2023 Legislative Updates
Written by Matthew Contorelli, Senior Director of External Affairs for the Arizona REALTORS®
September 19, 2023
Fall Legislative Update
While the historic 204-day legislative session of yesterday may seem like it just ended, the 2024 session is now only 111 days away, and as you may have guessed, the Arizona REALTORS® lobbying efforts are hard at work for you. While several hot-button items, such as education and water, look to take the spotlight next year, the Arizona REALTORS® are meeting with both legislative and appointed leaders to ensure that the real estate industry, private property rights, homeownership and housing interests are protected in the coming session.
Short-Term Rentals
For the third consecutive year, Representative Selina Bliss announced that she will continue to try to pass legislation that would allow smaller cities and towns to limit the number of short-term rentals (STR’s), at the request of the League of Cities and Towns. With no changes in their approach or new details to protect private property rights and the disparity the law would create; this proposal remains largely viewed as dead-on-arrival once again.
Deed Fraud
The Arizona REALTORS® have been meeting with Department of Real Estate Commissioner Susan Nicholson, Governor Hobbs’ staff and Legislators to develop solutions that will stop the rising trend of deed fraud. While several solutions have been presented, the Arizona REALTORS® are speaking up against new regulations that would increase liability on REALTORS® and push to develop more substantive solutions that will truly address the issues. It’s a fine line to walk but we are confident that we can find it.
Water
Water will be one of the spotlight issues in 2024 and the Arizona REALTORS® are at the table; most recently, the Arizona REALTORS® have attended meetings for the Governor’s Assured Water Supply Committee, as well as the legislative Ad-Hoc Water Committee Meeting. Proposals will likely focus on the 100-year assured water supply for build-to-rent developments and investments to support conservation and management.
As always, stay tuned for more updates and know that the Arizona REALTORS® are fighting for you!
AUGUST 8, 2023
THE LONGEST SESSION: 2023 LEGISLATIVE SESSION WRAP-UP
After 204 days, 1675 introduced bills, 211 bills passed, and a record-setting 143 bills vetoed, the first regular session of the fifty-sixth legislature adjourned sine die on Monday, July 31, 2023, at 5:16 PM. This session marked the longest in Arizona’s history. On that day, the months of dedicated work by the Arizona REALTORS® lobbying team paid off and two very important bills reached Governor Hobbs’ desk: SB1131, which repeals Arizona’s regressive residential rental tax (Rental TPT) statewide; and SB1102, a highly contested plan to refer the expiring Proposition 400 transportation tax to the 2024 ballot for approval by Maricopa County voters. The Governor signed both into law, despite having previously vetoed earlier versions of both bills.
So, what changed? Compromise. The Republican-led legislature largely didn’t want to pass Prop 400 legislation, viewing the extension of a tax, as a new tax; however, conservative hearts were won over as the Governor kept the door open on Rental TPT.
BACKGROUND
Repealing residential rental tax in Arizona has been a legislative priority for the Arizona REALTORS® for over a decade. Arizona law permits city governments to impose Rental TPT on properties rented for residential purposes for 30 or more consecutive days. Arizona is one of only two states to allow TPT collection on residential rental properties, which not only negatively impacts housing affordability, but has also hurt REALTORS® engaged in property management. SB1131 does not apply to commercial or short-term rental properties and will take effect on January 1, 2025. The timeframe was set at the request of the Governor’s office to allow cities more time to adjust for changes in revenue.
IMPACT TO RENTERS
Arizona renters pay an average of $600 in TPT charges annually, or $50 monthly, based on a $2,000/month lease with related taxable charges. This is money that could be used for gas, food, or other monthly expenses or savings towards buying a home. Rental TPT is charged on the taxable gross income, not just the rent amount. Charges for such items as internet, telecommunications, utilities, pet fees, or maintenance are considered part of the taxable gross income, per the model city tax code.
IMPACT TO PROPERTY MANAGERS
For REALTORS® engaged in property management, you know the impact well. Whether city governments or the Arizona Department of Revenue (ADOR) collect the tax, the process has consistently created confusion, sent false notices of taxes not paid, and has not aligned with property management practices. This has even resulted in some property management companies losing business due to miscalculations or related notices. The tax system used to report and collect rental TPT taxes in AZ is woefully inadequate, error-prone, and costly to administer by both property managers and the state alike. The Arizona REALTORS® have spent countless hours working with ADOR to rectify these issues, despite some process improvements, the challenges and costs to businesses persisted.
OPPOSITION FROM CITIES
One thing you may be asking yourself is why did the Cities fight so hard? Haven’t we heard elected leaders from across the state agree that we must improve housing supply and affordability? Well, Cities that levy this tax on renters stand to collectively lose $200M+, annually. That may sound like a lot, but some cities are sitting on budget surpluses in excess of $100M. In fact, Rental TPT revenues often account for less than 1% of the general fund. Since FY2020, cities’ TPT collections have increased by $1.15 BILLION and Rental TPT collections have increased by 28%. As rents increase, cities tax renters deeper into desperation, all while spending millions on lobbyists, membership organizations, and international trips. Fortunately, the Arizona REALTORS® had the bipartisan support of legislative leaders to get this to Governor Hobbs’ desk, despite the calls, threats, and fearmongering.
PROP 400
SB1102 seeks to continue the tax that has helped support Maricopa County Infrastructure for the past 40 years, for another 25 years. If approved by voters, Prop 400 will generate over $20 Billion, but the rules of where the monies can go will be stricter than ever. 40.5% of the funds will go to freeways and roads, 22.5% into arterial projects, and 37% into public transit if approved by voters. However, no tax revenue will be used for light rail expansion projects, a compromise reached between the Governor and legislative Republican leadership. The bill does allow capital costs, as well as maintenance and operation of public transportation and capital rehabilitation spending for existing light rail systems. No more than 3.5% of the 37% of public transit funds can be used for light rail rehabilitation. Even though the Prop 400 bill the Legislature passed doesn’t include money to expand light rail, the county can still expand using other funding. One area where the light rail will not be expanded to is a Capitol loop project that the city of Phoenix and the Maricopa Association of Governments had been planning for years to extend light rail service in Phoenix to Interstate 10. The bill states no light rail projects will be built near 17th Avenue on the east, Adams Street on the north, 18th Avenue on the west, and Jefferson Street on the south, effectively killing the Capitol loop project. This is just a glimpse into how heated the Prop 400 negotiations got.
