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

Summary
December General Fund revenue collections
totaled $883.2 million. Base revenues, which
exclude one-time adjustments, were 2.0%
above the prior year.
The lower growth in December revenues was
the result of 2 contrasting factors. First,
Individual Income withholding showed a large
gain, however this was due mostly to
technical timing issues.

www.azleg.gov/jlbc.htm

“Year-to-date,
revenues are
3.6% higher than
last year and are
$32.3 million

January 2013

In contrast, Corporate Income Tax refunds
were significantly larger than the prior year,
and receipts paid by corporations declined in
December.
Overall December sales tax collections, which
reflect November sales, increased by 5.1%
compared to the prior year. The bulk of
holiday sales will be reflected in January
collections, which should provide further
information on revenue performance during
this significant period of tax collections.

In comparison to revenue of $883.2 million,
December 2012 General Fund spending was
$561.6 million, or $(8.4) million below last year.
December expenditures were lower than last
year primarily due to decreased enrollment in
the Medicaid program.
Fiscal year-to-date, General Fund revenues of
$4.5 billion have been offset by $5.4 billion in
spending.
The state’s fiscal health can also be measured
by the operating fund balance. The state
pays its bills out of the operating fund
balance, which consists of the General Fund
and certain dedicated funds. As of midJanuary 2013, the operating balance is $1.8
billion.
In addition, the state has $451.8 million in
Budget Stabilization Fund reserves, which
represents an original $450 million deposited
as part of the FY 2013 budget plus $1.8 million
of interest earned.

Total December General Fund collections
were $13.2 million above the enacted May
budget forecast. Year-to-date, revenues are
3.6% higher than last year and are
$32.3 million above the budget forecast.

above the
budget
forecast.”

Table of Contents
Summary.................................................................. 1
December Revenues............................................. 2
Economic Indicators.............................................. 4
Summary of Recent Agency Reports

This report has been
prepared for the Arizona
Legislature by the Joint
Legislative Budget
Committee Staff on
January 18, 2013.

• AHCCCS/DHS – Reconciliation Report ........... 7
• Comm. Colleges – Annual Report................... 7
• Comm. Colleges – Report on Workforce

Development ..................................................... 7

• ACJC – Report on Criminal Justice

Enhancement Fund ........................................... 7
• DES – Domestic Violence Funding................... 7
• SFB – Funding Estimates ..................................... 7
• Universities – Financial Aid Report ................... 8
• Public Program Eligibility Report ...................... 8
• PSPRS – Funding Status Report ......................... 8

December Spending ............................................. 9
Tracking Arizona’s Recovery.............Appendix A

2

JLBC – MONTHLY FISCAL HIGHLIGHTS – JANUARY 2013

December Revenues
Table 1

December
Year-to-Date

General Fund Revenues ($ in Millions)
FY 2013
Collections
$ 883.2
$ 4,493.5

Sales Tax collections of $386.7 million were 5.1%
above December 2011 and $8.8 million above
the budget forecast for the month.
Year-to-date, sales tax collections are 4.7%
above the prior year and are $28.4 million above
forecast.
“Sales Tax
collections of
$386.7 million
were 5.1%
above
December
2011 and $8.8
million above
the budget
forecast for the
month.”

Table 2 displays the December growth rates for
the largest categories.
Table 2

Sales Tax Growth Rates
Compared to Prior Year

Retail
Contracting
Utilities
Use
Restaurant & Bar

December
6.8%
7.0%
(3.5)%
(2.5)%
4.2%

YTD
5.7%
3.2%
3.7%
(0.4)%
6.7%

Retail and contracting together account for
almost 60% of all sales tax revenues. December
retail, which reflects November sales, increased
by 6.8%. The December increase brings retail
collections for the first half of FY 2013 up to 5.7%,
compared to a 6.8% growth rate for the first half
of FY 2012.
Overall, the retail category grew by 5.0% in FY
2012 compared to the prior year. With the
December growth rate of 6.8%, the year-todate growth rate of 5.7% continues to exceed
last year’s retail growth rate.
Contracting collections have been much more
volatile than retail, but also increased by 7.0%
this month. Four of the first six months of FY 2013
have shown positive growth in the contracting
category. The December increase brings the
year-to-date increase in contracting to 3.2%.
Individual Income Tax net revenues were $410.2
million in December, or 16.4% more than the prior
year. Collections were $29.6 million, or 7.8%
above the budget forecast. Year-to-date,

Difference From
Budget Forecast
$ 13.2
$ 32.3

Difference
From FY 2012
$ (20.6)
$ (34.9)

revenues have grown 7.6% and are $60.5 million
above forecast.
The large December increase relative to the
forecast was primarily the result of greater than
anticipated withholding tax collections. The
increase in withholding may be the result of one
more collection day in December compared to
last year. Collections will likely smooth out by
the end of January, which has one less
collection day compared to January of the
prior year.
As indicated in Table 3, withholding was up
13.6% in December. The December increase
brings withholding tax collections for the first half
of the fiscal year to 5.4%. This amount is $18.1
million above the budget forecast.
Total estimated and final payments of $72.6
million were 30.2% above last year, and were
$3.2 million, or 4.6% above forecast. For the first
half of the fiscal year, payments are $(3.8)
million below the forecast.
Refunds of $(2.2) million were $1.4 million less
than last year’s amount. Year-to-date, refunds
are $46.1 million below forecast.
Table 3

Individual Income Tax Growth Rates
Compared to Prior Year

Withholding
Estimated +
Final Payments
Refunds

December
`13.6%
30.2%
(9.0)%

YTD
5.4%
13.7%
(8.1)%

Corporate Income Tax net collections were $95.0
million in December, which is $(34.8) million less
than the prior year’s net collections of $129.8
million. December corporate income tax
collections are typically one of the larger
collection months. Collections for the month
were $(22.4) million below the forecast. Year- todate, collections are down (8.3)% and are $(24.8)
million below forecast.

