HB2482 - Building renewal grants; job-order-contracting

Senate Engrossed House Bill building renewal grants; procurement practices (now: building renewal grants; job-order-contracting) State of Arizona House of Representatives Fifty-seventh Legislature Second Regular Session 2026 HOUSE BILL 2482 AN ACT amending section 41-5702, Arizona Revised Statutes; relating to school facilities. (TEXT OF BILL BEGINS ON NEXT PAGE) Be it enacted by the Legislature of the State of Arizona: Section 1. Section 41-5702, Arizona Revised Statutes, is amended to read: START_STATUTE 41-5702. Powers and duties; staffing; reporting requirements A. The division shall: 1. Assess school facilities and equipment deficiencies and approve the distribution of grants as appropriate. 2. Maintain a database of school facilities to allow for the administration of the new school facilities formula and the building renewal grant fund. The facilities listed in the database must include all buildings that are owned by school districts. The division shall ensure that the database is updated on at least an annual basis. Each school district shall report to the division not later than September 1 of each year information as required by the division to administer the building renewal grant fund and by the school facilities oversight board to compute new school facilities formula distributions, including the nature and cost of major repairs, renovations or physical improvements to or replacement of building systems or equipment that were made in the previous year and that were paid for either with local monies or monies provided from the building renewal grant fund. Each school district shall report any school or school buildings that have been closed, that are vacant or partially used pursuant to section 15-119 and that have been leased to another entity or that operate as a charter school. The division shall develop guidelines and definitions for the reporting prescribed in this paragraph and may review or audit the information, or both, to confirm the information submitted by a school district. Notwithstanding any other provision of this chapter, if a school district converts space that is listed in the database maintained pursuant to this paragraph to space that will be used for administrative purposes, the school district is responsible for any costs associated with converting, maintaining and replacing that space. If a building is significantly upgraded or remodeled, the division shall adjust the age of that school facility in the database as follows: (a) Determine the building capacity value as follows: (i) Multiply the student capacity of the building by the per pupil square foot capacity established by section 41-5741. (ii) Multiply the product determined in item (i) of this subdivision by the cost per square foot established by section 41-5741. (b) Divide the cost of the renovation by the building capacity value determined in subdivision (a) of this paragraph. (c) Multiply the quotient determined in subdivision (b) of this paragraph by the currently listed age of the building in the database. (d) Subtract the product determined in subdivision (c) of this paragraph from the currently listed age of the building in the database, rounded to the nearest whole number. If the result is a negative number, use zero. 3. Inspect, contract with a third party to inspect or certify school district self-inspections of school buildings at least once every five years to ensure compliance with the building adequacy standards prescribed in section 41-5711, the accuracy of the reporting of vacant and partially used buildings pursuant to this subsection and routine preventive maintenance guidelines as prescribed in this section with respect to constructing new buildings and maintaining existing buildings. The division shall randomly select twenty school districts every thirty months and provide for them to be inspected pursuant to this paragraph. 4. Develop prototypical elementary and high school designs. The division shall review the design differences between the schools with the highest academic productivity scores and the schools with the lowest academic productivity scores. The division shall also review the results of a valid and reliable survey of parent quality rating in the highest performing schools and the lowest performing schools in this state. The survey of parent quality rating shall be administered by the department of education. The division shall consider the design elements of the schools with the highest academic productivity scores and parent quality ratings in the development of elementary and high school designs. The division shall develop separate school designs for elementary, middle and high schools with varying pupil capacities. 5. Develop application forms, reporting forms and procedures to carry out the requirements of this article, including developing and implementing policies and procedures to: (a) Ensure that the division and the school facilities oversight board, as applicable, notify school districts in a uniform manner of the services and funding available for school districts from the board or the division for facility construction, renovation and repair projects. The policies and procedures shall require the division and the board to provide at least one annual communication to school districts in a manner prescribed by the division and shall require each school district to develop and maintain a list of persons who are responsible for facilities management at that school district. (b) Establish a project eligibility assessment for all projects submitted for funding from the building renewal grant funding fund established by section 41-5731 or the emergency deficiencies correction funding fund established by section 41-5721 , including establishing standardized criteria for project eligibility. Notwithstanding section 15-213, subsection M, chapter 23 of this title and the rules adopted by the state board of education pursuant to section 15-213, subsection a, the maximum dollar amount of an individual job order for job-order-contracting for construction services is $1,000,000 for any project that receives monies from the building renewal grant fund established by section 41-5731 and that is not an emergency, as determined by the division. Before the division formally approves a project, the staff of the division : ( i ) May review the costs and scope of the proposed project with persons and entities that have submitted bids on the project . ( ii ) shall verify that requirements are not artificially divided or fragmented in order to constitute a job order that satisfies the requirements of this subdivision . ( iii ) On request by a school district, shall determine whether a project submitted for funding from the building renewal grant fund is an emergency not later than five business days after the date on which the division receives the request. The division shall determine that A project is an emergency if the school district demonstrates a serious need for materials, services or construction or expenses that exceeds the school district's adopted budget for the current fiscal year and that seriously threatens the functioning of the school district, the preservation of property or public health, welfare or safety. This item does not authorize the division to approve funding from the building renewal grant fund for a project that does not serve an academic purpose as required by section 41-5731, subsection I. (c) Ensure that the