SB1551 would redirect investment earnings from Arizona’s budget stabilization fund into the statewide infrastructure trust fund, which is used for transportation projects. The bill amends the statutes governing both funds so that monies earned from investing the budget stabilization fund would be credited to the infrastructure trust fund, and those monies could then be used for phases of development or construction of transportation projects in the current or next fiscal year. The bill also keeps the infrastructure trust fund subject to legislative appropriation and requires an expenditure plan to be reviewed by the Joint Committee on Capital Review before money is spent.
The measure leaves the broader structure of the budget stabilization fund in place, including its growth-based deposit and withdrawal formulas, the 10 percent cap relative to general fund revenue, and the ability to temporarily divest funds to address a negative cash balance. Its main policy change is to divert the fund’s investment earnings to highway-related spending rather than allowing those earnings to remain in the stabilization fund. The bill defines transportation projects narrowly as new or improved federal or state highways.
Impact
SB1551 would amend A.R.S. sections 28-7011 and 35-144 to change the destination of investment earnings from the budget stabilization fund, shifting them to the statewide infrastructure trust fund for highway construction and improvement. This would affect the state treasurer’s administration of both funds, the flow of investment income, and the financing available for transportation infrastructure. It would also preserve legislative oversight through appropriation requirements and Joint Committee on Capital Review review of expenditure plans.
Sentiment
The bill appears to have received little support and ultimately failed in committee. In the Senate Appropriations, Transportation and Technology Committee, it was defeated by a 2-7 vote on February 11, 2026. With no committee transcript available, the available record suggests the proposal did not gain traction among committee members, likely reflecting concern about redirecting budget stabilization resources away from the state’s rainy-day reserve structure.
Contention
The central point of contention is the diversion of budget stabilization fund investment earnings to transportation projects. Supporters would likely view the bill as a way to create a dedicated funding stream for highways and infrastructure, while opponents may have been concerned about weakening the state’s fiscal cushion or reducing flexibility in the budget stabilization fund. Another likely issue is that the bill ties transportation funding to earnings from a reserve fund rather than to a direct appropriation or dedicated tax source, which may have raised concerns about long-term budget stability and prioritization of general fund reserves over capital spending.
A resolution to direct the Clerk of the House of Representatives to only present to the Governor enrolled House bills finally passed by both houses of the One Hundred Third Legislature.
Relating to nonsubstantive additions to, revisions of, and corrections in enacted codes, to the nonsubstantive codification or disposition of various laws omitted from enacted codes, and to conforming codifications enacted by the 88th Legislature to other Acts of that legislature.