higher education; increased costs; restrictions

HB2298 - 572R - I Ver

REFERENCE TITLE:
higher education; increased costs; restrictions

State of Arizona

House of Representatives

Fifty-seventh Legislature

Second Regular Session

2026

HB 2298

Introduced by

Representatives
Aguilar: Austin, Blattman, Cavero, Garcia, M�rquez, Sandoval, Villegas

AN
ACT

amending section 15-1626, Arizona
Revised Statutes; relating to the Arizona board of regents.

(TEXT OF BILL BEGINS ON NEXT PAGE)

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

Section 1. Section 15-1626, Arizona Revised
Statutes, is amended to read:

START_STATUTE
15-1626.

General administrative powers and duties of board; definition

A. The Arizona board of regents shall:

1. Have and exercise the powers necessary for the
effective governance and administration of the institutions under the board's
control.� To that end, the board may adopt, and authorize each university to
adopt, regulations, policies, rules or measures as are deemed necessary and may
delegate in writing to the board's committees, to university presidents, or the
presidents' designees, or to other entities under the board's control, any part
of the board's authority
for the administration

to administer
and
governance of

govern
those institutions, including those powers enumerated in
section 15-1625, subsection B, paragraphs 2 and 4, paragraphs 3, 4,
8,
9,
10,
11,
12
, 13
and
22

23
of
this subsection and subsection B of this section.�
the boaRD may
rescind
any delegation of authority
may be rescinded by
the board
at any time in whole or in part.

2. Appoint and employ and determine the compensation
of presidents with the power and authority and for the purposes in connection
with the operation of the institutions as the board deems necessary.

3. Appoint and employ and determine the compensation
of vice presidents, deans, professors, instructors, lecturers, fellows and the
other officers and employees with the power and authority and for the purposes
in connection with the operation of the institutions as the board deems
necessary, or delegate the board's authority pursuant to paragraph 1 of this
subsection.

4. Remove any officer or employee when the interests
of education in this state so require in accordance with the board's personnel
rules and policies.

5. Fix tuitions and fees to be charged and
differentiate the tuitions and fees between institutions and between residents,
nonresidents, undergraduate students, graduate students, students from foreign
countries and students who have earned credit hours in excess of the credit
hour threshold. For the purposes of this paragraph, the
undergraduate credit hour threshold is one hundred forty-five hours for
students who attend a university under the jurisdiction of the board. The
undergraduate credit hour threshold shall be based on the actual full-time
equivalent student enrollment counted on the forty-fifth day of every
fall and spring semester, divided by two, and any budget adjustment based on
student enrollment shall occur in the fiscal year following the actual full-time
equivalent student enrollment count. The undergraduate credit hour
threshold shall not apply to degree programs that require credit hours above
the credit hour threshold, credits earned in the pursuit of up to two
baccalaureate degrees, credits earned in the pursuit of up to two state
regulated licensures or certificates, credits earned in the pursuit of teaching
certification, credits transferred from a private institution of higher
education, credits transferred from an institution of higher education in
another state, credits earned at another institution of higher education but
that are not accepted as transfer credits at the university where the student
is currently enrolled and credits earned by students who enroll at a university
under the jurisdiction of the board more than twenty-four months after the end
of that student's previous enrollment at a public institution of higher
education in this state. On or before October 15 of each year, the board shall
report to the joint legislative budget committee the number of in-state
students and out-of-state students who were enrolled at
universities under the jurisdiction of the board during the previous fiscal
year and who met or exceeded the undergraduate credit hour threshold prescribed
in this paragraph. The amount of tuition and fees included in the
operating budget for the university adopted by the board as prescribed in
paragraph
13

14
of this subsection
is subject to legislative appropriation and shall be deposited in a separate
tuition and fees subaccount for each university. All other tuition and fee
revenue shall be retained by each university for expenditure as approved by the
board in a separate local tuition and fees subaccount for each
university. This subaccount shall consist of only tuition and
fees. The universities shall not use any tuition or fee revenue to
fund or support an alumni association.

6. Adopt rules to govern the board's tuition and
academic fee setting process that provide for the following:

(a) At least one public hearing at each university
as an opportunity for students and members of the public to comment on any
proposed increase in tuition or fees.

(b) Publication of the notice of public hearing at
least ten days before the hearing in a newspaper of general circulation in
Maricopa county, Coconino county and Pima county. The notice shall
include the date, time and location of the public hearing.

(c) Public disclosure by each university of any
proposed increases in tuition or fees at least ten days before the public
hearing.

