Arizona Administrative Code, Title 2 — Administration

Partial collection: 1046 complete publisher documents are included. The complete current publisher inventory has not been verified. This is a dated Cornell LII captured edition, with originals captured between 2026-09-01 and 2026-09-11. It contains 642 substantive publisher documents and 404 complete legal-history note documents. Native notices and incomplete documents remain privately preserved. The complete current edition has not been independently verified.

Chapter 8 STATE RETIREMENT SYSTEM BOARD

Article 1 RETIREMENT SYSTEM

Ariz. Admin. Code tit. 2, ch. 8, art. 1, Table 1 Expired

History

• Emergency adoption effective July 6, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Emergency rule adopted again effective September 29, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Permanent rule adopted effective December 22, 1993 (Supp. 93-4). Emergency amendments to Table 1 adopted effective January 30, 1997, pursuant to A.R.S. § 41-1026 for a maximum of 180 days (Supp. 97-1). Emergency expired. Permanent amendments adopted effective September 12, 1997 (Supp. 97-3). Amended by emergency rulemaking under A.R.S. § 41-1026 at 10 A.A.R. 2496, effective August 2, 2004 for 180 days (Supp. 04-2). Amended by final rulemaking at 10 A.A.R. 4012, effective November 13, 2004 (Supp. 04-3). Table expired under A.R.S. § 41-1056(E) at 16 A.A.R. 1765, effective July 14, 2010 (Supp. 10-3).

Ariz. Admin. Code tit. 2, ch. 8, art. 1, Table 2 Expired

History

• Emergency adoption effective July 6, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Emergency rule adopted again effective September 29, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Permanent rule adopted effective December 22, 1993 (Supp. 93-4). Emergency amendments to Table 2 adopted effective January 30, 1997, pursuant to A.R.S. § 41-1026 for a maximum of 180 days (Supp. 97-1). Emergency expired. Permanent amendments adopted effective September 12, 1997 (Supp. 97-3). Amended by emergency rulemaking under A.R.S. § 41-1026 at 10 A.A.R. 2496, effective August 2, 2004 for 180 days (Supp. 04-2). Amended by final rulemaking at 10 A.A.R. 4012, effective November 13, 2004 (Supp. 04-3). Table expired under A.R.S. § 41-1056(E) at 16 A.A.R. 1765, effective July 14, 2010 (Supp. 10-3).

Ariz. Admin. Code tit. 2, ch. 8, art. 1, Table 3 Repealed

History

• Emergency adoption effective July 6, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Emergency rule adopted again effective September 29, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Permanent rule adopted effective December 22, 1993 (Supp. 93-4). Emergency amendments to Table 3 adopted effective January 30, 1997, pursuant to A.R.S. § 41-1026 for a maximum of 180 days (Supp. 97-1). Emergency expired. Permanent amendments adopted effective September 12, 1997 (Supp. 97-3). Table 3 repealed; new Table 3 renumbered from Table 4 by final rulemaking at 9 A.A.R. 4614, effective December 6, 2003 (Supp. 03-4). Table repealed by emergency rulemaking under A.R.S. § 41-1026 at 10 A.A.R. 2496, effective August 2, 2004 for 180 days (Supp. 04-2). Table repealed by final rulemaking at 10 A.A.R. 4012, effective November 13, 2004 (Supp. 04-3).

Ariz. Admin. Code tit. 2, ch. 8, art. 1, Table 3A Expired

History

• New Table made by emergency rulemaking under A.R.S. § 41-1026 at 10 A.A.R. 2496, effective August 2, 2004 for 180 days (Supp. 04-2). New Table made by final rulemaking at 10 A.A.R. 4012, effective November 13, 2004 (Supp. 04-3). Table expired under A.R.S. § 41-1056(E) at 16 A.A.R. 1765, effective July 14, 2010 (Supp. 10-3).

Ariz. Admin. Code tit. 2, ch. 8, art. 1, Table 3B Expired

History

• New Table made by emergency rulemaking under A.R.S. § 41-1026 at 10 A.A.R. 2496, effective August 2, 2004 for 180 days (Supp. 04-2). New Table made by final rulemaking at 10 A.A.R. 4012, effective November 13, 2004 (Supp. 04-3). Table expired under A.R.S. § 41-1056(E) at 16 A.A.R. 1765, effective July 14, 2010 (Supp. 10-3).

Ariz. Admin. Code tit. 2, ch. 8, art. 1, Table 4 Expired

History

• Emergency adoption effective July 6, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Emergency rule adopted again effective September 29, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Permanent rule adopted effective December 22, 1993 (Supp. 93-4). Table 4 renumbered as Table 3 by final rulemaking at 9 A.A.R. 4614, effective December 6, 2003 (Supp. 03-4). New Table made by emergency rulemaking under A.R.S. § 41-1026 at 10 A.A.R. 2496, effective August 2, 2004 for 180 days (Supp. 04-2). New Table made by final rulemaking at 10 A.A.R. 4012, effective November 13, 2004 (Supp. 04-3). Table expired under A.R.S. § 41-1056(E) at 16 A.A.R. 1765, effective July 14, 2010 (Supp. 10-3).

Ariz. Admin. Code tit. 2, ch. 8, art. 1, Table 4A Repealed

History

• New Table made by final rulemaking at 9 A.A.R. 4614, effective December 6, 2003 (Supp. 03-4). Table repealed by emergency rulemaking under A.R.S. § 41-1026 at 10 A.A.R. 2496, effective August 2, 2004 for 180 days (Supp. 04-2). Table repealed by final rulemaking at 10 A.A.R. 4012, effective November 13, 2004 (Supp. 04-3).

Ariz. Admin. Code tit. 2, ch. 8, art. 1, Table 4B Repealed

History

• New Table made by final rulemaking at 9 A.A.R. 4614, effective December 6, 2003 (Supp. 03-4). Table repealed by emergency rulemaking under A.R.S. § 41-1026 at 10 A.A.R. 2496, effective August 2, 2004 for 180 days (Supp. 04-2). Table repealed by final rulemaking at 10 A.A.R. 4012, effective November 13, 2004 (Supp. 04-3).

Ariz. Admin. Code tit. 2, ch. 8, art. 1, Table 4C Repealed

History

• New Table made by final rulemaking at 9 A.A.R. 4614, effective December 6, 2003 (Supp. 03-4). Table repealed by emergency rulemaking under A.R.S. § 41-1026 at 10 A.A.R. 2496, effective August 2, 2004 for 180 days (Supp. 04-2). Table repealed by final rulemaking at 10 A.A.R. 4012, effective November 13, 2004 (Supp. 04-3).

Ariz. Admin. Code tit. 2, ch. 8, art. 1, Table 5 Expired

History

• Emergency adoption effective July 6, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Emergency rule adopted again effective September 29, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Permanent rule adopted effective December 22, 1993 (Supp. 93-4). Table 5 repealed, new Table 5 adopted by emergency action effective January 30, 1997, pursuant to A.R.S. § 41-1026 for a maximum of 180 days (Supp. 97-1). Emergency expired. Table 5 repealed, new Table 5 adopted by regular rulemaking action effective September 12, 1997 (Supp. 97-3). Table 5 repealed; new Table 5 renumbered from Table 6 and amended by final rulemaking at 9 A.A.R. 4614, effective December 6, 2003 (Supp. 03-4). Table repealed; new Table made by emergency rulemaking under A.R.S. § 41-1026 at 10 A.A.R. 2496, effective August 2, 2004 for 180 days (Supp. 04-2). Former Table 5 renumbered to Table 6; new Table 5 made by final rulemaking at 10 A.A.R. 4012, effective November 13, 2004 (Supp. 04-3). Table expired under A.R.S. § 41-1056(E) at 16 A.A.R. 1765, effective July 14, 2010 (Supp. 10-3).

Ariz. Admin. Code tit. 2, ch. 8, art. 1, Table 6 Expired

History

• Emergency adoption effective July 6, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Emergency rule adopted again effective September 29, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Permanent rule adopted effective December 22, 1993 (Supp. 93-4). Table repealed, new Table adopted effective September 12, 1997 (Supp. 97-3). Former Table 6 renumbered to Table 5; new Table 6 renumbered from Table 7 and amended by final rulemaking at 9 A.A.R. 4614, effective December 6, 2003 (Supp. 03-4). Table repealed; new Table made by emergency rulemaking under A.R.S. § 41-1026 at 10 A.A.R. 2496, effective August 2, 2004 for 180 days (Supp. 04-2). Former Table 6 renumbered to Table 7; new Table 6 renumbered from Table 5 and amended by final rulemaking at 10 A.A.R. 4012, effective November 13, 2004 (Supp. 04-3). Table expired under A.R.S. § 41-1056(E) at 16 A.A.R. 1765, effective July 14, 2010 (Supp. 10-3).

Ariz. Admin. Code tit. 2, ch. 8, art. 1, Table 7 Expired

History

• Emergency adoption effective July 6, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Emergency rule adopted again effective September 29, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Permanent rule adopted effective December 22, 1993 (Supp. 93-4). Table repealed, new Table adopted effective September 12, 1997 (Supp. 97-3). Renumbered to Table 6 by final rulemaking at 9 A.A.R. 4614, effective December 6, 2003 (Supp. 03-4). New Table made by emergency rulemaking under A.R.S. § 41-1026 at 10 A.A.R. 2496, effective August 2, 2004 for 180 days (Supp. 04-2). Table 7 renumbered from Table 6 and amended by final rulemaking at 10 A.A.R. 4012, effective November 13, 2004 (Supp. 04-3). Table expired under A.R.S. § 41-1056(E) at 16 A.A.R. 1765, effective July 14, 2010 (Supp. 10-3).

Ariz. Admin. Code tit. 2, ch. 8, art. 1, Table 8 [Repealed]

History

• Adopted effective September 12, 1977 (Supp. 77-5). Table 8 repealed, new Table 8 adopted effective July 24, 1985 (Supp. 85-4). Repealed by emergency effective July 6, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Repealed again by emergency effective September 29, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Repealed effective December 22, 1993 (Supp. 93-4).

Ariz. Admin. Code tit. 2, ch. 8, art. 1, Table 9 [Repealed]

History

• Adopted effective September 12, 1977 (Supp. 77-5). Table 9 repealed, new Table 9 adopted effective July 24, 1985 (Supp. 85-4). Repealed by emergency effective July 6, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Repealed again by emergency effective September 29, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Repealed effective December 22, 1993 (Supp. 93-4).

Ariz. Admin. Code tit. 2, ch. 8, art. 1, Table 10 [Repealed]

History

• Adopted effective October 18, 1984 (Supp. 84-5). Table 10 repealed, new Table 10 adopted effective July 24, 1985 (Supp. 85-4). Repealed by emergency effective July 6, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Repealed again by emergency effective September 29, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Repealed effective December 22, 1993 (Supp. 93-4).

Ariz. Admin. Code tit. 2, ch. 8, art. 1, Exhibit A [Repealed]

History

• Adopted by emergency effective July 6, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Emergency rule adopted again effective September 29, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Permanent rule adopted effective December 22, 1993 (Supp. 93-4). Repealed by emergency rulemaking under A.R.S. § 41-1026 at 10 A.A.R. 2496, effective August 2, 2004 for 180 days (Supp. 04-2). Repealed by final rulemaking at 10 A.A.R. 4012, effective November 13, 2004 (Supp. 04-3).