division and the school facilities oversight board maintain standardized documentation of all projects submitted to the board and the division for consideration to receive services or a financial award from the board or the division. The board and the division shall maintain standardized documentation of any project awarded monies by the board or the division, including records of payments to school districts in a manner prescribed by the division. The standardized documentation shall include the following as part of the eligibility determination criteria: (i) Whether the problem that the proposed project intends to address caused the building or facility to fall below the minimum school facility adequacy guidelines prescribed in section 41-5711. (ii) Whether the school district performed the routine preventive maintenance required by section 41-5731 on the building or facility. (d) Require a school district to submit contact information for each proposed project, including the name, email address and telephone number of persons who are responsible for facilities management at the school district. (e) Require a school district to provide justification for each proposed project, including all of the following: (i) The school district's use or planned use of the facility. (ii) A detailed description of the problem and the school district's recommended solution. (iii) Any completed professional study regarding the proposed project. (iv) Any citation or report from government entities. (v) The estimated cost of the proposed project, with documentation. (vi) The project category. (vii) A description of any local funding that will be used for the proposed project. (viii) Documentation on associated insurance coverage, if applicable. (f) Require that an initial application not be considered complete until all necessary information is submitted. (g) Allow a school district to submit an incomplete application and request technical assistance from the staff of the board if the school district is unable to provide sufficient information in the initial application. (h) If applicable, require that a complete application be received by the board at least fifteen business days before the next regularly scheduled board meeting in order for the application to be considered at that meeting. An incomplete application may be considered at that meeting if both the staff of the board and the superintendent of the school district deem the project critical. (i) Allow the staff of the board or the division, as applicable, to notify a school district in writing before review by the board or division that the proposed project does not meet eligibility criteria prescribed in this chapter. The written notification shall include documentation to support the determination that the proposed project does not meet the eligibility criteria prescribed in this chapter. The school district may directly appeal the determination of ineligibility to the director of the division. The school district may directly appeal the director's determination of ineligibility to the board. (j) Prohibit the staff of the board or division from requesting that a school district withdraw a project application from review by the board or division if the initial review determines that the proposed project may be ineligible for monies pursuant to this chapter. 6. Electronically submit an annual report on or before December 15 to the speaker of the house of representatives, the president of the senate, the superintendent of public instruction, the secretary of state and the governor that includes the following information: (a) A detailed description of the amount of monies distributed by the division under this chapter in the previous fiscal year. (b) A list of each capital project that received monies from the division under this chapter during the previous fiscal year, a brief description of each project that was funded and a summary of the division's reasons for distributing monies for the project. (c) A summary of the findings and conclusions of the building maintenance inspections conducted pursuant to this article during the previous fiscal year. (d) A summary of the findings of common design elements and characteristics of the highest performing schools and the lowest performing schools based on academic productivity, including the results of the parent quality rating survey. For the purposes of this subdivision, "academic productivity" means academic year advancement per calendar year as measured with student-level data using the statewide nationally standardized norm-referenced achievement test. 7. On or before December 1 of each year, report electronically to the joint committee on capital review the amounts necessary to fulfill the requirements of section 41-5721 for the following three fiscal years. In developing the amounts necessary for this report, the division shall use the most recent average daily membership data available. On request from the division, the department of education shall make available the most recent average daily membership data for use in calculating the amounts necessary to fulfill the requirements of section 41-5721 for the following three fiscal years. The division shall provide copies of the report to the president of the senate, the speaker of the house of representatives and the governor. 8. On or before June 15 of each year, electronically submit detailed information regarding demographic assumptions and a proposed construction schedule for individual projects approved in the current fiscal year and expected project approvals for the upcoming fiscal year to the joint committee on capital review for its review. A copy of the report shall also be submitted electronically to the governor's office of strategic planning and budgeting. The joint legislative budget committee staff, the governor's office of strategic planning and budgeting staff and the division staff shall agree on the format of the report. 9. Every two years, provide school districts with information on improving and maintaining the indoor environmental quality in school buildings. 10. Adopt rules regarding the validation of adjacent ways projects pursuant to paragraph 11 of this subsection. 11. Validate proposed adjacent ways projects that are submitted by school districts as prescribed in section 15-995 pursuant to rules adopted by the division under paragraph 10 of this subsection. 12. Submit a monthly report to the school facilities oversight board that details each adjacent ways project validated pursuant to paragraph 11 of this subsection. 13. Brief the joint committee on capital review at least once each year regarding the use of monies from all of the following: (a) The emergency deficiencies correction fund established by section 41-5721. (b) The building renewal grant fund established by section 41-5731. (c) The new school facilities fund established by section 41-5741. B. The school facilities oversight board or the division may contract for the following services in compliance with the procurement practices prescribed in chapter 23 of this title: 1. Private services. 2. Construction project management services. 3. Assessments for school buildings to determine if the buildings have outlived their useful life pursuant to section 41-5741, subsection G or have been condemned. 4. Services related to land acquisition and development of a school site. C. The school facilities oversight board shall: 1. [Text truncated for display. Full text available on LegiScan.]