JLBC - Monthly Fiscal Highlights

1716 W. Adams
Phoenix, AZ 85007
Phone:
(602) 926-5491
Fax:
(602) 926-5416

www.azleg.gov/jlbc.htm

“March was the
eighth
consecutive
month of yearover-year
growth in base
General Fund
revenue
collections…
these collections
were 4.5%
above last year.”

This report has been
prepared for the Arizona
Legislature by the Joint
Legislative Budget
Committee Staff on
April 28, 2011.

April 2011

Summary
March was the eighth consecutive month of
year-over-year growth in base General Fund
revenue collections. General Fund revenues
totaled $489.3 million. Excluding the
temporary 1-cent sales tax, these collections
were 4.5% above last year.
March collections potentially indicate positive
signs for the economy. In particular, base
sales tax collections (excluding the 1-cent
increase) were 6.8% above the prior year,
which represents the largest increase since
February 2007 (excluding a technical
adjustment made in April 2010).
In contrast, individual income tax collections
continue to be difficult to interpret as the
state is still processing refund checks and
depositing payments. The current forecast
projects refunds to increase overall in the
“refund season” (February - June) as
compared to the prior year due to
overwithholding by taxpayers. Year-to-date,
however, refunds have actually declined from
the prior year. Because April is a significant
refund and payment month, additional data
is needed to determine the ultimate trend in
individual income tax collections.

collections, the recently enacted FY 2011
budget revisions incorporated only $40 million
of the $108.5 million in establishing a new
budgeted revenue level.
In comparison to March revenue of $489.3
million, March 2011 General Fund spending
was $420.0 million, or $58.1 million above last
year. March expenditures were higher than
the prior year in part due to differences in the
timing of ADE reductions as compared to last
year.
Fiscal year-to-date, General Fund revenues of
$5.83 billion have been offset by $6.69 billion
in spending.
The state began FY 2011 with an operating
balance of $1.5 billion. The divergence of
revenues and spending year-to-date has
caused the operating fund balance to
decline to $825.1 million at the end of March.

March General Fund collections were $24.4
million above the January Baseline forecast.
Year-to-date, revenues are $108.5 million
above the January Baseline forecast. Of that
amount, $72.5 million is due to the individual
income tax and the remaining $36.0 million is
related to all other tax categories. Given the
uncertainty surrounding individual income tax

Table of Contents
Summary .................................................................. 1

JLBC Meeting........................................................... 8

March Revenues..................................................... 2

JCCR Meeting ......................................................... 8

Economic Indicators.............................................. 4

March Spending ..................................................... 9

FAC Meeting Summary ......................................... 7

2

JLBC – MONTHLY FISCAL HIGHLIGHTS – APRIL 2011

March Revenues
Table 1

General Fund Revenues ($ in Millions)

March
Year-to-Date

FY 2011
Collections
$ 489.3
$ 5,829.5

Sales Tax collections were $358.3 million in
March. Excluding the $70.6 million from the
temporary 1-cent increase, collections were
$287.7 million, or 6.8% above March 2010.
Table 2 displays the March growth rates for the
largest categories.
Table 2

Sales Tax Growth Rates
Compared to Prior Year

“[Base sales tax]
collections were
$287.7 million, or
6.8% above
March 2010”

Retail
Contracting
Utilities
Use
Restaurant & Bar

March
8.6%
15.6%
2.8%
(4.6)%
5.1%

YTD
3.0%
(8.0)%
0.9%
0.3%
3.2%

Retail and contracting together account for
about 60% of all sales tax revenues. Retail
collections were again very strong compared
to the same month last year, up 8.6%, or about
$11 million. Contracting was also strong
compared to March of last year; however,
losses earlier in the year continue to weigh
down the year-to-date growth.
Historically, Contracting has been the second
largest category. Since FY 2007, however,
Contracting revenues have declined by over
60%. FY 2010 was the first time in at least the
past 20 years that Contracting slipped from the
second position, falling just short of Utilities.
Since the start of FY 2011, Utilities collections
have exceeded Contracting 6 of the 9
months, making the year-to-date Utilities
collections $12.6 million, or 4.1% greater than
Contracting. For the past 2 months, Restaurant
& Bar collections have also exceeded
Contracting.
Including the 1-cent increase, collections were
$16.3 million above the forecast year-to-date.
Individual Income Tax net revenues were
$(4.6) million in March, as refunds exceeded
withholding and payments. Collections were
$16.9 million above the forecast. Year-to-date,
revenues have grown 13.0% and are $72.5
million above forecast through March.

