Purpose

Removes the requirement that the Legislature authorize the level of bonds the Arizona Board of Regents (ABOR) can issue and stipulates that ABOR is authorized to issue bonds if it does not spend more than ten percent of its annual capital debt expenditures and receives approval from the Joint Legislative Committee on Capital Review (JCCR).

Background

Current statute authorizes JCCR to develop and approve formulas for computing annual building renewal funding, approve building systems for capital improvement plans and review current capital improvement plans (A.R.S. §41-1252). JCCR is required to report to the Legislature concerning funding for land acquisition, capital projects and building renewal and must review the scope, purpose and estimated costs when projects are estimated over $250,000.

ABOR has the authority to issue bonds to acquire projects for university institutions if approved by the Legislature. ABOR also has the power to refund bonds issued to acquire projects and refund any such refunding bonds (A.R.S. §15-1683). The interest rate and form of the bond, dates of issue and other matters relating to bond issuance are determined by ABOR. However, statute specifies that bonds must mature within 40 years of the initial date of issue.

S.B. 1257 changes the authority to approve ABOR issued bonds from the Legislature to JCCR provided that ABOR does not spend beyond a cap of ten percent of ABOR’s annual expenditures for capital debt.

Any fiscal impact to the state general fund is unknown at this time. A Joint Legislative Budget Committee staff fiscal note has been requested.

Provisions

1. Changes the authority to approve ABOR issued bonds from the Legislature to JCCR provided that ABOR does not spend beyond a cap of ten percent of ABOR’s annual expenditures for capital debt.

2. Provides for a general effective date.

Prepared by Senate Staff

March 21, 2002

Assigned to FIN & ED FOR COMMITTEE

Purpose