HB2251 - 451R

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          House Engrossed
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  State of Arizona
  House of Representatives
  Forty-fifth Legislature
  First Regular Session
  2001
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     HOUSE BILL 2251
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AN ACT

AMENDING SECTIONS 35-113.01, 35-115, 35-122, 35-142, 35-173, 41-1275, 41-1279, 41-2955, 41-2958 AND 41-3102, ARIZONA REVISED STATUTES; MAKING AN APPROPRIATION; RELATING TO STATE BUDGET PROCEDURES.

(TEXT OF BILL BEGINS ON NEXT PAGE)

Be it enacted by the Legislature of the State of Arizona:

Section 1. Section 35-113.01, Arizona Revised Statutes, is amended to read:

35-113.01. Request for federal monies; report

A. All state agencies, boards, commissions and departments shall submit to the department of administration for acknowledgment, copies of all agreements, contracts and copies of all applications and requests for federal ~~funds,~~ MONIES to be used for any purpose.

B. Every state agency, board, commission or department seeking federal ~~funds~~ MONIES for any project or program shall furnish to the department of administration with each copy of AN application or request a statement of the purposes for which ~~any such~~ THE project or program is desired or advocated, the source and amount of ~~funds~~ MONIES to be granted or provided ~~therefor,~~ FOR THE PROJECT OR PROGRAM and a statement of the conditions, if any, ~~upon~~ ON which ~~such funds~~ THE MONIES are to be provided. The director may at ~~his~~ THE DIRECTOR'S discretion accept from the state agency, board, commission or department a summary of the information required in this section.

C. All departments, agencies, boards or commissions, shall forward an acknowledgment to the department of administration upon receipt of federal ~~funds~~ MONIES.

D. ALL STATE AGENCIES, BOARDS, COMMISSIONS AND DEPARTMENTS SHALL REPORT BY THE LAST DAY OF EACH QUARTER OF THE CALENDAR YEAR TO THE JOINT LEGISLATIVE BUDGET COMMITTEE ON ANY FEDERAL MONIES EXPENDED BY THAT ENTITY WHICH IS TEN PER CENT OR MORE IN EXCESS OF ANY AMOUNT SPENT DURING THE PRIOR FISCAL YEAR. THE REPORT SHALL FURTHER INDICATE WHETHER THOSE NEW FEDERAL MONIES ARE DERIVED FROM AN INCREASED AND ONGOING SOURCE OF REVENUE. IN THE INTERIM BETWEEN QUARTERLY REPORTS, THE JOINT LEGISLATIVE BUDGET COMMITTEE STAFF MAY ASK AN AGENCY, BOARD, COMMISSION OR DEPARTMENT TO SUBMIT AN EXPENDITURE PLAN FOR ANY NEW PROGRAM USING AT LEAST FIVE HUNDRED THOUSAND DOLLARS OF FEDERAL FUNDS.

E. FOR THE PURPOSES OF THIS SECTION, FEDERAL MONIES DO NOT INCLUDE ANY ENTITLEMENT PROGRAM OR RESEARCH GRANTS RECEIVED BY THE UNIVERSITIES.

Sec. 2. Section 35-115, Arizona Revised Statutes, is amended to read:

35-115. Contents of budget report

Each budget report of odd-numbered years as required by section 35-111 shall include the following:

1. Summary statements of the financial condition of the state, to include:

(a) A consolidated balance sheet showing all current assets and liabilities of the state at the close of the fiscal year last concluded.

(b) Summary statements of the actual income and expenditures of the fiscal year last concluded.

2. Schedules showing actual income from each source for the preceding fiscal year and the estimated income of the current fiscal year and of the two ensuing fiscal years. The statements of income and estimated income shall be itemized by source, by budget units and sources, and by funds and shall show separately revenue from nonrevenue, all detailed by sources.

3. Detailed comparative statements of expenditures and requests for appropriations by funds, budget units, budget programs and budget classes, showing the expenditures for the fiscal year last concluded, and the estimated expenditures for the current year, and the request of each budget unit and the governor's recommendations for appropriations for the two ensuing fiscal years, all distributed according to budget programs and budget classes. In connection with each expenditure involving construction projects to be completed in one or more fiscal years, there shall be shown the total estimated cost of each project and the amount recommended to be appropriated and expended in each ensuing fiscal year until completion of the project. The state capital improvement plan and the governor's recommendations concerning the plan shall be incorporated into the budget report.

