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ARIZONA STATE SENATE
Fifty-Seventh Legislature, Second Regular Session
building
renewal grants; procurement practices
(NOW: building renewal grants; job-order-contracting)
Purpose
Caps the maximum amount of an individual job order for job-order-contracting for construction services at $1,000,000 for any project that receives Building Renewal Grant Fund (BRG Fund) monies. Requires Division of School Facilities (Division) Staff to verify that requirements are not artificially divided or fragmented to constitute a job order that satisfies the $1,000,000 limitation.
Background
The State Board of Education must adopt rules as outlined that prescribe procurement practices for school districts. Statute caps the maximum dollar amount of an individual job order for job-order-contracting construction services at $1,000,000, or a higher or lower amount prescribed by the school district governing board in a policy adopted in a public meeting. Requirements may not be artificially divided or fragmented to constitute a job order that satisfies the $1,000,000 limitation on job-order-contracting construction services (A.R.S. § 15-213).
The Division within the Arizona Department of Administration must develop and implement policies and procedures to establish a project eligibility assessment for all projects submitted for funding from the BRG Fund and the Emergency Deficiencies Correction Fund, including standardized criteria for project eligibility. Before the Division formally approves a project, Division Staff may review the costs and scope of the proposed project with the person and entities that have submitted project bids (A.R.S. § 41-5702).
The Division administers the BRG Fund and distributes BRG Fund monies to
school districts who request BRG Fund grants to maintain the adequacy of
existing school buildings. A school district must use BRG Fund monies for the
following projects: 1) major renovations and repairs to a building that is used
for student instruction or other academic purposes; 2) upgrading systems and
areas that will maintain or extend a building's useful life; and 3)
infrastructure costs. A school district may not use BRG Fund monies for: 1) new
construction; 2) remodeling interior space for aesthetic reasons; 3) exterior
beautification; 4) demolition; 5) routine preventative maintenance; and 6) any
project in a building that is being leased to another entity (A.R.S.
§ 41-5731).
Job-order-contracting means a project delivery method in which: 1) the contract is a requirements contract for indefinite quantities of construction; 2) the construction to be performed is specified in job orders issued during the contract; and 3) finance, maintenance, operations, preconstruction, design and other related services may be included (A.R.S. § 41-2503).
There is no anticipated fiscal impact to the state General Fund associated with this legislation.
Provisions
1. Caps, for any project that receives BRG Fund monies, the maximum amount of an individual job order for job-order-contracting for construction services at $1,000,000.
2. Requires Division Staff, before formally approving a project that receives BRG Fund monies, to verify that the requirements are not artificially divided or fragmented to constitute a job order that satisfies the $1,000,000 limitation on job-order-contracting for construction services.
3. Makes technical and conforming changes.
4. Becomes effective on the general effective date.
House Action
ED 2/3/26 DPA/SE 7-2-2-1
3rd Read 2/25/26 31-22-7
Prepared by Senate Research
March 16, 2026
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