3

JLBC – MONTHLY FISCAL HIGHLIGHTS – JANUARY 2013

December Revenues (Continued)
Non-General Fund

The Lottery Commission reports that December ticket
sales were $52.9 million, which is $(1.7) million, or (3.2)%,
less than sales in the prior year. Year-to-date ticket sales
are $324.3 million, which is 10.7% above last year’s sales.
While sales increased, net General Fund revenues
actually declined due to an increase in the payment of
debt service for the Lottery Revenue Bonds issued in FY
2010.

Table 4

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 $101.8 million in December were up
$253,400, or 0.2%, compared to December of last year.
Year-to-date revenues are approximately equal to
collections in the prior year.

General Fund Revenue:
Change from Previous Year and Enacted May Budget Forecast
December 2012
Current Month

FY 2013 YTD (Six Months)

Change From
Actual

December 2011

December 2012

Amount

Change from
Actual

Budget Forecast

Percent

Amount

Percent

December 2011

December 2012

Amount

Budget Forecast

Percent

Amount

Percent

Taxes
Sales and Use - Base*

$308,624,715

$14,344,748

$1,861,103,164

$77,417,048

4.3 %

$5,265,901

0.3 %

78,080,670

4,430,828

6.0

4,205,591

5.7

467,347,668

26,355,270

6.0

23,161,442

5.2

410,181,568

57,832,784

16.4

29,586,904

7.8

1,857,129,476

131,199,271

7.6

60,462,897

3.4

95,002,909

(34,823,191)

(26.8)

(22,392,920)

(19.1)

295,309,749

(26,766,000)

(8.3)

(24,809,145)

(7.7)

Property

2,582,891

(664,129)

(20.5)

(917,109)

(26.2)

7,610,282

(1,490,016)

(16.4)

(2,264,718)

(22.9)

Luxury - Tobacco

2,200,295

649,273

41.9

0

0.0

11,809,255

(2,011,406)

(14.6)

(1,656,300)

(12.3)

2,489,900

(301,532)

(10.8)

0

0.0

14,614,500

15,984,361

(20,166,293)

(55.8)

(0.1)

131,485,514

(28,216,546)

(17.7)

--

0

(200,825)

(100.0)

(48.8)

240,447

(22,081)

(8.4)

- 1¢ Increase*
Income - Individual
- Corporate

- Liquor
Insurance Premium
Estate
Other Taxes
Sub-Total Taxes

0
30,732
$915,178,041

0
(4,492)
$21,297,996

4.9 %

-(12.8)
2.4 %

$4,606,392

(15,639)
0
(29,268)
$15,043,951

1.5 %

1.7 %

$4,646,650,055

885,815

$177,150,530

6.5

4.0 %

484,008
(7,514,486)

3.4
(5.4)

0
(119,553)
$53,010,046

-(33.2)
1.2 %

Other Revenue
Lottery

5,624,540

(102,300)

(1.8)

624,540

12.5

17,048,200

(7,378,800)

(30.2)

License, Fees and Permits

2,698,835

(553,566)

(17.0)

198,835

8.0

15,356,063

1,004,748

7.0

(143,937)

(0.9)

1,468

(2,061,396)

(99.9)

(2,081,970)

(99.4)

(47,355)

(78.9)

4.3

(6,328,508)

(43.6)

(12.6)

(2,938,842)

(17.3)

Interest
Sales and Services

1,328,242

99,701

8.1

Other Miscellaneous

2,391,724

1,433,248

149.5

0

0

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

(1,839,211)
$10,205,598
$925,383,639

(1,902,715)
($3,087,028)
$18,210,968

--(23.2) %
2.0 %

(8,532)

(85.3)

(1,171,758)

(46.9)

8,171,492

59.4

14,061,158

891,724
0
(2,339,211)
($1,804,402)
$13,239,549

12,645

--

0

--

7,157,211

(15.0) %

$61,806,769

1.5 %

$4,708,456,823

336,394
(2,022,790)
0
(4,352,081)
($14,494,499)
$162,656,030

-(37.8)
(19.0) %
3.6 %

(5,951,800)

(25.9)

0
(5,342,789)
($20,753,231)
$32,256,814

-(42.7)
(25.1) %
0.7 %

Other Adjustments
Urban Revenue Sharing
Budget Plan Transfers
Sub-Total Other Adjustments
TOTAL GENERAL FUND REVENUE

(42,798,670)
589,363
(42,209,307)
$883,174,332

(7,430,050)

21.0

0

0.0

(256,792,020)

(44,580,300)

21.0

0

(31,333,493)

(98.2)

0

0.0

41,796,914

(140,065,163)

(77.0)

0

(214,995,106)

(197,512,891)

-- %

0

(0.0) %

($34,856,860)

(0.8) %

$32,256,815

0.7 %

(38,763,543)

-- %

0

0.0 %

($20,552,575)

(2.3) %

$13,239,549

1.5 %

$4,493,461,718

(0.3) %

$591,795,271

0.0
0.0

Non-General Funds
Highway User Revenue Fund

$101,775,581

$253,372

0.2 %

($355,761)

$259,633

0.0 %

($6,229,662)

(1.0) %

* Total December collections including the temporary 1¢ increase approved by the voters in May 2010 were $386.7 million. This amount is $18.8 million, or 5.1%, above December 2011 and $8.8 million, or 2.3%, above
forecast.