Difference From
Forecast
$ 24.4
$ 108.5

Difference
From FY 2010
$ 86.3
$ 391.0

As indicated in Table 3 below, withholding tax
payments declined by (2.5)% in March for a
year-to-date increase of 5.9%. This increase
continues to be difficult to interpret due to
changes in the state withholding rates last
July. (See the August MFH for additional
information.)
Since job growth has been nearly flat, the
strong year-to-date withholding growth has led
us to believe that taxpayers were being
overwithheld as a result of the change in the
rates in July. If this were the case, refunds
would be expected to grow during tax season.
In March, however, refunds were actually
(5.4)% below the prior year and $36.0 million
less than the forecast amount, continuing the
trend from February. Given the significance of
April collections, we will need an additional
month of data before interpreting the results.
Table 3

Individual Income Tax Growth Rates
Compared to Prior Year

Withholding
Estimated +
Final Payments
Refunds

March
(2.5)%
6.4%
(5.4)%

YTD
5.9%
1.2%
(10.5)%

Corporate Income Tax net collections were
$51.2 million in March, or $(15.2) million below
the prior year. Collections were $(6.3) million
below the forecast. Year-to-date through
March, revenues are up 54.8% and are right at
forecast.
The Lottery Commission reports that March
ticket sales were $60.0 million, which is $4.5
million, or 8.2%, above sales in the prior year.
Year-to-date, ticket sales are $434.3 million,
which is 7.0% above last year’s sales. The
General Fund share of sales has increased
significantly more than overall sales, however,
due to changes in the distribution formula.
Non-General Fund
Tobacco Tax revenues were $27.6 million in
March. Collections were up 4.0% compared

3

JLBC – MONTHLY FISCAL HIGHLIGHTS – APRIL 2011

March Revenues

(Continued)

to the prior year, and were $(1.7) million
below the budget estimate for the month.
Year-to-date collections are down (1.3)% and
are $(0.4) million below the budget estimate.
Less than 10% of tobacco taxes are deposited
directly into the General Fund. The remainder
primarily goes to AHCCCS and the Department
of Health Services to defray the General Fund
cost of operating those programs, along with
funding the Early Childhood Development
and Health Board.

Highway User Revenue Fund (HURF) revenues
consist of gasoline and use fuel (diesel) tax,
motor carrier fees (commercial carriers),
vehicle license tax and registration fees, and
various other fees. HURF collections of $98.6
million in March were up $0.4 million or 0.4%
compared to March of last year. Year-todate, revenues have grown 1.6%.

Table 4

General Fund Revenue:
Change from Previous Year and Enacted Budget Forecast
March 2011
Current Month

FY 2011 YTD (Nine Months)

Change From
March 2010

Actual
March 2011

Percent

Amount

Change from
Forecast
Percent

Amount

March 2010

Actual
March 2011

Amount

Forecast
Percent

Percent

Amount

Taxes
Sales and Use w/o 1¢ *
Income - Individual
- Corporate
Property
Luxury - Tobacco
- Liquor
Insurance Premium
Estate
Other Taxes
Sub-Total Taxes

$287,692,472

$18,420,620

6.8 %

$11,150,280

$2,583,757,809

$45,579,445

(4,565,068)

14,244,787

--

16,947,063

(78.8)

2,004,351,585

230,011,982

13.0

72,463,550

3.8

51,246,697

(15,237,601)

(6,302,548)

(11.0)

324,518,625

114,832,251

54.8

35,358

0.0

(22.9)

4.0 %

1.8 %

$23,645,742

105,099

0.9 %

656,801

(9,274)

(1.4)

(43,199)

(6.2)

12,839,166

(224,866)

(1.7)

1,429,076

(1,009,140)

(41.4)

(1,126,679)

(44.1)

18,027,670

(1,252,778)

(6.5)

(3,164,897)

(14.9)

0.8

3,224,982

265,433

9.0

681,602

26.8

21,962,986

210,091

1.0

3,156,231

16.8

94,458,657

3,613,295

4.0

2,758,657

3.0

273,286,315

6,953,095

2.6

1,954,459

0.7

0

0

437,372

52,544

13.7

0

0.0

1,121,002

370,726

1,987,006

680,922

52.1

854,533

75.5

$435,264,619

$20,658,846

$5,241,168,534

$396,842,685

-49.4
5.0 %

0
998,502
$25,063,678

-815.1
6.1 %

8.2 %

$99,050,076

1.9 %

Other Revenue
Lottery

5,662,540

(1,217,660)

(17.7)

662,540

13.3

35,453,449

9,488,549

36.5

3,621,819

11.4

License, Fees and Permits

2,239,360

(433,529)

(16.2)

139,360

6.6

21,203,061

1,681,144

8.6

2,743,917

14.9

1,306,534

224.6

Interest

--

(284,174)

(98.0)

1,888,301

(1,241,700)

(39.7)

