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Arizona state budget

Arizona Governor Jan Brewer signed the state's $8.6 billion FY2013 budget into law on May 7, 2012. ^[1]

Arizona has a total state debt of approximately $59,220,240,000, when calculated by adding the total of outstanding official debt, pension and other post-employment benefits (OPEB) liabilities, Unemployment Trust Fund loans, and 2011 budget gap. ^[2]

See also: The Arizona State Budget on State Budget Solutions

[edit] FY2013 State Budget

Governor Jan Brewer signed the state's $8.6 billion FY2013 budget into law on May 7, 2012. ^[5]

Spending increases contained in the budget include:^[5]

• $89 million to K-12 education, including $40 million for a program to ensure that students are ready to read by third grade;
• $21million for universities;
• $39 million for the seriously mentally ill;
• $20 million for the construction of 500 new state-run maximum-security prison beds and $16 million for 1,000 new private-prison beds.

The Finance Advisory Committee told lawmakers that the projected surplus for FY2013 $143 million. The temporary one-cent-per-dollar increase in the sales tax expires on May 31, 2013, with one month left in the fiscal year.^[6] Economists project that the state will be in the red anywhere from $610 million to $1.2 billion in FY2014.^[7]

Legislative Proposed Budget

On Feb. 20, 2012, Republic leaders released their $8.65 billion proposed budget, 18 hours before committees were to review the budget. Democrats said that Republicans were being sneaky and expressed frustration about the quick speed at which they were expected to decide on the budget. Gov. Jan Brewer said that she would not sign the budget should it reach her desk.^[8]

The legislative budget spends $300 million less than the governor's proposed budget and the legislative budget sets aside $200 million in 2013 to retire some debt early. ^[9]

In April, Republicans said that they were close to reaching a budget agreement with Gov. Brewer but they released no details. Democrats said that they were not at the table but that the plan would reflect some of their ideas.^[10]

Governor's Proposed Budget

Gov. Jan Brewer announced in Dec. 2011 that the state was not facing a deficit in FY2013, the first time the state was not facing a deficit for the coming fiscal year. Instead, budget director John Arnold anticipates a "temporary surplus" of between $1.3 billion and $1.5 billion for FY2013. As a result, Brewer said that the state would not be asking the largest counties to make a mandatory donation to the state's general fund as it has done for several years.^[11]

The governor's proposed budget can be found here. The governor's $8.96 billion budget proposal would give state workers their first pay raise in five years if they opt out of the state's personnel system, and tends to Arizona's ailing technological infrastructure. It also saves $600 million for emergencies.^[12]

[edit] FY2012 State Budget

• See past state budgets

As of Dec. 2011, legislative budget staffers forecasting the state will end the fiscal year with more than $400 million in the bank.^[13]

The state’s FY 2012 General Fund budget is $8.32 billion. After accounting for non-General Fund monies, the state’s “all funds” budget is $26.9 billion.^[14] The state's $8.3 billion FY2012 general fund budget relied primarily on cuts to eliminate a projected $1.1 billion shortfall.^[15] Gov. Brewer signed it into law on April 6, 2011.^[16] Using those cuts, the budget eliminates a projected $1.1 billion shortfall.^[15] The budget is 20% smaller than it was four years ago.^[17]

The 416 page Appropriations Report for FY2012 prepared by the Joint Legislative Budget Committee can be found here.

Spending cuts include:^[15][18]

• $198 million from universities, approximately a 40% reduction in state support to the schools from the past thee years
• $183.2 million from K-12 schools
• nearly $72.9 million from community colleges
• $50.4 million from the state's social-service agency

The Legislature also approved these FY 2012 budget actions:^[14] • $1.1 billion in new reductions, including $524 million from Medicaid waiver plan savings. • $172 million in new fund transfers (in addition to $85 million in the Baseline for a total of $256 million). • $53 million in other revenue, including $22 million for a one-time Tax Amnesty Program. • $66 million cash payments or redirected local revenue (in addition to $35 million in the Baseline for a total of $101 million). • $70 million in additional base revenue above the Baseline estimate, including the Legislature's adoption of revenue growth rates of 5.6% in FY 2011 and 5.7% in FY 2012.