4

JLBC – MONTHLY FISCAL HIGHLIGHTS – JANUARY 2013

Recent Economic Indicators

“The Conference
Board’s U.S.
Consumer
Confidence
Index fell (9.0)%
in December…
largely due to
consumer fears
about future
impacts of going
over the ‘fiscal
cliff.’”

NATIONAL

See Appendix A – Tracking Arizona’s Recovery
for additional historical information.

The Conference Board’s U.S. Consumer
Confidence Index fell (9.0)% in December,
bringing the indicator’s year-over-year growth
down to 0.5%. The index’s drop was largely due
to consumer fears about future impacts of
going over the “fiscal cliff”. In December, the
measure’s sub-index for confidence in
economic conditions 6 months into the future
dropped (17.8)%. Congress’ recent action to
avert the most austere changes of the cliff may
help restore some of the lost confidence in
coming months.

The Federal Reserve Bank of Philadelphia also
publishes a leading index for each state that
forecasts economic conditions for the next 6
months. In addition to the coincident index,
Arizona’s leading index is based on Arizona
housing permits, Arizona initial unemployment
insurance claims, national manufacturing
delivery times, and the interest rate spread
between the 3-month and 10-year Treasury
instruments.

The Conference Board’s U.S. Leading Economic
Index decreased by (0.2)% in November to a
reading of 95.8. The latest reading is 1.8%
above that in November 2011. November
decreases in stock prices and new
manufacturing orders more than offset
improvements in credit conditions and building
permits.
The Semiconductor Industry Association (SIA)
reported that Semiconductor Billings (3-month
moving average) in the Americas increased
5.1% in November to $5.03 billion. This amount is
9.7% above billings in November 2011 and
represents the highest reading since January
2001. Semiconductors are Arizona’s largest
international export industry.
Consumer prices, as measured by the U.S.
Consumer Price Index (CPI), were unchanged
in December and grew by 1.7 % above the
prior year. During December, a 0.1% increase
in core inflation (all prices except for food and
energy) was offset by a (1.2)% decrease in
energy prices.
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.
In November, 45 out of 50 states had increases in
their coincident indexes. Arizona’s coincident
index increased by 0.3% compared to the prior
month. Year-over-year, the Arizona index is 2.8%
above last year, which is the 19th highest growth
rate in the country. While this is a significant
improvement, Arizona’s index is still (10.9)%
below its peak, which occurred in August 2007.

Using a 3-month average, Arizona’s leading
index projects that state GDP will grow at an
annualized rate of 3.2% over the next 6 months.
This is lower than the revised 3.3% growth
projection in October but higher than the 3.0%
projection in November 2011.
Housing
The number of Maricopa County pending
foreclosures decreased from 11,973 in
November to 10,466 in December. This
represents the seventh consecutive monthly
decrease in this measure. The December total
is significantly below the peak in December
2009 (51,466). See Appendix A – Tracking
Arizona’s Recovery.
The total housing inventory in the Greater
Phoenix area decreased from 24,712 in
December 2011 to 21,095 in December 2012, a
(14.6)% decrease. This continues the decline in
inventory that started in January 2011.
As the supply of housing has declined, the price
has increased. In the Metropolitan Phoenix
area, the median price of a single family home
was $162,500 in November. This represents a
3.5% increase from October, and a 29.0%
increase from November of last year.
Another measure of the health of the Arizona
real estate market is permitting activity. For the
3-month period through November, a total of
1,263 single-family building permits had been
issued statewide, a 50.8% increase from last
year. This level of activity is comparable to the
amount of permits seen in September 2008, a
month which marked the beginning of the
rapid decline in the state’s housing market. Still,
the current level of permitting remains far
below a more normal 3-month average of
3,000 to 4,000 permits. See Appendix A –
Tracking Arizona’s Recovery.

5

JLBC – MONTHLY FISCAL HIGHLIGHTS – JANUARY 2013

Recent Economic Indicators
The performance of the multi-family housing
sector is similar to that of single-family housing.
For the 3-month period ending in November, a
total of 358 multi-family building permits had
been issued in the state. This figure represents a
level similar to October 2008. Multi-family
permitting activity remains (66.2)% below the
peak of activity in April 2007.
State Agency Data

“Compared to
the same month
last year, food
stamp
participation was
down by (0.7)%.”