Sales and Services

1,876,546

(255,698)

(12.0)

(123,454)

(6.2)

21,809,097

(447,329)

(2.0)

3,389,430

18.4

Other Miscellaneous

3,260,981

145,060

4.7

(2,839,019)

(46.5)

19,234,238

(8,189,805)

(29.9)

(1,907,925)

(9.0)

0

0

--

--

27,146,306

27,146,306

202,124

425,229

--

(3,297,876)

(94.2)

15,099,604

(18,806,086)

(5,742,623)

(30.2) %

141,834,056

12,179,314

9.4 %

4.5 %

$5,383,002,590

$409,021,999

8.2 %

Disproportionate Share
Transfers and Reimbursements
Sub-Total Other Revenue
TOTAL BASE REVENUE

5,826

13,247,377
$448,511,996

71,113

(1,265,485)
$19,393,361

(8.7) %
4.5 %

0

$19,321,055

-(55.5)

0
(9,380,469)
(2,774,927)
$96,275,149

0.0
(38.3)
(1.9) %
1.8 %

Other Adjustments
Urban Revenue Sharing
1¢ TPT Increase*
Budget Plan Transfers
Leaseback Proceeds

(39,500,543)

12,886,509

--

0

0.0

(355,504,888)

115,978,581

--

0

70,646,937

70,646,937

--

5,106,437

7.8

614,565,441

614,565,441

--

12,222,024

2.0

9,647,264

(16,584,163)

(63.2)

0

0.0

187,445,346

(13,141,362)

(6.6)

0

0.0

(100.0)

0

0

0

(735,419,300)

40,793,658

66,949,283

-- %

5,106,437

14.3 %

446,505,899

(18,016,641)

$489,305,653

$86,342,644

21.4 %

$24,427,491

5.3 %

$5,829,508,489

Highway User Revenue Fund

$98,584,000

$374,000

0.4 %

($1,099,358)

(1.1) %

Tobacco Tax (All Funds Total)

$27,617,173

$1,062,752

4.0 %

($1,705,574)

(5.8) %

Sub-Total Other Adjustments
TOTAL GENERAL FUND REVENUE

--

0

--

0

0.0

--

(3.9) %

12,222,024

2.8 %

$391,005,359

7.2 %

$108,497,173

1.9 %

$897,140,000

$14,252,000

1.6 %

$1,008,727

0.1 %

$241,525,155

($3,125,892)

(1.3) %

Non-General Funds

($406,518)

(0.2) %

__________
* Sales and Use line excludes revenue from the temporary 1¢ increase approved by the voters in May 2010. That revenue is shown under One-Time Revenues. Total March collections including the 1¢ increase were
$358.3 million. This amount is $89.1 million, or 33.1%, above March 2009 and $16.3 million, or 4.8%, above forecast. Year to date, total collections including the 1¢ increase were $3.20 billion. This amount is $660.1
million, or 26.0%, above March 2009 and $35.9 million, or 1.1%, above forecast.

4

JLBC – MONTHLY FISCAL HIGHLIGHTS – APRIL 2011

Economic Indicators
NATIONAL

“There were
(319,000) fewer
payroll
employees last
month than
when
employment
peaked in
December 2007.
This represents a
net job loss of
(11.7)%.”

The Conference Board’s U.S. Consumer
Confidence Index increased by 1.6 points in
April to a reading of 65.4, following an (8.2)
point drop in the prior month. Survey
respondents’ assessment of both current and
future economic conditions improved.
Although the index has risen in 6 of the last 7
months, it still remains considerably below prerecession levels. It should be noted that a
recent change in the methodology
employed by the Conference Board makes
year-over-year comparisons difficult to
interpret.
The Conference Board’s U.S. Index of Leading
Economic Indicators rose 0.4% in March,
following a 1.0% increase in February,
indicating that the economy will continue to
grow in spite of rising fuel costs and falling
home prices. The leading index rose for the
9th consecutive month in March and is now
significantly above pre-recession levels. The
slight increase in March was primarily due to a
combination of slower delivery times
(indicating an increase in factory orders) and
increased building permitting activity.
Consumer prices, as measured by the U.S.
Consumer Price Index (CPI), rose by 0.5% in
March, following a 0.5% increase February.
These price increases come on top of the 0.4%
CPI increases in both January and December.
The sharp increase in the CPI over the last 4
months is primarily due to rising food and
gasoline prices. Year over year, the index is up
by 2.7%, the highest rate of inflation since
December 2009. Higher energy prices will likely
cause consumers to increasingly shift their
spending patterns away from non-essentials
towards necessities, such as food and gasoline.
Core inflation, which excludes food and
energy prices, remains subdued with a yearover-year increase of 1.2%.
ARIZONA
The Federal Reserve Bank of Philadelphia’s
coincident index gauges current economic
activity in each state. The index combines 4
indicators: employment, average hours
worked in manufacturing, unemployment rate,
and inflation-adjusted wages.
Arizona’s coincident index rose for the 6th
consecutive month in March. The month-overmonth increase of 0.3% was (0.1)% below the
national average. When compared to the

