SB1834 • 2026

capital outlay; 2026-2027; appropriations

SB1834 - capital outlay; 2026-2027; appropriations

Budget Labor Taxes

Passed Legislature

This bill passed both chambers and reached final enrollment, even if later executive action is not shown here.

Sponsor: David C. Farnsworth, John Kavanagh
Last action: 2026-05-04
Official status: Senate committee of the whole
Effective date: Not listed

Plain English Breakdown

Using official source text because the generated explanation was unavailable or could not be confirmed against the official bill text.

capital outlay; 2026-2027; appropriations

SB1834 - 572R - Senate Fact Sheet Assigned to ATT�� AS VETOED ARIZONA STATE SENATE Fifty-Seventh Legislature, Second Regular Session VETOED FACT SHEET FOR H.B.

What This Bill Does

SB1834 - 572R - Senate Fact Sheet Assigned to ATT�� AS VETOED ARIZONA STATE SENATE Fifty-Seventh Legislature, Second Regular Session VETOED FACT SHEET FOR H.B.
4141/S.B.
1834 capital outlay; 2026-2027; appropriations.
Purpose Makes session law changes relating to capital outlay necessary to implement the FY 2027 state budget.

Limits and Unknowns

This entry is temporarily using official source text because the generated explanation could not be confirmed against the official bill text during the last sync.

Bill History

2026-05-04 Senate
Senate committee of the whole
2026-05-04 Senate
Senate majority caucus
2026-05-04 Senate
Senate minority caucus
2026-04-28 Senate
Senate second read
2026-04-27 Senate
Senate Rules: PFC
2026-04-27 Senate
Senate Appropriations, Transportation and Technology: DP
2026-04-27 Senate
Senate first read

Official Summary Text

SB1834 - 572R - Senate Fact Sheet

Assigned to
ATT������������������������������������������������������������������������������������������������������������������������������ AS
VETOED

ARIZONA STATE SENATE

Fifty-Seventh
Legislature, Second Regular Session

VETOED

FACT SHEET FOR
H.B. 4141/S.B. 1834

capital outlay;
2026-2027; appropriations.

Purpose

Makes session
law changes relating to capital outlay necessary to implement the FY 2027 state
budget.

Background

The Arizona
Constitution prohibits substantive law from being included in the general
appropriations, capital outlay appropriations and supplemental appropriations
bills. However, it is often necessary to make statutory and session law changes
to effectuate the budget. Thus, separate bills called budget reconciliation
bills (BRBs) are introduced to enact these provisions. Because BRBs contain
substantive law changes, the Arizona Constitution provides that they become effective
on the general effective date, unless an emergency clause is enacted.

H.B. 4141 contains the budget reconciliation
provisions for changes relating to capital outlay.

Provisions

Building
Renewal

Appropriates the following amounts in FY 2027 to the following state
agencies from the specified funds for major maintenance and repair activities
for state buildings:

Agency

Fund Source

Amount

Arizona
Department of Administration (ADOA)

Capital
Outlay Stabilization Fund (COSF)

$16,800,000

Arizona
Department of Corrections, Rehabilitation and Reentry (ADCRR)

ADCRR
Building Renewal Fund

$5,864,300

Arizona
Game and Fish Department (AZGFD)

AZGFD
Fund

$1,932,900

Arizona
State Lottery Commission

State
Lottery Fund

$237,800

Arizona Department of Transportation (ADOT)

State
Highway Fund (SHF)

$22,990,400

State
Aviation Fund

$394,900

Requires ADOA to allocate appropriated monies to state agencies for
necessary building renewal.

Reduces the ADOA appropriation for building renewal by the difference
between the appropriated monies and the balance in the COSF, if monies in the
COSF are insufficient to fund the $16,800,000 appropriation.

Allows ADOA to use monies appropriated for building renewal in FY 2027
for building projects related to retrofitting facilities for space consolidation
initiatives.

Prohibits ADCRR from spending any of the FY 2027 appropriation for
building renewal on personal services or overhead expenses related to managing
funded projects.

Statewide
Highway Construction

Appropriates
$432,663,000 in FY 2027 from the SHF to ADOT to:

plan and construct state highways, including the national system of
interstate highways within the state, the state primary or secondary system,
the county primary or secondary system and urban rural routes;

acquire rights-of-way; and

provide
for the cost of contracted field administration and engineering on construction
projects and debt service payments on bonds issued for highway construction.

Exempts the $432,663,000 appropriation to ADOT from review by the Joint
Committee on Capital Review (JCCR).