Chapter 17 Water Quality Appeals Board

Article 1 APPEALS

Ariz. Admin. Code tit. 2, ch. 17, art. 1, app B [Repealed]

History

• Adopted effective January 8, 1998 (Supp. 98-1). Repealed by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Chapter 8 STATE RETIREMENT SYSTEM BOARD

Article 1 RETIREMENT SYSTEM

Ariz. Admin. Code tit. 2, ch. 8, art. 1, Exhibit C [Repealed]

History

• Adopted by emergency effective July 6, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Emergency rule adopted again effective September 29, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Permanent rule adopted effective December 22, 1993 (Supp. 93-4). Repealed by emergency rulemaking under A.R.S. § 41-1026 at 10 A.A.R. 2496, effective August 2, 2004 for 180 days (Supp. 04-2). Repealed by final rulemaking at 10 A.A.R. 4012, effective November 13, 2004 (Supp. 04-3).

Ariz. Admin. Code tit. 2, ch. 8, art. 1, Exhibit G [Repealed]

History

• Adopted by emergency effective July 6, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Emergency rule adopted again effective September 29, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Permanent rule adopted effective December 22, 1993 (Supp. 93-4). Repealed by emergency rulemaking under A.R.S. § 41-1026 at 10 A.A.R. 2496, effective August 2, 2004 for 180 days (Supp. 04-2). Repealed by final rulemaking at 10 A.A.R. 4012, effective November 13, 2004 (Supp. 04-3).

Ariz. Admin. Code tit. 2, ch. 8, art. 1, Exhibit H [Repealed]

History

• Adopted by emergency effective July 6, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Emergency rule adopted again effective September 29, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Permanent rule adopted effective December 22, 1993 (Supp. 93-4). Repealed by emergency rulemaking under A.R.S. § 41-1026 at 10 A.A.R. 2496, effective August 2, 2004 for 180 days (Supp. 04-2). Repealed by final rulemaking at 10 A.A.R. 4012, effective November 13, 2004 (Supp. 04-3).

Ariz. Admin. Code tit. 2, ch. 8, art. 1, Exhibit I [Repealed]

History

• Adopted by emergency effective July 6, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Emergency rule adopted again effective September 29, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Permanent rule adopted effective December 22, 1993 (Supp. 93-4). Repealed by emergency rulemaking under A.R.S. § 41-1026 at 10 A.A.R. 2496, effective August 2, 2004 for 180 days (Supp. 04-2). Repealed by final rulemaking at 10 A.A.R. 4012, effective November 13, 2004 (Supp. 04-3).

Ariz. Admin. Code tit. 2, ch. 8, art. 1, Exhibit J [Repealed]

History

• Adopted by emergency effective July 6, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Emergency rule adopted again effective September 29, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Permanent rule adopted effective December 22, 1993 (Supp. 93-4). Repealed by emergency rulemaking under A.R.S. § 41-1026 at 10 A.A.R. 2496, effective August 2, 2004 for 180 days (Supp. 04-2). Repealed by final rulemaking at 10 A.A.R. 4012, effective November 13, 2004 (Supp. 04-3).

Ariz. Admin. Code tit. 2, ch. 8, art. 1, Exhibit K [Repealed]

History

• Adopted by emergency effective July 6, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Emergency rule adopted again effective September 29, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Permanent rule adopted effective December 22, 1993 (Supp. 93-4). Repealed by emergency rulemaking under A.R.S. § 41-1026 at 10 A.A.R. 2496, effective August 2, 2004 for 180 days (Supp. 04-2). Repealed by final rulemaking at 10 A.A.R. 4012, effective November 13, 2004 (Supp. 04-3).

Chapter 1 DEPARTMENT OF ADMINISTRATION

Article 1 EXPIRED

Ariz. Admin. Code § R2-1-101 Expired

History

• Adopted effective April 7, 1982 (Supp. 82-2). Section R2-1-101 repealed, new Section adopted effective April 15, 1991 (Supp. 91-2). Section expired under A.R.S. § 41-1056(E) at 7 A.A.R. 5991, effective November 30, 2001 (Supp. 01-4).

Ariz. Admin. Code § R2-1-102 Expired

History

• Adopted effective April 7, 1982 (Supp. 82-2). Section R2-1-102 repealed, new Section adopted effective April 15, 1991 (Supp. 91-2). Section expired under A.R.S. § 41-1056(E) at 7 A.A.R. 5991, effective November 30, 2001 (Supp. 01-4).

Ariz. Admin. Code § R2-1-103 Expired

History

• Adopted effective April 7, 1982 (Supp.82-2). Section R2-1-103 repealed, new Section adopted effective April 15, 1991 (Supp. 91-2). Section expired under A.R.S. § 41-1056(E) at 7 A.A.R. 5991, effective November 30, 2001 (Supp. 01-4).

Ariz. Admin. Code § R2-1-104 Expired

History

• Adopted effective April 7, 1982 (Supp. 82-2). Amended effective February 7, 1990 (Supp. 90-1). Section R2-1-104 repealed, new Section adopted effective April 15, 1991 (Supp. 91-2). Section expired under A.R.S. § 41-1056(E) at 7 A.A.R. 5991, effective November 30, 2001 (Supp. 01-4).

Article 2 TRANSFERRED

Ariz. Admin. Code § R2-1-201 Transferred

History

• Adopted effective July 27, 1983 (Supp. 83-4). Section repealed, new Section adopted effective February 7, 1990 (Supp. 90-1). Transferred to R2-15-201 (Supp. 91-3).

Ariz. Admin. Code § R2-1-202 Transferred

History

• Adopted effective July 27, 1983 (Supp. 83-4). Repealed effective February 7, 1990 (Supp. 90-1). Transferred to R2-15-202 (Supp. 91-3).

Ariz. Admin. Code § R2-1-203 Transferred

History

• Adopted effective July 27, 1983 (Supp. 83-4). Section repealed, new Section adopted effective February 7, 1990 (Supp. 90-1). Transferred to R2-15-203 (Supp. 91-3).

Ariz. Admin. Code § R2-1-204 Transferred

History

• Adopted effective July 27, 1983 (Supp. 83-4). Section repealed, new Section adopted effective February 7, 1990 (Supp. 90-1). Transferred to R2-15-204 (Supp. 91-3).

Ariz. Admin. Code § R2-1-205 Transferred

History

• Adopted effective July 27, 1983 (Supp. 83-4). Section repealed, new Section adopted effective February 7, 1990 (Supp. 90-1). Transferred to R2-15-205 (Supp. 91-3).

Ariz. Admin. Code § R2-1-206 Transferred

History

• Adopted effective July 27, 1983 (Supp. 83-4). Editorial correction, subsection (B), paragraph (3) (Supp. 84-2). Section repealed, new Section adopted effective February 7, 1990 (Supp. 90-1). Transferred to R2-15-206 (Supp. 91-3).

Ariz. Admin. Code § R2-1-207 Transferred

History

• Adopted effective July 27, 1983 (Supp. 83-4). Section repealed, new Section adopted effective February 7, 1990 (Supp. 90-1). Transferred to R2-15-207 (Supp. 91-3).

Ariz. Admin. Code § R2-1-208 Transferred

History

• Adopted effective July 27, 1983 (Supp. 83-4). Repealed effective February 7, 1990 (Supp. 90-1). Transferred to R2-15-208 (Supp. 91-3).

Ariz. Admin. Code § R2-1-209 Transferred

History

• Adopted effective July 27, 1983 (Supp. 83-4). Section repealed, new Section adopted effective February 7, 1990 (Supp. 90-1). Transferred to R2-15-209 (Supp. 91-3).

Article 3 EMERGENCY EXPIRED

Ariz. Admin. Code § R2-1-301 Emergency Expired

History

• Adopted as an emergency effective October 10, 1984, pursuant to A.R.S. § 41-1003, valid for only 90 days. Emergency expired.

Ariz. Admin. Code § R2-1-302 Emergency Expired

History

• Correction, Historical Note not shown in Supp. 84-5, added in Supp. 85-4. Adopted as an emergency effective October 10, 1984, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 85-4). Emergency expired.

Article 4 EMERGENCY TELECOMMUNICATION SERVICES REVOLVING FUND

Ariz. Admin. Code § R2-1-401 Definitions

The following definitions shall apply for purposes of this Article:

1. "Assistant Director" means Assistant Director of the Information Services Division of the Arizona Department of Administration.

2. "Automatic location identification" or "ALI" means the process of electronically identifying and displaying the name of the subscriber and the address of the calling telephone number to a person answering a 9-1-1 call.

3. "Automatic number identification" or "ANI" means the telephone number of a caller that is automatically identified at the PSAP receiving a 9-1-1 call.

4. "Basic 9-1-1" means a service that routes a 9-1-1 call to a PSAP for dispatch services. There are no ALI or ANI data provided with the call.

5. "Busy hour" means the hour period during a 24-hour day when the number of 9-1-1 calls to the PSAP is generally at a maximum.

6. "Busy month" means the one-month period during a 12-month calendar year when, as a general matter, the number of 9-1-1 calls to the PSAP is at a maximum.

7. "Central office" means the physical site of the switching equipment for a specific telephone exchange area.

8. "Customer premise equipment" or CPE means the PSAP's communication equipment necessary for handling 9-1-1 calls.

9. "Dedicated 9-1-1 trunk" means a telephone circuit that is used exclusively to transport 9-1-1 calls.

10. "Enhanced 9-1-1" means a service that routes a 9-1-1 call to a PSAP for dispatch services and delivers the telephone number, name, and address to the PSAP.

11. "Fund" means the emergency telecommunication services revolving fund established in A.R.S. § 41-704(B).

12. "Network access mileage computations" means a computation based on distance measured from the Central Office located outside of the local exchange area to the Central Office that serves the PSAP based on the type of circuits between the Central Offices.

13. "Network exchange services" means telephone circuits or private lines dedicated to and used exclusively for the purpose of receiving, extending, or transferring 9-1-1 calls.

14. "Nine-One-One service" or "9-1-1 service" means a telephone service which allows a user of the public telephone system to reach a PSAP by dialing the digits 9-1-1.

15. "Person" has the same meaning as at A.R.S. § 1-215.

16. "Public or Private safety agency" means any unit of local, state, or federal government, special purpose district, or private person located in whole or in part within this state, that provides or has the authority to provide firefighting, law enforcement, ambulance, or other emergency or medical services.

17. "Public safety answering point" or "PSAP" means a communications facility operated on a 24-hour basis that is assigned the responsibility to receive 9-1-1 calls and, as appropriate, notifies or dispatches public or private safety services or extends, transfers, or relays 9-1-1 calls to an appropriate public or private safety agency.

18. "Public safety answering point manager" means a person responsible for the daily operation of a public safety answering point.

19. "PSAP service area" means the area in which an emergency-call-taking service is provided by a PSAP.

20. "Selective routing" means a process through which a 9-1-1 call is automatically routed to a predetermined PSAP based on the telephone number of the calling party.

21. "Service plan" means a written plan which identifies the method of providing and maintaining 9-1-1 Service in a specific geographic area.

22. "Telephone exchange area" means a specific geographic area designated by the Arizona Corporation Commission to receive service from 1 or more central offices.

23. "Wireless service" means mobile or cellular telephone service, whether digital or analog.

History

• Adopted effective July 22, 1985 (Supp. 85-4). Amended effective June 14, 1990 (Supp. 90-2). Amended by final rulemaking a 6 A.A.R. 1971, effective May 12, 2000 (Supp. 00-2).

Ariz. Admin. Code § R2-1-402 Establishment of 9-1-1 Planning Committee

A. To qualify for funding under A.R.S. § 41-704(B), all the public or private safety agencies in a specific geographic area to be served shall establish a 9-1-1 planning committee to develop a service plan.

B. A 9-1-1 planning committee shall include representation from all public and private safety agencies located within the specific geographic area that have the authority to provide firefighting, law enforcement, ambulance, or other medical or emergency services.

C. To receive funding, a 9-1-1 planning committee shall submit a service plan as required in R2-1-403 .

History

• Adopted effective July 22, 1985 (Supp. 85-4). Amended effective June 14, 1990 (Supp. 90-2). Amended by final rulemaking a 6 A.A.R. 1971, effective May 12, 2000 (Supp. 00-2).