The Arizona REALTORS® fought hard for eight months, attending countless meetings, whipping votes, whipping them again, brokering deals, strategizing, re-strategizing, and fielding calls and texts from morning to midnight – because getting these two pieces of legislation make Arizona a better place to live and work. These bills speak to the core values of the REALTOR® Party. The session was long and hard but 2024 is just over four months away and the Arizona REALTORS® will be ready for the next fight.
JUNE 23, 2023
While lawmakers returned to the capitol only briefly after a three-week pause to vote to recess again until July 31st when they’re expected to adjourn sine die, there was no shortage of action.
Why keep the session open for such an unpreceded length? To allow the Senate to confirm the remainder of Governor Hobbs’ executive nominees for agency directorships and board commissions. Thankfully, Arizona Department of Real Estate Commissioner, Susan Nicholson, isn’t one of those; Commissioner Nicholson received unanimous support from the Senate Director Nominations Committee on June 8th as REALTORS® from across the state packed the room to show support.
Last week, the Maricopa County Board of Supervisors filled the last remaining vacancy in the House with now-Representative Quantá Crews.
Despite the negotiations failing after numerous rounds of meetings, the Proposition 400 reauthorization for Maricopa County, which would ask voters to extend its transportation tax, caused much consternation. Republicans ultimately passed their own solution on a party-line vote, which was quickly vetoed by the Governor, adding to the record-setting tally of 143 vetoes. The REALTORS® urged all parties to find responsible common ground that would fulfill the needs of the region and state responsibly but the verdict is still out if that’s possible in this challenging environment.
Nevertheless, the Arizona REALTORS® reached a huge milestone by passing SB1131, which would repeal residential rental tax (Rental TPT) statewide, out of the Senate with bipartisan support thanks to freshman Democrats, Senator Flavio Bravo and Senator Anna Hernandez. The bill is waiting to be transmitted to the governor, as negotiations and communication with the Governor’s office continue to ensure that the Governor signs it into law and puts an end to this regressive tax on Arizona renters when affordable and fair housing is needed more than ever.
And just when we had a full roster, Senator Steve Kaiser, a Republican from North Phoenix, resigned his seat effective last Friday. Lawmakers will likely choose his replacement during this next recess.
Stay tuned to find out when this session will end!
Session Summary
Session Days: 166
Bills Posted: 1672
Bills Passed: 345
Bills Vetoed: 143
Bills Signed: 202
Mem, Res Posted: 110
Mem, Res Passed: 32
MAY 16, 2023
After weeks of negotiations and a marathon vote into the wee hours of Wednesday in the Senate, and an all-day affair in the House, the Legislature passed a bipartisan budget that Governor Hobbs signed last Thursday night. Some highlights include the highest-ever investment into housing and homeless issues, Alzheimer’s research, tax rebates for families with children, and increased K-12 school funding. Key points of interest for the Arizona REALTORS® included: $150 million to the Housing Trust Fund, $60 million to a new Homeless Shelter and Services Fund administered by the Arizona Department of Housing (ADOH), $5 million for the Mobile Home Relocation and Abandonment program through ADOH, $5 million for Corrections Transition and Re-Entry Housing, $6.9 million to help end Veteran Homelessness, $5 million Area Agencies on Aging, and $1.9 million for military transitional housing.
After the budget passed, lawmakers took a long weekend before returning on Monday, May 15th to pass 85 bills. They then announced that they will adjourn until June 12th, breaking from the recent pattern of adjourning sine die shortly after the budget has passed. This is due to expected travel-related absences among legislators on both sides of the aisle. However, the Arizona REALTORS® made sure to send a message before the three-week holiday by passing our top-priority SB1131 (Rental Tax) out of the House on a 35-24-1-1 vote, picking up a little more support from House Democrats. One issue still pending is the belabored extension of the Proposition 400 Maricopa County transportation tax, now intertwined in the SB1131 negotiations. The tax is used to fund public transportation and is set to expire in 2025 unless the legislature authorizes an extension to be sent to the ballot beforehand, which is a key win for Hobbs. Despite the League of Cities and Towns, Mayors, and their dozens of lobbyists continuing to disseminate fear and misinformation, the Arizona REALTORS® team is confident we can continue to work with Governor Hobbs and the Legislature to get this win for Housing Affordability across the finish line!
How good is the Arizona REALTORS® team? The Arizona REALTORS® team and partners shine again with SEVEN nominations for the Arizona Capitol Times: Best of the Capitol Awards, including, Matt Contorelli and Tom Farley for Best Lobbyist, RAPAC for Best Political Action Committee (poised to win for the 3rd year in a row), HMA Public Relations for Best PR Firm, Tom Farley for Toughest Lobbyist to Go Against, Willetta Partners for Best Lobbying Firm, and Joe Wolf for Power Broker. The Best of the Capitol is a lighthearted evening event that honors the people and groups engaged in Arizona politics in more than 30 categories, including Best Elected Official, Best Lobbyist, Best Dressed, and Best Twitterer. While the event may be lighthearted, these awards hold immense value and clout among our elected officials, political insiders, and most importantly our members.
With the legislature out until June 12th, your Legislative Update will return on June 13th with all the action from 1700 West Washington Street!
Session Summary
Session Days: 128
Bills Posted: 1671
Bills Passed: 235
Bills Vetoed: 66
Bills Signed: 148
Mem, Res Posted: 109
Mem, Res Passed: 19
HOT BILLS TO WATCH
- Repeal Arizona’s Regressive Residential Tax (Rental TPT): SB1131
MAY 2, 2023
It’s been quiet at 1700 W. Washington as House Republicans continue to wait for the Maricopa County Board of Supervisors to appoint a replacement for the vacancy left by Liz Harris. A decision is expected any day now, and rumors continue to favor Julie Willoughby, a 2022 legislative candidate.
With the Legislature returning to work Wednesday, Senate President Warren Petersen is eager to wrap this session up by booking a long floor agenda starting at 10 AM. With chatter around Prop 400, AHCCCS money, and Arizona REALTORS® #1 priority all in play this week, it will be a definitive week for all Arizonans, and hopefully, we’ll a better picture of when this rocky session will be coming to an end. Stay tuned!