Appropriates balances and collections in the SHF that exceed the
specific amounts appropriated by the FY 2027 General Appropriations Act and
Capital Outlay BRB to ADOT for authorized purposes.

Requires
ADOT, by November 1, 2026, to report to the Directors of the Joint Legislative
Budget Committee (JLBC) and the Governor's Office of Strategic Planning and
Budgeting (OSPB) on:

ADOT's actual prior year, estimated current year and upcoming budget
year highway construction expenses from all fund sources;

capital outlay information for FYs 2026, 2027 and 2028; and

ADOT's
estimated outstanding debt principal balance at the end of FY 2028 and the
estimated debt service payment amounts for each of FYs 2028 through 2031.

10.

Requires ADOT's highway
construction expenses report to:

include fund sources from bond proceeds and appropriated, federal, local
agency, state highway and regional area road monies; and

be
in the same format as the prior year unless the Directors of JLBC and OSPB have
approved modifications to the format.

11.

Requires
ADOT's reported capital outlay information to be in the same format as tables two,
three and seven of ADOT's capital outlay estimates in the FY 2026
Appropriations Report.

12.

Requires ADOT's report on
estimated outstanding debt principal balance and service payments to:

include SHF statewide construction bonds, Highway User Revenue Fund
bonds, Maricopa and Pima Associations of Governments controlled access bonds,
Maricopa Regional Area Road Fund bonds and grant anticipation notes; and

be
comparable to the information reported for ADOT in the FY 2026 Appropriations
Report.

Airport
Planning and Development

13.

Appropriates
$29,048,900 from the State Aviation Fund in FY 2027 to ADOT to plan, construct,
develop and improve state, county, city or town airports, as determined by the
State Transportation Board.

14.

Exempts
the $29,048,900 appropriation to ADOT from JCCR review.

15.

Appropriates
any balances and collections in the State Aviation Fund that exceed the
specific amounts appropriated by the FY 2027 General Appropriations Act and
Capital Outlay BRB to ADOT in FY 2027 for authorized purposes.

16.

Requires
ADOT, by December 31, 2026, to report to the JLBC staff on the status of all
aviation grant awards and distributions.

17.

Requires
the report on aviation grants to delineate projects by individual airport and
fiscal year, including any future-year commitments.

Miscellaneous

18.

Appropriates
$26,300,000 from the state GF in FY 2029 to the State Match Advantage for Rural
Transportation Fund.

19.

Transfers,
by June 30, 2026, the FY 2026 reduction of $2,500,000 made to the appropriation
for the rehabilitation of pavement along U.S. Route 191 between Armory Road and
East Safford from the SHF to the state General Fund (state GF) for the support
and maintenance of state agencies.

20.

Appropriates
$25,000,000 from the state GF in FY 2029, rather than FY 2028, to the Arizona
Department of Veterans' Services to construct and establish a veterans' home
facility in the northwestern portion of Arizona.

21.

Allows
ADOA to spend up to five percent of all capital outlay appropriations,
excluding distributions to nonstate agencies, for expenditures for project
management of building renewal and capital projects.

22.

Prohibits ADOA from spending
any other capital outlay appropriations:

on personal services or employee-related expenditures; or

for
maintenance contracts on building components and equipment without JCCR review.

23.

Prohibits
any capital outlay appropriations from being spent for personal services or
employee-related expenditures of state employees, excluding services provided
as part of the Inmate Construction Program for correctional facilities.

24.

Becomes
effective on signature of the Governor.

Governor's Veto Message

The Governor
indicates in her
veto
message
that H.B. 4141, and this version of the FY 2027 state budget as a
whole, would cause Arizona to default on its debt obligations, endanger
vulnerable children, cut public safety funding and provide tax breaks for
billionaires, data centers and special interests. The Governor outlines her
specific concerns, including cuts to funding for specified agencies and
programs, and invites the Legislature to return to the negotiating table.

House Action
����������������������������������������������������������
Senate
Action

APPROP�������� 4/28/26����� DP������ 11-7-0-0������������ ATT���������������� 4/28/26����� DP������������� 6-4-0�������������������������

3
rd

Read��������� 4/29/26����������������� 33-20-7�������������� 3
rd

Read��������� 5/4/26��������������������������� 16-12-2

(H.B. 4141
was substituted for S.B. 1834 on 3
rd
Read)

Vetoed by the Governor 5/5/26

Prepared by
Senate Research

May 6, 2026

LMM/KS/hk

Current Bill Text

Read the full stored bill text

SB1834 - 572R - S Ver

Senate Engrossed

capital outlay;
2026-2027; appropriations

State of Arizona

Senate

Fifty-seventh Legislature

Second Regular Session

2026

SENATE BILL 1834

AN
ACT

Amending laws 2024, chapter 211, section
6; Making capital outlay appropriations for the different departments of the
state and for state institutions; providing for review of capital outlay
projects.

