HCR 2042

REFERENCE TITLE: expenditure limitation; school districts; repeal.
State of Arizona
House of Representatives
Fifty-seventh Legislature
Second Regular Session
2026
HCR 2042
Introduced by
Representatives
  Volk: Abeytia, Austin, Connolly, Contreras L, Garcia, Gutierrez, Hernandez A,
  Hernandez C, Hernandez L, Liguori, M�rquez, Simacek, Stahl Hamilton, Travers,
  Villegas;� Senator Ortiz
A
CONCURRENT RESOLUTION
proposing an amendment to the
Constitution of Arizona; amending article IX, section 21, Constitution of
Arizona; relating to expenditure limitations.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it resolved by the House of Representatives of the State of
Arizona, the Senate concurring:
1. Article IX, section 21, Constitution of Arizona,
is proposed to be amended as follows if approved by the voters and on
proclamation of the Governor:
START_STATUTE21. Expenditure limitations for community college districts;
definitions
Section 21. (1) The economic estimates
commission shall determine and publish prior to before April 1 of each year the expenditure limitation for the
following fiscal year for each community college district. The
expenditure limitations shall be determined by adjusting the amount of
expenditures of local revenues for each such district for fiscal year 1979-1980
to reflect the changes in the student population of each district and the cost
of living. The governing board of any community college district shall
not authorize expenditures of local revenues in excess of the limitation
prescribed in this section, except in the manner provided by law.
(2) The economic estimates
commission shall determine and publish prior to May 1 of each year the
aggregate expenditure limitation for all school districts for the following
fiscal year.� The aggregate expenditure limitation shall be determined by
adjusting the total amount of expenditures of local revenues for all school
districts for fiscal year 1979-1980 to reflect the changes in student
population in the school districts and the cost of living, and multiplying the
result by 1.10. The aggregate expenditures of local revenues for all
school districts shall not exceed the limitation prescribed in this section,
except as provided in subsection (3) of this section.
(3) Expenditures in excess of the
limitation determined pursuant to subsection (2) of this section may be
authorized by the legislature for a single fiscal year, by concurrent
resolution, upon affirmative vote of two-thirds of the membership of each house
of the legislature.
(4) (2) As used in For the purposes of this
section:
(a) "Cost of living" means either:
(i) The price of goods and services as measured by
the implicit price deflator for the gross national product or its successor as
reported by the United States department of commerce, or its successor agency.
(ii) A different measure or index of the cost of
living adopted at the direction of the legislature, by concurrent resolution, upon on the affirmative vote of two-thirds
of the membership of each house of the legislature. Such a measure or index shall apply for subsequent fiscal years,
except it shall not apply for the fiscal year following the adoption of such the measure or index if the measure
or index is adopted after March 1 of the preceding fiscal year.
(b) "Expenditure" means any amounts
budgeted to be paid from local revenues as prescribed by law.
(c) "Local revenues" includes all
monies, revenues, funds, property and receipts of any kind whatsoever received
by or for the account of a school district or community
college district or any of its agencies, departments, offices, boards,
commissions, authorities, councils and institutions, except:
(i) Any amounts or property received from the
issuance or incurrence of bonds, or other lawful long-term obligations issued
or incurred for a specific purpose, or any amounts or property collected or
segregated to make payments or deposits required by a contract concerning such
bonds or obligations.� For the purpose purposes
of this subdivision, long-term obligations
shall not include warrants issued in the ordinary course of operation or
registered for payment by a political subdivision.
(ii) Any amounts or property received as payment
of dividends and interest, or any gain on the sale or redemption of investment
securities, the purchase of which is authorized by law.
(iii) Any amounts or property received by a school district or community college district in the capacity of
trustee, custodian or agent.
(iv) Any amounts received as grants and aid of any
type received from the federal government or any of its agencies except school
assistance in federally affected areas.
(v) Any amounts or property received as grants,
gifts, aid or contributions of any type except amounts received directly or
indirectly in lieu of taxes received directly or indirectly from any private
agency or organization,  or any individual.
(vi) Any amounts received from the this state for the purpose of purchasing land, buildings or
improvements or constructing buildings or improvements.
