HB2742 Summary

• Establishes a new 0.6% use tax effective July 1, 2021, with revenues distributed to education, workforce development, and university programs through a new section 42-5029.02.

• Allocates use tax revenues as follows: $86.3 million annually for school days/teacher salaries, $7.8 million for school safety, 82% to classroom site fund, 13.75% to universities (including $86.5 million minimum to technology/research fund), and 4.25% to community college workforce development programs.

• Modifies the classroom site fund distribution requirements in section 15-977, including changes to teacher compensation allocations (40% performance-based, 20% base salary) and expanded allowable uses for maintenance and operations.

• Creates a conditional enactment structure tied to House Concurrent Resolution 2031, with different effective dates depending on whether the constitutional amendment passes at the next general election.

• Makes conforming amendments to Arizona Revised Statutes sections governing school accountability, community colleges, higher education funding, and income tax credit reviews.