Bill
HB 4141
Allocates substantial capital outlay for major maintenance, building renewal, and targeted infrastructure projects (veterans’ facility, highways, airports) with new reporting and f
HB 4141 Summary — Capital Outlay; 2026-2027 Appropriations (Arizona, 57th Legislature, 2nd Regular Session)
Purpose and general intent
- The bill effectuates capital outlay appropriations for fiscal year 2027 (and related transition provisions) across state agencies and state-owned facilities, with a focus on major maintenance, building renewal, infrastructure projects, and specific program funding (e.g., veterans’ facilities, rural transportation, airport planning).
- It reorganizes and clarifies funding sources, reporting requirements, and limitations on how appropriations may be used, including protections around non-building-related spending and oversight.
Key provisions and changes
1) Veterans’ home facility funding (Sec. 1)
- Establishes a new appropriation of $25,000,000 from the state general fund in FY 2027-2028 to the Department of Veterans’ Services (DVS) to construct and establish a veterans’ home facility in the northwestern region of Arizona.
- The $25M is contingent on federal funding commitments: at least 65% of total costs must be irrevocably committed by the United States government before expenditure.
- DVS must present proposed site locations to the Arizona Veterans’ Service Advisory Commission for approval, with a feasibility analysis provided.
- Before spending, DVS must submit project scope, purpose, and estimated cost to the Joint Committee on Capital Review (JCCR) for review under § 41-1252, ARS.
- The appropriation is exempt from lapsing provisions under § 35-190, ARS.
2) Building renewal and major maintenance (Sec. 2)
- Sets FY 2026-2027 capital outlay major maintenance allocations for state buildings as follows:
- Department of Administration (ADOA): $16,800,000 from the Capital Outlay Stabilization Fund (COSF) for building renewal; can be used for retrofitting for space consolidation; if COSF is insufficient, reduction is allowed to match COSF balance.
- Department of Corrections (DOC): $5,864,300 from the DOC Building Renewal Fund; cannot be used for personal services or overhead related to project management.
- Arizona Game and Fish Department: $1,932,900 from the Game and Fish Fund.
- Arizona State Lottery Commission: $237,800 from the State Lottery Fund.
- Department of Transportation (ADOT): $22,990,400 from the State Highway Fund and $394,900 from the State Aviation Fund.
3) ADOT statewide highway construction (Sec. 3)
- Appropriates $432,663,000 from the State Highway Fund for statewide highway construction (including interstate, primary/secondary, county systems, urban/rural routes), rights-of-way, field administration/engineering, and debt service on highway bonds.
- Any excess funds in the SHF beyond the statutory appropriations are available to ADOT for statewide highway construction purposes.
- ADOT must report by November 1, 2026 on prior-year, current-year, and upcoming highway construction expenses (by fund source) to JLBC and OSPB, using the prior-year format unless modified.
- ADOT must report capital outlay information for FYs 2025-2026, 2026-2027, 2027-2028 in the same format as the FY 2025-2026 appropriations report.
- ADOT must report estimated outstanding debt principal balance at end of FY 2027-2028 and debt service payments for 2027-2031 to JLBC and OSPB.
- The $432,663,000 appropriation is exempt from JCCR review.
4) U.S. Route 191 pavement rehabilitation transfer (Sec. 4)
- Transfers a prior reduction of $2,500,000 from the SHF (for Route 191 pavement rehab) to the state general fund for general state agency support and maintenance.
5) State Match Advantage for Rural Transportation Fund (Sec. 5)
- Adds a FY 2028-2029 appropriation of $26,300,000 from the state general fund to the State Match Advantage for Rural Transportation Fund (as established in § 28-339, ARS).
6) Airport planning and development (Sec. 6)
- Allocates $29,048,900 from the State Aviation Fund for FY 2026-2027 to ADOT to plan, construct, develop, and improve airports as determined by the State Transportation Board.
- Any SAF balances/receipts exceeding the appropriation may be used by ADOT for airport planning and development in FY 2027.
- Requires December 31, 2026 reporting on status of aviation grants and distributions by airport and year, including future commitments.
- Exempts this appropriation from JCCR review.
7) Use of appropriations; general controls (Sec. 7)
- Allows ADOA to use up to 5% of its total Capital Outlay act funds (excluding amounts to nonstate entities) for project management of building renewal and capital projects; other funds require JCCR review for personal services, employee-related expenses, or maintenance contracts tied to building components/equipment.
- All other monies in the Capital Outlay Act may not be spent on personal services or employee-related expenses of state employees, except for inmate-construction-program-related services for correctional facilities.
Procedural and timeline notes
- Several sections require reporting by November 1, 2026 to JLBC and OSPB, detailing highway construction costs, capital outlay information for multiple fiscal years, and debt service outlook.
- The DVS veterans’ facility funding is conditioned on federal cost-sharing and requires approval and feasibility review prior to commitment.
- Some appropriations are explicitly exempt from JCCR review, indicating streamlined oversight for those components.
- The bill appropriates funds for FY 2026-2027 (and in some cases FY 2027-2028/2028-2029), shaping multi-year capital planning and maintenance.
Affected entities
- Arizona Department of Administration
- Department of Corrections
- Arizona Game and Fish Department
- Arizona State Lottery Commission
- Arizona Department of Transportation (including SHF, SAF, and ADOT’s aviation and highway programs)
- Department of Veterans’ Services
- State agencies and state-owned facilities needing major maintenance/building renewal
- Rural transportation programs via the State Match Advantage
Impact context
- Increases capital outlay focus on building renewal and major maintenance, with targeted investments in veterans’ facilities, transportation infrastructure, and airport planning.
- Adds reporting and oversight requirements intended to improve transparency of capital expenditures and debt related to large-scale highway and airport projects.
- Creates flexibility to reallocate excess fund balances to higher-priority capital needs while enforcing constraints on personnel-related spending outside inmate-construction programs.
Compiled from official sources — confirm details with the bill’s official record.
Sign in to ask a question.
