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ARIZONA STATE SENATE
Fifty-Seventh Legislature, Second Regular Session
general appropriations act; 2026-2027
Purpose
Makes session law changes relating to general appropriations necessary to implement the FY 2027 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 (JLBC).
S.B. 1831 contains the budget provisions for changes relating to general appropriations.
Provisions
FY 2027 Ongoing Fund and Major Footnote Changes
Arizona Department of Administration (ADOA)
Major Footnote Changes
1. Requires the $377,100 appropriated for corrections officer employer contributions to be distributed to the following counties to fully cover the Corrections Officer Retirement Plan employer contribution rate increase:
a) $4,600 to Apache County;
b) $10,100 to Cochise County;
c) $14,100 to Coconino County;
d) $7,700 to Gila County;
e) $7,800 to Graham County;
f) $4,400 to La Paz County;
g) $134,400 to Maricopa County;
h) $19,900 to Mohave County;
i) $8,800 to Navajo County;
j) $81,300 to Pima County;
k) $15,100 to Pinal County;
l) $6,600 to Santa Cruz County;
m) $38,300 to Yavapai County; and
n) $24,000 to Yuma County.
ADOA School Facilities Division (SFD)
Ongoing General Fund (GF) and Other Fund (OF) Changes
|
Summary of Changes |
Source |
Comments |
FY 2027 Changes |
|
Building Renewal Grants |
GF |
Onetime |
183,000,000 |
|
New Construction Formula |
GF |
Prior year project savings (onetime) |
(20,200,000) |
Major Footnote Changes
2. Allows SFD to use the unencumbered balance of $20,622,600 in the New School Facilities Fund for facilities and land costs for school districts that received SFD final approval by December 15, 2025.
Department of Child Safety (DCS)
Ongoing GF and OF Changes
|
Summary of Changes |
Source |
Comments |
FY 2027 Changes |
|
Congregate Care |
GF |
Onetime |
36,900,000 |
|
Extended Foster Care Coaching |
GF |
Onetime |
8,200,000 |
Arizona Health Care Cost Containment System (AHCCCS)
Ongoing GF and OF Changes
|
Summary of Changes |
Source |
Comments |
FY 2027 Changes |
|
Formula |
GF |
|
(42,000,000) |
Arizona Commerce Authority (ACA)
Ongoing GF and OF Changes
|
Summary of Changes |
Source |
Comments |
FY 2027 Changes |
|
Eliminate Annual Arizona Competes Fund Deposit |
GF |
|
(500,000) |
Arizona Department of Corrections, Rehabilitation and Reentry (ADCRR)
Ongoing GF and OF Changes
|
Summary of Changes |
Source |
Comments |
FY 2027 Changes |
|
4% Correctional Officer Stipend |
GF |
Onetime |
21,400,000 |
Major Footnote Changes
3. Requires the Director of ADCRR to award a onetime stipend payment to ADCRR employees that are employed by the ADCRR after July 3, 2026.
4. Requires the onetime stipend payment to be equal to four percent of the employee's annual salary level and the amount must be distributed evenly throughout each pay period in FY 2027.
5. Specifies that the amount appropriated for private prison per diem includes $3,767,200 for the purpose of awarding a onetime correctional officer stipend.
6. Requires ADCRR to amend private prison bed contracts to increase per diem rates in FY 2027 on a onetime basis to provide an amount sufficient for a onetime four percent stipend to each correctional officer employed in a private prison that contracts with the state.
Arizona Criminal Justice Commission (ACJC)
Ongoing GF and OF Changes
|
Summary of Changes |
Source |
Comments |
FY 2027 Changes |
|
Victims of Crime Act Federal Funds Backfill |
GF |
Onetime |
2,250,000 |
Major Footnote Changes
7. Requires ASDB, by September 1, 2026, to submit a report to JLBC that details the schools' budgetary and operational changes since FY 2026.
8. Requires the report to include any budgetary or operational changes relating to the ASDB's closure of the Tucson campus, the termination of the residential program, the relocation of campus-based staff and any plans for the disposition of land owned by ASDB at the Tucson campus.
