A.R.S. tit. 35 ch. 1 — Arizona Revised Statutes Title 35 Chapter 1 — Budgetary And Fiscal Provisions For State Agencies

35-101. Definitions In this chapter, unless the context otherwise requires: 1. "Allotment" means the allocation of an appropriation or other fund source over a full fiscal year within a budget program or expenditure class. 2. "Authorized agent" means a commercial enterprise that is contracted to process transactions on behalf of a state agency. 3. "Budget estimates" means statements with accompanying explanations, as provided by this chapter, in which a budget unit states its financial requirements and requests appropriations. 4. "Budget program" means functions and activities of a budget unit or within a budget unit that are preplanned to fulfill a distinct mission. 5. "Budget unit" means any department, commission, board, institution or other agency of this state receiving, expending or disbursing state monies or incurring obligations against this state. 6. "Cardholder" means any person: (a) Named on the face of a credit card to whom or for whose benefit the credit card is issued by an issuer. (b) In possession of a credit card with the consent of the person to whom the credit card was issued. 7. "Claim" means a demand against the state for payment for either: (a) Goods delivered or, in the case of highway construction, goods or facilities to be delivered by the federal government. (b) Services performed. 8. "Convenience fee" means an additional fee that is imposed by an authorized agent on a web-based or voice response portal transaction for the acceptance of a credit card that would not be charged if the same transaction were completed by an alternate method of payment. 9. "Credit card" means: (a) Any instrument or device, whether known as a credit card, charge card, credit plate, courtesy card or identification card or by any other name, that is issued with or without a fee by an issuer for the use of the cardholder in obtaining money, goods, services or anything else of value, either on credit or in possession or in consideration of an undertaking or guaranty by the issuer of the payment of a check drawn by the cardholder, on a promise to pay in part or in full at a future time, whether or not all or any part of the indebtedness represented by this promise to make deferred payment is secured or unsecured. (b) Any debit card, electronic benefit transfer card or other access instrument or device, other than a check that is signed by the holder or other authorized signatory on the deposit account, that draws monies from a deposit account in order to obtain money, goods, services or anything else of value. (c) Any stored value card, smart card or other instrument or device that enables a person to obtain goods, services or anything else of value through the use of value stored on the instrument or device. (d) The number assigned to an instrument or device described in subdivision (a), (b) or (c) of this paragraph even if the physical instrument or device is not used or presented. 10. "Discount fee" means the fee that is calculated and charged by the credit card issuer or a financial institution pursuant to an agreement for the processing of any credit card transaction. 11. "Encumbrance" means an obligation in the form of any purchase order, contract or other commitment that is chargeable to an appropriation or any other authorized fund source and for which a part of the fund source is reserved. It ceases to be an encumbrance when paid or canceled. 12. "Expenditure class" means one of the kinds of expenditure denoting a class of services or commodities purchased or properties acquired as specified in the classification of expenditures prescribed by the director of the department of administration for use in expenditure accounting, in making budget estimates and in the budget reports and budgets. 13. "Issuer" means any business organization, state agency or financial institution, or its duly authorized agent, that issues a credit card. 14. "Prepayment" means the payment of a claim before receiving the goods or services. 15. "Processing fee" means a fee that is charged by an entity other than a credit card issuer or the processing financial institution to process a credit card transaction. 16. "Purchase order" means a document that is signed by the appropriate agency authorized signatory, that requests a vendor to deliver described goods or services at a specific price and that on delivery and acceptance of the goods or services by this state becomes an obligation of this state. 17. "Service fee or surcharge" means a fee, whether fixed or variable, that is in addition to the transaction amount, that is charged by a state agency when the state agency accepts a credit card for payment and that is necessary for the state agency to process the payment. 18. "Transaction amount" means the total amount due to the state for any goods, service or license or anything else of value. 35-101.01. Definition of substitute check In this title, unless the context otherwise requires, "substitute check" means a paper reproduction of an original warrant or check that is created from an electronic image of the original warrant or check and that meets all of the following: 1. Contains an image of the front and back of the original warrant or check. 2. Bears a magnetic ink character recognition line containing all of the information in the magnetic ink character recognition line of the original warrant or check. 3. Conforms in paper stock and dimension and otherwise with generally applicable industry standards for substitute checks. 4. Is suitable for automated processing in the same manner as the original warrant or check. 35-102. Fiscal year A. The fiscal year of the state and for the expenditure of appropriations shall commence July 1 each year. Accounts or annual reports of state officials required by law to be published, shall be prepared and published for the fiscal year as established by this section. B. The fiscal year beginning July 1, 1955, shall be known as the forty-fourth fiscal year and thereafter each fiscal year shall be designated in progressive numerical sequence. 35-103. Annual financial reports; notification; payments A. All state or county officers, boards, commissions or agencies that are required by law to prepare, make or publish annual reports of financial condition or operations, except the industrial commission, shall, notwithstanding any law to the contrary, prepare, make or publish those reports within ninety days after the close of each fiscal year. The reports shall disclose with respect to the fiscal year, rather than the calendar year, all matters and things required by law. B. State officers, boards, commissions or agencies shall deliver five copies of their annual reports to the Arizona state library, archives and public records or its agent to satisfy the requirements of the state documents program or arrangements or agreements entered into pursuant to section 41-151.05, subsection A, paragraph 5. C. The administrative head of a state board, commission or agency who fails to comply with this section shall have all compensation the administrative head receives from public monies withheld until such time as the administrative head complies with this section. D. The governmental units described in subsection A of this section shall: 1. Notify the Arizona state library, archives and public records if the reports subject to this section are posted on an internet website. 