4. A summary statement for each fund of the cash resources estimated to be available at the beginning of the next two fiscal years and the estimated cash receipts for the two ensuing fiscal years, as compared with the total recommended amounts for appropriations for all budget programs and budget classes for the two ensuing fiscal years, and if the total of the recommended expenditures exceeds the total of the estimated resources, recommendations as to how the deficiency is to be met and estimates of receipts from any proposed additional revenues.

5. For the 1999-2000 fiscal year and thereafter, delineation, by budget unit, of requested expenditures for administrative costs, including administrative personnel salaries and employee related expenses and direct, indirect and shared costs for administrative office space, equipment, supplies and overhead. For purposes of this paragraph, "administrative" means any supportive activity relating to management, supervision, budget or execution of the affairs of the budget unit as distinguished from activities relating to its primary direct service functions. The process of delineation and determination of what constitutes administrative costs for each budget unit shall be developed by the governor's office of strategic planning and budgeting in consultation with the director and staff of the joint legislative budget committee.

6. A summary on one page or less providing ~~selected~~ performance measures of the budget unit for the previous fiscal year and the budget years. The performance measures may be expressed as service level measures on a unit cost basis, ~~and~~ shall be established by the governor's office of strategic planning and budgeting in consultation with the director and staff of the joint legislative budget committee. AND SHALL, AT A MINIMUM, INCLUDE A RELEVANT AND SIGNIFICANT MEASURE OF EACH OF THE FOLLOWING:

(a) A MEASURE OF PROGRAM INPUT.

(b) A MEASURE OF PROGRAM OUTPUT.

(d) A MEASURE OF PROGRAM EFFICIENCY.

(e) A MEASURE OF PROGRAM CLIENT SATISFACTION.

(f) A MEASURE OF PROGRAM OUTCOMES.

Sec. 3. Section 35-122, Arizona Revised Statutes, is amended to read:

35-122. Strategic plans; program lists; compilation; children's social services report

A. Consistent with instructions issued by the governor, the administrative head of each budget unit is responsible for:

1. Developing a strategic plan for the entire budget unit. At a minimum, the plan shall extend for the current fiscal year and the two ensuing fiscal years and shall contain a mission statement, goals, objectives and performance measures for the budget unit as a whole. The performance measures shall be stated in terms that are consistent with a budget unit's goals and objectives and that emphasize results. The strategic plan shall be submitted to the governor's office of strategic planning and budgeting and to the staff of the joint legislative budget committee by September 1 of each year.

2. Developing a strategic plan for each program identified in subsection B of this section. The plan shall use the same format as the plan required under paragraph 1 OF THIS SUBSECTION. These plans shall not be submitted to the governor's office of strategic planning and budgeting and the staff of the joint legislative budget committee unless otherwise required for a strategic program area review authorized by section 41-1275.

B. Consistent with instructions issued by the governor, the administrative head of each budget unit is responsible for developing a list of programs for the budget unit. For each program the list shall include a description, its mission statement, goals, performance measures that emphasize results and budgetary data for the current and prior fiscal year. The budgetary data shall include funding amounts, regardless of source. The list of programs shall be submitted to the governor's office of strategic planning and budgeting by September 1 of each year. The governor's instructions shall allow budget units with a minimal number of programs to consolidate their submissions for the strategic plan required under subsection A of this section with the list of programs required under this subsection.

C. The governor's office of strategic planning and budgeting shall compile the submissions required in subsection B of this section and no later than five days after the regular session of the legislature convenes of each even-numbered year shall publish a master list of programs that are performed or overseen by state government. In consultation with the staff of the joint legislative budget committee, the governor's office of strategic planning and budgeting may modify the list of programs submitted by each budget unit. The master list shall include the program description, mission statement, goals, performance measures and budgetary data. The list shall include all programs that are administered jointly by two or more budget units.

D. THE MASTER LIST OF STATE GOVERNMENT PROGRAMS FOR THE FOLLOWING AGENCIES THAT PROVIDE HEALTH CARE AND OTHER SOCIAL SERVICES TO CHILDREN, TO THE EXTENT THAT IT IS POSSIBLE, SHALL BE CONSISTENT WITH THE 1997 MASTER LIST OF STATE GOVERNMENT PROGRAMS' BUDGETARY AND PROGRAMMATIC FORMAT:

1. THE DEPARTMENT OF ECONOMIC SECURITY.

2. THE DEPARTMENT OF HEALTH SERVICES.

3. THE DEPARTMENT OF EDUCATION.

4. THE DEPARTMENT OF JUVENILE CORRECTIONS.

5. THE ADMINISTRATIVE OFFICE OF THE COURTS.

6. THE ARIZONA HEALTH CARE COST CONTAINMENT SYSTEM.

E. THE PROGRAM STRUCTURE USED FOR BUDGETING PURPOSES MAY BE MODIFIED BY THE LEGISLATURE AS PART OF THE BIENNIAL BUDGET.

D. F. For purposes of this section, a program may include a subprogram as determined by the governor's office of strategic planning and budgeting and the staff of the joint legislative budget committee.