same month in the prior year, Arizona’s
coincident index was up by 0.7%, which was
significantly below the national average of
2.9%. There were only 3 states (Kansas,
Montana, and Nevada) with a lower yearover-year growth rate than Arizona. The
Arizona coincident index is currently more than
(13)% below its peak reading in August of 2007,
almost 3 times the national average decline for
the comparable period. See Tracking
Arizona’s Recovery for additional historical
information.
Employment
According to most recent Arizona Workforce
Employment Report, the state added 9,900
nonfarm jobs in March. This translates into a
month-over-month increase of 0.4%, or half of
the average gain for March in the 10-year
period prior to the last recession.
Statewide payroll employment in March was
up by 0.2%, or 5,000 jobs, compared to 1 year
ago. According to the Federal Bureau of
Labor Statistics, there were only 3 other states
with a lower year-over-year job growth in
March.
As reported last month, the March revision of
state employment data revealed that labor
market conditions in 2010 were considerably
worse than previously reported. Instead of
adding jobs between August and December
of 2010, the state shed an average of (22,000)
jobs per month over the same period.
January 2011 marked the first year-over-year
increase (700 jobs) in payroll employment
since January 2008. While February and
March job numbers were marginally better,
overall labor market conditions in the state
remain weak. There were (319,000) fewer
payroll employees last month than when
employment peaked in December 2007. This
represents a net job loss of (11.7)%. See
Tracking Arizona’s Recovery for additional
historical information.
While current conditions in the job market
remain weak, there are a couple of forwardlooking indicators that suggest that better days
lie ahead. First, the number of individuals filing
initial claims for unemployment insurance has
been trending down ever since October 2009.
This is generally considered a good sign, as a
decline of this measure typically indicates that
employers are shedding fewer workers than
previously. This phase is typically followed by a
gradual increase in payroll employment.

5

JLBC – MONTHLY FISCAL HIGHLIGHTS – APRIL 2011

Economic Indicators
In March, there were a total of 23,037 first-time
claims in the state, a (14.9)% decline over the
same month in the prior year. While this is a
significant improvement, the overall level of
initial jobless claims for the month of March is
still close to 50% above the pre-recession
average. Claims peaked in April 2009 when
more than 41,000 individuals filed for initial
jobless benefits. See Tracking Arizona’s
Recovery, for additional historical information.

“Year-over-year,
the number of

The other leading indicator that points to
increased hiring in the future is the average
work week of production employees in
manufacturing industries. “Factory hours”
tend to lead the business cycle as employers
typically adjust work hours before increasing
or decreasing the size of their workforce. This
measure has been trending up since reaching
a trough in August 2009, as seen in the graph
below.
Average Weekly Hours of Production Workers

TANF recipients

42.0

(47.5)%.”

Average Work Week

41.5

has declined by

41.0

(Continued)

area in March, there were a total of 11,055
existing single-family home sales that resulted
in a median resale home price of $128,825.
Relative to the prior year, the number of sales
is up 1.8%, while prices are (13.0)% lower. Of
the existing sales, 37.5%, or 4,145 were
foreclosures.
The number of new single family building
permits averaged 801 for the 3-month period
ending in March. This was a 20.8% increase
over the previous 3-month period (through
February) and was (31.5)% below the same
period last year. The number of single family
permits is (89.5)% below the peak of 7,648
average permits issued for the June, July, and
August 2004 3-month period.
State Agency Data
In April AHCCCS caseloads equaled 1.34
million members, a (0.1)% decrease over the
prior month. AHCCCS caseloads are currently
(1.4)% below April 2010 levels. Total enrollment
reached its peak in June 2010, and has
declined slowly since then.