2. Pay the Arizona state library, archives and public records the fee charged pursuant to section 41-151.12 if the governmental unit refuses the state library's request to deliver, and the state library incurs any expenses in obtaining, the copies that are required to be delivered pursuant to this section. 35-111. Executive budget Not later than five days after the regular session of the legislature convenes, the governor shall submit to the legislature a budget containing a complete plan of expenditures proposed to be made before the close of the next fiscal year for budget units and all monies and revenues estimated to be available therefor, together with an explanation of the basis of the estimates and recommendations as to proposed legislation, if any, that the governor deems necessary to provide revenues sufficient to meet the proposed expenditures. 35-112. Forms for budget unit estimates; date of transmittal A. The governor shall prescribe the forms to be used by budget units in submitting their budget estimates and requests for appropriations in accordance with this chapter and shall prepare necessary instructions for guiding officials in preparing the budget estimates and requests. B. On or before July 1 each year, the governor shall transmit to the administrative head of each budget unit at least three complete sets of prescribed forms on which budget estimates and requests for appropriations for the ensuing fiscal year are to be submitted. 35-113. Submission of budget estimates The administrative head of each budget unit, not later than September 1 of each year or at a later date not to exceed thirty days after September 1 if approved by the director of the governor's office of strategic planning and budgeting, shall submit to the governor, with two copies, estimates of the financial requirements and of receipts, including appropriated and nonappropriated monies in no less detail than the state general fund, of the budget unit for the next fiscal year. The estimates shall include a detailed estimate of the cost to the budget unit in the next fiscal year attributable to a county's, city's or town's establishment of a minimum wage if that minimum wage exceeds the minimum wage established by this state pursuant to section 23-363. The estimates shall be on the forms and in the manner prescribed by the governor with explanatory data that may be required, together with additional information the head of the budget unit desires to submit. The estimates submitted shall bear the approval of the administrative head of the budget unit. 35-113.01. Request for federal funds A. All state agencies, boards, commissions and departments shall submit to the department of administration for acknowledgment, copies of all agreements, contracts and copies of all applications and requests for federal funds, to be used for any purpose. B. Every state agency, board, commission or department seeking federal funds for any project or program shall furnish to the department of administration with each copy of application or request a statement of the purposes for which any such project or program is desired or advocated, the source and amount of funds to be granted or provided therefor, and a statement of the conditions, if any, upon which such funds are to be provided. The director may at his discretion accept from the state agency, board, commission or department a summary of the information required in this section. C. All departments, agencies, boards or commissions, shall forward an acknowledgment to the department of administration upon receipt of federal funds. 35-114. Continuous financial planning; submission of tentative budget report; appropriations estimate report A. The governor shall have in continuous process of preparation and revision a tentative budget report for the next fiscal year for budget units. On receipt of the estimates of the several budget units, the governor shall check the estimates with information available to the governor and shall make further inquiries and investigations and recommend changes in the tentative budget report the governor deems warranted. B. The governor's office of strategic planning and budgeting in consultation with the joint legislative budget committee staff shall determine and report to the governor and the legislature an estimate of appropriations subject to the limit imposed by article IX, section 17, Constitution of Arizona. The report shall be published by February 15 of each year for the preceding fiscal year, for the current fiscal year and for the ensuing fiscal year to reflect the budget recommendations of the governor. 35-115. Contents of budget report Each budget report required by section 35-114 shall include the following: 1. Summary statements of the financial condition of the state, including: (a) A consolidated balance sheet showing all current assets and liabilities of the state at the close of the fiscal year last concluded. (b) Summary statements of the actual income and expenditures of the fiscal year last concluded. (c) Similar summary statements of estimated fund balances for the current fiscal year. 2. Schedules showing actual income from each source for the preceding fiscal year and the estimated income of the current fiscal year and for the next fiscal year for budget units. The statements of income and estimated income shall be itemized by source, by budget units and sources and by funds and shall show separately revenue from nonrevenue, all detailed by sources. 3. Detailed comparative statements of expenditures and requests for appropriations by funds, budget units, budget programs and budget classes, showing the expenditures for the fiscal year last concluded, the estimated expenditures for the current year, the request of each budget unit and the governor's recommendations for appropriations for the next fiscal year for budget units, all distributed according to budget programs and budget classes. In connection with each expenditure involving construction projects to be completed in one or more fiscal years, the budget report shall show the total estimated cost of each project and the amount recommended to be appropriated and expended in each ensuing fiscal year until completion of the project. The state capital improvement plan and the governor's recommendations concerning the plan shall be incorporated into the budget report. 4. A summary statement for each fund of the cash resources estimated to be available at the beginning of the next fiscal year for budget units and the estimated cash receipts for the next fiscal year for budget units, as compared with the total recommended amounts for appropriations for all budget programs and budget classes for the next fiscal year for budget units. If the total of the recommended expenditures exceeds the total of the estimated resources, the summary statement shall include recommendations as to how the deficiency is to be met and estimates of receipts from any proposed additional revenues. 5. A summary statement of expenditures and full-time equivalent positions for each retirement system, delineated by fund source. 