FOR THIRD READ                                                                                                      AS PASSED BY HOUSE

ARIZONA STATE SENATE

Fifty-Seventh Legislature, First Regular Session

FACT SHEET FOR H.B. 2973

state budget implementation; FY2026

Purpose

Makes session law changes relating to budget implementation necessary to implement the FY 2026 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.

H.B. 2973 contains the budget reconciliation provisions for changes relating to budget implementation.

Provisions

1. States that the Legislature is not required to appropriate monies to or transfer monies from the Budget Stabilization Fund in FY 2026, FY 2027 and FY 2028.

2. Continues to suspend the Budget Stabilization Fund cap of 10 percent of the state General Fund (state GF) revenue for FY 2026 and prohibits the State Treasurer from transferring any surplus monies from the Budget Stabilization Fund to the state GF.

3. Continues to require, retroactive to July 1, 2025, any unrestricted federal monies received by Arizona in FY 2026 to be deposited in the state GF and used to pay essential governmental services.

4. Becomes effective on the general effective date, with retroactive provisions as noted.

House Action

APPROP         6/24/25      DP       11-6-0-2

3^rd Read          6/24/25                  31-25-4

Prepared by Senate Research

June 25, 2025

AN/slp