Session Summary
Session Days: 114
Bills Posted: 1632
Bills Passed: 176
Bills Vetoed: 64
Bills Signed: 112
Mem, Res Posted: 104
Mem, Res Passed: 19
HOT ISSUES
Repeal Arizona’s Regressive Residential Tax (Rental TPT)
Repealing Arizona’s regressive residential rental tax (Rental TPT) remains the top priority for the Arizona REALTORS® 2023 Legislative Agenda, despite our first attempt being vetoed by Governor Hobbs (press release, here). The effort is still very much alive via SB1131 and with new language that explicitly outlines how this legislation will help renters lower monthly expenses, this new effort will sit squarely in the budget negotiations and is ready for the fight. The Arizona REALTORS® have been working with legislative leadership and the Governor’s office to make sure this gets done.
Responsible Solutions to the Housing Crisis
After SB1117 died on the Senate floor, Senator Steve Kaiser went back to the drawing board, via a strike-everything amendment on HB2536. The new language includes NO by-right zoning but does look to implement 180-day zoning time limits, policies to expand the construction and use of Additional Dwelling Units (ADUs), changes to minimum parking requirements for developers, and easing stipulations cities can impose related to cosmetic features of new developments. After much debate, the bill passed out of committee with bipartisan support. The legislation remains a work in progress and the Arizona REALTORS® are committed to working with Sen. Kaiser to ensure that any passed legislation does not deteriorate private property rights or put homeowners and homebuyers at risk. Other bills in the housing supply conversation are SB1161 and SB1163.
Rio Verde Foothills
Legislators are continuing to work to find solutions for the water service issue facing the Rio Verde Foothills, after the City of Scottsdale discontinued water delivery to the community this past January. Now Scottsdale Representative Alex Kolodin looks to solve that with HB2561, which would direct a municipality (Scottsdale) that provides water service to provide water service through a standpipe for water hauling to persons residing outside the municipality’s water service area who do not have access to sufficient water if a list of specified conditions apply, including that the municipality previously provided water service to those persons and there is no other source of water for those persons within 10 miles of their households. Having an emergency clause, the bill would become effective immediately upon signing and require a two-thirds vote, which it looks like it has.
Water
With officials on both sides of the aisle wanting to do something about the deal that’s letting a Saudi-based company pump Arizona groundwater for nothing more than the price of a cheap land lease in La Paz County. Attorney General Kris Mayes, a Democrat, criticized the deal during her campaign, and in a TV interview on February 19 said she’s planning to take action. In the Arizona House of Representatives, Rep. Leo Biasiucci, R-Lake Havasu City, is sponsoring a bill (HB2376) that would target land deals with foreign entities. The bill got approval from the House on February 22, and will now move to the Senate. As for more substantive water policy to address Arizona’s short and long-term conservation and management, that remains the sleeping giant of the legislative session.
Short-Term Rentals
Traction on any Short-term Rental (STR) Legislation has been absent from the legislature this year. Representative Selina Bliss’ attempt (HB2047) to limit how many STR’s could be permitted in a city or town never saw a committee hearing after hearing that the Arizona REALTORS® would oppose the effort. That said, the Arizona REALTORS® will continue to track legislative proposals to regulate the industry and ensure the private property rights of the STR operator, and the surrounding property owners, are protected all the same.
Stay tuned as the Arizona REALTORS® continue to advance and defend our 2023 Legislative Policies!
APRIL 25, 2023
Last week was relatively quiet as legislators took a “Legislative Spring Break” while House Republicans wait for the Maricopa County Board of Supervisors to review replacement recommendations for Liz Harris. A decision is expected later this week. Those recommendations, formed by votes from LD13 Precinct Committeemen, shocked folks across the state when Harris was the top vote-getter to fill the seat she was just expelled from. Other names on the list included former Senate President Steve Yarbrough and 2022 House candidate, Julie Willoughby.
While legislators took time off, Governor Hobbs broke the record for the most vetoes in a single session of the state Legislature. Hobbs vetoed 11 more bills last Tuesday to reach the 63-mark, topping Janet Napolitano’s record of 58 vetoes set in 158 days of the 2005 session. Hobbs did sign a few bills in the process, one of which being SB1110 (Rogers) which requires county recorders to provide a system for notifying someone when a document is recorded that names them and allows for residents to opt-in. Some counties already have similar processes in place but would require all counties to get on board by January 1, 2025. The bill passed with overwhelming bipartisan support. With deed fraud becoming an increasing issue, the REALTORS® will continue to work on any effort to protect homeowners across Arizona.
In the week ahead, Legislators are getting back to work to pass a flurry of bipartisan bills with numerous absences and Harris’ vacancy stopping House Republicans from passing bills on a party-line vote. In the meantime, the Arizona REALTORS® are upping the pressure on repealing the Rental Tax with billboards and digital sign trucks circling the Capitol, urging Governor Hobbs and Legislators to get this important legislation done. Stay tuned!
SESSION SUMMARY
Session Days: 107
Bills Posted: 1632
Bills Passed: 156
Bills Vetoed: 63
Bills Signed: 93
Mem, Res Posted: 104
Mem, Res Passed: 19
HOT ISSUES
Repeal Arizona’s Regressive Residential Tax (Rental TPT)
Repealing Arizona’s regressive residential rental tax (Rental TPT) remains the top priority for the Arizona REALTORS® 2023 Legislative Agenda, despite our first attempt being vetoed by Governor Hobbs (press release, here). The effort is still very much alive via SB1131 and with new language that explicitly outlines how this legislation will help renters lower monthly expenses, this new effort will sit squarely in the budget negotiations and is ready for the fight. The Arizona REALTORS® have been working with legislative leadership and the Governor’s office to make sure this gets done.
Responsible Solutions to the Housing Crisis
After SB1117 died on the Senate floor, Senator Steve Kaiser went back to the drawing board, via a strike-everything amendment on HB2536. The new language includes NO by-right zoning but does look to implement180-day zoning time limits, policies to expand the construction and use of Additional Dwelling Units (ADUs), changes to minimum parking requirements for developers, and easing stipulations cities can impose related to cosmetic features of new developments. After much debate, the bill passed out of committee with bipartisan support. The legislation remains a work in progress and the Arizona REALTORS® are committed to working with Sen. Kaiser to ensure that any passed legislation does not deteriorate private property rights or put homeowners and homebuyers at risk. Other bills in the housing supply conversation are SB1161 and SB1163.