40.5
40.0
39.5
39.0
38.5
38.0
37.5
Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11

According to the Federal Bureau of Labor
Statistics, the average work week in March
was 40.6 hours, a 1.0% increase over the prior
month, and a 3.6% improvement since March
2010. This figure matches the average work
for March in the 5-year period leading up to
the 2007-2009 recession. The state’s
manufacturing sector has added jobs in 5 of
the last 6 months.
Housing
In March, the number of new Maricopa
County foreclosure notices increased 11.6%
from February levels to 5,692. The number of
Maricopa County pending foreclosures
decreased in March. The March total of
35,495 is (31.0)% below the peak in December
2009 (51,466). See Tracking Arizona’s Recovery
for additional historical information.
While foreclosure notices and pending
foreclosures continue their decline from
recent highs, they continue to be a major
influence on existing home sales and the
respective prices. In the Metropolitan Phoenix

There were 41,389 TANF recipients in the state
in March, a monthly caseload decrease of
(2.2)%. Year-over-year, the number of TANF
recipients has declined by (47.5)%. This
decline is the result of changes to the
statutory lifetime limit a person may receive
cash assistance. Beginning in July 2010,
recipients can only receive benefits for a
maximum of 36 months in a lifetime. The FY
2012 budget further reduces this limit to 24
months. Previously, the maximum had been
60 months. The FY 2011 budget assumed
caseloads of approximately 70,000 in FY 2011.
The Supplemental Nutrition Assistance
Program (SNAP), formerly known as Food
Stamps, provides assistance to low-income
households to purchase food. In March, there
were a total 1.1 million food stamp recipients
in the state, a 0.4% increase over the prior
month. Compared to the same month last
year, food stamp participation was up by
1.7%. The number of food stamp recipients
began increasing steadily in July 2007, after
several years in the 550,000 to 575,000 range.
The 3-month average count of the Department
of Correction’s (ADC) inmate population
declined to 40,070 inmates between February
and April 2011. Relative to the prior period, the
population has increased by 7 inmates, and
compared to a year ago the population has
declined by (394) inmates.

6

JLBC – MONTHLY FISCAL HIGHLIGHTS – APRIL 2011

Economic Indicators

(Continued)

Table 5

ECONOMIC INDICATORS
Indicator
Arizona
- Unemployment Rate (SA)
- Initial Unemployment Insurance Claims
- Unemployment Insurance Claimants
- Non-Farm Employment - Total
Manufacturing
Construction
- Average Weekly Hours, Manufacturing
- Contracting Tax Receipts (3-month average)
- Retail Sales Tax Receipts (3-month average)
- Residential Building Permits (3-month moving average)
Single-family
Multi-unit
- Greater Phoenix Existing Home Sales
Single-Family
Townhouse/Condominium
- Greater Phoenix Median Resale Home Price
Single-Family
Townhouse/Condominium
- Foreclosure Activity, Maricopa County
Foreclosure Notices (Notice of Trustee’s Sales Recorded)
Pending Foreclosures (Active Notices)
Greater Phoenix S&P/Case-Shiller Home Price Index
(Jan. 2000 = 100)
- Arizona Months Supply of Housing, (ARMLS)
- Phoenix Sky Harbor Air Passengers
- Arizona Average Natural Gas Price
($ per thousand cubic feet)
- Arizona Consumer Confidence Index (1985 = 100)
- Arizona Coincident Index (July 1992 = 100)
- Arizona Personal Income
- Arizona Population
- AHCCCS Recipients
- TANF Recipients
- SNAP (Food Stamps) Recipients
- ADC Inmate Growth (3-month average)
- Probation Caseload (Adult/Juvenile)
Non-Maricopa
Maricopa County
United States
- Gross Domestic Product
(Chained 2005 dollars, SAAR)
- Consumer Confidence Index (1985 = 100)
- Leading Indicators Index (2004 = 100)
- U.S. Semiconductor Billings (3-month moving average)
- Consumer Price Index, SA (1982-84 = 100)
*Adjusted for 1¢ sales tax

Time Period

Current Value

Change From
Prior Period

Change From
Prior Year

March
March
February
March
March
March
March
Jan-Mar
Jan-Mar

9.5%
23,037
63,322
2.40 million
149,100
107,200
40.6
$31.2 million
$151.4 million

(0.1)%
15.9%
(8.4)%
0.4%
0.5%
1.9%
1.0%
0.9%
(0.4)%

(0.6)%
(14.9)%
(31.7)%
0.2%
0.7%
(2.5)%
3.6%
9.1%*
7.3%*

Jan-Mar
Jan-Mar

801
197

20.8%
3.3%

(31.5)%
8.0%

March
March

11,055
1,785

29.1%
22.3%

1.8%
1.4%

March
March

$128,825
$85,000

(3.2)%
0.0%

(13.0)%
(15.0)%

March
March
February

5,692
35,495
100.81

11.6%
(9.3)%
(0.7)%

(29.2)%
(27.7)%
(8.4)%

March
February
December

3.8 months
2.98 million
$6.64

1st Quarter 2011
March
4th Quarter 2010
April 1, 2010
April
March
March
Feb-April

62.8
179.08
$226.7 billion
6.39 million
1,338,013
41,389
1,070,156
40,070

11.5%
0.3%
1.1%
N/A
(0.1)%
(2.2)%
0.4%
7 inmates

25.1%
0.7%
3.3%
N/A
(1.4)%
(47.5)%
1.7%
(394) inmates

February
February

19,077
26,066

(450)
(46)