At the beginning of January, total AHCCCS
caseloads equaled 1.27 million members, a
0.2% increase from the prior month. Overall,
AHCCCS caseloads are currently (4.2)% below
January 2012 levels. The traditional acute care
AHCCCS population, which consists primarily of
lower income children and their parents,
increased 0.1% from last month and decreased
(1.3)% from a year ago. The total population in
this program is almost 900,000.
The childless adult program has not allowed
new participants since July 2011. This population
has declined (137,773) since then to 86,719. Of
the decline, (11,938) is attributed to members
who were transferred to the SSI program. As a
whole, the Proposition 204 program has
declined (1.3)% compared to the prior month,
and (21.8)% from the prior year.
KidsCare provides coverage for children with
incomes above those in the traditional
population. Its enrollment has declined since a
freeze was implemented in January 2010.
Enrollment declined (1.2)% compared to the
prior month and (35.5)% from the prior year.
Beginning on May 1, 2012, AHCCCS began a
new program, entitled KidsCare II, which
provides coverage for children up to 175% of
the Federal Poverty Level. The state match is
provided by voluntary payments from political
subdivisions. As of the beginning of January,
25,844 children were enrolled in KidsCare II.
There were 40,930 TANF recipients in the state in
November, a monthly caseload decrease of
(2.6)%. Year-over-year, the number of TANF
recipients has increased by 6.8%. This marks the
third month of year-over-year growth in the
TANF program since November 2009. Since that
time, the State reduced the lifetime limit a
person may receive cash assistance, first to 36
months and then further to 24 months.
Previously, the maximum had been 60 months.
The appropriation for TANF cash assistance in
the FY 2013 budget funds a caseload of
approximately 36,200 recipients in FY 2013.

(Continued)

The Supplemental Nutrition Assistance Program
(SNAP), formerly known as Food Stamps,
provides assistance to low-income households
to purchase food. In November, there were a
total 1.1 million food stamp recipients in the
state, a (0.8)% decrease over the prior month.
Compared to the same month last year, food
stamp participation was down by (0.7)%. The
number of SNAP 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 Corrections (ADC) inmate population
increased to 40,085 inmates in December 2012.
Relative to the prior 3-month period, the
population has increased by 46 inmates.
Compared to a year ago, the population has
increased by 54 inmates.
Employment
The state gained a total of 3,200 nonfarm jobs
between November and December. The
private sector added a net of 4,900 jobs in
December whereas the government sector
shed (1,700) jobs. The nonfarm job net gain of
0.1% was comparable to the 10-year average
increase of 0.2% for December. The largest
contributions to December’s month-over-month
net job gain came from the following sectors:
leisure and hospitality (+1,400), information
(+1,100), financial activities (+1,100), and
education and health services (+1,100).
Compared to December 2011, nonfarm
employment was up by 2.6%, or 63,900 jobs. The
last time employment grew at a faster year-overyear rate was in January 2007. The largest yearover-year net job gains came from the following
industries: professional and business services
(+13,300), trade, transportation, and utilities
(+12,200) and education and health services
(+10,200).
For the calendar year as a whole, Arizona’s
economy added an average of 50,500 jobs
(+2.1%), the best performance since 2006.
As of December, total nonfarm employment
remained (7.5)%, or (204,800) jobs, below peak
employment in December 2007. See Appendix
A – Tracking Arizona’s Recovery.

6

JLBC – MONTHLY FISCAL HIGHLIGHTS – JANUARY 2013

Recent Economic Indicators

(Continued)

Table 5

ECONOMIC INDICATORS
Indicator
Arizona
- Unemployment Rate (SA)
- Initial Unemployment Insurance Claims
- Unemployment Insurance Recipients
- 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 Home Sales
Single-Family
Townhouse/Condominium
- Greater Phoenix Median Home Price
Single-Family
Townhouse/Condominium
- Greater Phoenix S&P/Case-Shiller Home Price Index
(Jan. 2000 = 100)
- Foreclosure Activity, Maricopa County
Pending Foreclosures (Active Notices)
- Greater Phoenix Total Housing Inventory, (ARMLS)
- Phoenix Sky Harbor Air Passengers
- Revenue Per Available Hotel Room
- Arizona Average Natural Gas Price
($ per thousand cubic feet)
- Arizona Consumer Confidence Index (1985 = 100)
- Arizona Coincident Index (July 1992 = 100)
- Arizona Leading Index -- 6 month projected growth rate
- Arizona Personal Income
- Arizona Population
- AHCCCS Recipients
Acute Care Traditional
Spend Down
Prop 204 Childless Adults
Other Prop 204
Kids Care
Kids Care II
Long-Term Care – Elderly & DD
Emergency Services
- TANF Recipients
- SNAP (Food Stamps) Recipients
- ADC Inmate Growth (3-month average)
- Probation Caseload
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

December
December
December
December
December
October
November
Oct-Dec
Oct-Dec

7.9%
19,147
38,101
2.51 million
153,100
119,400
40.6
$36.1 million
$149.8 million

0.1 %
(4.3)%
(3.8)%
0.1%
0.5%
(0.3)%
0.2%
(1.0)%
3.6%

(1.1)%
(14.2)%
(30.9)%
2.6%
2.4%
6.5%
0.5%
3.6%*
6.2%*

Sep-Nov
Sep-Nov

1,263
358

(6.6)%
(29.7)%

50.8%
36.2%

November
November

8,007
1,181

(8.5)%
(6.3)%

12.7%
9.9%

November
November
October

$162,500
$100,000
122.39

3.5%
6.4%
1.4%

29.0%
23.7%
21.7%

December
December
November
November
November

10,466
21,095
3.31 million
$51.25
$4.47

(12.6)%
(9.2)%
(1.1)%
(14.1)%
10.6%

(47.6)%
(14.6)%
0.2%
(2.5)%
(11.1)%

2nd Quarter 2012
November
Sep-Nov
3rd Quarter 2012
July 1, 2012
January

November
November
Oct-Dec

68.6
181.26
3.2%
$236.8 billion
6.55 million
1,268,918
883,617
86,719
148,114
8,281
25,844
53,346
62,997
40,930
1,128,883
40,085