Rio Verde Foothills
Legislators are continuing to work to find solutions for the water service issue facing the Rio Verde Foothills, after the City of Scottsdale discontinued water delivery to the community this past January. Now Scottsdale Representative Alex Kolodin looks to solve that with HB2561, which would direct a municipality (Scottsdale) that provides water service to provide water service through a standpipe for water hauling to persons residing outside the municipality’s water service area who do not have access to sufficient water if a list of specified conditions apply, including that the municipality previously provided water service to those persons and there is no other source of water for those persons within 10 miles of their households. Having an emergency clause, the bill would become effective immediately upon signing and require a two-thirds vote, which it looks like it has.
Water
With officials on both sides of the aisle wanting to do something about the deal that’s letting a Saudi-based company pump Arizona groundwater for nothing more than the price of a cheap land lease in La Paz County. Attorney General Kris Mayes, a Democrat, criticized the deal during her campaign, and in a TV interview on February 19 said she’s planning to take action. In the Arizona House of Representatives, Rep. Leo Biasiucci, R-Lake Havasu City, is sponsoring a bill (HB2376) that would target land deals with foreign entities. The bill got approval from the House on February 22, and will now move to the Senate. As for more substantive water policy to address Arizona’s short and long-term conservation and management, that remains the sleeping giant of the legislative session.
Short-Term Rentals
Traction on any Short-term Rental (STR) Legislation has been absent from the legislature this year. Representative Selina Bliss’ attempt (HB2047) to limit how many STR’s could be permitted in a city or town never saw a committee hearing after hearing that the Arizona REALTORS® would oppose the effort. That said, the Arizona REALTORS® will continue to track legislative proposals to regulate the industry and ensure the private property rights of the STR operator, and the surrounding property owners, are protected all the same.
Stay tuned as the Arizona REALTORS® continue to advance and defend our 2023 Legislative Policies!
APRIL 18, 2023
Last week was anything but ordinary at the Capitol. On Wednesday the House voted 46-13-1 to expel Chandler Republican Representative Liz Harris. Every Democrat and the majority of Republicans voted to expel Harris after an ethics charge relating to Harris’ actions involving a speaker she invited to testify at a joint House and Senate election integrity hearing back in February.
That speaker made unsubstantiated allegations against politicians, judges and the Church of Jesus Christ of Latter-day Saints, even going so far as to specifically allege that Speaker of the House Ben Toma, Governor Hobbs, and others were being bribed by the Sinaloa Cartel. Tucson Democrat Representative Stephanie Stahl-Hamilton filed an ethics complaint over Harris’ role and Tuesday the House Ethics Committee unanimously concluded she violated a House rule and damaged the “institutional integrity of the House.”
In light of the expulsion, both chambers agreed to take an unscheduled “spring break,” adjourning last Thursday and scheduled to return Tuesday April 25th. During the break, Republican district leadership in Harris’ district will nominate three individuals to replace her and send those names to the Maricopa County Board of Supervisors. That body will appoint a new Representative to finish the remainder of Harris’ term, through 2024. Legislative leadership will also use this time to continue budget conversations as whispers grow louder that an agreement with the Governor’s office may be coming soon.
Session Summary
Session Days: 97
Bills Posted: 1632
Bills Passed: 147
Bills Vetoed: 48
Bills Signed: 53
Mem, Res Posted: 104
Mem, Res Passed: 19
HOT ISSUES
Repeal Arizona’s Regressive Residential Tax (Rental TPT)
Repealing Arizona’s regressive residential rental tax (Rental TPT) remains the top priority for the Arizona REALTORS® 2023 Legislative Agenda, despite our first attempt being vetoed by Governor Hobbs (press release, here). The effort is still very much alive via SB1131 and with new language that explicitly outlines how this legislation will help renters lower monthly expenses, this new effort will sit squarely in the budget negotiations and the Arizona REALTORS is ready for the fight. The Arizona REALTORS® are working with legislative leadership and the Governor’s office to make sure this gets done.
Responsible Solutions to the Housing Crisis
After SB1117 died on the Senate floor, Senator Steve Kaiser went back to the drawing board, via a strike-everything amendment on HB2536. The new language includes NO by-right zoning but does look to implement 180-day zoning time limits, policies to expand the construction and use of Additional Dwelling Units (ADUs), changes to minimum parking requirements for developers, and eases stipulations cities can impose related to cosmetic features of new developments. After much debate , the bill passed out of committee with bipartisan support. The legislation remains a work in progress and the Arizona REALTORS® is committed to working with Sen. Kaiser to ensure that any passed legislation does not deteriorate private property right or put homeowners and homebuyers at risk. Other bills in the housing supply conversation are SB1161 and SB1163.
Rio Verde Foothills
Legislators are continuing to work to find solutions for the water service issue facing the Rio Verde Foothills, after the City of Scottsdale discontinued water delivery to the community this past January. Now Scottsdale Representative Alex Kolodin looks to solve that with HB2561, which would require a municipality (Scottsdale) that provides water service to provide water service through a standpipe for water hauling to persons residing outside the municipality’s water service area who do not have access to sufficient water if a list of specified conditions apply, including that the municipality previously provided water service to those persons and there is no other source of water for those persons within 10 miles of their households. Having an emergency clause, the bill would become effective immediately upon signing and require a two-thirds vote, which it looks like it has.
Water
Officials on both sides of the aisle want to do something about the deal that’s letting a Saudi-based company pump Arizona groundwater for nothing more than the price of a cheap land lease in La Paz County. Attorney General Kris Mayes, a Democrat, criticized the deal during her campaign and in a TV interview on February 19th said she’s planning to take action. In the Arizona House of Representatives, Rep. Leo Biasiucci, R-Lake Havasu City, is sponsoring a bill (HB2376) that would target land deals with foreign entities. The bill got approval from the House on February 22nd, and will now move to the Senate. As for more substantive water policy to address Arizona’s short and long-term conservation and management, that remains the sleeping giant of the legislative session.