6. Each fiscal year for budget units, a delineation of requested expenditures for administrative costs, including administrative personnel salaries and employee-related expenses and direct, indirect and shared costs for administrative office space, equipment, supplies and overhead. For the purposes of this paragraph, "administrative" means any supportive activity relating to management, supervision, budget or execution of the affairs of the budget unit as distinguished from activities relating to the budget unit's primary direct service functions. The process of delineation and determination of what constitutes administrative costs for each budget unit shall be developed by the governor's office of strategic planning and budgeting in consultation with the director and staff of the joint legislative budget committee. 7. A summary on one page or less providing selected performance measures of the budget unit for the previous fiscal year and the budget years. The performance measures may be expressed as service level measures on a unit cost basis and shall be established by the governor's office of strategic planning and budgeting in consultation with the director and staff of the joint legislative budget committee. 35-116. Supervisory powers of governor relating to budget report; exceptions A. Prior to submission of the budget report to the legislature, the governor shall examine the statements and estimates and shall make or cause to be made further investigations, with hearings before the governor, or the governor's designee, and shall make changes or revisions in appropriations requested that the governor deems advisable. B. The legislature shall not be subject to the control of the governor in the preparation and submission of budgets, but shall submit its requests for appropriations for the two ensuing fiscal years to the governor for review by the legislature. C. The judiciary shall not be subject to the control of the governor in the preparation and submission of budgets, but shall submit its requests for appropriations for the ensuing fiscal year to the governor for review by the legislature. D. The appropriation requests of the Arizona board of regents and the department of transportation for the ensuing fiscal year may be revised by the governor, but the governor shall also submit the appropriation request prepared and submitted by the budget unit in its original form to the legislature for review. 35-117. Participation of governor-elect in budget hearings The governor-elect shall be entitled to participate in all budget hearings and shall be furnished a copy of the budget report as approved by the governor. 35-118. Transmission of budget report to legislature The governor shall have the budget report prepared in such number of copies as he deems necessary, and copies thereof shall be transmitted to the legislature not later than five days after the regular session of the legislature convenes. 35-119. Assistance to appropriation committees From the time of transmission of the budget report to the legislature until the appropriation act or acts have been finally disposed of, the director of the governor's office of strategic planning and budgeting, in person or by an assistant, shall be available to the legislature and the appropriation committees thereof for explanation of any recommendation made in the governor's budget report to the legislature. 35-120. Additional powers of governor A. In aid of any powers vested in the governor under this article, the governor: 1. Shall have access to offices of all budget units. 2. May examine all books, papers, records and documents in the office of any budget unit. 3. May require any state officer or head of any budget unit to furnish such data, information or statements as may be necessary. B. The provisions of this section shall apply to the board of regents and the institutions under the jurisdiction of the board of regents, only as they relate to the appropriations requested. C. The power of the governor as prescribed by the terms of this section, to investigate budget units, including the board of regents, may be delegated to the office of strategic planning and budgeting or the department of administration. Such power may be used and shall extend to funds appropriated by the legislature in its relation to budget preparation for the current and preceding fiscal year. The powers granted by the terms of this section may be exercised by the governor during any period of the fiscal year. 35-121. Format of appropriations The format of the appropriations for the support and maintenance of state departments and institutions shall be for each fiscal year for all budget units. 35-121.01. Local minimum wage; reimbursement of state costs; collection; withholding A. After considering the information in the budget estimates required by section 35-113, the legislature may allocate and, if allocated, the department of administration shall assess and collect from a county, city or town an amount to reimburse this state for the cost to this state in the next fiscal year attributable to the county's, city's or town's establishment of a minimum wage if that minimum wage exceeds the minimum wage established by this state pursuant to section 23-363. B. The department shall assess the amounts under this section not later than July 31 of each year. The amounts are payable immediately on assessment. If the county, city or town does not pay to the department the amount allocated pursuant to this section on or before December 31 of the year the allocation is made, the department shall notify the state treasurer, who shall subtract the amount owed by the county, city or town from any payments required to be made by the state treasurer to that county, city or town pursuant to section 42-5029, subsection D, plus interest on that amount pursuant to section 44-1201, retroactive to the first day the amount was due. If the amount the state treasurer withholds is insufficient to meet the requirements of this section, the state treasurer shall withhold from any other monies payable to that county, city or town from whatever state funding source is available an amount necessary to fulfill the requirement. C. Unless otherwise required by law, the monies paid to the department or withheld by the state treasurer for the amounts assessed pursuant to subsection A of this section shall be credited to the funds in the amounts prescribed in the estimates required pursuant to section 35-113. 35-122. Budget unit program lists; strategic plans; operating plans; compilation and publishing of master list A. Consistent with instructions issued by the governor, the administrative head of each budget unit is responsible for developing a list of programs for the budget unit. For the purposes of this section, a program may include a subprogram as determined by the governor's office of strategic planning and budgeting and the staff of the joint legislative budget committee. In consultation with the staff of the joint legislative budget committee, the governor's office of strategic planning and budgeting may modify the list of programs submitted by each budget unit. B. Consistent with instructions issued by the governor, the administrative head of each executive branch budget unit is responsible for developing a five-year strategic plan for the budget unit. The strategic plan shall be updated annually. The plan shall contain strategic issues, a mission statement, a description, strategies and resource assumptions. The resource assumptions shall include the number of full-time equivalent positions and budgetary data, including all funding sources categorized by state general fund, other appropriated funds, nonappropriated funds and federal funds that are required to support the strategic plan. The agency shall also provide an executive summary of the strategic plan. The executive summary shall not exceed five pages in length. The strategic plan, including the executive summary, shall be posted on the agency's official internet website and submitted to the governor's office of strategic planning and budgeting and to the staff of the joint legislative budget committee on or before January 1 of each year. C. Consistent with instructions issued by the governor, the administrative head of each budget unit is responsible for: 1. Developing an operating plan for each program identified in subsection A of this section. The plan shall use the format required in subsection D of this section and be submitted to the governor's office of strategic planning and budgeting on or before September 1 of each year. Each budget unit shall annually submit performance measures and budgetary data for the prior, current and ensuing fiscal years. 