Ariz. Admin. Code § R2-1-403 Submission of Service Plan

Each 9-1-1 planning committee shall submit a final service plan to the Assistant Director. The following information shall be included:

1. The name and mailing address of the planning committee chairperson;

2. The names of all members of the 9-1-1 planning committee;

3. The date the service plan is submitted to the Assistant Director;

4. The date the 9-1-1 service is scheduled to begin;

5. The signature of the chairperson;

6. A map showing the geographic boundaries of the telephone exchange areas included in the proposed 9-1-1 service system, each PSAP location, and any other jurisdictional boundaries;

7. The name and mailing address of the public or private safety agency operating each PSAP;

8. The name and telephone number of each PSAP manager;

9. A description of the procedures and agreements to be followed when responding to 9-1-1 calls that are routed to a PSAP other than the one serving the area from which the call originates;

10. A description of the 9-1-1 system routing and switching configurations;

11. A description of the network exchange services, the central office equipment to be used, and any network access mileage computations;

12. An itemized list of both estimated installation cost and ongoing costs as discussed in R2-1-409 for proposed telephone service and equipment. These estimates shall be obtained by the 9-1-1 planning committee from the telephone company serving the telephone exchange area and signed by an authorized employee of the telephone company or equipment vendor. Equipment that is on term contract from the State of Arizona Purchasing Office is exempt from bidding requirements;

13. A copy of the equipment specifications used for bidding the system customer premise equipment. A minimum of 2 bids is required;

14. A copy of the low-bid response with itemized equipment costs and associated installation charges and a list of vendors;

15. A certification from the 9-1-1 planning committee that the service plan meets the requirements of the public or private safety agencies whose services will be available in response to a 9-1-1 call;

16. A list of all public and private safety agencies whose services will be available in response to 9-1-1 calls with the following information about each:

a. Agency name,

b. Agency mailing address,

c. Name and telephone number of the agency head,

d. A brief description of the services to be provided, and

e. A description of proposed procedures for dispatching emergency service providers;

17. A description of an alternate method of providing service if there is a failure of all or a portion of the 9-1-1 service system or a failure of the PSAP primary electrical power;

18. A certification from the 9-1-1 planning committee for the ALI feature, that at least 90% of the 9-1-1 service area is addressed with street numbers. Before implementation of the ALI feature, certification of a less than 10% error rate in the data base shall be obtained from the telephone company responsible for the data base; and

19. A plan for a program of public information regarding 9-1-1 service, which the 9-1-1 planning committee chairperson or designee will implement at least 30 days before 9-1-1 service begins.

History

• Adopted effective July 22, 1985 (Supp. 85-4). Amended effective June 14, 1990 (Supp. 90-2). Amended by final rulemaking a 6 A.A.R. 1971, effective May 12, 2000 (Supp. 00-2).

Ariz. Admin. Code § R2-1-404 Certificate of Service Plan Approval

A. The Assistant Director shall approve or disapprove a service plan within 60 days of its submission.

B. If approved, the Assistant Director shall notify the 9-1-1 planning committee chairperson in writing of the approval of the service plan and shall include an itemization of the costs that are eligible for payment from the fund. This approval shall be in the form of a "Certificate of 9-1-1 Service Plan Approval".

C. If a service plan or any part of a service plan is disapproved, the Assistant Director shall notify the 9-1-1 planning committee chairperson in writing within 60 days of the reasons for the disapproval and the opportunity to submit a revised service plan.

D. By the 15th of December of each year, a 9-1-1 planning committee with an approved service plan shall submit a budget of projected 9-1-1 costs to the Assistant Director for the next fiscal year.

History

• Adopted effective July 22, 1985 (Supp. 85-4). Amended effective June 14, 1990 (Supp. 90-2). Amended by final rulemaking a 6 A.A.R. 1971, effective May 12, 2000 (Supp. 00-2).

Ariz. Admin. Code § R2-1-405 Resubmitting of a Service Plan

If a service plan or any part of a service plan is disapproved by the Assistant Director, a revised service plan may be resubmitted by the 9-1-1 planning committee chairperson within 45 days of receipt of the notice of disapproval. The Assistant Director shall approve or disapprove the revised service plan within 30 days following receipt.

History

• Adopted effective July 22, 1985 (Supp. 85-4). Amended effective June 14, 1990 (Supp. 90-2). Amended by final rulemaking a 6 A.A.R. 1971, effective May 12, 2000 (Supp. 00-2).

Ariz. Admin. Code § R2-1-406 Modification of an Approved Service Plan

A. The Assistant Director shall be notified in writing by the 9-1-1 planning committee chairperson at least 60 days in advance of any proposed modification to a 9-1-1 system that would result in a material change to the service plan as approved.

B. Within 30 days of receipt of any proposed modification, the Assistant Director shall approve or disapprove the proposed modification. If the proposed modification is disapproved, the proposed modification is ineligible for payment from the fund.

C. The PSAP manager shall review PSAP and network services annually and submit any proposed modification in annual budget request by December 15th of the year preceding the fiscal year in which the modification is proposed to be made.

History

• Adopted effective July 22, 1985 (Supp. 85-4). Amended effective June 14, 1990 (Supp. 90-2). Amended by final rulemaking a 6 A.A.R. 1971, effective May 12, 2000 (Supp. 00-2).

Ariz. Admin. Code § R2-1-407 9-1-1 System Design Standards

In order to obtain approval of a service plan, the 9-1-1 planning committee shall include the following in the service plan:

1. A 9-1-1 service system shall be designed and operated to provide service that enables no more than 1 call out of 100 incoming calls to receive a busy signal on the first dialing attempt during the busy hour of an average week during the busy month;

2. Each telephone position with the capability of answering or handling 9-1-1 calls shall be equipped with the necessary interface to communicate with TDD/TTY devices for communications with hearing-impaired individuals in accordance with the Americans with Disabilities Act;

3. A 9-1-1 service system shall include the following services:

a. Law enforcement services including services of the County Sheriff and the Department of Public Safety;

b. Firefighting services; and

c. Ambulance or emergency medical services;

4. Other services may be included in a 9-1-1 service system at the discretion of the public or private safety agency operating the PSAP, but the fund shall not pay for these other services;

5. PSAP answering equipment shall permit answering personnel to place a 9-1-1 call on hold;

6. Each PSAP and each participating public or private safety agency shall have at least 1 published telephone number to call for non-emergency services. One non-emergency number may be shared by 2 or more participating public or private safety agencies if there is a cooperative agreement for call-answering responsibility; and

7. An automatic alarm system or other related device shall not be connected in a manner that activates a call to a 9-1-1 service system.

History

• Adopted effective July 22, 1985 (Supp. 85-4). Amended effective June 14, 1990 (Supp. 90-2). Amended by final rulemaking a 6 A.A.R. 1971, effective May 12, 2000 (Supp. 00-2).

Ariz. Admin. Code § R2-1-408 9-1-1 Operational Requirements

In order to obtain approval from the Assistant Director for payment from the fund for costs eligible for payment under R2-1-409, the PSAP shall:

1. Monitor the 9-1-1 service system level of service to ensure that the standards in R2-1-407 are met. Once each fiscal year the PSAP manager shall obtain a report regarding the 9-1-1 level of service from the telephone company servicing the telephone exchange area. If the report provided by the telephone company indicates that the required service level is not being met, the PSAP manager shall:

a. Request the telephone company to prepare plans, specifications, and cost estimates to raise the level of service to that required in R2-1-407.

b. Notify the Assistant Director under R2-1-406 if, based on information provided by the telephone company, modifications to the system are necessary.

2. Provide service to all callers within its service area 24 hours each day, 7 days a week. To qualify as a primary or secondary PSAP, the PSAP must receive a minimum of 300 9-1-1 emergency calls per month.

3. Refer all calls entering the 9-1-1 service system that do not require a public or private safety response unit be dispatched to a non-9-1-1 telephone number.

4. Designate a telephone number other than 9-1-1 as a backup number in case the 9-1-1 service system fails. The designated alternate telephone number shall be published in the public telephone directory, by the local public safety agency.

5. Develop and maintain a system for recording 9-1-1 calls received by the PSAP. The records shall be retained for at least 31 days from the date of the call and shall include the following information:

a. Date and time the call is received,

b. Nature of the problem, and

c. Action taken by the dispatcher.

6. To qualify as a remote print site, the PSAP must receive a minimum of 100 emergency calls per month.

History

• Adopted effective July 22, 1985 (Supp. 85-4). Amended effective June 14, 1990 (Supp. 90-2). Amended by final rulemaking a 6 A.A.R. 1971, effective May 12, 2000 (Supp. 00-2).

Ariz. Admin. Code § R2-1-409 Funding Eligibility

A. The following costs of providing 9-1-1 service shall be reimbursed by the ADOA 9-1-1 Office from the fund, subject to available monies and the following requirements, to a 9-1-1 planning committee that has a Certificate of 9-1-1 Service Plan Approval:

1. Costs of the network exchange services necessary to provide the minimum grade of service.

2. Costs for necessary and appropriate equipment required by the PSAP to receive and process 9-1-1 calls and messages. This may include computer telephone integrated systems or other automated call management and distribution systems.

3. Ongoing maintenance costs following the warranty period, if any, for the customer premise equipment used in the receiving and processing of 9-1-1 calls and messages.

4. Necessary and appropriate consulting services or administrative costs, not to exceed 3% of the amounts deposited annually in the revolving fund.

B. The Assistant Director shall consider special projects that further statewide 9-1-1 availability, including addressing or database projects, public education, and training programs on a case-by-case basis. Special project funding is based on community needs and the availability of funds.

History

• Adopted effective July 22, 1985 (Supp. 85-4). Amended effective June 14, 1990 (Supp. 90-2). Amended by final rulemaking a 6 A.A.R. 1971, effective May 12, 2000 (Supp. 00-2).

Ariz. Admin. Code § R2-1-410 Method of Reimbursement

A. Network Exchange Services

1. The 9-1-1 planning committee chairperson shall submit the operating telephone company's billing statement for the network exchange services to the Assistant Director.

2. The Assistant Director shall review invoices for compliance with the original Certificate of 9-1-1 Service Plan Approval, and approve and make payment directly to the operating telephone company.

B. Station terminal equipment

1. Payment of costs for the 9-1-1 customer premise equipment shall be made after submission by the designated public safety office, of a copy of the vendor's contract, with an itemized listing of equipment and associated costs and installation charges, to the Assistant Director for review and approval.

2. The Assistant Director shall make payment directly to the vendor upon verification that the invoice is in compliance with the original Certificate of 9-1-1 Service Plan Approval.

C. Maintenance costs

1. Payment of costs for ongoing maintenance shall be made by the ADOA 9-1-1 Office of customer premise equipment following expiration of a warranty period for the equipment. Payment shall be made by the designated public safety office submitting a copy of the maintenance contract with an itemized list of hourly labor rates and equipment costs.

2. The Assistant Director shall make payment directly to the vendor upon verification that the charges are for the 9-1-1 equipment and services originally contracted for and that the vendor's hourly labor rate does not exceed the prevailing labor rate for similar communication equipment and services.

D. The Assistant Director shall pay the costs for consulting directly to the consultant, after the Assistant Director verifies that:

1. The need and proposed cost of consulting services is identified in either the original 9-1-1 service plan under R2-1-403 or in the annual budget under R2-1-404(D); and

2. A copy of the consultant's contract is submitted to the Assistant Director.

History

• Adopted effective July 22, 1985 (Supp. 85-4). Amended effective June 14, 1990 (Supp. 90-2). Amended by final rulemaking a 6 A.A.R. 1971, effective May 12, 2000 (Supp. 00-2).

