Arizona Legislature Approves the FY22 Budget

July 1, 2021
State Relations

 

The Arizona Legislature Approves the FY22 Budget

On June 30, 2021 Governor Ducey signed the fiscal year 2022 state budget. The budget enacts $12.8 billion in spending, including a significant investment in higher education. Additionally, the budget reflects a major change in Arizona tax policy that shifts the state’s multi-tier income tax rate into a two-rate system for 2022:  2.55% for individuals who make up to $27,272 in taxable income and $2.98% for individuals who make more than that amount. If Arizona’s economy continues to grow the rates will be further reduced to 2.5% for all Arizonans. More details on the tax plan can be found here.  As in previous years, the budget passed along party lines with Republicans providing the needed 31 votes in the House and 16 votes in the Senate.

 

Investment in Arizona’s Public University System

The FY22 budget includes an additional $138 million ($92.65 million on-going/$45.65 million one-time) to Arizona’s three public universities. The University of Arizona will receive $31.8 million in on-going funding and $15.1 million in one-time funding.  Most of the new dollars go toward the New Economy Initiative (NEI), which provides funding to develop a skilled workforce and enhance economic opportunities. Highlights of UA's funding is detailed below:

 

New Economy Initiative (NEI) Funding - $19.2M on-going/$13.2M one-time

Appropriates $19.2 million on-going and $13.2 million one-time to fund UA New Economy Initiatives priorities including health sciences, engineering, and space and defense.  

 

School of Mining - $4M on-going

Appropriates $4 million on-going to establish a School of Mining.

 

Health Insurance Trust Funding (HITF) - $5.9M on-going

Appropriates $5.9 million on-going to backfill the HITF deduction from FY21.

 

Natural Resources Users Law and Policy Center - $500K on-going

Appropriates $500,000 on-going to the UA Natural Resources Users Law and Policy Center to provide pro bono legal expertise to small landowner claimants in general stream adjudication of water rights.

 

UA Center for the Philosophy of Freedom - $1.25M one-time

Appropriates $1,250,000 to the UA Center for the Philosophy of Freedom.

 

Agriculture Workforce Program - $500K one-time

Appropriates $500,000 one-time to the UA Cooperative Extension Office to establish a program that will provide incentives to food-producing agricultural organizations to hire apprentices. 

 

Arizona Promise Scholarship - $7.5M on-going

Appropriates $7.5 million on-going to the Arizona Board of Regents to establish and administer an Arizona Promise Scholarship program.

  • Subject to funding available, the promise program allows eligible students pursuing a baccalaureate degree at ASU, NAU & UA to receive a scholarship equal to the actual cost of tuition and fees after financial aid.
  • Students may receive the scholarship for up to 8 academic semesters.
  • To be eligible a student must:
    • Qualify for resident tuition.
    • Graduate from an AZ high school with a 2.5 GPA.
    • Maintain full enrollment status.
    • Complete and submit the Free Application for Federal Student Aid.

 

COVID-19 Vaccination Prohibition; Exception Language

The FY22 budget includes statutory language related to the COVID-19 vaccination that does the following:

  • Prohibits a university from mandating a student receive a COVID-19 vaccine or show proof of a vaccine to participate in class or academic services.
  • Prohibits a university from mandating testing or mask usage based on student vaccination status or willingness to disclose vaccination status.
  • Allows health screening and testing mandates and proof of vaccination for students in clinical settings at a healthcare institution (hospitals, nursing care home, residential care institutions, intermediate care institutions, facilities for individuals with intellectual disabilities, group homes or other medical facilities).
  • Allows a university to mandate testing only if there is a significant outbreak as determined by ADHS.
  • Allows a university to mandate a student receive a COVID-19 vaccination if they are engaged in research or testing activities that involved handling live COVID-19 virus.