Bill Text: AZ SCR1029 | 2024 | Fifty-sixth Legislature 2nd Regular | Introduced
Bill Title: Trust land; distribution; inflation adjustments
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2024-02-06 - Senate read second time [SCR1029 Detail]
Download: Arizona-2024-SCR1029-Introduced.html
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REFERENCE TITLE: trust land; distribution; inflation adjustments |
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State of Arizona Senate Fifty-sixth Legislature Second Regular Session 2024
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SCR 1029 |
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Introduced by Senator Marsh
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A Concurrent Resolution
proposing an amendment to the Constitution of Arizona; amending article X, section 7 and article XI, section 11, Constitution of Arizona; relating to school finance.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it resolved by the Senate of the State of Arizona, the House of Representatives concurring:
1. Article X, section 7, Constitution of Arizona, is proposed to be amended as follows if approved by the voters and on proclamation of the Governor:
7. Establishment of permanent funds; segregation, investment and distribution of monies; exception; resolution of litigation; definitions
Section 7. A. A separate permanent fund shall be established for each of the several objects for which the said grants are made and confirmed by the enabling act to the state, and whenever any monies shall be in any manner derived from any of said lands, the same shall be deposited by the state treasurer in the permanent fund corresponding to the grant under which the particular land producing such monies was, by the enabling act, conveyed or confirmed.
B. No monies shall ever be taken from one permanent fund for deposit in any other, or for any object other than that for which the land producing the same was granted or confirmed.
C. All such monies shall be invested in safe interest-bearing securities and prudent equity securities consistent with the requirements of this section.
D. The legislature shall establish a board of investment to serve as trustees of the permanent funds. The board shall provide for the management of the assets of the funds consistent with the following conditions:
1. Not more than sixty percent of a fund at cost may be invested in equities at any time.
2. Equities that are eligible for purchase are restricted to stocks listed on any national stock exchange or eligible for trading through the United States national association of securities dealers automated quotation system, or successor institutions, except as may be prohibited by general criteria or by a restriction on investment in a specific security adopted pursuant to this subsection.
3. Not more than five percent of all of the funds combined at cost may be invested in equity securities issued by the same institution, agency or corporation, other than securities issued as direct obligations of and fully guaranteed by the United States government.
E. In making investments under this section, the state treasurer and trustees shall exercise the judgment and care under the prevailing circumstances that an institutional investor of ordinary prudence, discretion and intelligence exercises in managing large investments entrusted to it, not in regard to speculation, but in regard to the permanent disposition of monies, considering the probable safety of capital as well as the probable total rate of return over extended periods of time.
F. The earnings, interest, dividends and realized capital gains and losses from investment of a permanent fund, shall be credited to that fund.
G. The board of investment shall determine the amount of the annual distributions required by this section and allocate distributions pursuant to law. The annual distribution from the permanent funds:
1. For fiscal years 2012-2013 through 2014-2015, shall be two and one-half percent of the average monthly market values of the fund for the immediately preceding five calendar years.
2. For fiscal years 2015-2016 through 2024-2025, shall be six and nine-tenths percent of the average monthly market values of the fund for the immediately preceding five calendar years, except that in fiscal year 2015-2016, the distribution made from the permanent state school fund shall be $259,266,200.
3. Beginning with fiscal year For fiscal years 2025-2026 through 2035-2036, shall be two and one-half eight and nine-tenths percent of the average monthly market values of the fund for the immediately preceding five calendar years.
H. For fiscal years 2015-2016 through 2024-2025, any increase in expendable earnings under section 37-521, subsection B, paragraph 4, Arizona Revised Statutes, that results from a distribution of more than two and one-half percent of the average monthly market values of the fund for the immediately preceding five calendar years pursuant to subsection G, paragraph 2 of this section shall be appropriated for basic state aid, including inflation adjustments required by section 15-901.01, Arizona Revised Statutes.
I. For fiscal years 2025-2026 through 2035-2036, any increase in expendable earnings under section 37-521, subsection B, paragraph 4, Arizona Revised Statutes, that results from a distribution of more than two and one-half percent of the average monthly market values of the fund for the immediately preceding five calendar years pursuant to subsection G, paragraph 3 of this section shall be appropriated as follows:
1. Four and four-tenths percent to school districts, charter schools and the Arizona state schools for the deaf and the blind to hire and to increase compensation for teachers and classroom support personnel.