Ongoing GF and OF Changes
|
Summary of Changes |
Source |
Comments |
FY 2027 Changes |
|
Supplemental Nutrition Assistance Program Benefit Match Rate Assume Error Rate Below 6% |
GF |
FY 2028 FY 2029 |
(138,700,000) (185,000,000) |
|
Victims of Crime Act Federal Funds Backfill |
GF |
Onetime |
11,500,000 |
|
Child Care Funding |
GF |
Onetime |
44,800,000 |
|
Developmental Disabilities High Need Clients |
GF |
Onetime |
17,900,000 |
Arizona Department of Education (ADE)
Ongoing GF and OF Changes
|
Summary of Changes |
Source |
Comments |
FY 2027 Changes |
|
Formula |
GF |
Declining Public School Enrollment |
(92,100,000) |
|
3rd Year Low Income Weight Increase |
GF |
Onetime |
37,000,000 |
|
3rd Year Additional Assistance Increase |
GF |
Onetime |
29,000,000 |
|
No School Meal Copay (130 185% FPL Households) |
GF |
Onetime |
2,000,000 |
Major Footnote Changes
9. Specifies that, of the $29,000,000 appropriated for additional assistance, $23,142,00 is included for a onetime district additional assistance supplement and $5,858,00 is included for a onetime charter additional assistance supplement.
10. Requires ADE to distribute monies for district additional assistance and charter additional assistance on a proportional basis based on the district's or charter's additional assistance funding received in FY 2026.
11. Allows a school district to budget the onetime district additional assistance in either the school district's maintenance and operation fund or unrestricted capital outlay fund.
12. Requires ADE to distribute the appropriated amount for onetime Free and Reduced-Price Lunch (FRPL) group B weight supplement to school districts and charter schools on a pro rata basis using the weighted student count for FRPL students for the school district or charter school.
13. Allows a school district to budget the monies it receives from the onetime FRPL group B weight supplement in either the school district's maintenance and operation fund or unrestricted capital outlay fund.
14. Requires ADE to allocate monies for the onetime school meal grants to school districts and charter schools that participate in the National Lunch Program or School Breakfast Program under the National School Lunch and Child Nutrition Acts for grants to reduce or eliminate copayments that would be charged to eligible children for reduced-price meals.
15. Stipulates that, if there are insufficient monies to cover the school meal grant awards for all eligible grantees, ADE must reduce each grant proportionately to cover all eligible grantees.
Arizona Department of Juvenile Corrections (ADJC)
Ongoing GF and OF Changes
|
Summary of Changes |
Source |
Comments |
FY 2027 Changes |
|
4% Youth Correctional Officer Stipend |
GF |
Onetime |
500,000 |
Department of Public Safety (DPS)
Ongoing GF and OF Changes
|
Summary of Changes |
Source |
Comments |
FY 2027 Changes |
|
Victims of Crime Act Federal Funds Backfill |
GF |
Onetime |
9,300,000 |
Secretary of State (SOS)
Major Footnote Changes
16. Requires the SOS, no later than 15 days after the last of day of each month, to report to the Director of JLBC and the Director of the Governor's Office of Strategic Planning and Budgeting (OSPB) on the previous month's expenditures and fiscal year-to-date expenditures for election services.
17. Requires the report to include the actual expenditures by purpose, including the costs associated with logic and accuracy testing, the statewide election publicity pamphlet, initiative and referendum processing, petition signature reimbursements and sample ballot requirements.
Office of Tourism
Ongoing GF and OF Changes
|
Summary of Changes |
Source |
Comments |
FY 2027 Changes |
|
Eliminate Agency GF Appropriation |
GF |
|
(8,200,000) |
Universities
Major Footnote Changes
18. Declares the Legislature's intent that the School of Civic and Economic Thought and Leadership at Arizona State University, the Economic Policy Institute at Northern Arizona University and the Center for the Philosophy of Freedom at the University of Arizona maintain the same funding level as FY 2026, except the universities may allocate the lump sum reduction of up to 5 percent prescribed by the FY 2027 General Appropriations Act.