Ariz. Admin. Code § R2-1-411 Allocation of Funds

The following change access and wireless service line verification shall be conducted by the ADOA 9-1-1 Office each year:

1. The Assistant Director shall request from the operating telephone companies providing 9-1-1 service, by February 15 of each year, the number and type of exchange access lines in each telephone exchange area in this state and the amount of 9-1-1 excise tax generated in each telephone exchange area in each county.

2. The Assistant Director shall request, by February 15 of each year, from each wireless service provider the number of activated wireless service lines within the state and the amount of 9-1-1 tax generated.

3. Each 9-1-1 planning committee that has a Certificate of 9-1-1 Service Plan Approval shall be apportioned a percentage of monies on deposit in the fund. Payment shall be made directly to the vendors identified in the 9-1-1 service plan.

4. If the combined statewide 9-1-1 service costs exceed the available monies in the fund, monies shall be allocated by the Assistant Director on a percentage basis determined by the ratio of revenue to expenses for the state as a whole.

History

• Adopted effective July 22, 1985 (Supp. 85-4). Amended effective June 14, 1990 (Supp. 90-2). Amended by final rulemaking a 6 A.A.R. 1971, effective May 12, 2000 (Supp. 00-2).

Article 5 EXPIRED

Ariz. Admin. Code § R2-1-501 Expired

History

• Adopted effective October 9, 1985 (Supp. 85-5). Section expired under A.R.S. § 41-1056(E) at 7 A.A.R. 3475, effective July 16, 2001 (Supp. 01-3).

Ariz. Admin. Code § R2-1-502 Expired

History

• Adopted effective October 9, 1985 (Supp. 85-5). Section expired under A.R.S. § 41-1056(E) at 7 A.A.R. 3475, effective July 16, 2001 (Supp. 01-3).

Ariz. Admin. Code § R2-1-503 Expired

History

• Adopted effective October 9, 1985 (Supp. 85-5). Section expired under A.R.S. § 41-1056(E) at 7 A.A.R. 3475, effective July 16, 2001 (Supp. 01-3).

Ariz. Admin. Code § R2-1-504 Expired

History

• Adopted effective October 9, 1985 (Supp. 85-5). Section expired under A.R.S. § 41-1056(E) at 7 A.A.R. 3475, effective July 16, 2001 (Supp. 01-3).

Ariz. Admin. Code § R2-1-505 Expired

History

• Adopted effective October 9, 1985 (Supp. 85-5). Section expired under A.R.S. § 41-1056(E) at 7 A.A.R. 3475, effective July 16, 2001 (Supp. 01-3).

Article 6 REPEALED

Ariz. Admin. Code § R2-1-601 [Repealed]

History

• Adopted as an emergency effective October 2, 1987, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 87-4). Emergency expired. Readopted as an emergency effective February 2, 1988, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 88-1). Emergency expired. New Section R2-1-601 adopted as a permanent rule effective May 3, 1989 (Supp. 89-2). Amended by final rulemaking at 17 A.A.R. 422, effective April 30, 2011 (Supp. 11-1). Repealed by final rulemaking at 24 A.A.R. 625, effective 5/5/2018.

Ariz. Admin. Code § R2-1-602 Renumbered

History

• Adopted effective May 3, 1989 (Supp. 89-2). Amended by final rulemaking at 17 A.A.R. 422, effective April 30, 2011 (Supp. 11-1). Section R2-1-602 renumbered to R2- 1-805 by final rulemaking at 24 A.A.R. 625, effective 5/5/2018.

Ariz. Admin. Code § R2-1-603 [Repealed]

History

• Adopted effective May 3, 1989 (Supp. 89-2). Section repealed; new Section made by final rulemaking at 17 A.A.R. 422, effective April 30, 2011 (Supp. 11-1). Repealed by final rulemaking at 24 A.A.R. 625, effective 5/5/2018.

Ariz. Admin. Code § R2-1-604 Repealed

History

• Adopted effective May 3, 1989 (Supp. 89-2). Section repealed by final rulemaking at 17 A.A.R. 422, effective April 30, 2011 (Supp. 11-1).

Ariz. Admin. Code § R2-1-605 Repealed

History

• Adopted effective May 3, 1989 (Supp. 89-2). Section repealed by final rulemaking at 17 A.A.R. 422, effective April 30, 2011 (Supp. 11-1).
• New rules for the Water Quality Appeals Board were adopted under a new Chapter (2 A.A.C. 17) in Supp. 98-1.

Article 7 REPEALED

Ariz. Admin. Code § R2-1-701 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-702 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-703 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-704 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-705 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-706 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-707 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-708 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-709 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-710 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-711 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-712 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-713 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-714 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-715 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-716 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-717 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-718 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-719 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-720 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-721 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-722 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-723 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-724 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-725 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-726 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-727 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-728 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-729 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-730 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-731 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-1-732 Repealed

History

• Adopted effective May 7, 1990 (Supp. 90-2). Repealed effective January 8, 1998 (Supp. 98-1).

Article 8 TRAVEL REDUCTION PROGRAMS

Ariz. Admin. Code § R2-1-801 Definitions

In this Article, unless otherwise specified:

1. "Agency head" means the head of each department, agency, board, and commission of this state.

2. "Area A and Area B" have the same meaning in A.R.S. § 49-541.

3. "Commuter transportation" means a mode of transportation used by an eligible employee to travel to or from the eligible employee's place of employment and made available to the eligible employee by a transportation provider under contract with the state of Arizona.

3. 4. "Director" means the Director of the Department of Administration or the director's designee.

4. 5. "Eligible employee" means an employee, in pay status, and lives or works in Area A or Area B, except a university employee .

6. "Employee" means an individual elected or appointed to a state position, or employed on a part-time or full-time basis by a department, agency, board, or commission of this state.

5. 7. "Pay status" has the meaning in R2-5A-101.

6. 8. "Private transportation" means the conveyance of passengers, by a commercial enterprise, on scheduled routes by bus for which an individual passenger pays a fare. "Period" means October 1 through the following April 1.

7. "Public transportation" has the meaning in A.R.S. § 41-710.01(B) .

8. 9. "Reduced cost" means the portion of the total cost of commuter transportation that is paid by an eligible employee.

9. 10. "Reimbursement subsidy" means the portion of the total cost of commuter transportation that is paid on behalf of an eligible employee to a transportation provider through a contract with the state of Arizona.

10. "Transportation card" means the evidence of an eligible employee's participation in a transportation program, issued to the employee by the Department of Administration.

"Transportation program" means a system for reimbursement or subsidy of public or private transportation expenses under A.R.S. § 41-710.01 . "Telework" has the same meaning as at 5 U.S.C. 6501.

12. "Transportation provider" means:

a. An incorporated city or town,

b. A regional public transportation authority established under A.R.S. § 48-5102,

c. A regional transportation authority established under A.R.S. § 48-5302,

d. A commercial enterprise, or

e. An Arizona state agency.

History

• Adopted effective May 31, 1991 (Supp. 91-2). Section repealed, new Section adopted effective December 30, 1994 (Supp. 94-4). Amended by final rulemaking at 6 A.A.R. 746, effective February 1, 2000 (Supp. 00-1). Amended by final rulemaking at 13 A.A.R. 4579, effective February 5, 2008 (Supp. 07-4). Amended by final rulemaking at 24 A.A.R. 625, effective 5/5/2018.

Ariz. Admin. Code § R2-1-802 Eligibility for Commuter Transportation Reimbursement Subsidy

A. The Director shall pay a reimbursement subsidy on behalf of an eligible employee who:

1. Completes an application, using a form available from the Department of Administration, for authorization to pay the reduced cost for commuter transportation; and

2. Uses commuter transportation to travel to or from the eligible employee's place of employment.

3. Has authorized payroll deductions under A.R.S. § 38-612(B)(9) .

B. An eligible employee who uses public or private bus or light rail as a means of commuter transportation shall:

1. Authorize payroll deduction under A.R.S. § 38-612(B)(9) of the reduced cost; and

2. As a condition of being authorized to pay the reduced cost for commuter transportation and being issued a transportation card, agree:

a. Not to allow anyone else to use the transportation card;

b. To use the transportation card only for commuter transportation unless the eligible employee incurs the transportation provider's maximum monthly charge;

c. To maintain payroll deduction authorization;

d. To notify the Department of Administration if the transportation card is lost or stolen;

e. To pay $5 on a payroll deduction to replace a lost, damaged, or stolen transportation card;

f. To surrender the transportation card upon termination of employment with the state; and

g. That use of the transportation card after receiving notice of a change to the terms of using the transportation card constitutes agreement to the change.

History

• Adopted effective May 31, 1991 (Supp. 91-2). Section repealed, new Section adopted effective December 30, 1994 (Supp. 94-4). Amended by final rulemaking at 6 A.A.R. 746, effective February 1, 2000 (Supp. 00-1). Amended by final rulemaking at 24 A.A.R. 625, effective 5/5/2018.

Ariz. Admin. Code § R2-1-803 Commuter Transportation Reimbursement Subsidy Amount

A. The Director shall determine the amount of reimbursement subsidy, up to 100% of the actual cost of commuter transportation, based upon:

1. The number of eligible employees authorized under R2-1-802 to pay reduced cost for commuter transportation;

2. The cost of the commuter transportation; and

3. The amount of state funds appropriated by the Legislature for reimbursement subsidy purposes.

B. The Director shall notify an eligible employee of:

1. The initial percentage of reimbursement subsidy before the employee applies under R2-1-802(A)(1); and

2. Any change in the amount of reimbursement subsidy at least 30 days before the effective date of the change.

History

• Adopted effective May 31, 1991 (Supp. 91-2). Section repealed, new Section adopted effective December 30, 1994 (Supp. 94-4). Amended by final rulemaking at 6 A.A.R. 746, effective February 1, 2000 (Supp. 00-1). Amended by final rulemaking at 24 A.A.R. 625, effective 5/5/2018.

Ariz. Admin. Code § R2-1-804 Commuter Transportation Reimbursement Subsidy Procedure

A. A transportation provider shall submit a monthly invoice to the Director that itemizes the total commuter transportation costs incurred by each eligible employee.

B. The Director shall pay the transportation provider the reimbursement subsidy amount for each eligible employee.

C. The eligible employee shall pay the reduced cost to the transportation provider either directly or, if required under R2-1-802(B), through payroll deduction.

History

• Adopted effective May 31, 1991 (Supp. 91-2). Section repealed, new Section adopted effective December 30, 1994 (Supp. 94-4). Amended by final rulemaking at 6 A.A.R. 746, effective February 1, 2000 (Supp. 00-1). Amended by final rulemaking at 24 A.A.R. 625, effective 5/5/2018.

Ariz. Admin. Code § R2-1-805 Adjusted Work Hours

A. During the period, each agency head shall provide work schedule options so a minimum of 85 percent of employees whose offices are located in Area A or Area B are on adjusted work hours. Adjusted work hours are schedules that:

1. Begin the workday on or before 7:30 a.m., or on or after 8:30 a.m., and conclude the workday on or before 4:30 p.m., or on or after 5:30 p.m.;

2. Adjust work hours into a four-day, 40-hour work week. Employees shall avoid a workday that begins between 7:30 a.m. and 8:30 a.m. or concludes between 4:30 p.m. and 5:30 p.m., whenever possible; or

Allow the employee to telework.

4. The employee's agreement to comply with the conditions in subsection (B).

B.

As a condition of receiving a transportation card, an eligible employee shall agree: Notwithstanding the requirements of subsection (A), each agency shall comply with A.R.S. § 38-401 requiring state offices to be open from 8:00 a.m. until 5:00 p.m.