(629)
(2,852)

4th Quarter 2010
(Final Estimate)
April
March
Dec-Feb
March

$13.4 trillion

3.1%

2.8%

65.4
114.1
$4.68 billion
223.49

2.5%
0.4%
(0.5)%
0.5%

13.3%
5.1%
26.6%
2.7%

(1.9) months
(8.7)%
10.5%

(1.0) months
2.6%
(0.7)%

7

JLBC – MONTHLY FISCAL HIGHLIGHTS – APRIL 2011

FAC Meeting
At its April 13, 2011 meeting, the Finance
Advisory Committee (FAC) heard
presentations on General Fund Revenue
collections, the U.S. economy, and state cash
flows. See FAC Meeting Packet for additional
information
JLBC Staff provided members with the latest
4-sector consensus estimates for the “Big 3”
revenue collections. The 4-sector consensus
estimate is a composite of equally weighted
estimates from:
• The University of Arizona Economic and
Business Research (EBR) General Fund
baseline model;
• The EBR conservative forecast model;
• The FAC panel; and
• JLBC Staff.
For FY 2011, base revenue collections are
expected to grow 5.6%, compared to the FY
2011 budgeted rate of 5.7%.
The 4-sector consensus forecast projects base
revenue growth of 4.2% in FY 2012. The
conservative forecast model, which
represents a “worst case scenario”, predicted
a double-dip recession and a decline in
General Fund revenues. FAC panelists
generally believed that this scenario was
unlikely.
Excluding the conservative forecast, General
Fund revenues were projected to grow by
6.0%, compared to the FY 2012 budgeted
rate of 5.7%.
JLBC Staff outlined the enacted FY 2012
budget which was approved in earlier in April.
In addition to the JLBC Staff presentation,
panel members heard formal presentations
from economist Jim Rounds and the State
Treasurer, Doug Ducey. The presenters and
FAC panelists generally believed that the
recession has ended in Arizona, but there
were still concerns about how the recovery
could be more prolonged than previously
predicted.

8

JLBC – MONTHLY FISCAL HIGHLIGHTS – APRIL 2011

JLBC Meeting
At its April 14, 2011 meeting, the Joint
Legislative Budget Committee considered the
following issues:
Land Department – Review of Establishing
Fees in Rule – The Committee gave a
favorable review of the State Land
Department’s request to establish its current
statutory fees in rule as required by recent
legislation.
School Facilities Board – Approval of Index for
School Facilities Board (SFB) Construction
Costs – The Committee approved a 0%
adjustment in the cost-per-square-foot factors
used in SFB funding formulas based on the
latest 1-year change in the Rider Levett
Bucknall national construction cost index.
Attorney General – Review of Allocation of
Settlement Monies – The Committee gave a

favorable review of a total of $6,206,800 from
5 settlements: 1) a $3,471,900 settlement
resulting from an agreement with Wells Fargo
Bank as a result of alleged misrepresentation
in the marketing of adjustable rate
mortgages; 2) a $1,500,000 settlement from a
consent judgment with Home Loan Center as
a result of alleged misrepresentation in the
marketing of adjustable rate mortgages; 3) a
$188,800 settlement from a consent judgment
with Amerix Corp, as a result of alleged
deceptive practices while offering and selling
debt management services; 4) a $861,100
settlement from a consent judgment with
Dannon Co, as a result of alleged misleading
product advertising; and 5) a $185,000
settlement from a consent judgment with
DirecTV Inc., as a result of alleged misleading
advertising.

JCCR Meeting
At its April 19, 2011 meeting, the Joint
Committee on Capital Review considered the
following issues:
Arizona State University – Review of Housing
Indirect Financing and Dining Bond Projects –
The Committee gave a favorable review of
the university’s request to enter into ground
leases with 2 private entities to renovate 2
dorms at the Tempe campus and to build a
new dorm at each of the West and East
campuses, at a cost of $99.5 million. The
Committee also gave a favorable review of
the university’s request to issue a $17.7 million
revenue bond to build a new dining hall
facility at each of the West and East
campuses.
Northern Arizona University – Review of
Housing Indirect Financing Projects – The
Committee gave a favorable review of the
university’s request to enter into a ground
lease with a private entity to build 2 new
dorms at its Flagstaff campus, at a cost of
$68.0 million.
Maricopa County Community College District
– Review of General Obligation Bond
Issuance – The Committee gave a favorable
review of the district’s request to issue a $150
million General Obligation bond, which is the
fourth issuance of a 5 series bonding package
totaling $951.4 million approved by voters in