FY 2020 Appropriation Adjustment
GF and OF
|
Agency |
Fund |
Amount |
|
ADE High Quality Teacher Professional Development Pilot Program |
GF |
(344,300) |
FY 2021 Appropriation Adjustment
GF and OF
|
Agency |
Fund |
Amount |
|
ADE High Quality Teacher Professional Development Pilot Program |
GF |
(400,000) |
FY 2022 Appropriation Adjustments
GF and OF
|
Agency |
Fund |
Amount |
|
ADE High Quality Teacher Professional Development Pilot Program |
GF |
(400,000) |
|
ADOA Retirement of Defeasance of Financing Agreements |
GF |
(5,037,800) |
FY 2023 Appropriation Adjustments
GF and OF
|
Agency |
Fund |
Amount |
|
Arizona Department of Veteran Services Tribal Ceremonies |
GF |
(1,000,000) |
FY 2024 Appropriation Adjustments
GF and OF
|
Agency |
Fund |
Amount |
|
ADCRR Transitional and Reentry Housing |
GF |
(3,733,300) |
|
DPS Civil Air Patrol Infrastructure |
GF |
(2,300,000) |
|
DPS Major Incident Division |
GF |
(1,323,200) |
FY 2025 Appropriation Adjustments
GF and OF
|
Agency |
Fund |
Amount |
|
AHCCCS Graduate Medical Education |
GF |
(4,298,100) |
|
DPS Major Incident Division |
GF |
(6,433,200) |
FY 2026 Supplemental Appropriations and Adjustments
GF and OF
|
Agency |
Fund |
Amount |
|
AHCCCS - Formula |
GF |
64,528,400 |
|
AHCCCS Formula Expenditure Authority |
OF |
340,175,800 |
|
DES Formula |
GF |
96,818,700 |
|
DES Formula Developmental Disabilities Expenditure Authority |
OF |
241,928,300 |
|
DPS Operating Expenditures Exempt from Lapsing |
OF |
4,750,000 |
|
SOS Special Election Expenses |
GF |
(1,215,200) |
|
ADE Basic State Aid (BSA) Formula |
GF |
(31,859,000) |
19. Declares the Legislature's intent that ADOA not enter into any agreements in FY 2026 to pay for any federal reimbursements related to excess balances in the Special Employee Health Insurance Trust Fund unless the proposed agreements have been reviewed by JLBC.
20. Allows DES, beginning April 1, 2027, to use up to $25,000,000 from the Budget Stabilization Fund (BSF) to provide funding for reimbursement grants.
21. Requires DES, before using the BSF monies, to notify the Director of JLBC and the Director of OSPB.
22. Requires the BSF appropriation to be fully reimbursed by September 1, 2027, and to be reimbursed in full as part of the closing process for FY 2027.
23. Prohibits the BSF appropriation from being used for additional programmatic expenditures.
FY 2027 Lump Sum Reductions
24. Reduces the following budget units' FY 2027 lump sum appropriation by the following amounts:
|
Agency |
Amount |
|
ADOA |
(967,200) |
|
ADOA SFD |
(78,200) |
|
Office of Administrative Hearings |
(46,300) |
|
Arizona Department of Agriculture |
(763,400) |
|
AHCCCS |
(10,576,400) |
|
Attorney General (AG) |
(1,292,900) |
|
State Board for Charter Schools |
(134,900) |
|
ACA |
(127,500) |
|
Community Colleges Rural Aid Applied to Each County Allocation Proportionately |
(700,000) |
|
Community Colleges Rural County Reimbursement Subsidy |
(54,100) |
|
Community Colleges Dine College Remedial Education |
(50,000) |
|
Community Colleges Additional Gila Workforce Development Aid |
(10,000) |
|
Arizona Corporation Commission |
(37,000) |
|
ACJC |
(230,000) |
|
Office of Economic Opportunity |
(24,800) |
|
DES |
(9,909,100) |
|
State Board of Education |
(165,900) |
|
ADE |
(7,120,400) |
|
Department of Emergency and Military Affairs |
(564,500) |
|
State Board of Equalization |
(35,600) |
|
Board of Executive Clemency |
(72,900) |
|
Department of Forestry and Fire Management |
(2,170,400) |
|
Arizona Department of Gaming |
(310,200) |
|
Office of the Governor |
(456,400) |
|
Governor's Office of Strategic Planning and Budgeting |
(138,300) |
|
Department of Health Services (DHS) |
(5,717,600) |
|
Arizona Historical Society |
(142,500) |
|
Prescott Historical Society |
(47,200) |
|
Arizona Department of Homeland Security |
(500,000) |
|
Industrial Commission of Arizona |
(4,200) |
|
Department of Insurance and Financial Institutions |
(299,400) |
|
Judiciary Supreme Court |
(1,273,900) |
|
Judiciary Court of Appeals |
