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ARIZONA STATE SENATE
Fifty-Seventh Legislature, Second Regular Session
VETOED
FACT SHEET FOR H.B. 4148/S.B. 1841
2026-2027; K-12 education.
Purpose
Makes statutory and session law changes relating to K-12 education 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.
H.B. 4148 contains the budget reconciliation provisions for changes relating to K-12 education.
Provisions
Basic State Aid
1. Increases the base level for FY 2027 from $5,113.26 to $5,215.53.
2. Increases the charter additional assistance amount per student for FY 2027:
a) from $2,131.90 to $2,174.54, for students in preschool programs for children with disabilities, kindergarten programs and grades 1 through 8; and
b) from $2,484.69 to $2,534.38, for students in grades 9 through 12.
3. Increases the transportation support level formula per-route-mile amount for FY 2027 as follows:
|
FY 2026 |
FY 2027 |
|
|
3.01 |
3.07 |
|
|
Between 0.5 and 1.0 |
2.47 |
2.52 |
|
Over 1.0 |
3.01 |
3.07 |
Arizona State Schools for the Deaf and the Blind Property Requirements
4. Stipulates that, before the Arizona State Schools for the Deaf and the Blind (ASDB) schools may sell school buildings or grounds, the ASDB schools must:
a) determine the appraised value of the buildings or grounds by ordering independent appraisals from at least two different firms;
b) submit a proposal to sell school buildings or grounds to the Joint Committee on Capital Review for review; and
c) sell the property to the highest and most responsible bidder at a public sale that is held for that purpose, except that the schools may not accept a bid that is lower than the appraised value determined by the independent appraisals.
5. Specifies that an ASDB school must procure appraisal services pursuant to the Arizona Procurement Code and award an appraisal services contract to a firm only if the appraiser is well qualified and a designated team member of a nationally recognized real estate appraisal association, institute or society.
6. Allows an ASDB school to use any appraisal that is ordered as prescribed as the appraised value of the buildings or grounds.
7. Directs ASDB to transmit the first $1,200,000 that ASDB receives for the sale or lease of school buildings or grounds in FYs 2027, 2028 and 2029 to the State Treasurer for deposit in the state General Fund.
8. Specifies that monies received by ASDB schools for fees, rentals and other charges for the use of school facilities for non-school events are not monies received for the lease of school buildings or grounds.
9. Establishes the Property Proceeds Fund (Property Fund), consisting of the proceeds from the sale or lease of ASDB school buildings and grounds.
10. Requires ASDB schools to administer the Property Fund and deposit all monies that ASDB schools receive for the sale or lease of school buildings and grounds in the Property Fund.
11. Specifies that Property Fund monies are subject to legislative appropriation and exempt from lapsing.
12. Requires, in any fiscal year in which the Legislature appropriates monies from the Property Fund to ASDB schools, the ASDB schools to prepare an expenditure plan for the monies and submit the plan to the Joint Legislative Budget Committee (JLBC) for review.
Miscellaneous
13. Conforms the tax year 2026 qualifying tax rates to reflect the required truth-in-taxation rate adjustment.
14. Authorizes the Arizona Department of Education (ADE) to use Failing Schools Tutoring Fund monies in FY 2027 for the following school improvements:
a) providing assistance to school districts and charter schools for professional development and coaching for teachers and principals;
b) monitoring the progress of school districts and charter schools towards improved academic outcomes; and
c) outreach to ensure that schools and parents have access to tutoring opportunities.
15. Requires, by September 1, 2026, ADE to report the proposed expenditures for FY 2027 Failing Schools Tutoring Fund monies to the Governor, the Senate President, the Speaker of the House of Representatives, the JLBC Director and the Governor's Office of Strategic Planning and Budgeting Director.
16. Continues to state as the intent of the Legislature and the Governor that school districts increase the total percentage of classroom spending over the previous year’s percentages in the combined categories of instruction, student support and instructional support as prescribed by the Auditor General.
17. Makes technical and conforming changes.
18. Becomes effective on the general effective date.
Governor's Veto Message
The Governor indicates in her veto message that H.B. 4148, and this version of the FY 2027 state budget as a whole, would cause Arizona to default on its debt obligations, endanger vulnerable children, cut public safety funding and provide tax breaks for billionaires, data centers and special interests. The Governor outlines her specific concerns, including cuts to funding for specified agencies and programs, and invites the Legislature to return to the negotiating table.
House Action Senate Action
APPROP 4/28/26 DP 11-7-0-0 ATT 4/28/26 DP 6-4-0
3rd Read 4/29/26 33-20-7 3rd Read 5/4/26 16-12-2
(H.B. 4148 was substituted for S.B. 1841 on 3rd Read)
Vetoed by the Governor 5/5/26
Prepared by Senate Research
May 7, 2026
MH/ci