Short-Term Rentals
Traction on any Short-term Rental (STR) Legislation has been absent from the legislature this year. Representative Selina Bliss’ attempt (HB2047) to limit how many STR’s could be permitted in a city or town never saw a committee hearing after learning that the Arizona REALTORS® would oppose the effort. That said, the Arizona REALTORS® will continue to track legislative proposals to regulate the industry and ensure the private property rights of the STR operator and the surrounding property owners are protected all the same.
Stay tuned as the Arizona REALTORS® continue to advance and defend our 2023 Legislative Policies!
April 4, 2023
With regular committee hearings finishing last week, except for special meetings for the Appropriations Committees, the next few weeks — or months — will be spent on the floor debating and voting on the remaining bills, including sending those that were amended by the opposite chamber back to the original chamber for their approval or refusal of the changes. A refusal results in a conference committee with members from both chambers meeting to work out the differences in each version. Bills should also continue being sent up to the Governor for her action, where her veto stamp continues to get a workout.
Finally, legislative leadership and Governor Hobbs’ office are still toiling at reaching a passable budget. June 30 ends the state’s fiscal year, so that usually serves as an unofficial deadline for budget passage to avoid a state government shutdown.
Session Summary
Session Days: 87
Bills Posted: 1630
Bills Passed: 71
Bills Vetoed: 29
Bills Signed: 22
Mem, Res Posted: 102
Mem, Res Passed: 13
MARCH 28, 2023
Legislative tension is in the air at the Legislature as Governor Hobbs vetoes the Republican-led effort to eliminate taxes on food in Arizona, which passed out of the house last week on a party-line vote. Debates also included plans to increase teacher pay, education funding, and infrastructure; all clear signs that the tough budget negotiations are near.
Session Summary
Session Days: 79
Bills Posted: 1630
Bills Passed: 35
Bills Vetoed: 16
Bills Signed: 2
Mem, Res Posted: 102
Mem, Res Passed: 9
HOT ISSUES
Repeal Arizona’s Regressive Residential Tax (Rental TPT)
Repealing Arizona’s regressive residential rental tax (Rental TPT) remains the top priority for the Arizona REALTORS® 2023 Legislative Agenda, despite our first attempt being vetoed by Governor Hobbs (press release, here). The issue is back in committee this week, being heard in House Government on Wednesday, via a strike everything amendment on SB1131. With new language that explicitly outlines how this legislation will help renters, this new effort will sit squarely in the budget negotiations and is ready for the fight.
Responsible Solutions to the Housing Crisis
After SB1117 died on the Senate floor, Senator Steve Kaiser went back to the drawing board, via a strike-everything amendment on HB2536. The new language includes NO by-right zoning but does look to implement a 180-day zoning time limits, policies to expand the construction and use of Additional Dwelling Units (ADUs), changes to minimum parking requirements for developers, and eases stipulations cities can impose related to cosmetic features of new developments. After much debate the, the bill passed out of committee with bipartisan support. The legislation remains a work in progress and the Arizona REALTORS® are committed to working with Sen. Kaiser to ensure that any passed legislation does not deteriorate private property right or put homeowners and homebuyers at risk.
Rio Verde Foothills
Outside of the legislature, the Arizona REALTORS® have been tracking the fight for water service in the Rio Verde Foothills. The Corporation Commission held a public comment session on Monday, January 23rd, which lasted about 4 hours. The comments fell in two categories, those residents that do not what to be served by a private water company and those that do (allow EPCOR to serve the area). On Wednesday, January 25th, the Commission held a Staff Meeting and went into Executive Session to receive legal advice on whether they could or should accelerate the procedural schedule for EPCOR to be granted the CC&N to serve RIO Verde. After the session ended, the Commissioners returned and indicated they will stick to the existing procedural schedule but try to shorten some aspects of the case.
As of now, the evidentiary hearing will begin April 10. This procedure has become a feeding frenzy for attorneys with Jeff Crockett representing the Rio Verde Community Association, Michele Van Quathem representing the Rio Verde Country Club, Court Rick representing CR Community Association, Patrick Black representing Rio Verde Services, and Angela Cooner representing Tonto Verde Golf Association. The Arizona REALTORS® will continue to track and support solutions to this fight and look for ways to avoid similar situations in the future, as Rio Verde is far from the last community to face challenges such as these.
Water
With officials on both sides of the aisle want to do something about the deal that’s letting a Saudi-based company pump Arizona groundwater for nothing more than the price of a cheap land lease in La Paz County. Attorney General Kris Mayes, a Democrat, criticized the deal during her campaign, and in a TV interview on February 19 said she’s planning to take action. In the Arizona House of Representatives, Rep. Leo Biasiucci, R-Lake Havasu City, is sponsoring a bill (HB2376) that would target land deals with foreign entities. The bill got approval from the House on Feb. 22, and will now move to the Senate. As for more substantive water policy, to address Arizona’s short and long-term conservation and management, that remains the sleeping giant of the legislative session.
Short-Term Rentals
Traction on any Short-term Rental (STR) Legislation has been absent from the legislature this year. Representative Selina Bliss’ attempt (HB2047) to limit how many STR’s could be permitted in a city or town, never saw a committee hearing after hearing that the Arizona REALTORS® would oppose the effort. That said, the Arizona REALTORS® will continue to track legislative proposals to regulate the industry and ensure the private property rights of the STR operator and the surrounding property owners are protected all the same. Stay tuned as the Arizona REALTORS® continue to advance and defend our 2023 Legislative Policies!
MARCH 14, 2023
After what felt like weeks of partisan scuffles, the House finally started passing bills and sending them over to the Senate, last week; playing catch-up with Senators who sent their bills to the House weeks ago. This meant committee agendas were short, leaving long agendas for the week ahead.
Monday kicked off with Senator Steve Kaiser’s housing supply bill SB1117 (municipal platting; technical correction) failing in Third Read but could be resurrected. After passing Committee of the Whole on a voice vote, the bill failed on a 9-20-1 vote with most Democrats and some Republicans in opposition. Senator Kaiser also voted “no” to bring the bill back on reconsideration. Many Democrats opposed the legislation due to a lack of affordable housing guarantees, while some Republicans voted against the bill due to the extensive preemption of the current draft. That said, several Senators who voted against the bill left the door open to voting for the bill if it comes back with changes. Meanwhile, the REALTORS® will continue to work with stakeholders to find the balance that helps deliver real solutions for Arizonans.