(688,900) |
|
Judiciary Superior Court |
(4,210,600) |
|
ADJC |
(1,465,500) |
|
Arizona State Land Department |
(579,700) |
|
Legislature Auditor General |
(1,291,100) |
|
Legislature House of Representatives |
(907,800) |
|
Legislature JLBC |
(148,200) |
|
Legislature Legislative Council |
(452,900) |
|
Legislature Ombudsman-Citizens Aide Office |
(77,000) |
|
Legislature Senate |
(806,500) |
|
State Mine Inspector |
(107,900) |
|
State Natural Resource Conservation Board |
(19,500) |
|
Arizona Navigable Stream Adjudication Commission |
(6,700) |
|
State Real Estate Department |
(150,200) |
|
Arizona Department of Revenue (ADOR) |
(2,862,000) |
|
SOS |
(692,200) |
|
State Board of Tax Appeals |
(15,300) |
|
State Treasurer |
(85,800) |
|
Governor's Office on Tribal Relations |
(3,200) |
|
Arizona Board of Regents (ABOR) |
(2,733,000) |
|
Arizona State University |
(16,142,600) |
|
Northern Arizona University |
(5,561,700) |
|
University of Arizona Main Campus |
(10,670,800) |
|
University of Arizona Health Sciences Center |
(3,771,400) |
|
Arizona Department of Veterans' Services |
(569,800) |
|
Arizona Department of Water Resources |
(1,199,500) |
25. Prohibits the universities under the jurisdiction of the ABOR from reducing monies allocated from operating lump sum appropriations to the Arizona State University School of Civic and Economic Though and Leadership, the Northern Arizona University Economic Policy Institute and the University of Arizona Center for the Philosophy of Freedom by more than 5 percent of the total amount allocated to the school, institute or center.
Debt Service Payments
26. Allocates $26,997,100 of state GF revenue in FY 2027 to the Arizona Convention Center Development Fund.
Fund Transfers
27. Transfers the following amounts, by June 30, 2026, from the following fund sources to the state GF for the purposes of providing adequate support and maintenance for state agencies:
|
Fund |
Comments |
Amount |
|
ADOA Risk Management Revolving Fund |
24,300,000 |
|
|
ADOA Construction Insurance Fund |
|
8,500,000 |
|
AG Consumer Protection-Consumer Fraud Revolving Fund |
|
3,000,000 |
|
ACA Arizona Competes Fund |
|
63,300,000 |
|
Arizona Corporation Commission Securities Regulator and Enforcement Fund |
|
16,900,000 |
|
Arizona Corporation Commission Utility Regulation Revolving Fund |
|
6,800,000 |
|
ADCRR Prison Construction and Operations Fund |
|
10,000,000 |
|
ADCRR Transition Program Fund |
|
2,200,000 |
|
Arizona Department of Environmental Quality (ADEQ) Underground Storage Tank Revolving Fund |
|
8,700,000 |
|
ADEQ Recycling Fund |
|
4,000,000 |
|
Arizona Game and Fish Department (AZGFD) Heritage Land Acquisition Fund |
|
10,000,000 |
|
AZGFD Watercraft Licensing Fund |
|
3,400,000 |
|
DHS Health Services Lottery Fund |
|
5,100,000 |
|
Arizona Department of Housing Housing Trust Fund |
|
14,400,000 |
|
Industrial Commission of Arizona Administrative Fund |
|
6,700,000 |
|
Department of Insurance and Financial Institutions Automobile Theft Authority Fund |
|
5,800,000 |
|
Arizona State Land Department Trust Land Management Fund |
|
21,200,000 |
|
Judiciary Supreme Court Judicial Collection Enhancement Fund |
|
9,600,000 |
|
Arizona State Parks Board (ASPB) State Parks Revenue Fund |
|
11,900,000 |
|
ASPB Off-Highway Vehicle Recreation Fund |
|
10,000,000 |
|
ASPB Arizona State Parks Heritage Fund |
|
2,600,000 |
|
ABOR Technology and Research Initiative Fund |
|
24,900,000 |
|
ADOR Administrative Fund |
|
5,000,000 |
|
Arizona Department of Transportation (ADOT) State Match Advantage for Rural Transportation Fund |
|
26,300,000 |
|
ADOT Motor Vehicle Liability Insurance Enforcement Fund |
|
16,200,000 |
|
ADOT State Vehicle Replacement Fund |
|
5,000,000 |
|
Water Infrastructure Finance Authority Water Supply Development |
|
30,000,000 |
28. Transfers $9,700,000, by July 1, 2027, from the State Highway Fund to the state GF in FY 2027 for the purposes of providing adequate support and maintenance for state agencies.