1. Not to allow anyone else to use the transportation card;

2. To use the transportation card only for trips to and from work with a state agency, board, or commission, unless the employee incurs the maximum monthly charge in commuting;

3. To be responsible for charges incurred with the transportation card;

4. To notify the office designated by the Department of Administration if the transportation card is lost or stolen;

5. To pay $5 on a payroll deduction to replace a lost, damaged, or stolen transportation card;

6. To surrender the transportation card upon termination of employment with the state; and

7. That use of the transportation card after receiving notice from the Department of Administration of change in the transportation program policies constitutes the employee's agreement to the change.

History

• Adopted effective December 30, 1994 (Supp. 94-4). Amended by final rulemaking at 6 A.A.R. 746, effective February 1, 2000 (Supp. 00-1). Amended by final rulemaking at 13 A.A.R. 4579, effective February 5, 2008 (Supp. 07-4). Section R2-1-805 repealed; new Section R2-1-805 renumbered from R2-1-602 and amended by final rulemaking at 24 A.A.R. 625, effective 5/5/2018.

Article 9 REPEALED

Ariz. Admin. Code § R2-1-901 [Repealed]

History

• Adopted effective December 30, 1994 (Supp. 94-4). Amended effective September 11, 1997 (Supp. 97-3). Amended by final rulemaking at 14 A.A.R. 10, effective February 5, 2008 (Supp. 07-4). Repealed by final rulemaking at 24 A.A.R. 625, effective 5/5/2018.

Ariz. Admin. Code § R2-1-902 [Repealed]

History

• Adopted effective December 30, 1994 (Supp. 94-4). Amended effective September 11, 1997 (Supp. 97-3). Amended by final rulemaking at 14 A.A.R. 10, effective February 5, 2008 (Supp. 07-4). Repealed by final rulemaking at 24 A.A.R. 625, effective 5/5/2018.

Ariz. Admin. Code § R2-1-903 [Repealed]

History

• Adopted effective December 30, 1994 (Supp. 94-4). Amended effective September 11, 1997 (Supp. 97-3). Repealed by final rulemaking at 24 A.A.R. 625, effective 5/5/2018.

Ariz. Admin. Code § R2-1-904 [Repealed]

History

• Adopted effective December 30, 1994 (Supp. 94-4). Amended effective September 11, 1997 (Supp. 97-3). Repealed by final rulemaking at 24 A.A.R. 625, effective 5/5/2018.

Ariz. Admin. Code § R2-1-905 [Repealed]

History

• Adopted effective December 30, 1994 (Supp. 94-4). Amended effective September 11, 1997 (Supp. 97-3). Amended by final rulemaking at 14 A.A.R. 10, effective February 5, 2008 (Supp. 07-4). Repealed by final rulemaking at 24 A.A.R. 625, effective 5/5/2018.

Chapter 2 Arizona Commission on the Arts

Article 1 MATCHING PRIVATE MONIES WITH MONIES FROM THE ARIZONA ARTS ENDOWMENT FUND

Ariz. Admin. Code § R2-2-101 Definitions

In this Article, unless the context otherwise requires:

"Arizona Arts Endowment Fund" means the fund established in A.R.S. § 41-986.

"Arts Organization" means an organization that has applied for and received non-profit status under 501(c)(3) of the U.S. internal revenue code and whose primary mission is to produce, present, or serve the arts.

"Commission" means the Arizona Commission on the Arts.

"Donor-advised Fund" means monies donated to a community foundation, over which the donor or others designated by the donor retain the right to advise on grants from the fund.

"Field-of-interest for the arts Fund" means monies donated to a community foundation, that the donor restricts to grants in a specific charitable field.

"Non-designated Funds" means monies donated or appropriated to the Arizona Arts Endowment Fund, or to an endowment fund for which income generated is to be administered by the Commission for arts programs in Arizona.

"Other Government Endowment for the Arts" means an endowment of a community college, university, city or county local arts agency.

"Private Monies" means revenue from sources other than state tax funds such as cash or securities, irrevocable deferred gifts, lead trusts, real estate, or other items that are convertible to cash. The cash value of an irrevocable deferred gift is its present value.

"Programs" means arts activities or presentations that are promoted to the public.

History

• Adopted effective September 21, 1998 (Supp. 98-3). Amended by final rulemaking at 8 A.A.R. 3291, effective July 15, 2002 (Supp. 02-3).

Ariz. Admin. Code § R2-2-102 Matching Private Monies

A. The Commission shall consider private monies to be a match to the Arizona Arts Endowment Fund if the private monies are contributed as follows:

1. The donor enters into a written agreement with an endowment fund to dedicate the monies permanently; and

2. The donor designates the monies to the Arizona Arts Endowment Fund or to the endowment fund of a 501(c)(3) community organization contracting with the Arizona Commission on the Arts to administer the monies.

B. The Commission shall not consider a donation to be a match to the Arizona Arts Endowment Fund if:

1. The donor designates the monies to a specific arts organization's endowment fund, or

2. The donor designates the monies to another government endowment fund for the arts.

C. The Commission shall consider monies in a donor-advised fund or a field-of-interest for the arts fund the same as all other monies donated in compliance with subsection (A).

D. Funds may be held, accounted for, and named individually.

E. The Commission may enter into written agreements with one or more 501(c)(3) community organizations to collect, invest, and manage private monies. The contracted organization shall report, on a quarterly basis, the collection of, investment of, and return on the monies, to the Commission.

F. The Commission shall request annual written financial reports from non-profit arts organizations in Arizona. Each report shall include a statement of the amount of monies received by an endowment for the arts of the reporting non-profit arts organizations. The Commission shall annually document and report these gifts to arts endowments to the Legislature in addition to reporting non-designated funds.

History

• Adopted effective September 21, 1998 (Supp. 98-3). Amended by final rulemaking at 8 A.A.R. 3291, effective July 15, 2002 (Supp. 02-3).

Article 2 GRANTMAKING PROCEDURES FOR GRANTS FROM THE ARIZONA ARTS TRUST FUND

Ariz. Admin. Code § R2-2-201 Definitions

In this Article, unless the context otherwise requires:

"Applicant" means an organization that applies for a grant.

"Application" means the documentation and material that an applicant submits to request a grant.

"Arizona Arts Trust Fund" means the fund created by A.R.S. § 41-983.01 and funded with $15 from each annual filing fee submitted to the Arizona Corporation Commission by for-profit corporations.

"Arizona Arts Trust Fund Grant" means a general operating support grant that includes funds derived from the Arizona Arts Trust Fund.

"Board member" means a trustee of a non-profit organization elected or appointed according to that organization's bylaws.

"Commission" means the Arizona Commission on the Arts, a state agency, consisting of fifteen members appointed by the Governor.

"Commissioner" means one of 15 Governor-appointed members of the Commission responsible for the administration of the Arizona Arts Program and the Arizona Arts Endowment Fund.

"Criteria" means the established and published standards used to evaluate an application to determine whether a grant award is recommended.

"Denial conference" means the method by which an applicant that was not recommended for a grant may request a review of their application.

"Fiscal agent" means any Arizona organization, designated 501(c)(3) tax exempt by the Internal Revenue Service, that accepts grant funds on behalf of an organization not meeting the nonprofit tax-exempt requirements.

"General operating support" means a grants program administered by the Commission that provides funds to organizations to be used for administrative or artistic expenses, or both.

"Grant" means an award of financial support to an organization, for the purposes requested in the application.

"Grant conditions" means specific requirements, agreed to by the grantee in writing, that must be met or undertaken to receive a grant.

"Grant deadline" means the published date by which an application must be postmarked or hand-delivered to the Commission to be considered for a grant.

"Grant review panel" means a group of citizens appointed by the Commission to review and make recommendations on public policy and applications for grants.

"Grant review panel chair" means a Commissioner who serves as a non-voting member of the panel to ensure that state law is followed and that there is an open, fair process for the review of applications by the grant review panel.

"Grant review panel comments" means documented comments made by the grant review panelists during the application review process that become the public record of the process after the final grants are awarded.

"Grant review panelist" means an individual serving on the grant review panel.

"Grantee" means an organization receiving grant funds.

"Guidelines" means information published annually describing the Commission's grant program, including the application process, forms and formats, eligibility requirements, and criteria.

"Legal requirements" means the federal and state standards and regulations including those regarding fair labor, civil rights, accessibility, age discrimination, lobbying with appropriated monies, accounting records, and other published requirements to which organizations accepting a grant must adhere.

"Match" means an applicant's financial contribution to a project, in addition to a grant, that demonstrates the community support of the project.

"Non-profit organization" means a school, governmental unit, or corporation that is exempt from taxation under Section 501(c)(3) of the Internal Revenue Code.

"Substantial interest" has the same meaning as in A.R.S. § 38-502.

"Underserved populations" means persons who are members of ethnic or racial minorities, have disabilities, or are from communities outside the metropolitan areas of Phoenix and Tucson.

History

• New Section made by final rulemaking at 8 A.A.R. 406, effective January 9, 2002 (Supp. 02-1).

Ariz. Admin. Code § R2-2-202 Eligibility

To be eligible to receive an Arizona Arts Trust Fund grant under this Article, an applicant shall meet the following requirements:

1. Be based in Arizona;

2. Be a city or county government, be designated as a nonprofit 501(c)(3) organization by the Internal Revenue Service, or be an unincorporated organization using an Arizona-based nonprofit 501(c)(3) organization as a fiscal agent;

3. Submit no more than the maximum allowable number of grant applications per year as published in the Commission's guidelines;

4. Match grant funds with applicant funds as required by the Commission; and

5. Have the production, presentation, or service of the arts as its primary mission.

History

• New Section made by final rulemaking at 8 A.A.R. 406, effective January 9, 2002 (Supp. 02-1).

Ariz. Admin. Code § R2-2-203 Criteria

A. The following criteria shall be used by the grant review panels and the Commission for reviewing general operating support grants and granting funds from the Arizona Arts Trust Fund:

1. Artistic quality and creativity;

2. Ability of the applicant organization's programs to serve the needs of the community, including potential public exposure and public benefit, and efforts to reach artists and audiences from culturally diverse groups;

3. Managerial and administrative ability of the applicant organization to carry out arts programming and properly administer funds granted;

Appropriateness of the applicant organization's budget to carry out its proposed programs; and

5. History of the applicant organization in producing, presenting or serving the arts.

B. Further, the Commission shall also take into consideration in approving grants:

1. Whether the applicant represents underserved populations;

2. The applicant's employment of, or contracting with, artists who are members of racial or ethnic minorities; and

Inclusion of racial or ethnic minority members on applicant organizations' governing boards.

History

• New Section made by final rulemaking at 8 A.A.R. 406, effective January 9, 2002 (Supp. 02-1).

Ariz. Admin. Code § R2-2-204 Process for Obtaining a Grant from the Arizona Arts Trust Fund

A. The Commission shall establish an annual grant deadline and publish grant guidelines by January 15th of each year. Applications shall be postmarked or delivered by 5:00 p.m. on the grant deadline date. Late applications shall not be filed by the Commission but shall be returned without review.

B. An applicant shall submit a narrative and budget that comply with the grant guidelines and address the criteria in R2-2-203 . The Commission shall provide the forms and formats for the narrative and budget to the applicant. An applicant may submit supplemental information including slides, videotapes, audio recordings, press coverage, and print or other materials that document the artistic work of the applicant.

C. The Commission shall conduct a grant review process:

1. The Commission shall appoint grant review panels. Each panel shall be assigned a specific group of grant applications to review. The Commission shall appoint three to seven community members to serve on each of the grant review panels. Grant review panelists shall be appointed by the Commission for one year and may serve no more than three consecutive years on the same panel. No more than two members of any panel shall serve on the panel for the second and third years.