2. Developing a mission statement, a description and strategic issues for the entire budget unit as part of the operating plan to be submitted to the governor's office of strategic planning and budgeting on or before September 1 of each year. The mission statement, description and strategic issues shall be submitted at the same time to the staff of the joint legislative budget committee. D. The operating plan shall include a mission statement, a description, goals, performance measures that emphasize results and budgetary data. The budgetary data shall include funding amounts, regardless of source. E. The governor's office of strategic planning and budgeting shall compile the submissions required in subsection C, paragraphs 1 and 2 of this section and, not later than five days after the regular session of the legislature convenes of each even-numbered year, shall publish a master list of programs that are performed or overseen by state government. The master list shall include the program description, agency description, mission statement, strategic issues, goals, performance measures and budgetary data. 35-123. Nonappropriated monies; report The governor's office of strategic planning and budgeting shall prepare and distribute a separate report on or before February 1 of each year on all nonappropriated monies. The report shall include actual receipts and expenditures for the prior fiscal year and estimates of receipts and expenditures for the current fiscal year and the next fiscal year. 35-124. Performance pay component; identification Any performance pay that is authorized by the legislature shall be separately stated on each employee's paycheck receipt as performance pay. 35-125. Revenue and expenditure estimates; three-year plan; public hearing The general appropriation act shall include a provision that delineates the revenue and expenditure estimates for the following three years. The expenditure estimates shall be based on existing statutory funding requirements. Before the adoption of the general appropriation act, the legislature shall discuss the estimates in a public hearing. 35-131. Accounting system; reports; notice of deficiency; forms A. In accordance with generally accepted governmental accounting principles, the department of administration shall develop and prescribe for the use of all budget units a uniform accounting system so designed as to ensure compliance with all legal and constitutional requirements, including those respecting receiving, spending and accounting for public monies. B. The department of administration shall maintain complete, accurate and current financial records relating to state monies and to other public monies in the state treasury available to, encumbered by or expended by each budget unit, including trust monies or other monies not subject to appropriation, setting out all revenues, charges against all funds, fund and appropriation balances, interfund transfers, outstanding warrants, checks, electronic funds transfer vouchers and encumbrances, in a manner consistent with the uniform state accounting system, to prepare statewide financial statements in accordance with generally accepted governmental accounting principles. C. Each month the department of administration shall prepare and submit to the governor a report summarizing by budget unit and appropriation or other fund source the information prescribed in subsection B of this section in a form that will most clearly and accurately set out the current fiscal condition of the state and shall furnish to each budget unit a report of its transactions by appropriation or other fund source in a form that will clearly and accurately show the fiscal activity and condition of the appropriation or fund source. D. The responsible official for each budget unit shall monitor reports prepared pursuant to subsection C of this section to identify any projected total deficiency for the budget unit fiscal year. On a determination of a projected deficiency, the official shall take any action necessary to ensure continuing compliance with section 1-254 by notifying the governor, the speaker of the house of representatives, the president of the senate and the chairman of the joint legislative budget committee of the deficiency and the reasons for the deficiency. The initial notification of the deficiency shall be followed within ten business days by a report from the responsible budget unit official that includes the following: 1. A complete explanation of the causes of the deficiency. 2. A plan that ensures that the deficiency will be resolved within the fiscal year without supplemental appropriation and that includes the policy and programmatic implications of the deficiency and the plan. 3. A commitment to provide a progress report if the projected degree of deficiency changes substantially. The report shall include additional measures necessary to ensure resolution of the deficiency within the fiscal year. E. On or before December 1 of each year, the director of the department of administration shall submit to the governor a complete report of the financial transactions of the preceding fiscal year and of the financial condition of the state at the end of that year with such comments and supplementary data as the director of the department of administration deems necessary to make the report complete and readily understandable. The report shall include all appropriated and nonappropriated monies in no less detail than the state general fund. F. On or before February 1 of each year, the director of the department of administration and the state treasurer shall submit to the joint legislative budget committee a report explaining any differences between the department of administration's estimate of the previous fiscal year's state general fund ending balance submitted pursuant to subsection E of this section and the state treasurer's estimate of the invested balance, including the state general fund share of that balance, as of June 30 of the previous fiscal year submitted pursuant to section 41-172. G. In preparing the comprehensive annual financial report published in accordance with generally accepted accounting principles, the department of administration shall include supplementary schedules that reconcile any differences between the state general fund as reported in the comprehensive annual financial report and the state general fund as reported in the annual