2. One and one-half percent to school districts, charter schools and the Arizona state schools for the deaf and the blind to hire and to increase compensation for student support services personnel.
3. One-half percent to the school facilities division within the department of administration, or it successor, to award grants to support school districts, charter schools and the Arizona state schools for the deaf and the blind to support the costs of capital and technology expenses, including building improvements and construction costs to address school facility security concerns or other school safety needs identified by the division. The proceeds for any sale by a school district or charter school of school buildings or equipment that was procured or enhanced using monies appropriated pursuant to this paragraph shall be transferred to the treasurer's office for deposit in the state general fund.
I. J. On or before February 1 of each year, if the average monthly market values of the fund for the immediately preceding five calendar years have decreased compared to the average monthly market values of the fund for the five-calendar-year period that immediately precedes the preceding five calendar years, the director of the office of strategic planning and budgeting, or its successor agency, and the director of the joint legislative budget committee, or its successor agency, shall jointly notify the governor, the president of the senate and the speaker of the house of representatives that a reduction to the distribution prescribed in subsection G, paragraph 2 or 3 of this section is necessary to preserve the safety of the capital in the fund. On receipt of that notification, the legislature may enact legislation, with the approval of the governor, that reduces the distribution in subsection G, paragraph 2 or 3 of this section for the next fiscal year to at least two and one-half percent but less than six and nine-tenths percent of the average monthly market values of the fund for the immediately preceding five calendar years only on the affirmative vote of at least two-thirds of the membership of each house of the legislature and approval by the governor.
J. K. Any amount reduced pursuant to subsection I J of this section is not required to be paid or distributed:
1. From any other source of public monies.
2. In any subsequent fiscal year.
K. L. If the legislature enacts legislation, with the approval of the governor, that reduces the distribution pursuant to subsection I J of this section:
1. The legislature may reduce the base level for the next fiscal year by an amount commensurate with the reduction in the distribution from the permanent state school fund for the next fiscal year.
2. The amounts from the base level reduction are not required to be paid or distributed in any subsequent fiscal year.
3. The base level reduction is not part of the calculation of the base level for subsequent fiscal years.
L. M. This section preserves the authority vested in the legislature pursuant to this constitution.
M. N. This section and article XI, section 11 of this Constitution and the terms and appropriations of house bill 2001, fifty second legislature, first special session, fully satisfy the requirements of section 15-901.01, Arizona Revised Statutes.
O. FOR THE PURPOSES OF THIS SECTION:
1. "CLASSROOM SUPPORT PERSONNEL" MEANS ANY NONADMINISTRATIVE SCHOOL PERSONNEL WHO PROVIDE CLASSROOM SUPPORT AND INSTRUCTIONAL SUPPORT SERVICES AS PRESCRIBED BY THE SCHOOL DISTRICT GOVERNING BOARD OR CHARTER SCHOOL GOVERNING BODY, INCLUDING certificated personnel, LIBRARIANS, NURSES, COUNSELORS, SOCIAL WORKERS, SPEECH PATHOLOGISTS, BEHAVIORAL COACHES AND PSYCHOLOGISTS.
2. "STUDENT SUPPORT SERVICES PERSONNEL" MEANS ANY CLASSIFIED, NONADMINISTRATIVE SCHOOL PERSONNEL WHO PROVIDE STUDENT SUPPORT SERVICES AS prescribed BY THE SCHOOL DISTRICT GOVERNING BOARD OR CHARTER SCHOOL GOVERNING BODY, INCLUDING CLASSROOM AIDES, MEDIA SPECIALISTS, HEALTH ASSISTANTS, SECURITY PERSONNEL, STUDENT FOOD SERVICE PERSONNEL, CLERICAL STAFF, STUDENT TRANSPORTATION PERSONNEL AND SCHOOL SITE PLANT OPERATORS.
3. "TEACHER" MEANS ANY NONADMINISTRATIVE school PERSONNEL WHO INSTRUCT STUDENTS OR SUPPORT STUDENT ACADEMIC ACHIEVEMENT AS PRESCRIBED BY THE SCHOOL DISTRICT GOVERNING BOARD OR CHARTER SCHOOL GOVERNING BODY, INCLUDING CERTIFIcatED AND NONCERTIFIcatED TEACHERS, CLASSROOM TEACHERS, EARLY CHILDHOOD education TEACHERS, MENTOR TEACHERS, INSTRUCTIONAL COACHES AND ACADEMIC INTERVENTIONISTS.