Sec. 4. Section 35-142, Arizona Revised Statutes, is amended to read:

35-142. Monies kept in funds separate from state general fund; receipt and withdrawal

A. All monies received for and belonging to the state shall be deposited in the state treasury and credited to the state general fund except the following, which shall be placed and retained in separate funds:

1. The unexpendable principal of monies received from federal land grants shall be placed in separate funds and the account of each such separate fund shall bear a title indicating the source and the institution or purpose to which such fund belongs.

2. The interest, rentals and other expendable money received as income from federal land grants shall be placed in separate accounts, each account bearing a title indicating the source and the institution or purpose to which the fund belongs. Such expendable monies shall be expended only as authorized, regulated and controlled by the general appropriation act or other act of the legislature.

3. All private or quasi-private monies authorized by law to be paid to or held by the state treasurer shall be placed in separate accounts, each account bearing a title indicating the source and purpose of such fund.

4. All monies legally pledged to retirement of building indebtedness or bonds issued by those institutions authorized to incur such indebtedness or to issue such bonds shall be placed in separate accounts.

5. Monies of a multi-county water conservation district authorized by law to be paid to or held by the state treasurer shall be placed in separate accounts, each account bearing a title indicating the source and purpose of such fund.

6. All monies collected by the Arizona game and fish department shall be deposited in a special fund known as the state game and fish protection fund for the use of the Arizona game and fish commission in carrying out the provisions of title 17.

7. All federal monies that are received by the department of economic security for family assistance benefits and medical eligibility as a result of efficiencies developed by the department of economic security and that would otherwise revert to the state general fund pursuant to section 35-190 shall be retained for use by the department of economic security in accordance with the terms and conditions imposed by the federal funding source.

8. Monies designated by law as special state funds shall not be considered a part of the general fund. Unless otherwise prescribed by law, the state treasurer shall be the custodian of all such funds.

B. No money shall be received or held by the state treasurer except as authorized by law, and in every instance the treasurer shall issue a receipt for money received and shall record the transaction in the statewide accounting system. No money shall be withdrawn from the treasury except upon the warrant or electronic funds transfer voucher of the department of administration.

C. All federal monies granted and paid to the state by the federal government shall be accounted for in the accounts or funds of the state in the necessary detail to meet federal and state accounting, budgetary and auditing requirements, and all appropriations for matching such federal monies shall be transferred from the general fund to such separate funds as needed, except as otherwise required by the federal government.

D. Nothing in this section requires the establishment of separate accounts or funds for such federal monies unless otherwise required by federal or state law. The department of administration has the authority to use the most efficient system of accounts and records, consistent with legal requirements and standard and necessary fiscal safeguards.

E. Nothing in this section precludes the creation by the department of administration of a clearing account or other acceptable accounting method to effect prompt payment of claims from an approved budget or appropriation. The department of administration shall report each account or fund established or cancelled to the directors of the joint legislative budget committee and the governor's office of strategic planning and budgeting.

F. Nothing in this section or any other section precludes the use of monies kept in funds separate from the general fund, the interest from which accrues to the general fund, for payment of claims against the general fund, provided sufficient monies remain available for payment of claims against such funds.

G. The department of administration may issue warrants for qualified expenditures of federal program monies before they are deposited in the state treasury. The receipt of federal monies shall be timed to coincide, as closely as administratively feasible, with the redemption of warrants by the state treasurer. The department of administration shall limit expenditures to the amount that has been made available for the use under the grant award by the federal government. The state agency initiating the expenditures is responsible for ensuring that expenditures qualify for coverage under the guidelines of the federal grant award.

