Update: University Infrastructure, K-12, Economic Dev, Health & Transportation
The Arizona Legislature completed its seventeenth week of session as members worked into the early hours of Friday morning to fulfill its constitutionally mandated obligation of passing the Fiscal Year 2018 budget. The budget package, comprised of 11 separate bills, passed after hours of debate and public testimony on the floor and in issue committees in both chambers of the legislature.
The budget was largely passed as introduced. However, a few amendments were attached to clarify some of the outstanding issues. Items of note in the budget include:
As was introduced, the proposed TPT capture mechanism for university research infrastructure did not have the votes to pass. Therefore, lawmakers turned to the 2003 university infrastructure package as a funding model. The three state universities will receive infrastructure funding from FY2019 through FY2043 within the appropriations process, rather than through a TPT capture mechanism. Additionally, an amendment to the budget prohibits universities from hiring contract lobbyists.
It was apparent, through numerous proposed amendments, that Democrats made a strong attempt to increase teacher pay on the floor. However, the K-12 budget passed with the following provisions:
- Increases base student funding
- Creates a college credit examination
- Creates the Arizona Teacher Academy included in the Governor’s Budget
- Provides results-based funding for K-12 based on a variety of success criteria
- Appropriates in early literacy grants
- Funds broadband for rural Arizona schools
There are still a few bills that remain in the mix that if passed will benefit economic development in Arizona. The Angel Investment Tax Credit and Quality Jobs Reauthorization bills await consideration next week. The budget contained the following economic development issues:
- Funds the Arizona Commerce Authority at the existing level
- Closes down the Arizona Job Training Fund
- Funds the Arizona Office of Tourism at the existing level
Health issues in the budget took a back seat to education funding. The following issues were included in the budget:
- Retains AHCCCS reimbursement rates at existing levels
- Allows AHCCCS to recover erroneous Medicare payments
- Freezes KidsCare if the federal match rate falls below 100%
- Requires AHCCCS to submit a report on use of ERs for non-emergency use by AHCCCS enrollees
- Requires AHCCCS and DHS to submit a joint report on hospital costs and charges
Transportation funding has largely been omitted from conversation, however, received notable debate during budget discussions. Several lawmakers, across the aisle, called upon the Governor to demonstrate leadership on funding transportation. The following issues were in the adopted budget:
- Establishes the Highway Damage Recovery Account and appropriates
- Shifts jet fuel tax revenues to the State Aviation Fund
- Sweeps a portion of the State Aviation Fund
- Appropriates $356 million into the State Highway Fund
- Sweeps a portion of the State Highway Fund from ADOT to fund the Department of Public Safety
The legislature extended the session through Thursday. Next week is expected to be the final week of the 2017 Regular Session.