financial report required by subsection E of this section. This reconciliation shall address revenues, expenditures and fund balances. H. The director of the department of administration shall prescribe uniform classifications for assets, liabilities, receipts and expenditures and forms for the periodic reporting of financial accounts, transactions and other matters by budget units compatible with the reports required of the director of the department of administration under this section. Such records and accounts shall be maintained and reconciled by budget units. If required for reporting, the department of administration may establish or delete funds and budget units may maintain additional records for reporting to the federal government or other funding source. I. Each organization that is included in the state's reporting entity as defined by generally accepted accounting principles shall submit all necessary financial statements or information to the department of administration on a basis of accounting that is consistent with generally accepted accounting principles and that is in accordance with the policies and procedures of the department of administration. 35-141. General fund; payment of salaries and expenses The general fund consists of all money received into the state treasury except money designated by law for other statutory funds. Salaries of state officers, salaries of deputies, assistants, clerks and employees, and expenses incident to the offices thereof, shall be paid from the general fund or the respective fund indicated when and as authorized in the general appropriation act or any other appropriation enacted by the legislature. 35-142. Monies kept in funds separate from state general fund; receipt and withdrawal A. All monies received for and belonging to this state shall be deposited in the state treasury and credited to the state general fund except the following, which shall be placed and retained in separate funds: 1. The unexpendable principal of monies received from federal land grants shall be placed in separate funds, and the account of each separate fund shall bear a title indicating the source and the institution or purpose to which the fund belongs. 2. The interest, rentals and other expendable monies received as income from federal land grants shall be placed in separate accounts, each account bearing a title indicating the source and the institution or purpose to which the fund belongs. Such expendable monies shall be expended only as authorized, regulated and controlled by the general appropriations act or other act of the legislature. 3. All private or quasi-private monies authorized by law to be paid to or held by the state treasurer shall be placed in separate accounts, each account bearing a title indicating the source and purpose of the fund. 4. All monies legally pledged to retire building indebtedness or bonds issued by those institutions authorized to incur such indebtedness or to issue such bonds shall be placed in separate accounts. 5. Monies of a multi-county water conservation district authorized by law to be paid to or held by the state treasurer shall be placed in separate accounts, each account bearing a title indicating the source and purpose of the fund. 6. All monies collected by the Arizona game and fish department shall be deposited in a special fund known as the state game and fish protection fund for the use of the Arizona game and fish commission in carrying out title 17. 7. All federal monies that are received by the department of economic security for family assistance benefits and medical eligibility as a result of efficiencies developed by the department of economic security and that would otherwise revert to the state general fund pursuant to section 35-190 shall be retained for use by the department of economic security in accordance with the terms and conditions imposed by the federal funding source in an account or accounts established or authorized by the state treasurer. 8. Monies designated by law as special state funds shall not be considered a part of the state general fund. Unless otherwise prescribed by law, the state treasurer is the custodian of all such funds. 9. All monies received and any accounts established and maintained by the director of the Arizona state retirement system or the administrator of the public safety personnel retirement system, the corrections officer retirement plan and the elected officials' retirement plan. 10. Monies received by a state agency or institution as a gift, devise or donation shall not be considered a part of the state general fund or transferred to the state general fund unless the gift, devise or donation specifically authorizes a general state use for the monies. A state agency or institution that receives a monetary gift, devise or donation shall account for those monies separately. 11. All monies received by the Arizona game and fish commission in connection with clean water act in-lieu fee projects shall be deposited in a special trust fund, known as the game and fish in-lieu fee program restoration endowment trust fund, established by section 17-265 for the use of the Arizona game and fish commission solely for the following: (a) The purposes authorized under any enabling instrument between the commission, the United States army corps of engineers and the United States environmental protection agency. (b) Site selection, design, implementation, monitoring, management and administrative costs related to the Arizona game and fish department's responsibilities as an in-lieu fee sponsor pursuant to sections 401 and 404 of the clean water act. B. Monies shall not be received or held by the state treasurer except as authorized by law, and in every instance the treasurer shall issue a receipt for monies received and shall record the transaction in the statewide accounting system. Monies shall not be withdrawn from the treasury except on the warrant, check or substitute check, or electronic funds transfer voucher of the department of administration. C. Monies received for and belonging to this state and resulting from compromises or settlements by or against this state, excluding restitution and reimbursement to state agencies for costs or attorney fees, shall be credited to the state general fund unless specifically credited to another fund by law. A fund consisting of monies other than monies received for restitution, costs or attorney fees shall not be established by a court order without prior legislative authorization. For the purposes of this subsection, "restitution" means monies intended to compensate a specific, identifiable person, including this state, for economic loss. D. All federal monies granted and paid to this state by the federal government shall be accounted for in the accounts or funds of this state in the necessary detail to meet federal and state accounting, budgetary and auditing requirements, and all appropriations for matching such federal monies shall be transferred from the state general fund to such separate funds as needed, except as otherwise required by the federal government. E. This section does not require the establishment of separate accounts or funds for such federal monies unless otherwise required by federal or state law. The department of administration may use the most efficient system of accounts and records, consistent with legal requirements and standard and necessary fiscal safeguards. F. This