With Senate members being surveyed on their budget asks and House members following suit soon, the REALTORS® will be square in the fight of budget negotiations; ensuring repealing Arizona’s rental tax is a part of the conversation.
Session Summary
Session Days: 64
Bills Posted: 1626
Bills Passed: 18
Bills Vetoed: 16
Bills Signed: 2
Mem, Res Posted: 97
Mem, Res Passed: 4
HOT ISSUES
Repeal Arizona’s Regressive Residential Tax (Rental TPT)
Repealing Arizona’s regressive residential rental tax (Rental TPT) remains the top priority for the Arizona REALTORS® 2023 Legislative Agenda, despite our first attempt being vetoed by Governor Hobbs (press release, here). The Arizona REALTORS® are continuing to meet with members on both sides of the aisle to secure bipartisan support for this critical step toward affordable housing, so keep an eye out for this conversation to be a key part of budget negotiations!
Responsible Solutions to the Housing Crisis
FAILED IN THE SENATE SB1117 (Kaiser): municipal platting; technical correction
The Arizona REALTORS® have been meeting with Senator Steve Kaiser, Chairman of the 2022 Housing Supply Study Committee, on legislation to address Arizona’s housing supply shortage, which some experts have estimated to be 270,000 homes short. The language includes by-right zoning near light-rail, zoning review time limits, policies to expand the construction and use of Additional Dwelling Units (ADUs), removing and/or reducing minimum parking requirements for developers, among other topics. The legislation remains a work in progress and the Arizona REALTORS® are committed to working with Sen. Kaiser to ensure that any passed legislation does not deteriorate private property right or put homeowners and homebuyers at risk. With much debate around this bill, don’t be surprised to see it move through the process at a snail’s pace.
Rio Verde Foothills
Outside of the legislature, the Arizona REALTORS® have been tracking the fight for water service in the Rio Verde Foothills. The Corporation Commission held a public comment session on Monday, January 23rd, which lasted about 4 hours. The comments fell in two categories, those residents that do not what to be served by a private water company and those that do (allow EPCOR to serve the area). On Wednesday, January 25th, the Commission held a Staff Meeting and went into Executive Session to receive legal advice on whether they could or should accelerate the procedural schedule for EPCOR to be granted the CC&N to serve RIO Verde. After the session ended, the Commissioners returned and indicated they will stick to the existing procedural schedule but try to shorten some aspects of the case.
As of now, the evidentiary hearing will begin April 10. This procedure has become a feeding frenzy for attorneys with Jeff Crockett representing the Rio Verde Community Association, Michele Van Quathem representing the Rio Verde Country Club, Court Rick representing CR Community Association, Patrick Black representing Rio Verde Services, and Angela Cooner representing Tonto Verde Golf Association. The Arizona REALTORS® will continue to track and support solutions to this fight and look for ways to avoid similar situations in the future, as Rio Verde is far from the last community to face challenges such as these.
Water
With officials on both sides of the aisle want to do something about the deal that’s letting a Saudi-based company pump Arizona groundwater for nothing more than the price of a cheap land lease in La Paz County. Attorney General Kris Mayes, a Democrat, criticized the deal during her campaign, and in a TV interview on February 19 said she’s planning to take action. In the Arizona House of Representatives, Rep. Leo Biasiucci, R-Lake Havasu City, is sponsoring a bill (HB2376) that would target land deals with foreign entities. The bill got approval from the House on February 22, and will now move to the Senate. As for more substantive water policy, to address Arizona’s short and long-term conservation and management, that remains the sleeping giant of the legislative session.
Short-Term Rentals
Traction on any Short-term Rental (STR) Legislation has been absent from the legislature this year. Representative Selina Bliss’ attempt (HB2047) to limit how many STR’s could be permitted in a city or town, never saw a committee hearing after hearing that the Arizona REALTORS® would oppose the effort. That said, the Arizona REALTORS® will continue to track legislative proposals to regulate the industry and ensure the private property rights of the STR operator and the surrounding property owners are protected all the same.
Stay tuned as the Arizona REALTORS® continue to advance and defend our 2023 Legislative Policies!
MARCH 7, 2023
Last week we saw week two of crossover floor action come and go, but not without some fireworks. Tuesday brought a unified protest where House Democrats voted no on every bill that went up on the board Wednesday and Thursday. The protest arose because majority leadership in both chambers enforced a requirement that a bill have the support of a majority of the majority (or 16 Republicans) to be put to a full floor vote. It resulted in very few Democrat bills being brought to a vote. This development means that a big chunk of bills that need to cross over to the Senate are still awaiting a floor vote as leadership from both parties work out some semblance of an agreement.
Look for more of that this week, with the added twist of committees restarting and hearing the opposite chamber’s bills.
Session Summary
Session Days: 58
Bills Posted: 1,625
Bills Passed: 17
Bills Vetoed: 15
Bills Signed: 0
Mem, Res Posted: 97
Mem, Res Passed: 4
HOT ISSUES
Repeal Arizona’s Regressive Residential Tax (Rental TPT)
VETOED SB1184 (Kaiser)
VETOED HB2067 (Carter)
Repealing Arizona’s regressive residential rental tax (Rental TPT) remains the top priority for the Arizona REALTORS® 2023 Legislative Agenda, despite our first attempt being vetoed by Governor Hobbs (press release, here). The Arizona REALTORS® are continuing to meet with members on both sides of the aisle to secure bipartisan support for this critical step toward affordable housing, so keep an eye out for this conversation to be a key part of budget negotiations!
Responsible Solutions to the Housing Crisis
SB1117 (Kaiser): municipal platting; technical correction
The Arizona REALTORS® have been meeting with Senator Steve Kaiser, Chairman of the 2022 Housing Supply Study Committee, on legislation to address Arizona’s housing supply shortage, which some experts have estimated to be 270,000 homes short. The language includes by-right zoning near light-rail, zoning review time limits, policies to expand the construction and use of Additional Dwelling Units (ADUs), removing and/or reducing minimum parking requirements for developers, among other topics. The legislation remains a work in progress and the Arizona REALTORS® are committed to working with Sen. Kaiser to ensure that any passed legislation does not deteriorate private property rights or put homeowners and homebuyers at risk. With much debate around this bill, don’t be surprised to see it move through the process at a snail’s pace.
