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ARIZONA STATE SENATE
Fifty-Seventh Legislature, Second Regular Session
ENACTED
FACT SHEET FOR H.B. 4166/S.B. 1859
state budget implementation; 2026-2027
Purpose
Makes statutory session law changes relating to budget implementation 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. 4166 contains the budget reconciliation provisions for changes relating to budget implementation.
Provisions
1. Continues to require, retroactive to July 1, 2026, any unrestricted federal monies received by the state in FY 2027 to be deposited in the state General Fund (state GF) and used to pay for essential governmental services.
2. States that the Legislature is not required to appropriate monies to or transfer monies from the Budget Stabilization Fund in FY 2027 and FY 2028.
3. Continues to suspend the Budget Stabilization Fund cap of 10 percent of the state GF revenue for FY 2027 and prohibits the State Treasurer from transferring any surplus monies from the Budget Stabilization Fund to the state GF.
4. Requires the Arizona Department of Administration (ADOA) to:
a) have the ability to delegate authority or specific information technology (IT) functions to any budget unit; and
b) have the authority to enter into agreements with any state agency or political subdivision of the state to furnish IT services.
5. Requires any agreement to furnish IT services to provide for reimbursement to ADOA for the costs of the services furnished as determined by ADOA, unless monies have been appropriated by the Legislature for that purpose.
6. Specifies that ADOA's coordinated statewide plan for IT:
a) may include a requirement that budget units adopt certain technologies and data sharing practices to improve the efficiency of administering IT; and
b) must include developing a statewide data strategic plan for the purposes of improving the efficiency and effectiveness of data sharing and data governance activities.
7. Makes technical changes.
8. Becomes effective on the general effective date, with retroactive provisions as noted.
House Action Senate Action
APPROP 6/10/26 DP 15-1-2-0 ATT 6/10/26 DP 8-2-0
3rd Read 6/11/26 49-8-3 3rd Read 6/11/26 23-5-2
(H.B. 4166 was substituted for S.B. 1859 on 3rd Read)
Signed by the Governor 6/13/26
Chapter 138
Prepared by Senate Research
June 19, 2026
AN/ci