(TEXT OF BILL BEGINS ON NEXT PAGE)

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

Section 1. Laws 2024, chapter 211, section 6 is
amended to read:

Sec
. 6.
Appropriation reduction; fiscal year 2021-2022;
appropriation; fiscal year 2028-2029; department of veterans' services;
veterans' home facility; site selection; review; exemption

A. Notwithstanding
any other law, the following amounts are reduced from appropriations made to
the following state agency in fiscal year 2021-2022 by Laws 2021, chapter 406,
section 29 for the following project:

B. DEPARTMENT
OF VETERANS' SERVICES

Veterans' home
facility ����������������������� $(25,000,000)

Fund
source:

State general fund����������������������������� $(25,000,000)

C. The
sum of $25,000,000 is appropriated from the state general fund in fiscal year
2027-2028

2028-2029
to the
department of veterans' services to construct and establish a veterans' home
facility in the northwestern portion of this state.

D. The
appropriation made in subsection C of this section is intended to be this
state's share of the costs and is not subject to expenditure for any purpose
unless the department of veterans' services has irrevocable commitments from
the United States government to fund at least sixty-five percent of the total
costs.

E. The
department shall submit the proposed site location in the northwestern portion
of this state to the Arizona veterans' service advisory commission established
by section 41-602, Arizona Revised Statutes, for approval. The department
shall provide the commission a feasibility analysis of suitable sites to
consider when approving the site location.

F. Before spending the appropriation made in
subsection C of this section, the department of veterans' services shall submit
the scope, purpose and estimated cost of the capital improvements to the joint
committee on capital review for its review pursuant to section 41-1252, Arizona
Revised Statutes.

G. The
appropriation made in subsection C of this section is exempt from the
provisions of section 35-190, Arizona Revised Statutes, relating to lapsing of
appropriations.

Building Renewal

Sec. 2.
Capital outlay appropriations; major maintenance and
repair of state buildings

A. Notwithstanding
section 41-793.01, Arizona Revised Statutes, the amounts appropriated in this
section are appropriated for fiscal year 2026-2027 to be used by the applicable
agency for major maintenance and repair activities for state buildings in
accordance with title 41, chapter 4, article 7, Arizona Revised Statutes.

B. DEPARTMENT OF
ADMINISTRATION��������������������� $16,800,000

Fund
source:

Capital outlay stabilization fund�������������� $16,800,000

The department of administration shall
allocate the monies to state agencies for necessary building
renewal. If monies in the capital outlay stabilization fund
established by section 41-792.01, Arizona Revised Statutes, are insufficient to
fund the appropriation to the department of administration for building
renewal, the appropriation to the department of administration is reduced by
the difference between the amount appropriated to the department of
administration from the capital outlay stabilization fund and the balance in
the capital outlay stabilization fund.� Notwithstanding title 41, chapter 4,
article 7, Arizona Revised Statutes, the department of administration may use
monies appropriated for building renewal in fiscal year 2026-2027 for building
projects related to retrofitting facilities for space consolidation initiatives.

C. STATE DEPARTMENT OF
CORRECTIONS������������������ $ 5,864,300

Fund
source:

Department of corrections building

renewal fund�������������������������������� $ 5,864,300

The state department of corrections
may not spend any of this appropriation on personal services or overhead
expenses related to managing the funded projects.

D. ARIZONA GAME AND FISH
DEPARTMENT����������������� $ 1,932,900

Fund source:

Game and fish fund����������������������������� $ 1,932,900

E. ARIZONA STATE LOTTERY
COMMISSION����������������� $ 237,800

Fund source:

State lottery fund����������������������������� $ 237,800

F. DEPARTMENT OF
TRANSPORTATION��������������������� $23,385,300

Fund
sources:

State highway fund����������������������������� $22,990,400

State aviation fund���������������������������� $ 394,900

Department of Transportation Statewide Highway
Construction

Sec.
3.

Appropriation; department of transportation; statewide highway
construction; reports; exemption

A. The
amount appropriated in this section is appropriated for fiscal year 2026-2027
to plan and construct state highways, including the national system of
interstate highways within this state, the state primary or secondary system,
the county primary or secondary system and urban rural routes, to acquire
rights-of-way and to provide for the cost of contracted field
administration and field engineering on construction projects and debt service
payments on bonds issued for highway construction.