29. Specifies that the $9,700,000 transferred from the State Highway Fund reflects the interest income earned from investment of State Highway Fund monies from a portion of revenues derived from the state GF portion of transaction privilege tax revenues transferred in the FY 2023 state budget.
Payment Deferrals
30. Appropriates $40,000,000 from the Consumer Remediation Subaccount of the Consumer Restitution and Remediation Revolving Fund in FY 2027 to the AG and specifies that the monies consist of opioid claims-related litigation or settlements.
31. Requires the AG, by July 8, 2026, or if sufficient monies are not available on July 8, 2026, within three calendar days after sufficient monies become available, to transfer the $40,000,000 to the ADCRR Opioid Remediation Fund.
32. Requires ADCRR to use the monies in the specified opioid-related fund only for past and current costs for care, treatment, programs and other expenditures for individuals with opioid use disorder and any co-occurring substance use disorder or mental health conditions or for any other approved purposes prescribed in a court order, a settlement funds agreement that is entered into by the state and other parties to the opioid litigation.
33. Prohibits the AG from imposing any conditions on the transfer of the monies in the ADCRR Opioid Remediation Fund.
34. Stipulates that, if the AG does not transfer the full amounts specified by July 8, 2026, the ADOA General Accounting Office must directly transfer the amount from the subaccount to the ADCRR Opioid Remediation Fund.
35. Exempts the AG monies from lapsing.
36. Continues to defer $800,727,700 in BSA and additional state aid (ASA) payments from ADE in FY 2026 until after June 30, 2027, but no later than July 12, 2027, and excludes charter schools and school districts with a student count of less than 4,000 pupils from the deferral.
37. Requires ADE to make the deferral by reducing the apportionment of state aid for each month in the fiscal year by the same amount.
38. Requires ADE to disburse the FY 2028 appropriations of $800,727,700 to the counties for the school districts between July 1, 2027, and July 12, 2027, in amounts equal to the reductions in the apportionment of BSA and ASA.
39. Requires school districts to include, in the revenue estimates used for computing FY 2027 tax rates, the deferred appropriation monies that the districts will receive.
Additional FY 2027 Appropriations and Adjustments
40. Appropriates the following amounts in FY 2027 from the APF subaccounts to ADOA for the following automation and information technology project:
|
Project |
Subaccount |
Amount |
|
ADOR Integrated Tax System Modernization |
ADOR Subaccount |
19,756,800 12,538,400 (GF) 7,218,400 (OF) |
Statewide Operating Adjustments
GF and OF
|
Area of Adjustment |
GF |
OF |
Total |
|
Employer Health Insurance Contribution Reduction |
(194,788,900) |
(45,876,400) |
(240,665,300) |
|
Employer Health Insurance Contribution Increase |
228,363,200 |
55,000,000 |
283,363,200 |
|
State Fleet Operations |
(5,205,900) |
10,000 |
(5,195,900) |
|
State Fleet Replacement |
(2,422,400) |
(2,700,000) |
(5,122,400) |
|
Agency Risk Management |
(19,999,600) |
(5,888,700) |
(25,888,300) |
|
Agency Retirement |
(3,135,800) |
(271,500) |
(3,407,300) |
41. Prescribes statewide adjustments procedures and instructions.
42. Outlines the FY 2027 individual agency charges totaling $1,798,500 for general agency counsel provided by the AG.
Miscellaneous
43. 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.
44. Contains other reporting requirements.
46. Becomes effective on the signature of the Governor.
Prepared by Senate Research
April 24, 2026
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