section does not preclude the department of administration from establishing a clearing account or other acceptable accounting method to effect prompt payment of claims from an approved budget or appropriation. The department of administration shall report each account or fund established or cancelled to the directors of the joint legislative budget committee and the governor's office of strategic planning and budgeting. G. This section and any other section do not preclude the use of monies kept in funds separate from the state general fund, the interest from which accrues to the state general fund, to pay claims against the state general fund if sufficient monies remain available to pay claims against such funds. H. The department of administration may issue warrants, checks or electronic funds transfer vouchers for qualified expenditures of federal program monies before they are deposited in the state treasury. The receipt of federal monies shall be timed to coincide, as closely as administratively feasible, with the redemption of warrants, checks or substitute checks, or electronic funds transfer vouchers by the state treasurer. The department of administration shall limit expenditures to the amount that has been made available to use under the grant award by the federal government. The state agency initiating the expenditures is responsible for ensuring that expenditures qualify for coverage under the guidelines of the federal grant award. I. The department of administration shall establish policies and procedures for all state agencies for drawing federal monies. When the established method results in federal monies being held by this state, the department of administration may use the interest earned on the monies to pay the federal government for any related interest liability. If an interest liability is incurred due to a state agency varying from the established policies and procedures, the department of administration shall charge the appropriate agency account or fund. Any federal interest liability owed to this state resulting from the delayed federal disbursements shall be used to offset this state's interest liability to the federal government. Any remaining interest earnings shall be deposited in the state general fund. J. Any state agency or authorized agent of a state agency may accept credit cards pursuant to an agreement entered into by the state treasurer pursuant to section 35-315 to pay any amount due to that agency or agent or this state. K. Except for the department of revenue, agencies or authorized agents on behalf of state agencies that accept credit cards shall deduct any applicable discount fee and processing fee associated with the transaction amount before depositing the net amount in the appropriate state fund. No other reduction is allowed against the transaction amount. The net amount deposited in the appropriate state fund shall be considered as the full deposit required by law of monies received by the agency or the authorized agent. Payment of any applicable discount fee and processing fee shall be accounted for in the annual report submitted to the governor's office of strategic planning and budgeting in accordance with section 41-1273. The transaction amount of any credit card transaction shall not be reduced by any discount fee or processing fee in an amount of more than the merchant card settlement fees reflected in the state banking contract with the state treasurer's office. L. Any state agency that contracts with an authorized agent to electronically process transactions pursuant to title 41, chapter 23 may include a provision in the contract to allow the authorized agent to impose a convenience fee or a service fee or surcharge. If allowed, the convenience fee or the service fee or surcharge shall be charged to the cardholder in addition to the transaction amount, except for the following: 1. Except as provided in subsection R of this section, any permits, licenses or other authorizations needed to pursue a trade or occupation in this state. 2. Except as provided in subsection R of this section, any permits, licenses or other authorizations needed to establish, expand or operate a business in this state. 3. Except as provided in subsection R of this section, any permits, licenses or other authorizations needed to register a vehicle or license a driver in this state. M. Each state agency or its authorized agent shall: 1. Deduct the amount of the convenience fee or the service fee or surcharge before depositing the transaction amount or the transaction amount reduced by the discount fee or the processing fee, or both, into the appropriate state fund. 2. Not deduct any part of the convenience fee or the service fee or surcharge from the transaction amount before depositing the net amount into the appropriate state fund. 3. Deduct the amount of the discount fee or the processing fee, or both, from the transaction amount before depositing the net amount into the appropriate state fund. N. The net amount deposited in the appropriate state fund pursuant to subsection L or M of this section shall be considered as the full deposit of monies that is required by law and that is received by the agency. O. Before charging a convenience fee or a service fee or surcharge, a state agency shall submit the proposed convenience fee or the proposed service fee or surcharge to the state treasurer for approval. If the state treasurer determines that the proposed convenience fee or the proposed service fee or surcharge is necessary to ensure the efficient processing of payments to the state agency and complies with the standards of the credit card industry, the state treasurer shall approve the convenience fee or the service fee or surcharge. Notwithstanding section 35-142.01, convenience fees received by a state agency or its authorized agent may be used to offset the costs imposed by the authorized agent in processing the transactions. P. When the percentage of electronic transactions first exceeds at least thirty percent of a state agency's total transactions, the state agency shall perform a cost benefit report, including costs of convenience fees or the service fee or surcharge, the amount of revenue generated and any realized cost savings. Q. This section and any other provision of law do not authorize any state agency, authorized agent of any state agency or budget unit to establish a bank account for any government monies. All monies received by or on behalf of this state shall be deposited with and in the custody of the state treasurer or in an account that is authorized by the state treasurer pursuant to this section. This subsection does not apply to monies received and any accounts established and maintained by the director of the Arizona state retirement system or the administrator of the public safety personnel retirement system, the corrections officer retirement plan and the elected officials' retirement plan. R. If a state agency provides an alternative method of payment, the convenience fee or the service fee or surcharge may be charged to the cardholder in addition to the transaction amount. 