(d) A roll call vote of any final board action on
changes in tuition, including tuition rate changes for online programs, or
academic fees.

(e) Public disclosure by the board and each
university of any final board action on changes in tuition or academic fees.

7. Ensure that any change in tuition
or fees pursuant to paragraph 5 or 6 of this subsection, in any fiscal year in
which the legislature appropriates sufficient monies to fund at least fifty
percent of the tuition and mandatory fees charged to resident students, does
not:

(
a
) Increase the tuition or mandatory fees to be charged to a
resident undergraduate student if the percentage increase relative to the prior
year exceeds the over-the-year percentage change in the
metropolitan Phoenix consumer price index, or its successor index, as published
by the United States department of labor, bureau of labor statistics, or its
successor agency.

(
b
) Increase
the tuition or mandatory fees to be charged to an undergraduate student during
the first four consecutive years of the student's enrollment in a university
under the jurisdiction of the board.

7.

8.
Pursuant
to section 35-115, submit a budget request for each institution under the
board's jurisdiction that includes the estimated tuition and fee revenue
available to support the programs of the institution as described in the budget
request. The estimated available tuition and fee revenue shall be based on the
tuition and registration fee rates in effect at the time the budget request is
submitted with adjustments for projected changes in enrollment as provided by
the board.

8.

9.
Establish
curricula and designate courses at the several institutions that in the board's
judgment will best serve the interests of this state.

9.

10.
Award
degrees and diplomas on the completion of the courses and curriculum
requirements that the board deems appropriate.

10.

11.
Prescribe
qualifications for admission of all students to the universities.� The board
shall establish policies for guaranteed admission that ensure fair and
equitable access to students in this state from public, private and charter
schools and homeschools. For the purpose of determining the
qualifications of honorably discharged veterans, veterans are those persons who
served in the armed forces for at least two years and who were previously
enrolled at a university or community college in this state. Prior
failing grades received by a veteran at the university or community college in
this state may not be considered.

11.

12.
Adopt
any energy conservation standards adopted by the department of administration
for the construction of new buildings.

12.

13.
Employ
for the time and purposes that the board requires attorneys whose compensation
shall be fixed and paid by the board. Litigation to which the board is a party
and for which self-insurance is not provided may be compromised or
settled at the direction of the board.

13.

14.
Adopt
annually an operating budget for each university equal to the sum of
appropriated state general fund monies and the amount of tuition and fees
approved by the board and allocated to each university operating budget.

14.

15.
In
consultation with the state board of education and other education groups,
develop and implement a program to award honors endorsements to be affixed to
the high school diplomas of qualifying high school pupils and to be included in
the transcripts of pupils who are awarded endorsements. The Arizona
board of regents shall develop application procedures and testing criteria and
adopt testing instruments and procedures to administer the
program. In order to receive an honors endorsement, a pupil must
demonstrate an extraordinary level of knowledge, skill and competency as
measured by the testing instruments adopted by the Arizona board of regents in
mathematics, English, science and social studies.� Additional subjects may be
added at the determination of the Arizona board of regents.� The program is
voluntary for pupils.

15.

16.
Require
the publisher of each literary and nonliterary textbook used in the
universities of this state to furnish to the board computer software in a
standardized format when software becomes available for nonliterary textbooks
from which braille versions of the textbooks may be produced.

16.

17.
Require
universities that provide a degree in education to require courses that are
necessary to obtain a provisional structured English immersion endorsement as
prescribed by the state board of education.

17.

18.
Acquire
for each classroom

United States flags that are
manufactured in the United States and that are at least two feet by three feet,
hardware to appropriately display the United States flags and a legible copy of
the Constitution of the United States and the Bill of Rights.� The board shall
display the flags in each classroom in accordance with title 4 of the United
States Code and display a legible copy of the Constitution of the United States
and the Bill of Rights adjacent to the flag.

18.

19.
To
facilitate the transfer of military personnel and their dependents to and from
the public schools of this state, pursue, in cooperation with the state board
of education, reciprocity agreements with other states concerning the transfer
credits for military personnel and their dependents.� A reciprocity agreement
entered into pursuant to this paragraph shall:

(a) Address procedures for each of the following:

(i) The transfer of student records.

(ii) Awarding credit for completed coursework.

(iii)
Permitting

allowing
a student to satisfy the graduation requirements prescribed in
section 15-701.01 through the successful performance on comparable
exit-level assessment instruments administered in another state.

(b) Include appropriate criteria developed by the
state board of education and the Arizona board of regents.

19.

20.
Require
a university to publicly post notices of all of the university's employment
openings, including the title and description, instructions for applying and
relevant contact information.