(1.3)%
0.3%
(0.1)%
0.6%
N/A
0.2%
0.1%
(3.2)%
(0.1)%
(1.2)%
17.4%
0.3%
1.2%
(2.6)%
(0.8)%
46 inmates

32.2%
2.8%
0.2%
4.2%
1.3%
(4.2)%
(1.3)%
(100.0)%
(43.5)%
(4.8)%
(35.5)%
2.8%
12.8%
6.8%
(0.7)%
54 inmates

November
November

17,911
25,295

(222)
(168)

(698)
(255)

3rd Quarter 2012
(3rd Estimate)
December
November
Sep-Nov
December

$13.7 trillion

3.1%

2.6%

65.1
95.8
$5.03 billion
231.0

(9.0)%
(0.2)%
5.1%
0.0%

0.5%
1.8%
9.7%
1.7%

7

JLBC – MONTHLY FISCAL HIGHLIGHTS – JANUARY 2013

Summary of Recent Agency Reports
AHCCCS and the Department of Health Services - Report
on Reconciliation Payments - Pursuant to Laws 2012,
Chapter 294, Section 126, the Arizona Health Care Cost
Containment System (AHCCCS) and the Department of
Health Services (DHS) submitted their semi-annual report
on reconciliation payments and penalties received from
July 1, 2012 through December 31, 2012. AHCCCS
reports that during that 6-month period they deposited
$310,700 into the General Fund and used $639,400 to
offset Federal Medicaid Authority expenditures, all from
penalties and sanctions. DHS reports no reconciliation
payments and penalties during that period.
AHCCCS limits financial risks and profits for health plans
for most AHCCCS populations (the maximum
percentage of loss and profit varies by AHCCCS
population). Reconciliation payments are made to
health plans or AHCCCS if a health plan’s losses or
profits exceed the set level. A penalty, or sanction, may
be assessed against health plans for the failure to
demonstrate compliance with their contractual
responsibilities.
Previously, AHCCCS retained monies from reconciliation
payments and penalties. Laws 2012, Chapter 299,
Section 1 required that AHCCCS deposit monies
received for reconciliation payments and penalties into
the General Fund or the fund from which the
appropriation was originally made. (Amy Upston)
Arizona Community Colleges – Annual Report – Pursuant
to A.R.S. § 15-1427, the Arizona Community Colleges are
required to report on their progress during the previous
year. The FY 2012 report includes the following
summary information on the state system:

• 357,895 students (headcount) were enrolled for

development account. Monies in the account are
derived from Proposition 301 Sales Tax revenues and
shall be used for workforce development and job
training. Total revenues in FY 2012 were $940,600 and
total expenditures in the same year were $821,400.
(Tom Ritland)
Arizona Criminal Justice Commission – Report on
Criminal Justice Enhancement Fund – Pursuant to A.R.S.
§ 41-2401C, the Arizona Criminal Justice Commission
(ACJC) has provided its annual report on Criminal
Justice Enhancement Fund (CJEF) monies distributed to
law enforcement agencies. CJEF consists of a 47%
assessment on certain fines, penalties, and forfeitures
imposed and collected by the courts. In FY 2012, CJEF
revenues totaled $43.1million and the total funds
available for the fiscal year, including the beginning
balance and adjustments, was $65.3 million. In FY 2012,
CJEF revenues decreased by (1.4)% from FY 2011; CJEF
expenditures totaled $38.9 million, and fund transfers
totaled $5.9 million. (Krista MacGahan)
Department of Economic Security – Report on Available
State and Federal Domestic Violence Funding –
Pursuant to a General Appropriation Act Footnote, the
Department of Economic Security (DES) is submitting its
annual report on state and federal domestic violence
funds. A total of $23.6 million was used by 6 state
entities for domestic violence services in FY 2012, a
(1.8)% decline in spending from FY 2011, reflecting
reduced federal funding. (Ben Beutler)
School Facilities Board – Report on Funding Estimates –
Pursuant to A.R.S. § 15-2002, the School Facilities Board
(SFB) is required to report the estimated amounts
necessary in FY 2014 and FY 2015 for the New School
Facilities, Building Renewal, and Emergency Deficiencies
Correction Programs.

credit, resulting in a Full-Time Student Equivalent
count of 140,954.
• 90% of enrolled students resided within the district,
while 10% did not reside within the district.
• Total number of instructors employed was 11,201, of
which 2,539 (23%) were full-time and 8,662 (77%)
were part-time.
• Total operating revenues were $1.6 billion (this
amount excludes bond proceeds and fund balance
which total $182.1 million).
• Total expenditures were $1.8 billion.
(Tom Ritland)

In FY 2014, SFB estimates a total funding requirement of
$369.8 million, including $109.8 million for the New School
Facilities Program, and $260.0 million for the Building
Renewal Program. The new construction estimate
assumes the current construction limitation is lifted in FY
2014. The FY 2014 new construction cost would be
reduced through the use of lease-purchase authority or
by cash flowing the construction cost across several
years. The Building Renewal amount is based on the
current statutory formula, which was suspended in FY
2013 in favor of a $2.7 million discretionary grant
program.