35-142.01. Reimbursement of appropriated funds; receipt and deposit; prohibition; inmate health care services; notice A. Except as provided in subsections B and C of this section, when monies are appropriated to a budget unit for a specific program or purpose that is subject to reimbursement in whole or in part from federal monies or any other source, and that is so noted in the appropriation bill, the budget unit, on receipt of such reimbursement, shall deposit the monies, pursuant to sections 35-146 and 35-147, in the state general fund or the fund from which the appropriation was originally made. If the reimbursement is not noted in the appropriation bill, it may be credited to the account out of which the expenditure was incurred if the director of the budget unit determines that reimbursement within the fiscal year is necessary for operation of the budget unit and was not specifically considered and rejected by the legislature at the time of appropriating monies to the budget unit. The director of the budget unit shall notify the joint legislative budget committee, the governor's office of strategic planning and budgeting and the state comptroller in writing of determinations made pursuant to this section. B. When monies are appropriated to the Arizona health care cost containment system administration or the department of health services and the specific program or purpose for which the monies are appropriated is subject to reimbursement for reconciliation payments from or penalties against program contractors or health plans, the department or administration, on receipt of such reimbursement, shall deposit the monies, pursuant to sections 35-146 and 35-147, in the state general fund or the fund from which the appropriation was originally made. The Arizona health care cost containment system administration and the department of health services are prohibited from allowing reconciliation payments from or penalties against program contractors or health plans to be credited against future payments to the program contractor or health plan. C. Notwithstanding section 35-190, the state department of corrections may credit against payments owed in the current fiscal year to the department's health care contractor the amount of state and federal monies paid by the Arizona health care cost containment system administration for health care services on behalf of medicaid-eligible inmates regardless of the dates of service. On or before July 1 of each year, the director of the state department of corrections shall notify the directors of the joint legislative budget committee and the governor's office of strategic planning and budgeting of the amount of credits against payments for the previous fiscal year. 35-143. Collection through budget units; time for collection; failure to collect; liability A. Fees for licenses, permits, certificates of any kind and other amounts due any budget unit shall be collected at the time such licenses, permits or certificates are issued by the budget units issuing them. All other monies accruing to the various budget units or to the state through the various budget units shall also be collected at the time services are rendered, or at the time of accrual by the budget units rendering the services or assessing the charges, or otherwise giving rise to the claims in favor of the state. B. Any person or officer who neglects the collection of such fees or monies shall be liable to the state, both personally and on his bond. 35-143.01. Special funds; appropriation; reversion; use A. All monies deposited in special agency funds of self-supporting regulatory agencies, as provided in section 35-142, to be used by such agency for administration and enforcement, shall be subject to annual legislative appropriation. B. Unless otherwise provided by the legislature, a special fund self-supporting regulatory agency shall not expend more monies than are appropriated by the legislature for a fiscal year, and any monies remaining at the end of the fiscal year revert to the special agency fund. C. Any unexpended or unencumbered balance of monies remaining in the special funds of self-supporting regulatory agencies as provided in section 35-142 at the end of the fiscal year shall not revert to the state general fund and may be made available by the legislature for use by the agency for the following fiscal year. 35-144. Budget stabilization fund; definitions A. The budget stabilization fund is established consisting of monies transferred from the state general fund pursuant to subsection B of this section. The state treasurer shall administer the budget stabilization fund and invest and divest monies in the budget stabilization fund as provided by sections 35-313 and 35-314.02, and monies earned from investment shall be credited to the budget stabilization fund. Except as provided by this section: 1. Monies in the budget stabilization fund are exempt from the provisions of section 35-190 relating to the reversion of monies to the state general fund. 2. The monies in the fund are separate monies to be used only for the purposes of the fund. 3. An amount sufficient to pay claims certified by the state forester pursuant to section 37-1305, subsection E, paragraph 4 is continuously appropriated from the fund to the state treasurer for payment of the certified claims. Not more than $20,000,000 in unreimbursed claims may be outstanding from the fund at any time from the monies appropriated pursuant to this paragraph. B. In a calendar year in which the annual growth rate exceeds the trend growth rate, the excess growth when multiplied by total general fund revenue of the fiscal year ending in the calendar year determines the amount to be appropriated by the legislature to the budget stabilization fund in the fiscal year in which the calendar year ends. C. In a calendar year in which the annual growth rate is both less than two percent and less than the trend growth rate, the difference between the annual growth rate and the trend growth rate when multiplied by the total general fund revenue of the fiscal year ending in the calendar year determines the amount to be transferred by the legislature from the budget stabilization fund to the state general fund at the end of the fiscal year in which the calendar year ends. The transfer calculated pursuant to this subsection shall not exceed the available balance in the budget stabilization fund, nor shall the legislature transfer an amount that exceeds the amount sufficient to balance the state general fund budget. D. The legislature shall pass a bill that contains the emergency clause if the legislature either: 1. Reduces the amount for appropriation to the budget stabilization fund under subsection B of this section. 