Rio Verde Foothills
Outside of the legislature, the Arizona REALTORS® have been tracking the fight for water service in the Rio Verde Foothills. The Corporation Commission held a public comment session on Monday, January 23, which lasted about 4 hours. The comments fell in two categories, those residents that do not what to be served by a private water company and those that do (allow EPCOR to serve the area). On Wednesday, January 25th, the Commission held a Staff Meeting and went into Executive Session to receive legal advice on whether they could or should accelerate the procedural schedule for EPCOR to be granted the CC&N to serve RIO Verde. After the session ended, the Commissioners returned and indicated they will stick to the existing procedural schedule but try to shorten some aspects of the case.
As of now, the evidentiary hearing will begin April 10. This procedure has become a feeding frenzy for attorneys with Jeff Crockett representing the Rio Verde Community Association, Michele Van Quathem representing the Rio Verde Country Club, Court Rick representing CR Community Association, Patrick Black representing Rio Verde Services, and Angela Cooner representing Tonto Verde Golf Association. The Arizona REALTORS® will continue to track and support solutions to this fight and look for ways to avoid similar situations in the future, as Rio Verde is far from the last community to face challenges such as these.
Water
With officials on both sides of the aisle want to do something about the deal that’s letting a Saudi-based company pump Arizona groundwater for nothing more than the price of a cheap land lease in La Paz County. Attorney General Kris Mayes, a Democrat, criticized the deal during her campaign, and in a TV interview on February 19th said she’s planning to take action. In the Arizona House of Representatives, Rep. Leo Biasiucci, R-Lake Havasu City, is sponsoring a bill (HB2376) that would target land deals with foreign entities. The bill got approval from the House on February 22nd, and will now move to the Senate. As for more substantive water policy, to address Arizona’s short and long-term conservation and management, that remains the sleeping giant of the legislative session.
Short-Term Rentals
Traction on any Short-term Rental (STR) Legislation has been absent from the legislature this year. Representative Selina Bliss’ attempt (HB2047) to limit how many STR’s could be permitted in a city or town, never saw a committee hearing after hearing that the Arizona REALTORS® would oppose the effort. That said, the Arizona REALTORS® will continue to track legislative proposals to regulate the industry and ensure the private property rights of the STR operator and the surrounding property owners are protected all the same. Stay tuned as the Arizona REALTORS® continue to advance and defend our 2023 Legislative Policies!
FEBRUARY 28, 2023
We are 50 days into the legislative session and both the House and Senate are seeing plenty of action! Last week was crossover week, which means all the bills that began in the House had to be voted out of the House and cross over to the Senate, and vice versa. Because of all the floor action, committees didn’t meet, and members faced marathon floor sessions in which they slogged through action on a multitude of bills — so many that crossover week will spill into this week.
Session Summary
Session Days: 50
Bills Posted: 1,625
Bills Passed: 16
Bills Vetoed: 14
Bills Signed: 0
Mem, Res Posted: 97
Mem, Res Passed: 4
HOT ISSUES
VETOED – Repeal Arizona’s Regressive Residential Tax (Rental TPT)
SB1184 (Kaiser): PASSED THROUGH SENATE
HB2067 (Carter): PASSED THROUGH HOUSE
The top priority for the Arizona REALTORS® this session is to repeal Arizona’s regressive residential rental tax (Rental TPT). The Arizona REALTORS® met with members on both sides of the aisle to secure bipartisan support for this critical step towards affordable housing. Unfortunately, Governor Hobbs vetoed the legislation late last week, citing numerous reasons in a press release, here; that said, per the veto letter, Governor Hobbs does appear open to revisiting the legislation in budget negotiations. With the door open, the Arizona REALTORS® will continue to advocate for this important policy!
Responsible Solutions to the Housing Crisis
SB1117 (Kaiser): municipal platting; technical correction
The Arizona REALTORS® have been meeting with Senator Steve Kaiser, Chairman of the 2022 Housing Supply Study Committee, on legislation to address the housing crisis. This legislation will likely be struck on to another bill as an amendment, as the bill-introduction deadline has passed in the Senate. The language may include investments and flexibility for the Arizona Housing Trust Fund, offsets for Rural Impact Fess, by-right zoning and zoning review timeline mandates for cities, policies to expand the construction and use of Additional Dwelling Units (ADUs), removing and/or reducing minimum parking requirements for developer, among other topics. The Arizona REALTORS® are committed to working with Sen. Kaiser while ensuring that any passed legislation does not deteriorate private property rights or put homeowners and homebuyers at risk.
Rio Verde Foothills
Outside of the legislature, the Arizona REALTORS® have been tracking the fight for water service in the Rio Verde Foothills. The Corporation Commission held a public comment session on Monday, January 23, which lasted about 4 hours. The comments fell in two categories, those residents that do not what to be served by a private water company and those that do (allow EPCOR to serve the area). On Wednesday, January 25th, the Commission held a Staff Meeting and went into Executive Session to receive legal advice on whether they could, or should, accelerate the procedural schedule for EPCOR to be granted the CC&N to serve RIO Verde. After the session ended, the Commissioners returned and indicated they will stick to the existing procedural schedule but try to shorten some aspects of the case.
As of now, the evidentiary hearing will begin April 10. This procedure has become a feeding frenzy for attorneys with Jeff Crockett representing the Rio Verde Community Association, Michele Van Quathem representing the Rio Verde Country Club, Court Rick representing CR Community Association, Patrick Black representing Rio Verde Services, and Angela Cooner representing Tonto Verde Golf Association. The Arizona REALTORS® will continue to track and support solutions to this fight and look for ways to avoid similar situations in the future, as Rio Verde is far from the last community to face challenges such as these.
Water
Officials on both sides of the aisle want to do something about the deal that’s letting a Saudi-based company pump Arizona groundwater for nothing more than the price of a cheap land lease in La Paz County. Attorney General Kris Mayes, a Democrat, criticized the deal during her campaign, and in a TV interview on February 19 said she’s planning to take action. In the Arizona House of Representatives, Rep. Leo Biasiucci, R-Lake Havasu City, is sponsoring a bill (HB2376) that would target land deals with foreign entities. The bill got approval from the House on February 22, and will now move to the Senate.