H. The department of administration shall establish the policies and procedures for all state agencies for drawing federal monies INCLUDING THE RECEIPT AND EXPENDITURE REPORTS TO THE JOINT LEGISLATIVE BUDGET COMMITTEE REQUIRED BY SECTION 35-113.O1, SUBSECTION D. When the established method results in federal monies being held by this state, the department of administration may use the interest earned on the monies to pay the federal government for any related interest liability. If an interest liability is incurred due to a state agency varying from the established policies and procedures, the department of administration shall charge the appropriate agency account or fund. Interest payment charges to agencies shall be reported by the department of administration to the joint legislative budget committee on or before March 1. Any federal interest liability owed to this state as a result of the delayed federal disbursements shall be used to offset this state's interest liability to the federal government. Any remaining interest earnings shall be deposited in the state general fund.

I. Any state agency or authorized agent of a state agency may accept credit cards or charge cards pursuant to an agreement entered into by the state treasurer pursuant to section 35-315 for the payment of any amount due to that agency, OR agent or this state.

J. Agencies or authorized agents on behalf of state agencies that accept credit cards or charge cards shall deduct any applicable discount or convenience fee associated with the transaction amount before depositing the net amount in the appropriate state fund. The net amount deposited in the appropriate state fund shall be considered as the full deposit required by law of monies received by the agency. Payment of any applicable discount or convenience fee shall be accounted for in the annual report submitted to the governor's office of strategic planning and budgeting in accordance with section 41-1273.

K. State agencies shall report the number of transactions, the total dollar amount of transactions processed and the total dollar amount of any discount or transaction fees pursuant to subsection J of this section quarterly to the governor, the government information technology agency and the joint legislative budget committee.

Sec. 5. Section 35-173, Arizona Revised Statutes, is amended to read:

35-173. Definition; allotment of appropriations; limitations; approval of transfers; exceptions

A. An IN THIS SECTION, "allotment schedule" means a detailed plan of expenditures for a full fiscal year within a budget program or expenditure class.

B. Before monies from an authorized appropriation, or any other source, can be obligated, an allotment schedule must be approved and established by the department of administration. The allotment schedule shall be based on the estimated annual requirement and shall distribute the available spending authority to cover the entire fiscal year's operations.

C. With the exception of the department of administration, the budget unit, may, upon approval of the director of the department of administration:

1. Transfer spending authority from one expenditure class to another.

2. Transfer spending authority between and within programs if spending authority is appropriated to the budget unit by programs.

D. A transfer within a budget unit of spending authority appropriated for land acquisition, capital projects or building renewal shall be permissible only on approval of the joint committee on capital review.

E. No transfer to or from personal services or employee related expenditures from or to any other budget program or expenditure class shall be permitted unless recommended by the joint legislative budget committee and approved by the director of the department of administration, except that the director of the department of administration may transfer amounts equal to the gross payroll and related employee expenses of a budget unit from the monies of a budget unit available for this purpose to payroll imprest accounts for the purpose of paying employees of the budget unit and disbursing related employee expenses.

F. A transfer of spending authority within the department of administration shall be made only with the approval of the joint legislative budget committee, except as provided in subsection E.

G. A TRANSFER OF SPENDING AUTHORITY MADE PURSUANT TO SUBSECTION C OF THIS SECTION SHALL BE REPORTED TO THE JOINT LEGISLATIVE BUDGET COMMITTEE.

G. H. The provisions of this section shall not apply to the universities.

Sec. 6. Section 41-1275, Arizona Revised Statutes, is amended to read:

41-1275. Strategic program area reviews; procedures; definition

A. In consultation with the governor's office of strategic planning and budgeting, the staff of the joint legislative budget committee shall recommend to the joint legislative budget committee by January 1 of each odd-numbered year a list of program areas suggested for strategic program area review. Each budget unit may submit suggestions for which of its programs should be subject to strategic program area reviews. The joint legislative budget committee may designate subprograms or portions of particular programs to be subject to a strategic program area review. Budget units may be required to develop joint self-assessments if their programs are of a similar nature.