B. DEPARTMENT
OF TRANSPORTATION��������������������� $432,663,000

Fund
source:

State highway fund����������������������������� $432,663,000

Any balances and collections in the
state highway fund established by section 28-6991, Arizona Revised
Statutes, that exceed the specific amounts appropriated in the general
appropriations act and in this act are appropriated to the department of
transportation for the purposes provided in this section.

C. On or before November 1,
2026, the department of transportation shall report to the directors of the
joint legislative budget committee and the governor's office of strategic
planning and budgeting on its actual prior year, estimated current year and
upcoming budget year highway construction expenses from all fund sources,
including appropriated monies, federal monies, local agency monies, state
highway monies, bond proceeds and regional area road monies. The
report shall be in the same format as in the prior year unless the directors of
the joint legislative budget committee and the governor's office of strategic
planning and budgeting have approved modifications to the format.

D. On or before November 1,
2026, the department of transportation shall report capital outlay information
for fiscal years 2025-2026, 2026-2027 and 2027-2028 to the
directors of the joint legislative budget committee and the governor's office
of strategic planning and budgeting. This information shall appear in the same
format as tables two, three and seven, as found in the fiscal year 2025-2026
appropriations report.

E. On or before November 1,
2026, the department of transportation shall report the department's estimated
outstanding debt principal balance at the end of fiscal year 2027-2028 and the
estimated debt service payment amount for each of fiscal years 2027-2028,
2028-2029, 2029-2030 and 2030-2031 to the directors of the
joint legislative budget committee and the governor's office of strategic
planning and budgeting. This report shall include state highway fund
statewide construction bonds, Arizona highway user revenue fund bonds, Maricopa
association of governments and Pima association of governments controlled
access bonds, Maricopa regional area road fund bonds and grant anticipation
notes and is intended to be comparable to the information in the fiscal year
2025-2026 appropriations report.

F. Notwithstanding section
41-1252, Arizona Revised Statutes, the appropriation made in this section is
not subject to review by the joint committee on capital review.

Sec. 4.
Department of transportation; U.S. Route 191
pavement rehabilitation; transfer

On or before June 30, 2026, the
reduction of $2,500,000 made by Laws 2022, chapter 309, section 8, as amended
by Laws 2023, chapter 135, section 3 and Laws 2025, chapter 235, section 1,
from the state highway project to rehabilitate of pavement along United States
Route 191 between Armory Road and East Safford is transferred from the state
highway fund established by section 28-6991, Arizona Revised Statutes, to
the state general fund for the support and maintenance of agencies of this
state.

Sec. 5.
Appropriation;
fiscal year 2028-2029; state match advantage for rural transportation fund

The sum of $26,300,000 is appropriated
from the state general fund in fiscal year 2028-2029 to the state match
advantage for rural transportation fund established by section 28-339,
Arizona Revised Statutes.

Department
of Transportation Airport Planning and Development

Sec. 6.
Appropriation;
department of transportation; airport planning and development; report;
exemption

A. The amount appropriated
in this section is appropriated in fiscal year 2026-2027 to plan, construct,
develop and improve state, county, city or town airports as determined by the
state transportation board.

B. DEPARTMENT OF
TRANSPORTATION��������������������� $ 29,048,900

Fund source:

State aviation fund���������������������������� $ 29,048,900

Any balances and collections in the
state aviation fund established by section 28-8202, Arizona Revised
Statutes, that exceed the specific amounts appropriated in the general
appropriations act and in this act are appropriated to the department of
transportation in fiscal year 2026-2027 for the purposes provided in this
section.

C. On or before December
31, 2026, the department of transportation shall report to the joint
legislative budget committee staff on the status of all aviation grant awards
and aviation grant distributions.� The report shall delineate projects by
individual airport and fiscal year, including any future year commitments.

D. Notwithstanding section
41-1252, Arizona Revised Statutes, the appropriation made in this section is
not subject to review by the joint committee on capital review.

Sec
. 7.
Use of appropriations

A. The department of
administration may spend up to five percent of the amounts appropriated to the
department in this act, excluding amounts to be distributed to nonstate
agencies, for expenditures for project management of building renewal and
capital projects. All other monies appropriated to the department in
this act may not be spent for personal services or employee-related
expenditures or for maintenance contracts on building components and equipment
without review by the joint committee on capital review.

B. Except as provided in
subsection A of this section, the monies appropriated in this act may not be
spent for personal services or employee-related expenditures of state
employees, excluding any services provided as part of the inmate construction
program for correctional facilities.