Author: Camila Alarcon
With about sixty days into the legislative session, several bills impacting real estate and zoning have survived their first chamber. The following summarizes key bills in two areas: local control and vacation and short-term rentals. (Click on each bill name to see the full bill text.)
Local Control
- SB1147, a bill that imposes new limits on the sale of municipal properties, passed the Senate on a 16-14 vote, and is now heading to the House. The bill provides that for a property with a value of at least $50,000, the municipality must hire an independent appraiser to determine the sale or lease value, and post public notices of the proposed sale or lease for four weeks in a weekly publication and on the municipality’s website. The bill’s legislative intent section cites a need for enforcement of the Arizona Constitution’s gift clause.
- HB2240 is in direct response to the Arizona Supreme Court case, City of Phoenix v. Glenayre Electronics, Inc., where the Court held that the City of Phoenix was under no time limit to bring a lawsuit against a developer in an action involving the design, engineering, and construction of a property. The Court found that permits are not contracts, citing a lack of a contractual relationship between a municipality or county and a developer in such instances. HB2240 imposes an eight-year limit on a municipality and county in bringing a lawsuit against a developer in these cases, the same limit as that of contract actions.
Vacation and Short-Term Rentals
- Three years after prohibiting cities and counties from imposing extra restrictions on vacation and short-term rentals, two bills strive to treat them differently than residential properties. HB2672 requires owners or managers of such properties to provide contact information to the local governing body, redundantly prohibits non-residential uses on those properties, requires a transaction privilege tax license, and sets up a system of enforcement through the Arizona Department of Revenue. Keeping in line with the requirement of transaction privilege tax, HB2027 clarifies the taxation of vacation and short-term rentals by allowing for taxation by activity as long as the tax imposed is uniform for that activity within the jurisdictional boundaries.
For questions about legislative process or current legislation, please contact Camila Alarcon. Her practice focuses on administrative law and government relations.
