature shall determine and appropriate the amount of state aid each fiscal year to each district possessing the qualifications as prescribed in this chapter.

B. The state shall determine the amount of state aid, as prescribed in subsection D of this section, appropriated to each district for the fiscal year prior to the fiscal year for which the state aid is being calculated.

C. Each district qualified under this chapter shall have its state aid adjusted in an amount that reflects the growth or decrease in the full‑time equivalent student count of the district calculated as follows:

1. Calculate the growth or decrease in the actual, audited full‑time equivalent student count between the second and third most recent fiscal years prior to the fiscal year for which the state aid is being calculated for each district.

2. Calculate the average appropriation per full‑time equivalent student for all districts by dividing the amount determined in subsection B of this section by the actual, audited full‑time equivalent student count for all districts in the most recent fiscal year.

3. Multiply the amount calculated in paragraph 1 of this subsection by the average appropriation calculated in paragraph 2 of this subsection. This amount equals the adjustment required pursuant to this section.

D. The total amount appropriated to each district each fiscal year in accordance with this section shall serve as the amount of state aid to be adjusted in the next fiscal year. A district is eligible for growth funding pursuant to this section only for the portion of its most recent audited full-time student equivalent count that exceeds the audited full‑time student equivalent count recorded for the district for the most recent fiscal year in which an adjustment was previously made pursuant to subsection C of this section equal to a voucher amount of _______________ per full‑time equivalent student.

E. B. To be eligible for state aid, a district shall:

1. Be equipped with suitable buildings, equipment and campus.

2. Have at least three hundred twenty full‑time equivalent students attending in the district.

3. Have complied with all of the requirements of the district board, including budgets and curriculum.

F. C. The total amount of state monies that may be spent in any fiscal year by a district for operating state aid shall not exceed the amount appropriated or authorized by section 35‑173 for that purpose. Notwithstanding section 15‑1444, this section shall not be construed to impose a duty on an officer, agent or employee of this state to discharge a responsibility or to create any right in a person or group if the discharge or right would require an expenditure of state monies in excess of the expenditure authorized by legislative appropriation for that specific purpose, including any duties prescribed in an employment contract entered into pursuant to section 15‑1444, subsection A, paragraph 6.

G. D. In addition to the formula to determine the state aid appropriations prescribed in this section, the state may pay additional amounts for state aid to a district based on requests included in the district's budget request.

H. E. This section does not entitle a community college operated by a qualified Indian tribe to state aid for community colleges pursuant to this chapter. END_STATUTE

Sec. 2. Section 15-1661, Arizona Revised Statutes, is amended to read:

START_STATUTE15-1661. Annual appropriation; enrollment audit; expenditure; balance; salaries

A. There shall be appropriated in the general appropriation bill for each fiscal year a sum of monies not less than eighty‑five one‑hundredths of one mill on the dollar of the assessed valuation of all taxable property in the state for the improvement, support and maintenance of the institutions under the Arizona board of regents' jurisdiction, including payment of salaries, current expenses, purchase of equipment, making necessary repairs, construction of new buildings, purchase of lands and in general for payment of all such expenses connected with the management of the institutions under the Arizona board of regents' jurisdiction. The department of revenue, upon compiling the aggregate assessed valuation of all taxable property within this state, shall compute the amount of monies so determined and certify such amount over its seal to the department of administration and the state treasurer equal to a voucher amount of ____________________ per resident full‑time equivalent student.

B. The full‑time equivalent student enrollment reported for the previous fiscal year by each university shall be audited annually by the auditor general. The auditor general shall report the results of the audit to the staffs of the joint legislative budget committee and the governor's office of strategic planning and budgeting on or before October 15 of each year. On or before July 21 of each academic year, each university shall provide for the previous fall semester a certified report to the auditor general of the number of full‑time equivalent students calculated by the university and a separate report only for those students who meet the residency requirements prescribed in section 15‑1802. The university's records used to calculate full‑time equivalent student enrollment shall be provided to the auditor general in an electronic format prescribed by the auditor general. Beginning in 2006, Each university shall submit to the auditor general a summary of its full‑time equivalent student enrollment accounting policies and procedures, compilation procedures and source records used for calculating full‑time equivalent student enrollment. These accounting policies and procedures, compilation procedures and source records shall comply with policies developed on or before June 30, 2006 by the Arizona board of regents, in consultation with the auditor general and reviewed by the joint legislative budget committee. These policies shall include a review and recommendations of the necessity of minimum requirements for students enrolled in classes to qualify for appropriations pursuant to this section, including requirements that the class be a for‑credit course that is necessary for the completion of a degree and that the student enrolled in the course be physically present in this state at the time the course is conducted. The basic actual full‑time equivalent student enrollment shall be counted on the forty‑fifth day after the basic actual full‑time equivalent student enrollment classes begin for the fall and spring semesters, as published in the university catalogs, and divided by two. The Arizona board of regents shall also make recommendations of whether each professor or instructor should be required to review class rosters and make additions or deletions as necessary. If so, class rosters that reflect enrollment as of the forty‑fifth day shall be provided by the registrar's office to each professor or instructor for every class section. The class roster shall indicate the course number, course title, time, instructor name and students enrolled. On the forty‑fifth day class rosters, each professor or instructor shall indicate as withdrawn each student who has formally withdrawn from the course, and that student shall not be counted for state aid purposes. The official forty‑fifth day rosters shall include a manual signature and date or an electronic authorization and date by the professor or instructor and shall include the following certification:

I hereby certify that the information contained in this class roster accurately reflects those students who are enrolled.

C. The Arizona board of regents shall also report the basic actual full-time equivalent student enrollment for only those students who meet the residency requirements prescribed in section 15-1802. The basic actual full‑time equivalent student enrollment for only those students who meet the residency requirements prescribed in section 15-1802 that is reported by each university for the previous fiscal year shall be annually audited by the auditor general.