Arizona Community Colleges – Report on Workforce
Development Expenditures – The Arizona Community
Colleges are reporting on their previous year’s
workforce development plan activities and
expenditures. A.R.S. § 15-1472 requires each
community college district to establish a workforce

For FY 2015, the board estimates it will need funding in
the amount of $320.0 million. Of this total, $42.0 million is
for additional awards made for the New School Facilities
Program and $278.2 million is for the Building Renewal
Program.

8

JLBC – MONTHLY FISCAL HIGHLIGHTS – JANUARY 2013

Summary of Recent Agency Reports
SFB did not request to transfer any monies from the New
School Facilities Fund to the Emergency Deficiencies
Correction Fund in FY 2014 or FY 2015, due to insufficient
monies in the New School Facilities Fund. (Andrew
Hartsig)
Arizona Board of Regents – Report on University System’s
Financial Aid – Pursuant to A.R.S. § 15-1650, the Arizona
Board of Regents is required to submit an annual report
on financial aid. Highlights from the FY 2012 report
include:
•

Approximately $1.9 billion in total financial aid was
provided to students.
•
Of this amount, $912.3 million (49.3%) came from
federal sources, $601.2 million (32.5%) came from
state institutional sources, $335.0 million (18.1%)
came from private sources, and $1.8 million (0.1%)
came from state scholarships, grants and loans.
(The private sources amount includes $13.5 million
Arizona Financial Aid Trust, which is a combination
of both state and institutional sources of aid.)
•
A total of 120,015 students received aid, including
96,320 undergraduate students and 23,696
graduate students.
•
Of the undergraduate students receiving aid, 21,408
received non-need-based gift aid, 54,998 received
need-based gift aid, and 48,811 were awarded
miscellaneous types of non-gift aid (i.e. work study).
Some students received multiple types of aid.
•
The average aid package was $10,851, which
includes both need and non-need-based aid.
•
56.7% of undergraduate students and 59.0% of
graduate students have debt.
•
Upon graduation, the average undergraduate
student debt was $22,178, while the average
graduate student debt was $47,803.
(Marge Zylla)
Public Programs Eligibility Report - As enacted in the
2006 election, Proposition 300 limits participation in
certain state programs to citizens, legal residents, or
other persons lawfully present in the United States, and
requires semi-annual reports to the Joint Legislative
Budget Committee. Below is a summary of the reports:
Universities - At the 3 universities, 139,357 students
registered for the fall 2012 semester. Of the total
students registered, the universities were able to verify
the legal immigration status of 130,791 students.
Additionally, the universities reported that 11,542 of
these students did not require verification because they
have either not requested or received in-state tuition or
state supported financial aid. The universities reported
that a total of 7 students were unverifiable due to their
inability to provide the requisite documentation.

(Continued)

Department of Economic Security - The department
reported that 6,168 applications were received for child
care assistance during the reporting period of June 1,
2012 to November 30, 2012. Of this number, 6 were
denied because criteria for citizenship or legal residency
were not met.
Community Colleges - The Community Colleges reported
a total of 254,298 students statewide classified as in-state
for the fall 2012 semester. They reported 1,086 students
who were not entitled to be classified as in-state because
of a lack of lawful immigration status. Additionally,
112,669 students applied for financial aid. Of those who
applied, the community colleges reported that 89 were
not entitled to any aid because they were not lawfully
present in the United States.
Department of Education – The department reported that
15,752 people applied for instruction in Arizona Adult
Education during the reporting period of June 1, 2012 to
December 1, 2012. Of this amount, 623 were denied
instruction because they failed to provide evidence of
citizenship or legal residence in the United States. The
Arizona Adult Education program is currently funded with
Federal Funds and had been funded by a combination of
federal and state funds previously. (Krista MacGahan)
Public Safety Personnel Retirement System – Report on
Shared Cost Structure, Funding Status and Rate of Return –
Pursuant to A.R.S. § 38-848.02, the Public Safety Personnel
Retirement System (PSPRS) is required to report annually
on the shared cost structure of the employees and
employers, the funding status and the rate of return for the
system. Besides administering its own system, PSPRS is also
responsible for the Correctional Officers Retirement Plan
(CORP) as well as the Elected Officials Retirement Plan
(EORP). Table 6 shows the contribution rates, funded
status and rate of return for FY 2014, based on valuation
data from June 30, 2012.
In PSPRS and CORP, there is significant variation in the
actuarial status of individual employer groups, therefore
the employer contribution rates and funded statuses have
been shown in the aggregate. Individual employer
contribution rates and funded ratios are available on the
PSPRS website.
A 7-year smoothing period is used to calculate the
investment rate of return. This smoothing technique is a
tool used to reduce short-term volatility of assets by
deferring a portion of gains and losses over time. This
smoothing process is used under the condition that the
maximum deferred gain or loss remains within 20% of
market value. Table 1 shows 1-year market-based returns,
in addition to the 7-year smoothing technique. (Ben
Henderson)

9

JLBC – MONTHLY FISCAL HIGHLIGHTS – JANUARY 2013

Summary of Recent Agency Reports
Table 6

(Continued)

PSPRS Annual Report
PSPRS

CORP

30.44%
10.35%

13.68%
8.40%

25.94% 3/
13.00%

Funded Status 1/ 2/

58.6%

67.8%

58.4%

Rate of Return
1-year market value basis
7-year smoothing basis

(0.8%)
3.2%

(0.8%)
3.6%

(0.9%)
1.5%

FY 14 Contribution Rates 1/
Employer 2/
Employee

EORP

____________
1/ Based on June 30, 2012 valuation.
2/ Employer contribution rates and funded statuses for PSPRS and CORP
are shown in the aggregate, as there is significant variation in the
actuarial status between individual employer groups.
3/ Represents the state employer rate, which is lowered by court fees as
required by statute.

