Official Summary Text
HB2320 - 572R - Senate Fact Sheet
Assigned to
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PASSED BY COW
ARIZONA STATE SENATE
Fifty-Seventh
Legislature, Second Regular Session
AMENDED
FACT SHEET FOR
H.B. 2320
school districts;
bonds; financial advisors
Purpose
Requires a school district governing board (governing board), before
calling an election to issue school district bonds, to hire an independent
municipal advisor on a contingency fee basis to assist the governing board with
the election and any issuance of school district bonds, with certain exceptions.
Outlines requirements and duties for an independent municipal advisor who is
hired by a school district.
Background
A governing board may, and on petition of 15 percent of the school
district electors must, hold an election to: 1) locate or change the location
of school buildings; 2) purchase, sell or construct school sites or buildings
as prescribed; 3) decide whether school district bonds be issued and sold for
specified purposes; 4) lease school buildings or grounds for a period of more
than 20 years; or 5) change the list of capital projects or purposes authorized
by prior voter approval to issue bonds. School district bonds must be issued
and sold to: 1) purchase or lease school lots;
2) build or renovate school buildings; 3) supply school buildings with
furniture, equipment and technology; 4) improve school grounds; 5) purchase
pupil transportation vehicles; or 6) liquidate any indebtedness already
incurred for such purposes. Bond counsel, financial advisory, printing cost and
paying agent fees associated with the issuance of school district bonds must be
paid from the amount authorized by the electors or current operating funds.
School district bond election expenses must be paid only from current operating
funds (
A.R.S.
� 15-491
).
A
municipal advisor
means a person who provides advice to, or on
behalf of, a municipal entity or obligated person with respect to municipal
financial products or the issuance of municipal securities, including advice
with respect to the structure, timing, terms and other matters concerning such
financial projects or issues. A
municipal advisor
includes financial
advisors, guaranteed investment contract brokers, third-party marketers,
placement agents, solicitors and swap advisors. Federal law requires a
municipal advisor to register with the U.S. Securities and Exchange Commission
(U.S. SEC) to provide advice relating to municipal financial products or the
issuance of municipal securities (
15
U.S.C. � 78o-4
).
There is no anticipated fiscal impact
to the state General Fund associated with this legislation.
Provisions
1.
Stipulates
that, before calling an election to decide whether to issue and sell school
district bonds, a governing board must hire, on a contingency fee basis, an independent
municipal advisor who is registered and in good standing with the U.S. SEC, or
its successor, to advise and assist the governing board and school district
with:
a)
the election; and
b)
if a majority of votes cast at a school district bond election favors
issuing the bonds, each bond issue authorized by the election.
2.
Requires
an independent municipal advisor who is hired by a school district to:
a)
assist the governing board and school district in preparing the school
district bond election informational pamphlet;
b)
receive compensation from the school district only if voters authorize
the school district to issue bonds in the election for which the independent
municipal advisor provides advice and assistance;
c)
act in the best interests of the school district; and
d)
advise the governing board and school district on all aspects of issuing
school district bonds to assist the school district in achieving the most
effective cost of borrowing, including:
i.
determining the repayment structure of school district bonds;
ii.
if
necessary, obtaining ratings on school district bonds;
iii.
hiring other
professionals necessary to sell and issue school district bonds; and
iv.
assisting in any
other matter that is related to school district bond issuance.
3.
Prohibits
an independent municipal advisor who is hired by a school district from:
a)
colluding in advising on the selection of other professionals to assist
the school district; or
b)
if the person served as the independent municipal advisor for the
issuance of the school district bonds, purchasing or underwriting any issue of
school district bonds.
4.
Determines
that a school district is not required to hire an independent municipal advisor
if the school district is unable, after reasonable effort, to hire a qualified
independent municipal advisor on a contingency fee basis.
5.
Becomes
effective on the general effective date.
Amendments
Adopted by Committee of the Whole
1.
Specifies
that the requirement to hire an independent municipal advisor before calling an
election only applies to elections relating to the issuance of school district
bonds.
2.
Specifies
that a school district governing board must hire the independent municipal
advisor as prescribed on a contingency fee basis.
3.
Determines
that a school district is not required to hire an independent municipal advisor
if the school district is unable, after reasonable effort, to hire a qualified
independent municipal advisor on a contingency fee basis.
4.
Stipulates
that an independent municipal advisor must receive compensation from the school
district only if voters authorize the issuance of school district bonds in the
election for which the independent municipal advisor provides advice and
assistance.
House Action
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Senate
Action
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3
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Prepared by Senate Research
June 11, 2026
MH/hk
Current Bill Text
Read the full stored bill text
HB2320 - 572R - S Ver
Senate Engrossed
House Bill
school districts;
bonds; financial advisors
State of Arizona
House of Representatives
Fifty-seventh Legislature
Second Regular Session
2026
HOUSE BILL 2320
AN
ACT
amending title 15, chapter 4, article 5,
Arizona Revised Statutes, by adding section 15-492; relating to school
bond elections.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it
enacted by the Legislature of the State of Arizona:
Section 1. Title 15, chapter 4, article 5,
Arizona Revised Statutes, is amended by adding section 15-492, to read:
START_STATUTE
15-492.
Independent municipal advisors; duties; prohibition; exemption
A. Before calling an election
for the purpose of deciding whether bonds of the school district shall
be issued and sold pursuant to this article, the governing board of a school
district shall hire
, on a contingency fee basis, an
independent municipal advisor who is registered and in good standing with the
securities and exchange commission, or its successor, to advise and assist the
school district governing board and the school district with both:
1. The election.
2. If a majority of votes cast at the
bond election favors issuing the bonds, each bond issue authorized by the
election.
B. An independent municipal advisor
who is hired pursuant to subsection A of this section shall:
1. Advise the school district
governing board and the school district on all aspects of issuing the bonds to
assist the school district in achieving the most effective cost of borrowing,
including:
(
a
) Determining
the repayment structure of the bonds.
(
b
) Obtaining
ratings, if necessary, on the bonds.
(
c
) Hiring
other professionals necessary to sell and issue the bonds.
(
d
) Assisting
in any other matter that is related to the issuance of the bonds.
2. Assist the school district
governing board and the school district in preparing the informational pamphlet
required pursuant to title 35.
3. Act in the best interests of the
school district.
4. Receive compensation from the
school district only if voters authorize the school district to issue bonds in
the election for which the independent municipal advisor provides advice and
assistance.
C. An independent municipal advisor
who is hired pursuant to subsection A of this section may not:
1. Collude in advising on the
selection of other professionals to assist the school district.
2. Purchase or underwrite any issue
of school district bonds, if the person served as the independent municipal
advisor for that issue of bonds.
D. A school district is not required
to hire an independent municipal advisor pursuant to this section if the school
district is unable after reasonable effort to hire a qualified independent
municipal advisor on a contingency fee basis.
END_STATUTE