2. Grant review panelists shall hold a grant review panel meeting. Grant review panelists shall read all the applications assigned to their panel prior to the grant review panel meeting. Upon request, grant review panelists shall attend events of the applicant or speak with a representative of the applicant to be informed about the applicant organization. At the grant review panel meeting, grant review panelists shall contribute to the discussion of the applications; rate applications based on the facts in the applications and their own professional judgments about the merit of the applications, in relation to the criteria in R2-2-203; and provide policy and procedural suggestions for the Commission.

3. If a grant review panelist has a substantial interest in any application, the panelist shall declare the interest verbally and in writing and shall not participate in the discussion of or the vote on the application.

The grant review panel chair shall chair the grant review panel meeting and shall ensure that the discussion relates to the required criteria, that Commission policies and open meeting laws under A.R.S. 38-431 et seq. are followed, and that all grant review panelists have an opportunity to speak.

D. Following the grant review panel process, Commissioners shall receive grant review panelists' recommendations and grant review panel comments for each application. At the Commission meeting following the Commissioners' receipt of grant review panelists' recommendations, the Commissioners shall discuss the recommendations of the grant review panels and shall vote to accept, reject, or modify the recommendations of the grant review panels.

E. All applicants shall be notified in writing of the Commission's decisions. Any applicant that is not recommended for funding may request and shall be provided a denial conference. The Commission shall establish and publish in its grant guidelines the process for requesting and receiving a denial conference. The Commission shall not provide a denial conference based on dissatisfaction with the amount of a grant.

F. All applicants shall accept in writing the grant's legal requirements and grant conditions before grant funds are released.

History

• New Section made by final rulemaking at 8 A.A.R. 406, effective January 9, 2002 (Supp. 02-1).

Chapter 3 Arizona State Library, Archives and Public Records

Article 1 RULEMAKING

Ariz. Admin. Code § R2-3-101 Rulemaking Procedures

A. The Arizona State Library, Archives and Public Records (Library and Archives) staff shall, with due diligence, research best practices relevant to the proposed rule.

B. The Library and Archives shall seek input from legislators, stakeholders, constituents, and the public on proposed rules.

C. The Library and Archives shall publish all rules in the Arizona Administrative Code and on its agency web site.

History

• New Section made by exempt rulemaking at 11 A.A.R. 3863; effective October 15, 2005 (Supp. 05-3).

Article 2 GENERAL PROVISIONS

Ariz. Admin. Code § R2-3-201 Patron Admission

A. The reading rooms and resources of the Arizona State Library, Archives and Public Records (Library and Archives) are available during regular hours to all persons, subject to appropriate, orderly conduct. Children under 12 may use rare materials only when accompanied by an adult or with permission of the Director. Groups of 12 or more are asked to schedule tours in advance.

B. Patrons may be required to check brief cases, containers, overcoats, or other bulky items with Library and Archives staff before entering reading rooms or public stacks. Patrons may bring items essential to their research into reading rooms and public stacks with the approval of Library and Archives staff. Any unchecked items are subject to reasonable inspection at any time.

C. No animals are allowed, except assistance animals.

D. Smoking, eating, drinking, sleeping, and disruptive behavior are not allowed.

E. Individuals violating these rules will be asked to leave. Individuals repeatedly violating these rules may be denied admission.

History

• New Section made by exempt rulemaking at 11 A.A.R. 3863; effective October 15, 2005 (Supp. 05-3).

Article 3 ACCESS AND USE OF MATERIALS

Ariz. Admin. Code § R2-3-301 Protection of the Materials

Access, circulation or loan, use, or copying of materials in any of the collections of the Arizona State Library, Archives and Public Records (Library and Archives) may be prohibited or limited if such access, use, or copying could damage the materials.

History

• New Section made by exempt rulemaking at 11 A.A.R. 3863; effective October 15, 2005 (Supp. 05-3).

Ariz. Admin. Code § R2-3-302 Access

Materials in all of the Library and Archives' collections are collected, described, and preserved for the use of the Legislature, state agencies, and the public with the following exceptions.

1. Materials held by the Records Management Division are the property of the agency storing the records at the Records Management Center. All requests for access to these records must come from the agency of origin.

2. Materials that are rare or fragile may be used only by permission of and according to procedures established by the Director.

History

• New Section made by exempt rulemaking at 11 A.A.R. 3863; effective October 15, 2005 (Supp. 05-3).

Ariz. Admin. Code § R2-3-303 Circulation and Loans

A. Materials in circulating collections may be lent for use outside the Library and Archives to employees of the Arizona state government, to registered borrowers, and to other libraries in the United States through an interlibrary loan program if the Library and Archives has a reciprocal agreement with that library.

B. Individuals who fail to return borrowed items must pay the Library and Archives the cost to replace the item plus the costs of cataloging and processing the item.

C. Materials in non-circulating collections, including reference works, single copies of items, and fragile or rare items are not lent for use outside the Library and Archives except by permission of the Director.

D. Materials in non-circulating collections, including reference works, single copies of items, and fragile or rare items may be lent to qualified repositories for exhibition purposes with permission of the Director.

History

• New Section made by exempt rulemaking at 11 A.A.R. 3863; effective October 15, 2005 (Supp. 05-3).

Ariz. Admin. Code § R2-3-304 Copying

A. Copying of materials in any of the Library and Archives' collections is subject to federal copyright law. Patrons are responsible for complying with the provision of that law.

B. Materials in good condition in circulating and reference collections may be copied onsite using agency-supplied equipment.

C. Use of personal cameras, scanners, or other copying technology may be allowed by the Director if the process does not damage the materials and does not distract other patrons.

D. Requests for copies of fragile or special format materials must be approved by the Director.

E. Unique or rare materials may be copied only by Library and Archives staff.

History

• New Section made by exempt rulemaking at 11 A.A.R. 3863; effective October 15, 2005 (Supp. 05-3).

Ariz. Admin. Code § R2-3-305 Publication and Commercial Use

A. Patrons who intend to use copies or reproductions for any commercial purpose must notify the Library and Archives and pay charges required in A.R.S. § 39-121.03.

B. Publication of materials in any of the Library and Archives' collections is subject to federal copyright law. Patrons are responsible for obtaining any necessary permission to publish from the owner of copyright.

C. Publication or commercial use of materials in any of the Library and Archives' collections must include a credit to the Arizona State Library, Archives and Public Records. Some materials may require specific credits or citations.

History

• New Section made by exempt rulemaking at 11 A.A.R. 3863; effective October 15, 2005 (Supp. 05-3).

Article 4 RESTRICTING PUBLIC COMPUTER ACCESS TO VISUAL DEPICTIONS THAT ARE HARMFUL TO MINORS, OBSCENE OR PORNOGRAPHIC

Ariz. Admin. Code § R2-3-401 Requirements

A. A governing body that operates a public library shall develop, review and provide a written policy with input from the local library board, or its equivalent, for the use of its public access computers for each library in its jurisdiction under A.R.S. § 34-502(E). The policy shall:

1. Provide for blocking access on public access computers to such materials as referenced under A.R.S. § 34-502(B)(1) and (2) and as defined under A.R.S. § 34-501,

2. Provide procedures for library patrons of legal age to disable or request the disabling of technology protection under A.R.S. § 34-502(C) for research or other lawful purposes,

3. List citations to A.R.S. §§ 34-501 and 34-502, and

4. Acknowledge the awareness of, and concern for, a safe educational Internet experience for children despite the unregulated nature of the Internet.

B. Each library shall:

1. Comply with its governing body policy,

2. Post the policy in a conspicuous location as provided in A.R.S. § 34-502(D), and include an outline of the library's complaint process,

3. Establish guidelines and procedures to restrict users from gaining computer access to such materials as referenced under A.R.S. § 34-502(B)(1) and (2) and as defined under A.R.S. § 34-501, and

4. Deploy a technology protection measure to block access to such materials as referenced under A.R.S. § 34-502(B)(1) and (2) and as defined under A.R.S. § 34-501, by either centralized filtering or individual filters on public access computers or by use of a similar technology solution.

History

• New Section made by exempt rulemaking at 11 A.A.R. 3863; effective October 15, 2005 (Supp. 05-3). Amended by exempt rulemaking at 19 A.A.R. 540, effective March 21, 2013 (Supp. 13-1).

Article 5 STATE DOCUMENTS DEPOSITORY PROGRAM

Ariz. Admin. Code § R2-3-501 Program and Partners

A. The Director of the Arizona State Library and Archives (Library and Archives) may establish agreements with other libraries to establish a state documents depository program to collect, provide access to, and preserve copies of public reports and publications (see Article 2) of state, county and municipal officers, departments, boards, commissions, agencies and institutions, and public archives.

B. Any library that enters into an agreement pursuant to this subdivision shall continue to contribute at least the same level of support to the state documents program and shall not use any monies received pursuant to the agreement to supplant other monies available to the library.

History

• New Section made by exempt rulemaking at 11 A.A.R. 3863; effective October 15, 2005 (Supp. 05-3).

Ariz. Admin. Code § R2-3-502 Public Reports and Publications Included

A. The state documents depository program shall include public reports and publications, whether in print or electronic formats, that are published, disclosed, or distributed to the general public (or a targeted audience within the general public); and also at least one of the following:

1. That are required by law as a public report; or

2. That are required by law to be sent to the Governor, President of the Senate, or Speaker of the House; or

3. That describe an agency's activities, programs, or policies, including annual reports; or

4. That are the results of a formal study or investigation.

B. This program does not include non-public reports, including materials of a confidential nature or materials intended for use primarily within the agency, such as correspondence, forms, memos, or other materials produced for internal administrative or operational purposes. Non-public documents and agency copies of public reports and publications should be managed according to records retention schedules, which may specify some materials to be transferred to the Library and Archives at some future date.

History

• New Section made by exempt rulemaking at 11 A.A.R. 3863; effective October 15, 2005 (Supp. 05-3).

Ariz. Admin. Code § R2-3-503 Submission of Publications

A. Within 30 days of publication agencies shall send to the Library and Archives at no cost:

1. Six copies of public reports and publications issued in print and, if the document was created in electronic format, one copy in electronic format; or

2. One print copy and one in electronic format of public reports and publications issued electronically.

B. Electronic copies of public reports and publications shall be submitted in Adobe Portable Document Format (PDF or PDF-A).

C. All public reports and publications:

1. Shall include the name of the officer, agency, department, board, commission, or other institution responsible for issuing the report or publication; the title; the date and place of printing or publication; and

2. As appropriate, a public report or publication shall include the names of authors, individuals, or organizations that assisted in the production of the report or publication; and a citation of the statute or regulation requiring the report or publication.

D. Reports and publications should be sent to: State Documents, Arizona State Library, Archives and Public Records, 1700 W. Washington, Suite 300, Phoenix, AZ 85007. Electronic copies may be sent by e-mail to reports@lib.az.us.

History

• New Section made by exempt rulemaking at 11 A.A.R. 3863; effective October 15, 2005 (Supp. 05-3).

Article 6 INTERLIBRARY LOAN AND STATE GRANTS-IN-AID

Ariz. Admin. Code § R2-3-601 Eligibility

To be eligible for Library Services and Technology Act competitive grants, State Grants-in-Aid (including construction), and access to First Search, a library:

1. Must participate, upon patron or library request, as a lender and/or borrower in the statewide interlibrary loan of circulating print materials, regardless of subject or genre, without charge to their patrons or to other Arizona libraries.

2. Is encouraged, but not required, to share circulating, non-print materials.

3. May limit interlibrary loan requests to six per patron at any one time.

May limit requests to materials that have been published for at least a year; not currently on a nationally recognized best-seller list; or not needed by the library's own patrons.

5. With prior notice to the patrons, may pass on to their patrons real and actual charges incurred from out-of-state libraries in the filling of those patrons' interlibrary loan requests, including postage.

History

• New Section made by exempt rulemaking at 11 A.A.R. 3863; effective October 15, 2005 (Supp. 05-3).