December Spending
December 2012 General Fund spending of $561.6 million
was $(8.4) million lower than December 2011. (See
Tables 7 & 8). AHCCCS spent $(11.7) million less than
December 2011, due to lower enrollment in both the
Traditional and Proposition 204 Medicaid programs.

Year-to-date, spending is $5.4 billion, or $113.7 million
above last year.

Table 7
General Fund Spending ($ in Millions)

Agency
AHCCCS
Corrections
Economic Security
Education
Health Services
Public Safety
School Facilities
Board
Universities
Leaseback Debt
Service
Other
Total
Budget Stabilization
Fund Deposit
Grand Total

Dec 12

Change from
Dec 11

125.8
72.5
3.1
281.3
13.8
1.6
0.1

(11.7)
3.2
(3.7)
(1.0)
3.8
(0.4)
0.0

683.9
456.0
439.7
2,203.1
496.2
16.3
142.7

(143.5)
(13.0)
5.4
(16.9)
64.5
(18.3)
9.7

38.9
0.0

(3.8)
0.0

455.0
84.1

(10.3)
35.1

24.5
561.6

5.2
(8.4)

263.7
5,240.7

1.0
(86.3)

0.0
561.6

0.0
(8.4)

Year to Date

YTD Change
from FY 12

200.0

200.0

5,440.7

113.7

10

JLBC – MONTHLY FISCAL HIGHLIGHTS – JANUARY 2013

Table 8

General Fund Spending
($ in Thousands)
Agency
Department of Administration
Department of Admin Sale/Leaseback D/S
Office of Administrative Hearings
Department of Agriculture
AHCCCS
Arts, AZ Commission on the
Attorney General
AZ Capital Post Conviction Public
Defender
State Board of Charter Schools
AZ Commerce Authority
Community Colleges
Corporation Commission
Department of Corrections
AZ State Schools for the Deaf & Blind
Department of Economic Security
Department of Education
DEMA
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 Forester
Arizona Geological Survey
Government Information Tech.
Governor/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

December 12

Change from
December 11

Year-to-Date

YTD Change
from FY 12

558.7
2.9
230.2
125,829.9
1,713.7
-

(19.4)
(60.1)
(58.2)
(11,661.3)
312.3
(58.5)

14,577.8
84,119.8
430.5
3,859.8
683,891.1
11,024.9
4.1

4,559.4
35,069.1
(0.3)
(319.6)
(143,466.1)
(10.4)
1,948.9
(295.7)

50.2
2,625.0
45.9
72,531.3
1,930.2
3,148.3
281,343.9
573.2
0.0
22.3
49.2
200.3
12.9
185.9
9.8
604.2
13,800.0
176.9
47.2
108.0
2.4
332.9

(2.0)
3.2
3,218.3
861.7
(3,663.4)
(1,039.9)
762.9
(12.0)
(10.6)
(2.8)
17.9
13.6
(31.9)
(26.5)
1,702.9
3,799.0
(16.6)
(0.1)
(228.2)
2.2
(13.1)

395.3
15,750.0
32,096.3
285.6
456,028.3
12,150.8
439,660.6
2,203,059.8
4,034.0
7,000.0
55.0
339.1
375.9
1,402.4
896.4
2,143.2
465.1
4,040.7
496,222.0
1,737.4
346.9
735.4
27.4
2,502.5

1.4
(2.5)
7.9
(13,016.2)
1,028.4
5,441.2
(16,865.0)
642.7
(38.4)
(28.1)
(62.0)
(50.2)
(9.5)
(836.6)
5.8
3.1
1,052.7
64,481.9
(97.4)
14.7
(1,218.4)
(0.4)
(261.4)

999.3
486.3
997.4
3,003.9

(113.1)
222.5
137.4
779.4

8,270.9
36,863.1
6,839.3
21,243.0

1,334.4
34.7
(276.2)
(3,184.8)

11

JLBC – MONTHLY FISCAL HIGHLIGHTS – JANUARY 2013

Agency
State Land Department
Law Enforcement Merit System
Legislature
Auditor General
House of Representatives
Joint Legislative Budget Comm.
Legislative Council
Senate
Mine Inspector
Nav. Streams & Adjudication
Pioneers’ Home
Comm. for Postsecondary Ed.
Department of Public Safety
Arizona Department of Racing
Radiation Regulatory Agency
Real Estate Department
Department of Revenue
School Facilities Board
Secretary of State
Tax Appeals Board
OOffice of Tourism
Department of Transportation
Universities
Board of Regents
Arizona State University
Northern Arizona University
University of Arizona
Department of Veteran Services
Department of Water Resources
Department of Weights & Measures
Other
Total
Budget Stabilization Fund Deposit
Grand Total

December 12

Change from
December 11

Year-to-Date

YTD Change
from FY 12

29.7
5.4

27.4
0.8

548.3
33.1

(34.2)
4.9

1,323.4
872.6
144.8
361.6
713.9
95.0
8.5
51.0
1,571.2
60.3
149.8
2,727.8
107.8
1,300.8
17.2
431.6
-