2. Article XI, section 11, Constitution of Arizona, is proposed to be amended as follows if approved by the voters and on proclamation of the Governor:
11. Schools; inflation adjustments; exceptions; definitions
Section 11. A. On or before February 1 of each year, if the state transaction privilege tax growth rate and the total nonfarm employment growth rate are each at least one percent, but less than two percent, the director of the office of strategic planning and budgeting, or its successor agency, and the director of the joint legislative budget committee, or its successor agency, shall jointly notify the governor, the president of the senate and the speaker of the house of representatives. On receipt of the notification, the legislature is not required to make may forgo the inflation adjustments required by section 15-901.01, Arizona Revised Statutes, for the next fiscal year only on the affirmative vote of at least two-thirds of the membership of each house of the legislature.
B. On or before February 1 of each year, if the state transaction privilege tax growth rate and the total nonfarm employment growth rate are each less than one percent, the director of the office of strategic planning and budgeting, or its successor agency, and the director of the joint legislative budget committee, or its successor agency, shall jointly notify the governor, the president of the senate and the speaker of the house of representatives. On receipt of the notification, the legislature shall not may make the inflation adjustments required by section 15-901.01, Arizona Revised Statutes, for the next fiscal year only on the affirmative vote of at least two-thirds of the membership of each house of the legislature.
C. Beginning in fiscal year 2024-2025, on or before February 1 of each year, if the total amount of general fund appropriations for the Arizona department of education, or its successor agency, is at least forty-nine percent but less than fifty percent of the total general fund appropriation for the current fiscal year, the director of the office of strategic planning and budgeting, or its successor agency, and the director of the joint legislative budget committee, or its successor agency, shall jointly notify the governor, the president of the senate and the speaker of the house of representatives. On receipt of the notification, the legislature:
1. Is not required to make May forgo the inflation adjustments required by section 15-901.01, Arizona Revised Statutes, for the next fiscal year only on the affirmative vote of at least two-thirds of the membership of each house of the legislature.
2. May reduce the base level for the next fiscal year by the amount of the inflation adjustments required by section 15-901.01, Arizona Revised Statutes, made for the current fiscal year only on the affirmative vote of at least two-thirds of the membership of each house of the legislature.
D. Beginning in fiscal year 2024-2025, on or before February 1 of each year, if the total amount of general fund appropriations for the Arizona department of education, or its successor agency, is at least fifty percent of the total general fund appropriation for the current fiscal year, the director of the office of strategic planning and budgeting, or its successor agency, and the director of the joint legislative budget committee, or its successor agency, shall jointly notify the governor, the president of the senate and the speaker of the house of representatives. On receipt of the notification, the legislature:
1. Is not required to make May forgo the inflation adjustments required by section 15-901.01, Arizona Revised Statutes, for the next fiscal year only on the affirmative vote of at least two-thirds of the membership of each house of the legislature.
2. May reduce the base level for the next fiscal year by two times the amount of the inflation adjustments required by section 15-901.01, Arizona Revised Statutes, made for the current fiscal year only on the affirmative vote of at least two-thirds of the membership of each house of the legislature.
E. If the inflation adjustments required by section 15-901.01, Arizona Revised Statutes, are not required to be made or are prohibited from being made pursuant to this section for a fiscal year, the omitted inflation adjustment amounts:
1. Are not required to be paid or distributed in any subsequent fiscal year.
2. Become a part of the calculation of the base level for subsequent fiscal years.
F. If base level reductions are made pursuant to subsection C or D of this section for a fiscal year, the reduced amounts:
1. Are not required to be paid or distributed in any subsequent fiscal year.
2. Do not become part of the calculation of the base level for subsequent fiscal years.
G. This section preserves the authority vested in the legislature pursuant to this constitution.
H. For the purposes of this section:
1. "Total nonfarm employment growth rate" means the percentage change in the seasonally adjusted total nonfarm employment in this state from the final month of the most recent calendar year to the final month of the immediately preceding calendar year, as reported by the Arizona department of administration or its successor agency.
2. "State transaction privilege tax growth rate" means the percentage change in the revenues derived from the state transaction privilege tax that are distributed to the state general fund from the most recent calendar year to the immediately preceding calendar year, as reported by the Arizona department of revenue or its successor agency.
Sec. 3. Nonseverability
If any portion of this proposition is finally adjudicated invalid, the entire proposition is void.
3. The Secretary of State shall submit this proposition to the voters at the next general election as provided by article XXI, Constitution of Arizona.