Chapter 4 Board of Library Examiners

Article 1 GENERAL PROVISIONS

Ariz. Admin. Code § R2-4-01 Academic Requirements

A. Applicant shall have a Master's degree in library science, together with one year of experience in a public library of recognized standing, or

B. A Bachelor's degree conferred by an accredited college or university, plus fifteen (15) hours of courses in library science and two (2) years of appropriate experience in a public library of recognized standing.

History

• Former Rule 1.

Ariz. Admin. Code § R2-4-02 Application Information

A. Applicant shall furnish satisfactory recommendations from two former employers.

B. Consideration shall be given to applicant's moral character and commendable conduct; to his or her ability to work with the public; to maintain public relations; to conduct the financial affairs of a library in a business-like manner; and to show willingness to continue his or her training.

History

• Former Rule 2.

Chapter 5 Department of Administration - State Personnel System

Article 1 REPEALED

Ariz. Admin. Code § R2-5-101 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended effective August 2, 1989 (Supp. 89-3). Subsection (48) corrected to read "without prejudice" (Supp. 95-2). Subsection (55) amended to correct a printing error (Supp. 99-3). Amended by final rulemaking at 9 A.A.R. 1040, effective May 4, 2003 (Supp. 03-1). Amended by final rulemaking at 11 A.A.R. 4357, effective December 5, 2005 (Supp. 05-4). Amended by final rulemaking at 14 A.A.R. 1420, effective May 31, 2008 (Supp. 08-2). Amended by final rulemaking at 14 A.A.R. 2924, effective August 30, 2008 (Supp. 08-3). Amended by final rulemaking at 15 A.A.R. 207, effective March 7, 2009 (Supp. 09-1). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-102 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Correction to subsection (A) as certified effective December 31, 1986 (Supp. 87-3). Amended by final rulemaking at 9 A.A.R. 1040, effective May 4, 2003 (Supp. 03-1). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-103 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended by final rulemaking at 9 A.A.R. 1040, effective May 4, 2003 (Supp. 03-1). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-104 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Section heading amended by final rulemaking at 9 A.A.R. 1040, effective May 4, 2003 (Supp. 03-1). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-105 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended effective August 2, 1989 (Supp. 89-3). Amended by final rulemaking at 9 A.A.R. 1040, effective May 4, 2003 (Supp. 03-1). Amended by final rulemaking at 16 A.A.R. 685, effective June 5, 2010 (Supp. 10-2). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Article 2 REPEALED

Ariz. Admin. Code § R2-5-201 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended effective September 15, 1994 (Supp. 94-3). Amended by final rulemaking at 6 A.A.R. 4572, effective November 13, 2000 (Supp. 00-4). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-202 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended by final rulemaking at 6 A.A.R. 4572, effective November 13, 2000 (Supp. 00-4). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-203 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Subsection (G) corrected to add omitted text following the word "error" (Supp. 95-2). Amended by final rulemaking at 6 A.A.R. 4572, effective November 13, 2000 (Supp. 00-4). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-204 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Section repealed by final rulemaking at 6 A.A.R. 4572, effective November 13, 2000 (Supp. 00-4). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-205 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended by final rulemaking at 6 A.A.R. 4572, effective November 13, 2000 (Supp. 00-4). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-206 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended effective September 15, 1994 (Supp. 94-3). Amended by final rulemaking at 6 A.A.R. 4572, effective November 13, 2000 (Supp. 00-4). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-207 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended effective August 2, 1989 (Supp. 89-3). Amended by final rulemaking at 6 A.A.R. 4572, effective November 13, 2000 (Supp. 00-4). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-208 Repealed

History

• New Section adopted by final rulemaking at 6 A.A.R. 4572, effective November 13, 2000 (Supp. 00-4). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-209 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Repealed effective August 2, 1989 (Supp. 89-3).

Ariz. Admin. Code § R2-5-210 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Section repealed by final rulemaking at 6 A.A.R. 4572, effective November 13, 2000 (Supp. 00-4).

Ariz. Admin. Code § R2-5-211 Repealed

History

• Adopted effective August 2, 1989 (Supp. 89-3). Amended effective September 15, 1994 (Supp. 94-3). Amended by final rulemaking at 6 A.A.R. 4572, effective November 13, 2000 (Supp. 00-4). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-212 Repealed

History

• Reserved Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-213 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Subsection (C)(2) corrected to read "job-related" in line 2; Amended effective April 20, 1995 (Supp. 95-2). Amended by final rulemaking at 6 A.A.R. 4572, effective November 13, 2000 (Supp. 00-4). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Article 3 REPEALED

Ariz. Admin. Code § R2-5-301 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended by final rulemaking at 7 A.A.R. 2724, effective June 6, 2001 (Supp. 01-2). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-302 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended by final rulemaking at 7 A.A.R. 2724, effective June 6, 2001 (Supp. 01-2). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-303 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended effective August 2, 1989 (Supp. 89-3). Amended effective September 15, 1994 (Supp. 94-3). Amended effective March 4, 1997 (Supp. 97-1). Amended effective August 5, 1997 (Supp. 97-3). Amended by final rulemaking at 7 A.A.R. 2724, effective June 6, 2001 (Supp. 01-2). Amended by final rulemaking at 16 A.A.R. 1129, effective August 7, 2010 (Supp. 10-2). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-304 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended by final rulemaking at 5 A.A.R. 4417, effective November 2, 1999 (Supp. 99-4). Amended by final rulemaking at 7 A.A.R. 2724, effective June 6, 2001 (Supp. 01-2). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-305 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended effective April 20, 1995 (Supp. 95-2). Amended by final rulemaking at 7 A.A.R. 2724, effective June 6, 2001 (Supp. 01-2). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-306 Expired

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended by final rulemaking at 7 A.A.R. 2724, effective June 6, 2001 (Supp. 01-2). Section expired under A.R.S. § 41-1056(E) at 13 A.A.R. 1143, effective May 31, 2006 (Supp. 07-1).

Ariz. Admin. Code § R2-5-307 Expired

History

• Adopted as an emergency effective February 22, 1988, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 88-1). Emergency expired. New Section adopted effective March 10, 1993 (Supp. 93-1). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 3483, effective July 19, 2002 (Supp. 02-3).

Article 4 REPEALED

Ariz. Admin. Code § R2-5-401 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended by final rulemaking at 14 A.A.R. 4309, effective November 4, 2008 (Supp. 08-4). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-402 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended effective July 6, 1993 (Supp. 93-3). Amended effective April 20, 1995 (Supp. 95-2). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-403 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended as an emergency effective August 19, 1988 pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 88-3). Emergency expired. Amended effective September 12, 1989 (Supp. 89-3). Amended effective September 14, 1990 (Supp. 90-3). Amended effective August 5, 1997 (Supp. 97-3). Amended by final rulemaking at 6 A.A.R. 4093, effective October 3, 2000 (Supp. 00-4). Amended by final rulemaking at 9 A.A.R. 2082, effective August 2, 2003 (Supp. 03-2). Amended by final rulemaking at 13 A.A.R. 1635, effective June 30, 2007 (Supp. 07-2). Amended by final rulemaking at 14 A.A.R. 4309, effective November 4, 2008 (Supp. 08-4). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-404 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended effective August 2, 1989 (Supp. 89-3). Amended effective September 15, 1994 (Supp. 94-3). Amended by final rulemaking at 14 A.A.R. 4309, effective November 4, 2008 (Supp. 08-4). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-405 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended effective April 20, 1995 (Supp. 95-2). Amended by final rulemaking at 6 A.A.R. 4093, effective October 3, 2000 (Supp. 00-4). Amended by final rulemaking at 14 A.A.R. 4309, effective November 4, 2008 (Supp. 08-4). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-406 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-407 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended by final rulemaking at 6 A.A.R. 4093, effective October 3, 2000 (Supp. 00-4). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-408 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-409 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-410 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended effective August 2, 1989 (Supp. 89-3). Amended effective April 20, 1995 (Supp. 95-2). Amended by final rulemaking at 6 A.A.R. 4093, effective October 3, 2000 (Supp. 00-4). Amended by final rulemaking at 14 A.A.R. 4309, effective November 4, 2008 (Supp. 08-4). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-411 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended effective August 2, 1989 (Supp. 89-3). Amended effective April 20, 1995 (Supp. 95-2). Amended by final rulemaking at 6 A.A.R. 4093, effective October 3, 2000 (Supp. 00-4). Amended by final rulemaking at 14 A.A.R. 4309, effective November 4, 2008 (Supp. 08-4). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-412 Repealed

History

• Adopted as an emergency effective August 19, 1988, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 88-3). Emergency expired. Amended and adopted as a permanent rule effective September 12, 1989 (Supp. 89-3). Rule citation in subsection (B) corrected (Supp. 95-2). Former Section R2-5-412 renumbered to R2-5-413; new Section R2-5-412 adopted by final rulemaking at 6 A.A.R. 4093, effective October 3, 2000 (Supp. 00-4). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-413 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended effective August 2, 1989 (Supp. 89-3). Amended effective April 20, 1995 (Supp. 95-2). Former Section R2-5-413 renumbered to R2-5-414; new Section R2-5-413 renumbered from R2-5-412 and amended by final rulemaking at 6 A.A.R. 4093, effective October 3, 2000 (Supp. 00-4). Amended by final rulemaking at 14 A.A.R. 4309, effective November 4, 2008 (Supp. 08-4). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-414 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Former Section R2-5-414 renumbered to R2-5-415; new Section R2-5-414 renumbered from R2-5-413 and amended by final rulemaking at 6 A.A.R. 4093, effective October 3, 2000 (Supp. 00-4). Amended by final rulemaking at 14 A.A.R. 4309, effective November 4, 2008 (Supp. 08-4). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-415 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended effective August 2, 1989 (Supp. 89-3). Former Section R2-5-415 renumbered to R2-5-416; new Section R2-5-415 renumbered from R2-5-414 and amended by final rulemaking at 6 A.A.R. 4093, effective October 3, 2000 (Supp. 00-4). Section repealed; new Section R2-5-415 renumbered from R2-5-423 and amended by final rulemaking at 15 A.A.R. 207, effective March 7, 2009 (Supp. 09-1). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-416 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6) Amended effective August 2, 1989 (Supp. 89-3). Former Section R2-5-416 renumbered to R2-5-417; new Section R2-5-416 renumbered from R2-5-415 and amended by final rulemaking at 6 A.A.R. 4093, effective October 3, 2000 (Supp. 00-4). Amended by final rulemaking at 11 A.A.R. 4357, effective December 5, 2005 (Supp. 05-4). Amended by final rulemaking at 14 A.A.R. 1420, effective May 31, 2008 (Supp. 08-2). Section repealed by final rulemaking at 15 A.A.R. 207, effective March 7, 2009 (Supp. 09-1).

Ariz. Admin. Code § R2-5-417 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended effective August 2, 1989 and September 12, 1989 (Supp. 89-3). Former Section R2-5-417 renumbered to R2-5-418; new Section R2-5-417 renumbered from R2-5-416 and amended by final rulemaking at 6 A.A.R. 4093, effective October 3, 2000 (Supp. 00-4). Amended by final rulemaking at 11 A.A.R. 4357, effective December 5, 2005 (Supp. 05-4). Amended by final rulemaking at 14 A.A.R. 1420, effective May 31, 2008 (Supp. 08-2). Section repealed by final rulemaking at 15 A.A.R. 207, effective March 7, 2009 (Supp. 09-1). New Section made by final rulemaking at 17 A.A.R. 650, effective June 4, 2011 (Supp. 11-2). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-418 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended effective August 2, 1989 (Supp. 89-3). Former Section R2-5-418 renumbered to R2-5-419; new Section R2-5-418 renumbered from R2-5-417 and amended by final rulemaking at 6 A.A.R. 4093, effective October 3, 2000 (Supp. 00-4). Amended by final rulemaking at 14 A.A.R. 1420, effective May 31, 2008 (Supp. 08-2). Section repealed by final rulemaking at 15 A.A.R. 207, effective March 7, 2009 (Supp. 09-1).