B. The joint legislative budget committee shall determine those program areas that are subject to strategic program area review from the list of program areas submitted. The staff of the joint legislative budget committee and the governor's office of strategic planning and budgeting shall review the program areas. To aid in the review, the budget unit responsible for the program that is subject to strategic program area review shall prepare a self-assessment of its program by June 1 of the odd-numbered year in which the program is being reviewed AND MEET WITH THE CHAIRMEN OF THE APPROPRIATIONS COMMITTEES OF THE SENATE AND HOUSE OF REPRESENTATIVES BY AUGUST 1 OF THE ODD-NUMBERED YEAR TO DISCUSS THE PROGRAM AND SELF-ASSESSMENT. The self-assessment shall address the efficiency and effectiveness of each ~~program~~ PROGRAM'S operation and whether its current operation is consistent with the original legislative intent. The self-assessment shall be consistent with instructions issued by the governor's office of strategic planning and budgeting and joint legislative budget committee staff and shall be submitted to the two offices. The two offices shall evaluate the program areas according to agreed upon factors and shall jointly produce a report of their findings and recommendations for whether to retain, eliminate or modify funding and related statutory references for the programs that are subject to strategic program area review to the president of the senate, the speaker of the house of representatives and the governor no later than January 1 of each even-numbered year. The findings and recommendations shall include a description of personnel, facilities, equipment and funding of the strategic program area by all budget units or entities and shall address the views of the two offices on the program's efficiency, effectiveness and necessity and whether the program area should be consolidated into one budget unit if the program area is being administered by more than one budget unit.

C. The speaker of the house of representatives and the president of the senate shall assign all strategic program areas recommended by the joint legislative budget committee, pursuant to subsection B of this section, to the appropriations committees. The speaker of the house of representatives and the president of the senate may additionally assign the strategic program areas to an appropriate standing committee. The assigned standing committee shall hold at least one public hearing for the purpose of receiving public input and developing recommendations to the appropriations committees whether to retain, eliminate or modify funding and related statutory references for the strategic program area subject to review. If the speaker of the house of representatives and the president of the senate choose not to assign the strategic program areas to an additional standing committee the appropriations committee shall hold at least one public hearing for the purpose of receiving public input in developing recommendations whether to retain, eliminate or modify funding and related statutory references for the strategic program area subject to review.

D. For purposes of this section, "strategic program area" means a program, function or activity of state government conducted by one or more budget units or entities, or subdivisions of budget units or entities, and includes all personnel, facilities, equipment and funding of the program, function or activity, including federal, state, local and other funding. A strategic program area may include a subprogram area as determined by the governor's office of strategic planning and budgeting or the joint legislative budget committee staff.

Sec. 7. Section 41-1279, Arizona Revised Statutes, is amended to read:

41-1279. Joint legislative audit committee; composition; meetings; powers and duties

A. The joint legislative audit committee is established consisting of five members of the senate appointed by the president of the senate, one of whom shall be a member of the senate appropriations committee, and five members of the house of representatives appointed by the speaker of the house of representatives, one of whom shall be a member of the house of representatives appropriations committee. Selection of members shall be based on their understanding and interest in legislative audit oversight functions. Not more than three appointees of each house shall be of the same political party. The president OF THE SENATE and the speaker OF THE HOUSE OF REPRESENTATIVES shall designate one of their appointed members as chairman of their respective delegation. The chairman of the audit committee shall serve for the term of each legislature. The chairmanship of the audit committee shall alternate between the chairman of the senate delegation and the chairman of the house of representatives delegation beginning with the chairman of the senate delegation. The president of the senate and the speaker of the house of representatives shall also serve as ex officio members of the committee.

B. The committee shall meet at least quarterly and on call of the chairman. Members of the committee are eligible for reimbursement by their respective houses in the same manner as a member of the legislature who attends a meeting of a standing committee.

C. The committee shall:

1. Oversee all audit functions of the legislature and state agencies including sunset, performance, special and financial audits and the preparation and introduction of legislation resulting from audit report findings.

2. Appoint an auditor general subject to approval by a concurrent resolution of the legislature and direct the auditor general to perform all sunset, performance, special and financial audits and investigations.

3. Have the power of legislative subpoena in accordance with article 4 of this chapter.

4. Require state agencies to comply with findings and directions of the committee regarding sunset, performance, special and financial audits.

5. Perform all functions required by chapter 27 of this title relating to the sunset review of state agencies.

6. IN CONSULTATION WITH THE CHAIRMAN AND VICE-CHAIRMAN OF THE JOINT LEGISLATIVE BUDGET COMMITTEE, ORDER EMERGENCY SPECIAL AUDITS OF AGENCIES AND PROGRAMS WITHIN OR AMONG AGENCIES BY REQUIRING A TEAM OF FOUR AUDITORS FROM THE OFFICE OF THE AUDITOR GENERAL TO CONDUCT THE SPECIAL AUDIT AND REPORT TO THE COMMITTEE WITHIN THIRTY DAYS.

