ARIZONA STATE SENATE
Phoenix, Arizona
CORRECTED
Retroactive to July 1, 2000,
eliminates maximum override limits for a unified school district that is in the
seventh year of a revenue control limit budget override where the override is
not funded from property taxes.
Current law allows voters in
a school district to vote for the adoption of a budget in excess of the revenue
control limit. Additionally, the maximum budget override amount is ten percent,
notwithstanding any supplemental guidelines.
Current statute requires
school districts to phase down budget override amounts during the last two
years of an override. During the sixth year, the district receives two-thirds
of the original percentage approved for the budget override, losing an
additional third of that original percentage in the seventh year (ARS 15-481).
According to the Arizona
Department of Education, Chinle Unified School District (Chinle USD) is the
only district affected by S.B. 1086. In 1995, the voters in Chinle USD approved
two budget overrides: a ten percent
maintenance and operation override, and a five percent K-3 override. These
overrides were approved for a period of seven years, beginning with FY
1995-1996. These overrides are not funded by revenues from property tax but
from state, county and federal impact aid.
Due to an administrative oversight, Chinle USD did not request an
election to renew its override in FY 1999-2000 or FY 2000-2001, according to
the school district. As a result, the school district, unaware of the budget
reduction when adopting its budget for the last two years, expended the school
budget beyond capacity by approximately $700,000 last year and is required to
cut its budget by $1.4 million to compensate for the expenditure beyond
capacity in this school year. According to current statute, when a school
district overspends its budget in the prior year, the school district must also
reduce the current year’s budget to reflect the previous year’s
over-expenditure. As a result, Chinle USD would be required to reduce this
year’s budget by $2.1 million.
S.B. 1086, retroactive to
July 1, 2000, eliminates the override phase-down for school districts that are
in the seventh year of the budget override where overrides are not funded by
property taxes within the school district. This bill has no estimated fiscal
impact to the state general fund, according to the Joint Legislative Budget
Committee staff fiscal note.
1. Exempts a unified school district in the seventh year of a revenue control limit budget override where revenues are not funded by property taxes from budget override decreases during FY 2000-2001 and FY 2001-2002 when the following apply:
(a)
The
original overrides approved by voters of the school district were for the
maximum percentage available when the overrides were approved.
(b)
At
least 75 percent of the voters of the school district approved the override.
(c)
The
school district did not request, and the voters did not disapprove, to renew
either of the budget overrides.
2. Contains a retroactive effective date of July 1, 2000.
Prepared by Senate Staff
February 7, 2002