Ducey signs $1B university loan plan, considers other bills

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Gov. Doug Ducey signed a bill that would allow Arizona's three universities to borrow up to $1 billion. (Source: azgovernor.gov) Gov. Doug Ducey signed a bill that would allow Arizona's three universities to borrow up to $1 billion. (Source: azgovernor.gov)
PHOENIX (AP) -

Arizona Gov. Doug Ducey on Monday signed legislation that allows the state's three public universities to borrow up to $1 billion and puts the state on the hook for $27 million a year to help cover the payments.

The bonding package that will allow the universities to build new research facilities and tackle a backlog of maintenance was one of the most contentious of the session, with many majority Republicans opposed to the plan until cutting deals at the last minute. That allowed the plan to pass without Democratic support in the House and forced many Democrats in the Senate to back the plan for political reasons.

It was the first of 33 bills the Republican governor was set to consider Monday as he finishes action on legislation from the 2017 legislative session that ended May 10.

[READ MORE: Arizona lawmakers pass tax breaks as session ends]

The university funding will allow Ducey to claim a win going into his 2018 re-election bid by pointing to the new university funding. But it doesn't come close to replacing the $99 million in annual funding he cut in his first budget in 2015, and the new funding doesn't start for a year.

The governor said at a signing ceremony attended by university presidents, lawmakers - and the university mascots - that the loan package "ensures that the excellence that we have in our public universities in the state of Arizona will continue for decades."

[RELATED: Ducey considering final 33 bills of 2017 legislative session]

And he pushed back at questions about major cuts to universities in the past decade that together mean the state is paying less than half the per-student funding it was paying in 2008.

"Arizona was hurt more than other states in the country through the recession. We made the difficult decisions in the first year, our state's headed in the right direction, our economy's growing," Ducey said. "We're sitting in the fastest growing county in the country right now in Maricopa County. We can make decisions that are more positive so we can make investments in the future.

"I think everyone understands that's ever managed an enterprise that you have to sometimes make tough decisions, and this one was a forward thinking decision," he said.

Universities now receive nearly $400 million less in state cash per year than they did a decade ago, while enrollment has gone up by 50 percent. In real dollars, that means Arizona State University, Northern Arizona university and the University of Arizona are getting about $4,100 in general fund cash for each full-time student, compared to more than $9,600 per student in the 2008 budget year, according to the Legislature's budget analysts. The universities have made up the difference by sharply increasing tuition and fees.

University of Arizona President Michael Crow said the universities have restructured the way they are funded to become less reliant on state cash and Ducey has agreed to work on boosting funding up to 50 percent of the cost of attendance for an in-state student. It's currently below 40 percent, he said.

"We don't need the amount of resources that we needed in the past," he said. "What we need is a guaranteed amount of resources that we can predict our income around for in-state students."

The governor needs to act on 32 other pieces of legislation by the close of business Monday. Atop the list is a series of tax credits and other breaks for big and small corporations. Two bills extending workers' compensation coverage to current or retired firefighters with some cancers or heart problems also await action.

Others would boost mileage payments for state lawmakers and require counties and cities to only set votes for sales tax increases during November general elections.

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