[edit] Medicaid Waiver

The budget's heath care bill stated that the Legislature supported restoration of transplant coverage and authorized Brewer to make changes to the Medicaid program to fit services and eligibility standards to available funding.

The biggest cut reduces state funding for the Medicaid program by $510 million. Freezes proposed by Brewer would reduce Arizona Health Care Cost Containment System's enrollment by approximately 138,000 people in the next year. The reductions would come in enrollment categories that are above federally required minimums. The program now serves approximately 1.3 million low-income people, or 20% of Arizonans.^[15] The state plans to limit adult Medicaid recipients to 25 days of hospital coverage a year effective at the end of October 2011.^[19]

The cuts would save $207 million in FY2012.^[20]

Opponents challenged whether Gov. Brewer had legal authority to limit enrollment in Medicaid. A state court ruled on Aug. 11, 2011, that she can legally reduce enrollment in Arizona's Medicaid program to help balance the state budget..^[20]

[edit] State Budget FY2011

Find the state’s FY2011 Comprehensive Annual Financial Report (CAFR) compiled by the state government here.

At the end of FY2011, Arizona's revenues had increased 11.6 percent over FY2010, making the first time in four years that the state saw tax collections rise. The largest increase in tax collections came from one-time gains in the individual income tax, rather than from more people getting jobs and paying state income tax. ^[21] This increase in revenue is separate from the temporary 1-cent-per-dollar increase in the state sales tax. That increase generated $873 million, which the state accounts for separately since it is slated to expire in two years. The money generated at the end of FY2011 was in line with projections made in spring 2010.^[21]

In April 2011, lawmakers approved a budget plan that assumed the state would end FY2011 with a $332 million deficit, and planned to transfer money from the FY2012 to fill that hole. At the conclusion of FY2011, however, budget officials determined that the FY2011 deficit is closer to $32 million, requiring a smaller transfer than initially anticipated. ^[21]

Partly due to medicaid costs, the state had to cut funding for higher education to $682M, down from $1.2B in 2008.^[22]

Arizona requested that the most populous counties in the state make a mandatory "contribution" to Arizona's general fund to help fill the budget gaps. Maricopa, Pima, Mohave, Pinal and Yavapai counties gave the state a combined $38.6 million.^[23]

[edit] Budget transparency

See also: Evaluation of Arizona state website or Constitutional provisions regarding reading of bills or find transparency legislation at the Sunshine Standard

Arizona has a website that tracks government spending, Arizona OpenBook.

Arizona does not have a constitutional provision providing a legislative review period.

[edit] Government tools

This table can be used to evaluate the level of transparency provided by a state spending and transparency database:

Criteria for evaluating spending databases

State Database	Searchability	Grants	Contracts	Line Item Expenditures	Dept/Agency Budgets	Public Employee Salary
Arizona OpenBook	Y	N	Y	Y	Y	Y

• The service has an "Advanced Search" function.^[24]
• All expenditures are viewable as individual line item expenses.
• The page links to the Executive Branch website, which contains department and agency budgets.^[25]
• Salary totals per department are available through the State Treasurer's AZ Checkbook.^[26]

[edit] Arizona checkbook register

In February of 2010 the state began posting its checkbook register online, dubbing the website AZCheckbook. The checkbook shows a snapshot of the daily total deposits and withdrawals from the State's Operating Account.^[27] State Treasurer Dean Martin launched the website wanting it to be searchable, user-friendly website that discloses all revenues and expenditures for Arizona State government.^[28]

[edit] Transparency legislation

Main article: Arizona transparency legislation and transparency headlines

[edit] 2011

House Bill 2572 would require an online database of state and local spending.^[29]

[edit] Budget Background

The Governor releases a budget proposal shortly after each session of the Legislature convenes (2nd Monday in January). The Joint Legislative Committee (JLBC) then releases its estimate of baseline spending. The JLBC:

• 8 members from each house.
• Chairmanship rotates between 2 Appropriations Committee Chairmen.
• Committee meets monthly – has 188 statutory responsibilities.
• Publishes a monthly update on revenue collections and other fiscal issues.
• Especially during the interim between sessions, the JLBC provides legislative oversight of state fiscal issues.
• The Joint Committee on Capital Review is comparable committee for capital issues.