2004. The favorable review includes the
following 2 provisions: 1) the district will seek
Committee review before using any portion
from the bond issuance for any project not
previously reviewed by the Committee, and
2) the district will report to the Committee on
updated project costs when they return for
review of their fifth issuance.
Arizona Department of Administration –
FY 2011 Partial Rent Exemptions and FY 2012 –
FY 2013 Rent Payments – The Committee
recommended the proposed FY 2011 partial
rent exemptions for the Department of
Corrections, State Parks Board, Secretary of
State, and Governor’s Office and the FY 2012
and FY 2013 quarterly payment plan for the
State Board of Technical Registration.
Arizona State Lottery Commission – Review of
FY 2011 Building Renewal Allocation Plan –
The Committee gave a favorable review to
the commission’s $75,600 FY 2011 Building
Renewal Allocation Plan to be spent on a
replacement generator, updated
uninterruptible power supply system, and
damaged light pole.

9

JLBC – MONTHLY FISCAL HIGHLIGHTS – APRIL 2011

March Spending
“March 2011
spending of
$420.0 million
was $58.1 million
higher than

March 2011 General Fund spending was
$420.0 million. March expenditures were
higher than the prior year in part due to
differences in the timing of soft capital
reductions compared to the prior year.

•

FY 2011 Spending
March 2011 spending of $420.0 million was
$58.1 million higher than March 2010 (See
Table 2).

•

March 2010.”

•

•

In March, the Arizona Department of
Education spending was $37.2 million
higher than the prior year. March
expenditures were greater due to the
timing of soft capital reductions
compared to the prior year.
University spending was $56.9 million in
March, or $(16.9) million lower than the

prior year. The decreased expenditure
amount reflects the rollover being spread
out over the course of the fiscal year.
Department of Economic Security
spending was $57.8 million higher than
March of the prior year. The increased
expenditures amount is due to the prior
year expenditures being artificially
decreased because of operating
transfers among the agency’s funds.
In March, Department of Health Services
(DHS) spending was $21.8 million, or
$(31.1) million lower than the prior year.
The decreased expenditure amount
reflects a difference in the timing of
transfers to AHCCCS for the Medicaid
state match in the behavioral health
program compared to the prior year.

Table 6
General Fund Spending ($ in Millions)

Agency
AHCCCS
Corrections
Economic
Security
Education
Health Services
Public Safety
School Facilities
Board
Universities
Leaseback Debt
Service
Other
Total

Mar 11

Change
from
Mar 10

Year to
Date

129.5
59.2
29.5

20.1
(11.0)
57.8

1,143.8
651.2
492.6

86.9
14.3
13.9

96.2
21.8
1.6
0.1

37.2
(31.1)
(0.4)
-

2,680.5
401.9
35.1
67.1

(379.1)
(53.6)
(7.0)
(36.9)

56.9
-

(16.9)
-

721.3
52.1

(60.9)
52.1

25.2
420.0

2.4
58.1

448.7
6,694.3

(46.5)
(416.8)

YTD Change
from FY 10

10

JLBC – MONTHLY FISCAL HIGHLIGHTS – APRIL 2011

Table 7

Agency
Department of Administration
Department of Admin Sale/Leaseback D/S
Office of Administrative Hearings
Department of Agriculture
AHCCCS
Arizona Commission on the Arts
Attorney General
AZ Capital Post Conviction Public
Defender
State Board of Charter Schools
Board of Chiropractic Examiners
Department of Commerce
Community Colleges
Corporation Commission
Department of Corrections
Board of Cosmetology
AZ Criminal Justice Commission
AZ State Schools for the Deaf & Blind
Department of Economic Security
Department of Education
DEMA
Department. of Environmental Quality
DEQ – WQARF
Office of Equal Opportunity
State Board of Equalization
Board of Executive Clemency
Department of Financial Institutions
Department of Fire, Life, Bldg Safety
Office of the State Forrester
Board of Funeral Directors
Arizona Geological Survey
Government Information Tech.
Governor
Gov. - OSPB
Department of Health Services
Arizona Historical Society
Prescott Historical Society of AZ
Independent Redistricting Comm.
Commission on Indian Affairs
Department of Insurance
Judiciary
Supreme Court
Superior Court
Court of Appeals
Department of Juvenile Corrections
State Land Department

General Fund Spending
($ in Thousands)
Change from
March 11
March 10
1,661.0
804.8
1.4
(0.2)
650.1
144.4
129,450.3
20,118.3
46.0
(46.7)
1,007.3
270.4
51.5
35.5

Year-to-Date
16,185.0
52,066.9
665.3
6,588.7
1,143,781.2
495.4
12,794.3
527.9

YTD Change from
FY 10
2,657.0
52,066.9
(6.3)
(249.5)
86,943.1
(160.8)
(1,507.2)
54.2