(vii) Any amounts received pursuant to a transfer
during a fiscal year from another agency, department, office, board,
commission, authority, council or institution of the same community college
district or school district which that were
included as local revenues for such fiscal year or which that are excluded from local revenue under other provisions of
this subsection.
(viii) Any amounts or property accumulated by a
community college district for the purpose of purchasing land, buildings or
improvements or constructing buildings or improvements.
(ix) Any amounts received in return for goods or
services pursuant to a contract with another political subdivision, school
district,  or community college
district or the this state and
expended by the other political subdivision, school district,  or community college district or the this state pursuant to the expenditure limitation in effect
when the amounts are expended by the other political subdivision, school
district,  or community college
district or the this state.
(x) Any amounts received as tuition or fees
directly or indirectly from any public or private agency or organization or any
individual.
(xi) Any ad valorem taxes received pursuant to an
election to exceed the limitation prescribed by section 19 of this article or
for the purposes of funding expenditures in excess of the expenditure
limitations prescribed by subsection (7) (4)
of this section.
(xii) Any amounts received during a fiscal year as
refunds, reimbursements or other recoveries of amounts expended which
that were applied against the expenditure limitation for
such fiscal year or which that were
excluded from local revenues under other provisions of this subsection.
(d) For the purpose of subsection
(2) of this section, the following items are also excluded from local revenues
of school districts:
(i) Any amounts received as the
proceeds from the sale, lease or rental of school property as authorized by
law.
(ii) Any amounts received from the
capital levy as authorized by law.
(iii) Any amounts received from the
acquisition, operation, or maintenance of school services of a commercial
nature which are entirely or predominantly self-supporting.
(iv) Any amounts received for the
purpose of funding expenditures authorized in the event of destruction of or
damage to the facilities of a school district as authorized by law.
(v) Any
revenues derived from an additional state transaction privilege tax rate
increment for educational purposes that was authorized by the voters before
January 1, 2001.
(vi) Any amounts received pursuant
to article XI, section 8, Constitution of Arizona, that are approved by the
majority of qualified voters at a statewide general election held after
November 1, 2002, and before January 1, 2003.
(e) (d) "Student population" means the number of
actual, full-time or the equivalent of actual full-time students
enrolled in the school district or community college
district determined in a manner prescribed by law.
(5) (3) The
economic estimates commission shall adjust the amount of expenditures of local
revenues in fiscal year 1979-1980, as used to determine the expenditure
limitation of a community college district pursuant to
subsection (1) or (2) of this section, to reflect both of the following:
(a) Subsequent
transfers of all or any part of the cost of providing a governmental function,
in a manner prescribed by law. The adjustment provided for in this subsection paragraph shall be used in
determining the expenditure limitation of a community college
district pursuant to subsection (1) or (2) of this
section beginning with the fiscal year immediately following the transfer.
(6) The economic estimates
commission shall adjust the amount of expenditures of local revenues in fiscal
year 1979-1980, as used to determine the expenditure limitation of a
community college district pursuant to subsection (1) of this section, to
reflect
(b) Any
subsequent annexation, creation of a new district, consolidation or change in
the boundaries of a district, in a manner prescribed by law. The
adjustment provided for in this subsection paragraph
shall be used in determining the expenditure limitation of
a community college district pursuant to subsection (1) of this section
beginning with the fiscal year immediately following the annexation, creation
of a new district, consolidation or change in the boundaries of a district.
(7) (4) The
legislature shall establish by law expenditure limitations for each school
district beginning with the fiscal year beginning July 1, 1980. Expenditures
by a school district in excess of such an expenditure limitation must be
approved by a majority of the electors voting on the excess expenditures.
(8) (5) The
legislature shall establish by law a uniform reporting system for school districts and community college districts to ensure
compliance with this section. The legislature shall establish by law
sanctions and penalties for failure to comply with this section. END_STATUTE
2. Applicability
This act applies to fiscal years beginning
from and after June 30, 2027.
2. The Secretary of State
shall submit this proposition to the voters at the next general election as
provided by article XXI, Constitution of Arizona.