[edit] State Constitution

While Arizona is viewed as having a balanced budget provision, the Arizona Constitution allows shortfalls to carry over to the next fiscal year.

Article 9, sections 4 and 5 read:

“The fiscal year shall commence on the first day of July in each year. An accurate statement of the receipts and expenditures of the public money shall be published annually, in such manner as shall be provided by law. Whenever the expenses of any fiscal year shall exceed the income, the legislature may provide for levying a tax for the ensuing fiscal year sufficient, with other sources of income, to pay the deficiency, as well as the estimated expenses of the ensuing fiscal year.”^[30]

“The state may contract debts to supply the casual deficits or failures in revenues, or to meet expenses not otherwise provided for; but the aggregate amount of such debts, direct and contingent, whether contracted by virtue of one or more laws, or at different periods of time, shall never exceed the sum of three hundred and fifty thousand dollars; and the money arising from the creation of such debts shall be applied to the purpose for which it was obtained or to repay the debts so contracted, and to no other purpose. In addition to the above limited power to contract debts the state may borrow money to repel invasion, suppress insurrection, or defend the state in time of war; but the money thus raised shall be applied exclusively to the object for which the loan shall have been authorized or to the repayment of the debt thereby created. No money shall be paid out of the state treasury, except in the manner provided by law.”^[31]

[edit] Accounting Principles

Main article: Arizona government accounting principles

The Joint Legislative Audit Committee, which oversees all audit functions of the Arizona Legislature, provides direction for the Auditor General’s Office. Subject to approval by a majority vote of both legislative houses, the Committee also appoints the Auditor General for a 5-year renewable term. Debra K. Davenport has been the Auditor General since 1999. The Auditor General’s Office publishes online their audits and must:

• ascertain whether public entities are making wise use of their resources—public money, personnel, property, equipment, and space;
• determine whether public entities are complying with applicable laws, regulations, and governmental accounting and financial and reporting standards;
• define standards and establish procedures for accounting and budgeting, as the Legislature requires; and
• provide technical assistance to state and local governmental entities.^[32]

Arizona Revised Statutes §41-1279 established the Joint Legislative Audit Committee (JLAC). Among other duties, it is charged to:

• Oversee all audit functions of the legislature and state agencies including sunset, performance, special and financial audits, special research requests and the preparation and introduction of legislation resulting from audit report findings.
• 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.
• Require state agencies to comply with findings and directions of the committee regarding sunset, performance, special and financial audits.^[33]

[edit] Stimulus

Arizona has received $3.1 billion in federal funding.^[35]

[edit] Public Employees

Main article: Arizona public employee salaries

Main article: Arizona public pensions

According to 2008 Census data, the state of Arizona and local governments in the state employed a total of 373,696 people,^[36] up from a total of 352,500 state and local government employees in 2007.^[37] Of those 373,696 employees in 2008, 289,646 were full-time employees receiving a net pay of $1,211,330,199 per month and 84,050 were part-time employees paid $92,659,917 per month.^[36] More than 59% of those employees, or 221,264 employees, were in education or higher education.^[36]

[edit] See Also

• Arizona taxpayer-funded lobbying
• Arizona public pensions

[edit] External links

[edit] Additional reading

[edit] References

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	v • d • e State of Arizona Phoenix (capital)
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Judiciary	Arizona Supreme Court | Arizona Court of Appeals | Arizona General Jurisdiction Court | Arizona Limited Jurisdiction Courts | Judicial selection in Arizona | Judicial News | Judicial activists organizations |
Ballot Measures	2008 ballot measures | Arizona citizen initiatives 2002-2006 | Arizona local initiative and referendum | Arizona School Bond Issues | Process of Initiatives | Campaign finances |