Sec. 8. Section 41-2955, Arizona Revised Statutes, is amended to read:

41-2955. Termination of state agencies; continuation

A. All agencies shall terminate pursuant to the schedule prescribed by article 2 of this chapter, unless continued pursuant to this chapter.

B. Any agency may be continued by the legislature for a period not to exceed ten years. At the end of such period, it shall again be subject to sunset review. Any agency continued, revised or consolidated by the legislature shall contain within the enabling legislation a legislative intent section setting forth the objectives of the programs administered by the agency.

C. An agency is continued pursuant to this section if legislation to continue such agency is passed by the legislature and signed by the governor prior to the date set for termination of the agency even if the legislation to continue the agency has not become effective on the date of scheduled termination.

D. Any agency created from and after June 30, 1978 shall continue in existence for not more than ~~ten~~ EIGHT years from the effective date of its establishment and shall be subject to this chapter.

E. Each agency created from and after June 30, 1978 shall contain a policy or purpose statement in its enabling legislation setting forth the objectives of the programs.

F. Nothing in this chapter shall be construed to prohibit the legislature from terminating any agency covered by this chapter at a date earlier than that prescribed by this chapter nor to prohibit the legislature from considering any other legislation relative to any such agency. Nothing in this chapter shall be construed to terminate the funds administered by the water infrastructure finance authority of Arizona pursuant to title 49, chapter 8.

Sec. 9. Section 41-2958, Arizona Revised Statutes, is amended to read:

41-2958. Modified audits of certain agencies

At least every ~~ten~~ EIGHT years the joint legislative audit committee shall conduct a review of the following agencies and programs according to the following schedule using the factors that are deemed necessary and that are listed in section 41-2954, subsection D:

1. By July 1, 1996 for the department of education including the programs and activities administered, prescribed or regulated by the department.

2. By July 1, 1997 for the programs and commissions established by the legislature within the judiciary.

3. By July 1, 1998 for Arizona state university, Arizona state university west campus, Arizona state university east campus, the university of Arizona and northern Arizona university. For purposes of this paragraph, the committee may combine the review for all of the universities into one or more reviews and reports.

Sec. 10. Section 41-3102, Arizona Revised Statutes, is amended to read:

41-3102. Requirements for new programs established by the legislature

Any new program that is established by the legislature shall include in its enabling legislation a specific expiration date for the program that is not more than ~~ten~~ EIGHT years after the effective date of the program's enabling legislation AND SHALL INCLUDE THE REQUIREMENT OF A REPORT ON THE FOLLOWING PERFORMANCE MEASURES AND A TIME LIMIT FOR THE REPORT:

1. A MEASURE OF PROGRAM INPUT.

2. A MEASURE OF PROGRAM OUTPUT.

3. A MEASURE OF PROGRAM QUALITY.

4. A MEASURE OF PROGRAM EFFICIENCY.

5. A MEASURE OF PROGRAM CLIENT SATISFACTION.

6. A MEASURE OF PROGRAM OUTCOMES.

Sec. 11. Joint legislative study committee on state budget procedures

A. The joint legislative study committee on state budget procedures is established consisting of the following:

1. The president of the senate.

2. The speaker of the house of representatives.

3. The chairman of the appropriations committee in the senate.

4. The chairman of the appropriations committee in the house of representatives.

5. The majority leader of the senate.

6. The majority leader of the house of representatives.

7. The minority leader of the senate.

8. The minority leader in the house of representatives.

9. The director of the joint legislative budget committee staff.

10. The director of the governor's office of strategic planning and budgeting.

B. The committee shall study the outcome of:

1. The state's transition to a biennial budgeting process.

2. The state's transition to program budgeting.

3. The state's program authorization review and strategic program area review processes.

4. Performance measures within the state budget process.

C. The committee shall submit a report of its findings and recommendations on or before December 1, 2001, to the governor and provide this report to the secretary of state and the director of the Arizona state library, archives and public records.

Sec. 12. Appropriation; purpose; exemption

A. The sum of $308,000 is appropriated from the state general fund in fiscal year 2001-2002 to the auditor general for four full-time employees, employee related expenditures and other costs for the emergency special audits authorized by section 41-1279, Arizona Revised Statutes, as amended by this act.

B. The appropriation made in subsection A of this section is exempt from the provisions of section 35-190, Arizona Revised Statutes, relating to lapsing of appropriations.

Sec. 13. Delayed effective date

Sections 41-2955, 41-2958 and 41-3102, Arizona Revised Statutes, as amended by this act, are effective from and after June 30, 2003.