20.

21.
In consultation with the community college
districts in this state, develop and implement common equivalencies for
specific levels of achievement on advanced placement examinations and
international baccalaureate examinations in order to award commensurate
postsecondary academic credits at community colleges and public universities in
this state.

21.

22.
On
or before August 1 of each year, report to the joint legislative budget
committee the graduation rate by university campus during the previous fiscal
year. The board shall also report the retention rate by university
campus and by class, as determined by date of entry during the previous fiscal
year.

22.

23.
Enter
into an agreement with one or more career technical education district
governing boards pursuant to section 15-393, subsection K

if the agreement, in the board's judgment, will serve
the interests of this state.

B. The Arizona

board of
regents shall adopt personnel policies for all employees of the board and the
universities.

C. In conjunction with the auditor general, the
Arizona board of regents shall develop a uniform accounting and reporting
system, which shall be reviewed by the joint legislative budget committee
before final adoption by the board.� The board shall require each university to
comply with the uniform accounting and reporting system.

D. The Arizona board of regents may employ legal
assistance in procuring loans for the institutions from the United States
government.� Fees or compensation paid for legal assistance pursuant to this
subsection shall not be a claim on the state general fund but shall be paid
from funds of the institutions.

E. The Arizona board of regents shall approve or
disapprove any contract or agreement entered into by the university of Arizona
hospital with the Arizona industrial development authority.

F. The Arizona board of regents may adopt policies
that authorize the institutions under its jurisdiction to enter into employment
contracts with nontenured employees for periods of more than one year but not
more than five years.� The policies must prescribe limits on the authority of
the institutions to enter into employment contracts for periods of more than
one year but not more than five years, including the requirement that the board
approve the contracts.

G. The Arizona board of regents may adopt a plan or
plans for employee benefits that allow participation in a cafeteria plan that
meets the requirements of the United States internal revenue code of 1986.

H. The Arizona board of regents may establish a
program for the exchange of students between the universities under the
jurisdiction of the board and colleges and universities located in the state of
Sonora, Mexico.� Notwithstanding subsection A, paragraph 5 of this section, the
program may provide for in-state tuition at the universities under the
jurisdiction of the board for fifty Sonoran students in exchange for similar
tuition provisions for up to fifty Arizona students enrolled or seeking
enrollment in Sonoran colleges or universities. The board may direct
the universities to work in conjunction with the Arizona-Mexico
commission to coordinate recruitment and admissions activities.

I. The Arizona board of regents, in collaboration
with the universities under the board's jurisdiction, shall adopt a performance
funding model using performance metrics that include the increase in degrees
awarded, the increase in completed student credit hours and the increase in
externally generated research and public service funding. The
funding formula may give added weight to degrees related to science,
technology, engineering and mathematics and other high-value degrees that
are in short supply or that are essential to this state's long-term economic
development strategy.

J. The Arizona board of regents shall use the
performance funding model adopted pursuant to subsection I of this section in
developing and submitting budget requests for the universities under the
board's jurisdiction.

K. On or before November 1 of each year, the Arizona
board of regents shall submit to the joint legislative budget committee and the
governor's office of strategic planning and budgeting a report on university
debt and obligations, including:

1. Long-term notes and obligations.

2. Certificates of participation and other
obligations pursuant to any lease-purchase agreements.

3. Revenue bonds.

4. Bonds issued pursuant to section 15-1682.03.

5. Commercial paper issued pursuant to section 15-1696.

L. The report submitted pursuant to subsection K of
this section must contain, for the most recent fiscal year:

1. The aggregate level of outstanding principal and
the principal and interest payments, by type of debt or obligation.

2. An itemization, by campus and project, of the
amount of yearly principal and interest to be paid in the most recent and the
next five fiscal years.

M. The Arizona

board of
regents may enter into an intergovernmental agreement pursuant to section 15-1747
to manage universities under the board's jurisdiction subject to the terms of
the reciprocity agreement.

N. On or before November 1, 2025 and each year
thereafter, the Arizona board of regents shall submit to the joint legislative
budget committee each of the following for review:

1. The amount of monies that the board retained from
each university under the board's jurisdiction to supplement the board's
operating budget.

2. The board's expenditure plan for the current
fiscal year for monies that the board retained from each university under the
board's jurisdiction.

3. An accounting of how the board spent monies that
the board retained from the universities under the board's jurisdiction in the
immediately preceding fiscal year.

O. For the purposes of this section,
"university debt and obligations" means debt and obligations, the
principal and interest of which are paid in whole or in part with university
monies.
END_STATUTE