D. Students who have withdrawn or who have been withdrawn from classes as of the forty‑fifth day shall not be counted for state aid purposes. A record shall be maintained that identifies student withdrawals by date of withdrawal, as of the forty‑fifth day and after the forty‑fifth day for the entire semester.

E. Amounts appropriated as provided by subsection A of this section shall be paid as other claims against this state are paid.

F. The balance of appropriations as provided by subsection A of this section at the end of the fiscal year, if any, shall not revert to the general fund but shall be carried forward for the continued use for which appropriated.

G. Monies appropriated to a university under the jurisdiction of the Arizona board of regents for cost of living salary increases for university employees shall be used to provide cost of living salary increases to all university employees, including graduate student assistants. If monies are appropriated to a university for salary increases based on merit, the monies shall be used to provide merit increases according to the merit pay plan adopted by the Arizona board of regents.

H. The Arizona board of regents shall determine current actual full‑time equivalent student enrollment at each of the institutions under the jurisdiction of the Arizona board of regents. Full‑time equivalent student enrollment shall be calculated by adding the following:

1. The total number of enrolled fall and spring semester credit hours in 100‑level credit courses and 200‑level credit courses divided by fifteen.

2. The total number of enrolled fall and spring semester credit hours in 300‑level credit courses and 400‑level credit courses divided by twelve.

3. The total number of enrolled fall and spring semester credit hours in graduate level credit courses divided by ten.

I. The Arizona board of regents, in its annual budget request, shall not include funding for any student who is enrolled at an institution under the jurisdiction of the Arizona board of regents and who has earned credit hours in excess of the undergraduate credit hour threshold, except that the undergraduate credit hour threshold shall not apply to students who are enrolled in a degree program that requires credit hours above the credit threshold. For the purposes of this subsection, the undergraduate credit hour threshold is one hundred fifty-five hours for students who attend a university under the jurisdiction of the board in fiscal year 2006-2007, one hundred fifty hours for students who attend a university under the jurisdiction of the board in fiscal year 2007-2008 and one hundred forty‑five hours for students who attend a university under the jurisdiction of the board after fiscal year 2007-2008. The undergraduate credit hour threshold shall be based on the actual full‑time equivalent student enrollment counted on the forty‑fifth day after classes begin for the fall and spring semesters and any budget adjustment based on student enrollment shall occur in the fiscal year following the actual full-time equivalent student enrollment count. The undergraduate credit hour threshold shall not apply to credits earned in the pursuit of up to two baccalaureate degrees, credits earned in the pursuit of up to two state regulated licensures and certificates, credits earned in the pursuit of teaching certification, credits transferred from a private institution of higher education, credits transferred from an institution of higher education in another state, credits earned at another institution of higher education but that are not accepted as transfer credits at the university where the student is currently enrolled and credits earned by students who enroll at a university under the jurisdiction of the board more than twenty-four months after the end of that student's previous enrollment at a public institution of higher education in this state. END_STATUTE

Sec. 3. Title 15, chapter 14, article 2, Arizona Revised Statutes, is amended by adding section 15-1826, to read:

START_STATUTE15-1826. Student vouchers; eligibility; funding

A. The Arizona board of regents shall issue a voucher to any student who meets the requirements prescribed in this section. Each student who is issued a voucher pursuant to this section may use the voucher for the payment of tuition and fees at any accredited public or private postsecondary education institution in this state.

B. To qualify for a voucher pursuant to this section, a student shall satisfy all of the following requirements:

1. Submit a voucher application to the Arizona board of regents.

2. Declare an academic major, if the student is planning to enroll at an institution that awards four-year BACCALAUREATE degrees.

3. Meet university course placement requirements, which the Arizona board of regents shall ensure are aligned statewide for all higher education institutions in this state.

4. Obtain a passing score on a placement test for entry into degree fulfilling courses that uses the same cut‑score for all higher education institutions in this state.

C. Funding for the vouchers issued pursuant to this section shall be determined as follows:

1. To the extent practicable, the Arizona board of regents shall ensure that the average annual voucher amount is equivalent to the average in‑state tuition rate of the universities under the jurisdiction of the Arizona board of regents, except that the Arizona commerce authority may recommend pro‑rated voucher amounts for students based on the jobs needed in this state.

2. The postsecondary institution shall receive fifty per cent of the total voucher amount for each student when that student enrolls for that semester and shall receive the remaining fifty per cent on the student's successful academic completion of that semester. The Arizona board of regents shall report to the state treasurer the number of students who complete each semester, and the state treasurer shall disburse amounts pursuant to this paragraph based on those reports.

3. Any scholarship, grant or tuition assistance provided by the university or community college district shall be subtracted from the amount of the voucher.

D. To maintain eligibility for a voucher pursuant to this section, a student shall satisfy all of the following requirements:

1. Be enrolled full time at a postsecondary institution in this state in courses that total at least twelve credit hours during each of at least two academic semesters during the academic year.

2. Continuously satisfy the enrollment guidelines, the minimum grade point average and course completion requirements determined by the postsecondary institution.

E. A student is not eligible to receive a voucher pursuant to this section for more than four academic years. END_STATUTE

Sec. 4. Appropriation; Arizona board of regents; vouchers

The sum of $_______________ is appropriated from the state general fund in fiscal year 2014-2015 to the Arizona board of regents for the cost of vouchers issued to students pursuant to this act.

Sec. 5. Conforming legislation

The legislative council staff shall prepare proposed legislation conforming the Arizona Revised Statutes to the provisions of this act for consideration in the fifty‑second legislature, first regular session.