42.5
(22.4)
8.6
58.4
88.5
35.7
(6.3)
(226.1)
(382.1)
(45.2)
50.6
13.9
678.9
37.9
763.9
11.7
431.6
(3.0)

8,603.2
5,380.3
910.9
4,104.0
3,722.6
612.1
62.8
589.2
698.4
16,302.2
1,790.5
729.0
1,217.3
21,482.8
142,694.0
10,820.2
141.0
2,662.1
18.9

(438.4)
(707.7)
(105.3)
1,107.2
(383.7)
22.8
(27.3)
(519.1)
(18,322.6)
(879.9)
(20.9)
(99.8)
(7,251.8)
9,739.5
5,786.4
5.1
2,662.1
1.7

(288.7)
17,381.2
5,916.0
15,870.7
219.8
739.6
132.1
13.1
561,578.8
561,578.8

(490.3)
(1,788.2)
(515.6)
(1,001.8)
242.6
234.1
49.3
(1,517.2)
(8,406.0)
(8,406.0)

19,968.3
194,862.7
66,040.0
174,154.3
2,637.9
4,502.3
690.5
1,876.2
5,240,728.9
200,000.0
5,440,728.9

9,452.7
(10,728.9)
(3,044.6)
(6,011.0)
(1,257.7)
1,402.6
147.0
(2,409.1)
(86,343.3)
200,000.0
113,656.7

Tracking Arizona’
Arizona’s Recovery

Total NonNon-Farm Employment
2,800

Appendix A

2,700

Slide:
Thousands of Jobs

2……Total Non-Farm Employment
3……Initial Claims for Unemployment Insurance
4……State Sales Tax Collections – Retail Category
5……State Sales Tax Collections – Contracting
Category
6……Single Family Building Permits
7……Maricopa County Pending Foreclosures
8……Coincident Index

2,600

2,500

2,400

2,300

2,200

2001

1

JLBC

Initial Claims for Unemployment Insurance

2004

2005

2006

2007

2008

2009

2010

2011

JULY

JUL

JAN

JUL

JAN

JUL

JAN

JUL

JAN

JUL

JAN

JUL

JAN

JUL

JAN

JUL

JAN

JAN

JUL

JUL

2003

2012

2

Not seasonally adjusted

State Sales Tax Collections – Retail Category
$225

40,000
$200
35,000

$ in Millions

30,000
25,000
20,000
15,000

$175

$150

$125

2002

Not seasonally adjusted

Oct-12

Jul-12

Apr 12

Jan 12

Oct 11

July 11

Jan 11

Apr 11

Oct 10

July 10

Jan 10

Apr 10

Oct 09

July 09

Jan 09

Apr 09

Oct 08

July 08

Jan 08

Apr 08

Oct 07

Apr 07

July 07

JULY

JUL

2011

JAN

JUL

2010

JAN

JUL

2009

JAN

JUL

2008

JAN

JUL

2007

JAN

JUL

2006

JAN

JUL

2005

JAN

JUL

2004

JAN

JUL

2003

JAN

JUL

JAN

JUL

JAN

JAN

2001

Jan 07

$100

5,000

Oct 06

10,000
July 06

Total Monthly Claims for UI Benefits

2002

JLBC

45,000

JLBC

JAN

JUL

JAN

JAN

2,100

2012

3

JLBC

Excludes temporary 1 ¢ sales tax

4

State Sales Tax Collections – Contracting Category

Single Family Building Permits
100,000

$100

Single Family Building Permits

90,000

$ in Millions

$75

$50

$25

80,000
70,000
60,000
50,000
40,000
30,000
20,000

2001
Excludes temporary 1 ¢ sales tax

JLBC

5

2003

JLBC

2008

2009

2010

2011

JULY

JUL

JAN

JUL

JAN

JUL

JAN

JUL

JAN

JUL

2007

JAN

JUL

2006

JAN

JUL

2005

JAN

JUL

2004

JAN

JUL

JAN

JUL

2002

2012

6

12-Month Moving Sum

Maricopa County Pending Foreclosures

Economic Activity Index
210

60,000

200

Coincident Index Value

50,000

40,000

30,000

20,000

10,000

190
180
170
160
150

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

An initial notice of trustee sale has been recorded but final sale has not yet occurred

2012

JLBC

2002

2003

2004

2005

2006

2007

2008

2009

2011

Source: Coincident Index – Federal Reserve Bank of Philadelphia. Combines four state-level
indicators (employment, average hours worked in manufacturing, the unemployment rate, and wage
and salary disbursements) to summarize current economic conditions.

JULY

JAN

JUL

JUL

2010

JAN

JAN

JUL

JAN

JUL

JAN

JUL

JAN

JUL

JAN

JUL

JAN

JUL

JAN

JUL

JAN

JUL

JUL

2001

7

JAN

JAN

JULY

JAN

JUL

JAN

JUL

JAN

JUL

JAN

JUL

JAN

JUL

JAN

JUL

JAN

JUL

JAN

JUL

JAN

JUL

JUL

2001

JAN

140
JAN

0

JLBC

JAN

JAN

JUL

0
JAN

Jul-12

Oct-12

Jan 12

Apr 12

Oct 11

July 11

Jan 11

Apr 11

Oct 10

July 10

Jan 10

Apr 10

Oct 09

July 09

Jan 09

Apr 09

Oct 08

July 08

Jan 08

Apr 08

Oct 07

July 07

Jan 07

Apr 07

Oct 06

July 06

10,000

$0

2012

8