budget stabilization fund; transportation fund

SB1551 - 572R - I Ver

REFERENCE TITLE:
budget stabilization fund; transportation fund

State of Arizona

Senate

Fifty-seventh Legislature

Second Regular Session

2026

SB 1551

Introduced by

Senator
Farnsworth

AN
ACT

Amending sections 28-7011 and 35-144,
Arizona Revised Statutes; relating to the statewide infrastructure trust fund.

(TEXT OF BILL BEGINS ON NEXT PAGE)

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

Section 1. Section 28-7011, Arizona Revised
Statutes, is amended to read:

START_STATUTE
28-7011.

Statewide infrastructure trust fund; definition

A. The statewide infrastructure trust fund is
established. The state treasurer shall administer the
fund. Monies in the fund are subject to legislative appropriation
and are exempt from the provisions of section 35-190 relating to lapsing
of appropriations. The state treasurer shall invest and divest
monies in the fund as provided by section 35-313, and monies earned from
investment shall be credited to the fund. The fund consists of the
following:

1. Monies appropriated by the legislature.

2. Any nonfederal gifts, grants, donations or other
monies received by the state treasurer

from any
public or private source for transportation projects.

3. Monies earned from investment from
the budget STABILIZATION fund established by section 35-144.

B. The monies in the fund shall be used to fund any
phase of development or construction of transportation projects in the current
fiscal year or next fiscal year.

C. Before any expenditure is made from the fund, the
state treasurer and the department shall submit an expenditure plan for review
to the joint committee on capital review.

D. For the purposes of this section,
"transportation project" means any project that constructs a new
federal or state highway or makes improvements to any

existing
federal or state highway.
END_STATUTE

Sec. 2. Section 35-144, Arizona Revised
Statutes, is amended to read:

START_STATUTE
35-144.

Budget stabilization fund; definitions

A. The budget stabilization fund is established
consisting of monies transferred from the state general fund pursuant to
subsection B of this section. The state treasurer shall administer
the budget stabilization fund and invest and divest monies in the budget
stabilization fund as provided by sections 35-313 and 35-314.02,
and monies earned from investment shall be
credited to the budget
stabilization fund

transferred to the statewide
infrastructure trust fund established by section 28-7011
. Except
as provided by this section:

1. Monies in the budget stabilization fund are
exempt from the provisions of section 35-190 relating to the reversion of
monies to the state general fund.

2. The monies in the fund are separate monies to be
used only for the purposes of the fund.

3. An amount sufficient to pay claims certified by
the state forester pursuant to section 37-1305, subsection E, paragraph 4
is continuously appropriated from the fund to the state treasurer for payment
of the certified claims. Not more than $20,000,000 in unreimbursed
claims may be outstanding from the fund at any time from the monies
appropriated pursuant to this paragraph.

B. In a calendar year in which the annual growth
rate exceeds the trend growth rate, the excess growth when multiplied by total
general fund revenue of the fiscal year ending in the calendar year determines
the amount to be appropriated by the legislature to the budget stabilization
fund in the fiscal year in which the calendar year ends.

C. In a calendar year in which the annual growth
rate is both less than two percent and less than the trend growth rate, the
difference between the annual growth rate and the trend growth rate when
multiplied by the total general fund revenue of the fiscal year ending in the
calendar year determines the amount to be transferred by the legislature from
the budget stabilization fund to the state general fund at the end of the
fiscal year in which the calendar year ends. The transfer calculated
pursuant to this subsection shall not exceed the available balance in the
budget stabilization fund, nor shall the legislature transfer an amount that
exceeds the amount sufficient to balance the state general fund budget.

D. The legislature shall pass a bill that contains
the emergency clause if the legislature either:

1. Reduces the amount for appropriation to the
budget stabilization fund under subsection B of this section.

2. Increases the amount for transfer to the state
general fund under subsection C of this section.

E. The annual budget recommendations of the governor
and the joint legislative budget committee shall include estimates of
appropriations or transfers required under subsection B or C of this section.

F. A final determination of the amount to be
appropriated to or transferred from the budget stabilization fund shall be made
using personal income and price deflator estimates as reported in the second
calendar quarter for the preceding calendar year.� The economic estimates
commission shall determine the annual growth rate, the trend growth rate and
the required appropriation to or transfer from the budget stabilization fund at
its first meeting following the second calendar quarter report of the United States
department of commerce, but not later than June 1. The commission
shall certify and report its findings to the governor, the state treasurer, the
president of the senate, the speaker of the house of representatives and the
joint legislative budget committee.

G. The appropriation calculated pursuant to
subsection B of this section may be included in the general appropriations bill
for that fiscal year. Any additional appropriation calculated
pursuant to subsection F of this section shall be made by a separate act.

H. At the end of a fiscal year, the budget
stabilization fund balance shall not exceed ten percent of state general fund
revenue for the fiscal year. Any surplus monies above ten percent
shall be transferred by the state treasurer to the state general fund.

I. The state treasurer may temporarily divest monies
in the budget stabilization fund to avoid a negative cash balance in operating
monies. The amount divested shall not exceed the amount required to
meet immediate cash needs. The state treasurer may divest monies in
the budget stabilization fund only when the state general fund has a negative
cash balance.

J. For the purposes of this section:

1. "Adjusted personal income" means
personal income minus transfer payments, as reported by the United States
department of commerce, bureau of economic analysis, or its successor agency.

2. "Annual growth rate" means the
percentage change in real adjusted personal income in the calendar year ending
during a fiscal year as compared to real adjusted personal income for the
preceding calendar year. The annual growth rate shall be rounded to
the nearest one-hundredth of one percent.

3. "GDP price deflator" means the gross
domestic product price deflator reported by the United States department of
commerce, bureau of economic analysis, or its successor agency.

4. "Personal income" means the total
personal income of all persons in this state reported by the United States
department of commerce, bureau of economic analysis, or its successor agency.

5. "Real adjusted personal income" means
an amount that is determined by dividing adjusted personal income by the GDP
price deflator and multiplying the result by one hundred.

6. "Transfer payments" means that portion
of personal income that represents a government expenditure for which no
service is rendered or product is delivered, as determined by the United States
department of commerce, bureau of economic analysis, or its successor agency.

7. "Trend growth rate" means the average
annual growth rate for the most recent seven calendar years, rounded to the
nearest one-hundredth of one percent.
END_STATUTE