2. Increases the amount for transfer to the state general fund under subsection C of this section. E. The annual budget recommendations of the governor and the joint legislative budget committee shall include estimates of appropriations or transfers required under subsection B or C of this section. F. A final determination of the amount to be appropriated to or transferred from the budget stabilization fund shall be made using personal income and price deflator estimates as reported in the second calendar quarter for the preceding calendar year. The economic estimates commission shall determine the annual growth rate, the trend growth rate and the required appropriation to or transfer from the budget stabilization fund at its first meeting following the second calendar quarter report of the United States department of commerce, but not later than June 1. The commission shall certify and report its findings to the governor, the state treasurer, the president of the senate, the speaker of the house of representatives and the joint legislative budget committee. G. The appropriation calculated pursuant to subsection B of this section may be included in the general appropriations bill for that fiscal year. Any additional appropriation calculated pursuant to subsection F of this section shall be made by a separate act. H. At the end of a fiscal year, the budget stabilization fund balance shall not exceed ten percent of state general fund revenue for the fiscal year. Any surplus monies above ten percent shall be transferred by the state treasurer to the state general fund. I. The state treasurer may temporarily divest monies in the budget stabilization fund to avoid a negative cash balance in operating monies. The amount divested shall not exceed the amount required to meet immediate cash needs. The state treasurer may divest monies in the budget stabilization fund only when the state general fund has a negative cash balance. J. For the purposes of this section: 1. "Adjusted personal income" means personal income minus transfer payments, as reported by the United States department of commerce, bureau of economic analysis, or its successor agency. 2. "Annual growth rate" means the percentage change in real adjusted personal income in the calendar year ending during a fiscal year as compared to real adjusted personal income for the preceding calendar year. The annual growth rate shall be rounded to the nearest one-hundredth of one percent. 3. "GDP price deflator" means the gross domestic product price deflator reported by the United States department of commerce, bureau of economic analysis, or its successor agency. 4. "Personal income" means the total personal income of all persons in this state reported by the United States department of commerce, bureau of economic analysis, or its successor agency. 5. "Real adjusted personal income" means an amount that is determined by dividing adjusted personal income by the GDP price deflator and multiplying the result by one hundred. 6. "Transfer payments" means that portion of personal income that represents a government expenditure for which no service is rendered or product is delivered, as determined by the United States department of commerce, bureau of economic analysis, or its successor agency. 7. "Trend growth rate" means the average annual growth rate for the most recent seven calendar years, rounded to the nearest one-hundredth of one percent. 35-145. Control of taxes receivable from counties; statements from county treasurer; violation; penalty A. The treasurer of each county shall: 1. Remit to the state treasurer, on or before the fifteenth day of each month during each fiscal year, the portion of tax money belonging to the state which was collected during the previous month. 2. Transmit to the state treasurer a statement of financial transactions in a form authorized by the state treasurer. B. Any county which fails or refuses to comply with the provisions of this section, or refuses to pay any obligations due the state from the county, shall be notified in writing by the state treasurer. Any county which persists in such failure or refusal for a period of thirty days after mailing the notice is disqualified from receiving any portion of the excise tax monies under section 42-5029 until the county complies with the provisions of this section and pays the state its obligations. C. The provisions of this section shall not bar or suspend the state's right to commence an action for the purpose of compelling the collection or remitting of monies due the state. 35-146. Deposit of receipts by budget units A. All monies received by any officer or employee of any budget unit shall be promptly remitted to the state treasurer, and monies shall not be held, used or deposited in any personal or special bank account temporarily or otherwise by any agent or employee except as expressly provided by this chapter. B. All monies received by the state treasurer shall be credited to the state general fund, unless otherwise prescribed by law. C. All revenues included in the operating budget adopted by the Arizona board of regents for each university as prescribed in section 15-1626, subsection A shall be retained by each university. Tuition and fees shall be deposited in subaccounts as prescribed in section 15-1626, subsection A. 35-147. Treasurer's deposits; preparation and disposition A. The head of the budget unit or his authorized agent in depositing monies with the state treasurer shall use forms authorized by the state treasurer. B. The treasurer's deposit shall be delivered to the state treasurer together with the remittance or proof of prior deposit with the state servicing bank. The state treasurer shall validate the deposit and provide a confirmation to the budget units to be retained by the issuing budget unit. The treasurer's confirmation shall show the amount, the date deposited and a unique identifying number that will link the deposit to accounting documents and fund details maintained in the statewide accounting system. The treasurer's deposit forms shall be issued to the budget units by the department of administration. The administrative head of each budget unit shall be held accountable for each deposit. 35-148. Payment for interagency services as credit to account of agency; transfer of miscellaneous state monies to general fund; exceptions A. Interagency service agreements entered into between budget units may provide for reimbursement for services performed or advancement of funds for services to be performed. In either instance, monies received by the budget unit performing the services shall be credited to its appropriation account for its use in performing the services. If funds are advanced, the agency performing the services shall make an accounting of expenditures and return any advances not used to the appropriation account of the advancing agency. B. Except as provided in subsection A of this section, when money belonging to the state comes into the possession of a state officer, by recovery at law or otherwise, and no provision of law exists for the disposition of such money, it shall be deposited, pursuant to sections 35-146 and 35-147, in the state general fund. C. The provisions of this section shall not apply to money realized from the sale of personal property or from the sale of real property or improvements thereon by the Arizona board of regents, or by educational institutions under the control of the Arizona board of regents, the department of child safety or the department of economic security. 35-149. Disposition of private monies; contributions and suspense funds; exception A. Every department, institution, board or commission receiving private monies or contributions available for its support or for the purpose of defraying expenses or work done under its direction, other receipts that are subject to refund or return to the sender or receipts that have not yet accrued to the state shall, in depositing such monies with the state treasurer as provided in this chapter, certify to the department of administration: 1. The source from which such monies were received. 2. The terms and conditions under which and the purpose for which the monies were received. 3. The names of the trustees or administrators of the monies or contributions. 4. The name of the person authorized to approve expenditures from each fund. B. The department, institution, board or commission shall keep