Arizona Constitution|Section 21 - Expenditure limitations for school districts and community college districts

                                                




 21.  Expenditure limitations for school districts and
                  community college districts
Section 21.  (1)  The economic estimates commission shall
      determine and publish prior to April 1 of each year the expenditure limitation
      for the following fiscal year for each community college district.  The
      expenditure limitations shall be determined by adjusting the amount of
      expenditures of local revenues for each such district for fiscal year
      1979-1980 to reflect the changes in the student population of each district
      and the cost of living.  The governing board of any community college district
      shall not authorize expenditures of local revenues in excess of the limitation
      prescribed in this section, except in the manner provided by law.

      (2)  The economic estimates commission shall determine and publish prior
      to May 1 of each year the aggregate expenditure limitation for all school
      districts for the following fiscal year. The aggregate expenditure limitation
      shall be determined by adjusting the total amount of expenditures of local
      revenues for all school districts for fiscal year 1979-1980 to reflect the
      changes in student population in the school districts and the cost of living,
      and multiplying the result by 1.10.  The aggregate expenditures of local
      revenues for all school districts shall not exceed the limitation prescribed
      in this section, except as provided in subsection (3) of this section.

      (3)  Expenditures in excess of the limitation determined pursuant to
      subsection (2) of this section may be authorized by the legislature for a
      single fiscal year, by concurrent resolution, upon affirmative vote of
      two-thirds of the membership of each house of the legislature.

      (4)  As used in this section:

      (a)  "Cost of living" means either:

      (i)  The price of goods and services as measured by the implicit price
      deflator for the gross national product or its successor as reported by the
      United States department of commerce, or its successor agency.

      (ii)  A different measure or index of the cost of living adopted at the
      direction of the legislature, by concurrent resolution, upon affirmative vote
      of two-thirds of the membership of each house of the legislature.  Such
      measure or index shall apply for subsequent fiscal years, except it shall not
      apply for the fiscal year following the adoption of such measure or index if
      the measure or index is adopted after March 1 of the preceding fiscal year.

      (b)  "Expenditure" means any amounts budgeted to be paid from local
      revenues as prescribed by law.

      (c)  "Local revenues" includes all monies, revenues, funds, property and
      receipts of any kind whatsoever received by or for the account of a school
      district or community college district or any of its agencies, departments,
      offices, boards, commissions, authorities, councils and institutions, except:

      (i)  Any amounts or property received from the issuance or incurrence of
      bonds, or other lawful long-term obligations issued or incurred for a specific
      purpose, or any amounts or property collected or segregated to make payments
      or deposits required by a contract concerning such bonds or obligations.  For
      the purpose of this subdivision long-term obligations shall not include
      warrants issued in the ordinary course of operation or registered for payment
      by a political subdivision.

      (ii)  Any amounts or property received as payment of dividends and
      interest, or any gain on the sale or redemption of investment securities, the
      purchase of which is authorized by law.

      (iii)  Any amounts or property received by a school district or
      community college district in the capacity of trustee, custodian or agent.

      (iv)  Any amounts received as grants and aid of any type received from
      the federal government or any of its agencies except school assistance in
      federally affected areas.

      (v)  Any amounts or property received as grants, gifts, aid or
      contributions of any type except amounts received directly or indirectly in
      lieu of taxes received directly or indirectly from any private agency or
      organization, or any individual.

      (vi)  Any amounts received from the state for the purpose of purchasing
      land, buildings or improvements or constructing buildings or improvements.

      (vii)  Any amounts received pursuant to a transfer during a fiscal year
      from another agency, department, office, board, commission, authority, council
      or institution of the same community college district or school district which
      were included as local revenues for such fiscal year or which are excluded
      from local revenue under other provisions of this subsection.

      (viii)  Any amounts or property accumulated by a community college
      district for the purpose of purchasing land, buildings or improvements or
      constructing buildings or improvements.

      (ix)  Any amounts received in return for goods or services pursuant to a
      contract with another political subdivision, school district, community
      college district or the state and expended by the other political subdivision,
      school district, community college district or the state pursuant to the
      expenditure limitation in effect when the amounts are expended by the other
      political subdivision, school district, community college district or the
      state.

      (x)  Any amounts received as tuition or fees directly or indirectly from
      any public or private agency or organization or any individual.

      (xi)  Any ad valorem taxes received pursuant to an election to exceed
      the limitation prescribed by section 19 of this article or for the purposes of
      funding expenditures in excess of the expenditure limitations prescribed by
      subsection (7) of this section.

      (xii)  Any amounts received during a fiscal year as refunds,
      reimbursements or other recoveries of amounts expended which were applied
      against the expenditure limitation for such fiscal year or which were excluded
      from local revenues under other provisions of this subsection.

      (d)  For the purpose of subsection (2) of this section, the following
      items are also excluded from local revenues of school districts:

      (i)  Any amounts received as the proceeds from the sale, lease or rental
      of school property as authorized by law.

      (ii)  Any amounts received from the capital levy as authorized by law.

      (iii)  Any amounts received from the acquisition, operation, or
      maintenance of school services of a commercial nature which are entirely or
      predominantly self-supporting.

      (iv)  Any amounts received for the purpose of funding expenditures
      authorized in the event of destruction of or damage to the facilities of a
      school district as authorized by law.

      (v)  Any revenues derived from an additional state transaction privilege
      tax rate increment for educational purposes that was authorized by the voters
      before January 1, 2001.

      (vi)  Any amounts received pursuant to article XI, section 8,
      Constitution of Arizona, that are approved by the majority of qualified voters
      at a statewide general election held after November 1, 2002, and before
      January 1, 2003.

      (e)  "Student population" means the number of actual, full-time or the
      equivalent of actual full-time students enrolled in the school district or
      community college district determined in a manner prescribed by law.

      (5)  The economic estimates commission shall adjust the amount of
      expenditures of local revenues in fiscal year 1979-1980, as used to determine
      the expenditure limitation pursuant to subsection (1) or (2) of this section,
      to reflect subsequent transfers of all or any part of the cost of providing a
      governmental function, in a manner prescribed by law. The adjustment provided
      for in this subsection shall be used in determining the expenditure limitation
      pursuant to subsection (1) or (2) of this section beginning with the fiscal
      year immediately following the transfer.

      (6)  The economic estimates commission shall adjust the amount of
      expenditures of local revenues in fiscal year 1979-1980, as used to determine
      the expenditure limitation of a community college district pursuant to
      subsection (1) of this section, to reflect any subsequent annexation, creation
      of a new district, consolidation or change in the boundaries of a district, in
      a manner prescribed by law.  The adjustment provided for in this subsection
      shall be used in determining the expenditure limitation pursuant to subsection
      (1) of this section beginning with the fiscal year immediately following the
      annexation, creation of a new district, consolidation or change in the
      boundaries of a district.

      (7)  The legislature shall establish by law expenditure limitations for
      each school district beginning with the fiscal year beginning July 1,
      1980.  Expenditures by a school district in excess of such an expenditure
      limitation must be approved by a majority of the electors voting on the excess
      expenditures.

      (8)  The legislature shall establish by law a uniform reporting system
      for school districts and community college districts to ensure compliance with
      this section.  The legislature shall establish by law sanctions and penalties
      for failure to comply with this section.