HCR 2003
Initials CH Page 1 Education
ARIZONA HOUSE OF REPRESENTATIVES
Fifty-seventh Legislature
First Regular Session
HCR 2003: expenditure limit; school districts; authorization
Sponsor: Representative Gress, LD 4
Committee on Education
Overview
Allows school districts to exceed the aggregate expenditure limitation (AEL) in FY 2026.
History
In 1980, Arizona voters approved Proposition 109, which established the AEL for school
districts in the Arizona Constitution. The AEL functions as an aggregate spending cap for all
school districts. The state Constitution and statute detail the formula to calculate the AEL
and procedures if the AEL is exceeded.
Prior to May 1, the Economic Estimates Commission (EEC) must publish the AEL for the
following year. The AEL is calculated by adjusting FY 1980 local revenue expenditures for
all school districts to reflect changes in student population and the cost of living. This amount
is then multiplied by 10%. The state Constitution details the monies, revenues, funds,
property and receipts that comprise local revenues (Ariz. Const. art. 9 § 21).
By November 1, the State Board of Education (SBE) must determine the current year
aggregate expenditures of local revenues for all school districts. If this amount exceeds the
AEL, two options may occur. The Legislature may authorize, by March 1, the expenditures
of local revenues in excess of the AEL upon two-thirds approval in both the House of
Representatives and Senate. If the Legislature does not authorize the expenditures of local
revenues in excess of the AEL, SBE must inform each school district, by March 5, of the
amount by which the school district must reduce its expenditures of local revenues. Then, by
April 1, each school district governing board must adopt a revised current year budget that
is reduced by the amount determined by SBE (A.R.S. § 15-911).
Provisions
1. Authorizes school districts to spend local revenues in excess of the AEL in FY 2026,
subject to two-thirds approval in both the House of Representatives and Senate.
☐ Prop 105 (45 votes) ☐ Prop 108 (40 votes) ☐ Emergency (40 votes) ☐ Fiscal Note