26.7
83.2
30.7
59,195.8
1,056.0
29,469.0
96,152.4
707.2
9.3
17.5
62.6
149.6
118.4
39.1
41.5
39.0
98.8
73.6
21,830.2
170.0
24.3
0.7
1.5
345.0

(13.7)
34.5
(4.7)
(10,958.1)
811.4
57,820.0
37,218.6
(190.2)
(330.2)
9.2
(2.8)
19.0
30.2
41.0
39.1
31.4
4.9
(366.6)
(48.1)
(31,062.0)
93.3
(11.0)
0.7
(4.3)
39.4

552.2
2,896.6
99,319.7
467.3
651,245.6
16,090.4
492,602.4
2,680,536.1
8,455.1
0.6
7,000.0
138.5
467.8
682.2
2,099.7
1,642.1
1,996.2
541.2
381.2
4,880.3
1,414.3
401,944.2
4,771.3
563.7
0.7
46.5
4,406.8

(9.4)
(148.0)
480.0
53.5
14,322.4
(252.0)
4.6
783.2
13,875.6
(379,090.3)
1,510.6
(4,126.8)
(18.5)
(9.2)
(77.5)
(380.1)
(186.0)
1,996.2
(100.0)
(65.5)
29.8
(1,036.4)
(132.7)
(53,629.5)
1,573.4
21.1
(25.4)
(30.4)
(88.8)

655.2
8,386.0
586.1
2,182.2
132.3

48.8
6,525.4
208.3
(719.2)
1,299.5

15,990.6
55,824.5
11,305.7
40,410.6
2,473.6

2,462.4
(7,722.6)
762.4
(10,353.2)
(8,166.5)

11

JLBC – MONTHLY FISCAL HIGHLIGHTS – APRIL 2011

Agency
Law Enforcement Merit System
Legislature
Auditor General
House of Representatives
Joint Legislative Budget Comm.
Legislative Council
Senate
Department of Liquor Licenses
Board of Medical Student Loans
Mine Inspector
Department of Mines & Mineral Resources
Nav. Streams & Adjudication
OSHA
Arizona State Parks Board
Pioneers’ Home
Board of Psychologist Examiners
Comm. for Postsecondary Ed.
Department of Public Safety
Arizona Department of Racing
Radiation Regulatory Agency
Arizona Rangers Pension
Real Estate Department
Department of Revenue
School Facilities Board
Secretary of State
Tax Appeals Board
Office of Tourism
Department of Transportation
State Treasurer
Universities
Board of Regents
Arizona State University
Northern Arizona University
University of Arizona
Veterinary Medical Examiners Board
Department of Veteran Services
Department of Water Resources
Department of Weights & Measures
Other
Grand Total

March 11
4.0

Change from
March 10
3.9

Year-to-Date
55.0

YTD Change from
FY 10
(0.6)

1,062.0
848.4
113.1
271.2
593.4
16.9
64.6
8.6
4.9
196.7
0.5
1,631.7
109.5
154.9
1,830.8
65.7
803.5
15.4
0.9
-

(93.2)
(19.7)
(27.6)
(23.4)
(5.5)
(7.1)
16.9
(13.7)
(146.0)
(1.2)
196.7
(175.4)
(394.6)
77.4
(1.0)
20.7
(2,425.4)
40.4
(2,955.0)
5.0
(1.8)
(136.8)

13,339.2
9,296.4
1,603.1
3,351.3
6,571.3
3.3
360.7
863.2
815.8
106.6
20,000.0
1,181.1
25.0
610.4
35,070.4
3,540.8
1,031.3
8.2
2,208.7
31,311.3
67,094.0
12,112.2
199.9
37.4
-

1,916.0
(349.6)
(201.0)
(315.7)
(260.1)
(744.4)
(441.2)
(152.1)
208.7
0.6
(14.4)
(1,900.3)
1,184.1
(275.0)
(1,817.0)
(7,040.2)
(525.7)
(40.0)
(2.1)
(345.3)
4,765.5
(36,890.8)
1,444.4
1.6
(200.0)
(5.3)
(2,044.8)

802.0
25,435.6
8,551.9
22,135.0
69.4
403.3
61.0
188.7
419,995.1

695.8
(7,999.6)
(2,668.3)
(6,906.4)
(671.3)
(397.6)
50.0
213.6
58,140.1

16,555.7
319,185.6
107,460.9
278,144.4
9,299.5
5,189.9
833.2
2,537.3
6,694,255.5

(3,365.7)
(26,049.1)
(8,761.9)
(22,688.9)
(250.0)
2,368.8
(7,776.3)
(45.5)
(18,238.7)
(416,828.2)