Short-Term Rentals
Traction on any Short-term Rental (STR) legislation has been absent from the legislature this year. Representative Selina Bliss’ attempt (HB2047) to limit how many STRs could be permitted in a city of town never saw a committee hearing after being told that the Arizona REALTORS® would oppose the effort. That said, the Arizona REALTORS® will continue to track legislative proposals to regulate the industry and ensure the private property rights of the STR operator and the surrounding property owners are protected the same.
Stay tuned as the Arizona REALTORS® continue to advance and defend our 2023 Legislative Policies!
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FEBRUARY 2, 2023
The legislative session is underway as committee meetings and floor action pick up. Last Monday is the bill introduction deadline for the Senate, so there was a big drop in bills. The House deadline was yesterday, so expect lots of new reading material!
HOT ISSUES
Repeal Arizona’s Regressive Residential Tax (Rental TPT)
SB1184 (Kaiser): PASSED THROUGH SENATE COMMERCE COMMITTEE
HB2067 (Carter): PASSED THROUGH HOUSE WAYS AND MEANS COMMITTEE
The top priority for the Arizona REALTORS® this session is rallying support for SB1184 and HB2067, which will repeal Arizona’s regressive residential rental tax (Rental TPT). Last week, both bills passed through committees on party-line votes. The Arizona REALTORS® are actively meeting with members on both sides of the aisle to secure bipartisan support for this critical step toward affordable housing. This effort has a long road ahead before reaching Governor Hobbs’ desk, but the Arizona REALTORS® is confident in its strategy to pass this important legislation, which will help renters struggling to make ends meet and property owners and managers dealing with the bureaucratic administration of this tax.
Responsible Solutions to the Housing Crisis
Draft: municipal platting; technical correction
The Arizona REALTORS® has met with Senator Steve Kaiser, Chair of the 2022 Housing Supply Study Committee, on legislation to address the housing crisis. This legislation will likely be struck on to another bill as an amendment, as the bill-introduction deadline has passed in the Senate. The language may include investments and flexibility for the Arizona Housing Trust Fund, offsets for Rural Impact Fees, by-right zoning and zoning review timeline mandates for cities, policies to expand the construction and use of Additional Dwelling Units (ADUs), removing and/or reducing minimum parking requirements for developer, among other topics. The Arizona REALTORS® is committed to working with Senator Kaiser, while ensuring that any passed legislation does not deteriorate private property rights or put homeowners and homebuyers at risk.
Rio Verde Foothills
Outside of the legislature, the Arizona REALTORS® has been tracking the fight for water service in the Rio Verde Foothills. The Corporation Commission (Commission) held a public comment session on Monday, January 23, which lasted about 4 hours. The comments fell in two categories: residents who do not want to be served by a private water companies and those that do (allow EPCOR to serve the area).
On Wednesday, January 25th, the Commission held a staff meeting and into Executive Session to receive legal advice on whether they can and should accelerate the procedural schedule for EPCOR to be granted the CC&N to serve Rio Verde. After the session ended, the Commissioners returned and indicated they will stay with the existing procedural schedule but try to shorten some aspects of the case.
As of now, the evidentiary hearing will begin April 10th. This procedure has become a feeding frenzy for attorneys – Jeff Crockett representing the Rio Verde Community Association, Michele Van Quathem representing the Rio Verde Country Club, Court Rick representing CR Community Association, Patrick Black representing Rio Verde Services, and Angela Cooner representing Tonto Verde Golf Association.
The Arizona REALTORS® will continue to track and support solutions and look for ways to avoid similar situations in the future, as Rio Verde is far from the last community to face such challenges.
Additional legislative priorities for the Arizona REALTORS® include water (of course), short-term rentals, legislation around HOA regulations, and requirements for appraisers. Stay tuned as the Arizona REALTORS® continue to advance and defend our 2023 Legislative Policies!
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JANUARY 24, 2023
It’s week three of the legislative session and things are settling into a normalish pace around the Capitol. Several committees met last week but mostly heard agency presentations and only a handful of bills. Governor Hobbs’ budget staff officially presented their budget to the Joint Committee on Appropriations Tuesday morning and got a downright chilly reception from majority committee members. And so, the negotiating begins.
Senate Education Chair Ken Bennett, a former Secretary of State, lightened the mood this week when he trotted out his favorite visual aids to illustrate the state budget and the primary areas of spending–tall towers made of building blocks and tissue boxes (check it out here). Anything that helps all the newcomers understand the state budget is a welcome addition.
This week should bring more committee action on bills, along with the added excitement of the first full floor votes of the session.
The top priority for the Arizona REALTORS® this week is rallying support for SB1184 (Kaiser) and HB2067 (Carter), which would repeal Arizona’s regressive residential rental tax (Rental TPT). For over a decade the Arizona REALTORS® Board of Directors, by way of the legislative policies, has advocated support for repealing Rental TPT in Arizona. Arizona law allows city governments to impose a transaction privilege tax (TPT) on properties that are rented for residential purposes for 30 or more consecutive days. Arizona is one of a few places in the country that allows TPT collection on residential rental properties, which places countless burdens on property managers and negatively impacts housing affordability. With bills heading to the committee soon, this is the top priority for the Arizona REALTORS®.
Arizona Renters pay an average of $600 in TPT charges annually, or $51 monthly, based on a $2,000 a month lease with related taxable charges. Money that could be used for gas, food, or other monthly expenses or savings towards buying a home. Rental TPT is charged on the taxable gross income, not just the rent amount. Charges for such items as internet, telecommunications, utilities, pet fees, or maintenance are considered part of the taxable gross income, per the Arizona Model City Tax Code.
Since 2020, cities’ total TPT collections have increased by $1.15 billion and Rental TPT collections have increased by almost $50 million (28%). That means that as rents go up, the tax cities impose on renters becomes even more financially burdensome. Property owners already pay property, income, and sales taxes, so why are cities arguing that rental properties require greater services than homeowners? The additional revenue, that’s why.
Additional priorities the Arizona REALTORS® are working on include water (of course), short-term rentals, legislation around HOA regulations, and proposals to address the housing crisis. New bills are dropping by the hour so stay tuned to find out how the Arizona REALTORS® are fighting for you!