Ariz. Admin. Code § R2-5-419 Repealed

History

• Adopted effective August 2, 1989 (Supp. 89-3). Former Section R2-5-419 renumbered to R2-5-421; new Section R2-5-419 renumbered from R2-5-418 and amended by final rulemaking at 6 A.A.R. 4093, effective October 3, 2000 (Supp. 00-4). Amended by final rulemaking at 14 A.A.R. 1420, effective May 31, 2008 (Supp. 08-2). Section repealed by final rulemaking at 15 A.A.R. 207, effective March 7, 2009 (Supp. 09-1).

Ariz. Admin. Code § R2-5-420 Repealed

History

• Adopted effective August 2, 1989 (Supp. 89-3). Former Section R2-5-420 renumbered to R2-5-422; new Section R2-5-420 adopted by final rulemaking at 6 A.A.R. 4093, effective October 3, 2000 (Supp. 00-4). Section repealed by final rulemaking at 15 A.A.R. 207, effective March 7, 2009 (Supp. 09-1).

Ariz. Admin. Code § R2-5-421 Repealed

History

• Adopted effective February 28, 1991 (Supp. 91-1). Former Section R2-5-421 renumbered to R2-5-423; new Section R2-5-421 renumbered from R2-5-419 and amended by final rulemaking at 6 A.A.R. 4093, effective October 3, 2000 (Supp. 00-4). Amended by final rulemaking at 14 A.A.R. 1420, effective May 31, 2008 (Supp. 08-2). Section repealed by final rulemaking at 15 A.A.R. 207, effective March 7, 2009 (Supp. 09-1).

Ariz. Admin. Code § R2-5-422 Repealed

History

• New Section R2-5-422 renumbered from R2-5-420 and amended by final rulemaking at 6 A.A.R. 4093, effective October 3, 2000 (Supp. 00-4). Amended by final rulemaking at 14 A.A.R. 1420, effective May 31, 2008 (Supp. 08-2). Section repealed by final rulemaking at 15 A.A.R. 207, effective March 7, 2009 (Supp. 09-1).

Ariz. Admin. Code § R2-5-423 Renumbered

History

• New Section R2-5-423 renumbered from R2-5-421 and amended by final rulemaking at 6 A.A.R. 4093, effective October 3, 2000 (Supp. 00-4). Former R2-5-423 renumbered to R2-5-415 by final rulemaking at 15 A.A.R. 207, effective March 7, 2009 (Supp. 09-1).

Article 5 REPEALED

Ariz. Admin. Code § R2-5-501 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended effective April 20, 1995 (Supp. 95-2). Amended by final rulemaking at 7 A.A.R. 5811, effective December 6, 2001 (Supp. 01-4). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-502 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended effective September 15, 1994 (Supp. 94-3). Amended by final rulemaking at 7 A.A.R. 5811, effective December 6, 2001 (Supp. 01-4). Amended by final rulemaking at 12 A.A.R. 1733, effective July 1, 2006 (Supp. 06-2). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-503 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended effective September 9, 1998 (Supp. 98-3). Amended by final rulemaking at 7 A.A.R. 5811, effective December 6, 2001 (Supp. 01-4). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Article 6 REPEALED

Ariz. Admin. Code § R2-5-601 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Section repealed by final rulemaking at 6 A.A.R. 4572, effective November 13, 2000 (Supp. 00-4).

Ariz. Admin. Code § R2-5-602 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Section repealed by final rulemaking at 6 A.A.R. 4572, effective November 13, 2000 (Supp. 00-4).

Ariz. Admin. Code § R2-5-603 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Section repealed by final rulemaking at 6 A.A.R. 4572, effective November 13, 2000 (Supp. 00-4).

Ariz. Admin. Code § R2-5-604 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Section repealed by final rulemaking at 6 A.A.R. 4572, effective November 13, 2000 (Supp. 00-4).

Ariz. Admin. Code § R2-5-605 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Section repealed by final rulemaking at 6 A.A.R. 4572, effective November 13, 2000 (Supp. 00-4).

Article 7 REPEALED

Ariz. Admin. Code § R2-5-701 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended effective September 15, 1994 (Supp. 94-3). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-702 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended effective September 15, 1994 (Supp. 94-3). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Article 8 REPEALED

Ariz. Admin. Code § R2-5-801 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Amended effective July 25, 1994 (Supp. 94-3). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-802 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-803 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).
• Article 9 contained rules which were repealed and adopted under an exemption from the provisions of the Administrative Procedure Act (A.R.S. Title 41, Chapter 6) pursuant to Laws 1997, Ch. 288, § 10. Exemption from A.R.S. Title 41, Chapter 6 means the Department did not submit these rules to the Governor's Regulatory Review Council for review; the Department did not submit notice of proposed rulemaking to the Secretary of State for publication in the Arizona Administrative Register; and the Department was not required to hold public hearings on these rules. Temporary rules repealed and adopted under these Sections are repealed from and after June 30, 1999 (Supp. 98-2). Temporary rules repealed and adopted pursuant to Laws 1997, Ch. 288, § 10 were repealed from and after June 30, 1999 and the rule in effect before the adoption of the temporary rules became effective again upon the repeal of the temporary rules (Supp. 99-3).

Article 9 REPEALED

Ariz. Admin. Code § R2-5-901 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).
• The following Section R2-5-902 was temporarily repealed and a new Section was temporarily adopted under an exemption from the provisions of the Administrative Procedure Act (A.R.S. Title 41, Chapter 6) pursuant to Laws 1997, Ch. 288, § 10. Exemption from A.R.S. Title 41, Chapter 6 means the Department did not submit these rules to the Governor's Regulatory Review Council for review; the Department did not submit notice of proposed rulemaking to the Secretary of State for publication in the Arizona Administrative Register; and the Department was not required to hold public hearings on these rules. Temporary rules adopted are repealed effective June 30, 1999 (Supp. 98-2). The temporary rules were repealed from and after June 30, 1999, pursuant to Laws 1997, Ch. 288, § 10; the rule in effect before the adoption of the temporary rules became effective again upon the repeal of the temporary rules (Supp. 99-3). Section R2-5-902 was repealed and a new Section was adopted by final rulemaking (Supp. 99-4).

Ariz. Admin. Code § R2-5-902 Repealed

History

• Adopted effective December 31, 1986 (Supp. 86-6). Section R2-5-902 temporarily repealed; new Section temporarily adopted effective April 23, 1998, under an exemption from the provisions of the Administrative Procedure Act pursuant to Laws 1997, Ch. 288, § 10. Rules adopted under this temporary Section are repealed effective June 30, 1999 (Supp. 98-2). Section repealed from and after June 30, 1999, pursuant to Laws 1997, Ch. 288, § 10; the rule in effect before the adoption of the temporary rules became effective again upon the repeal of the temporary rules (Supp. 99-3). Section repealed by final rulemaking at 5 A.A.R. 4529, effective November 2, 1999; new Section adopted by final rulemaking at 6 A.A.R. 20, effective December 7, 1999 (Supp. 99-4). Amended by final rulemaking at 13 A.A.R. 958, effective May 5, 2007 (Supp. 07-1). Amended by final rulemaking at 16 A.A.R. 2379, effective January 15, 2011 (Supp. 10-4). Section repealed by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5-903 Repealed

History

• Emergency rule adopted effective January 4, 1996, pursuant to A.R.S. § 41-1026, in effect for a maximum of 180 days (Supp. 86-6). Adopted with changes effective June 7, 1996 (Supp. 96-2). Section repealed by final rulemaking at 17 A.A.R. 650, effective June 4, 2011 (Supp. 11-2).
• The following Section was temporarily adopted under an exemption from the provisions of the Administrative Procedure Act (A.R.S. Title 41, Chapter 6) pursuant to Laws 1997, Ch. 288, § 10. Exemption from A.R.S. Title 41, Chapter 6 means the Department did not submit these rules to the Governor's Regulatory Review Council for review; the Department did not submit notice of proposed rulemaking to the Secretary of State for publication in the Arizona Administrative Register; and the Department was not required to hold public hearings on these rules. Temporary rules adopted are repealed effective June 30, 1999 (Supp. 98-2). Section repealed from and after June 30, 1999, pursuant to Laws 1997, Ch. 288, § 10 (Supp. 99-3). New Section R2-5-904 adopted by final rulemaking (99-4).

Ariz. Admin. Code § R2-5-904 Repealed

History

• New Section adopted effective April 23, 1998, under an exemption from the provisions of the Administrative Procedure Act pursuant to Laws 1997, Ch. 288, § 10. This Section is automatically repealed effective June 30, 1999 (Supp. 98-2). Section repealed from and after June 30, 1999, pursuant to Laws 1997, Ch. 288, § 10 (Supp. 99-3). New Section adopted by final rulemaking at 6 A.A.R. 20, effective December 7, 1999 (Supp. 99-4). Formatting errors corrected (Supp. 08-3). Section repealed by final rulemaking at 16 A.A.R. 2379, effective January 15, 2011 (Supp. 10-4).

Chapter 5.1 State Personnel Board

Article 1 GENERAL PROVISIONS

Ariz. Admin. Code § R2-5.1-101 Definitions

Unless the context requires otherwise, the following definitions govern in this Chapter:

"Agency" for purposes of appeal from a disciplinary action, means an employing state entity that takes an appealable disciplinary action against a covered employee in covered service as defined by A.R.S. § 41-741.

2. "Appeal" means a written request filed with the Board by a permanent covered employee in covered service seeking relief from dismissal, involuntary demotion, or suspension of more than 80 working hours.

3. "Appellant" means a permanent covered employee in covered service who files an appeal with the Board.

4. "Complainant" means an employee or former employee as defined in A.R.S. § 38-531 who files a complaint with the Board.

5. "Complaint" means a written request for relief under A.R.S. § 38-532 filed with the Board by an employee or former employee.

"Day" means a calendar day, unless otherwise stated.

7. "Deposition" means a form of discovery in which testimony of a witness given under oath or affirmation and subject to cross examination is recorded in writing prior to a hearing.

8. "Hearing" means an administrative proceeding at which the appellant or complainant and the respondent are given the opportunity to present oral or written evidence.

9. "Hearing officer" means a person appointed by the Board, including any member of the Board to act as the trier of fact.

10. "Respondent" means an agency or individual whose interests are adverse to those of an appellant or complainant or who will be directly affected by the Board's decision.

11. "Subpoena Ad Testificandum" means a legal document issued under authority of the Board to compel the appearance of a witness at a hearing.

12. "Subpoena duces tecum" means a legal document issued under authority of the Board to compel a witness or entity to provide specific records.

History

• Adopted effective November 10, 1983 (Supp. 83-6). Former Section R2-5.1-101 renumbered to R2-5.1-102; new Section R2-5.1-101 adopted by final rulemaking at 7 A.A.R. 44, effective December 13, 2000 (Supp. 00-4). Amended by final rulemaking at 9 A.A.R. 22, effective February 7, 2003 (Supp. 02-4). Amended by exempt rulemaking at 18 A.A.R. 2926, effective October 29, 2012 (Supp. 12-4). Amended by final rulemaking at 20 A.A.R. 1359, effective 8/3/2014. Amended by final expedited rulemaking at 31 A.A.R. 1257, effective 4/1/2025.

Ariz. Admin. Code § R2-5.1-102 Personnel Board Procedures

A. Meetings. The Board shall provide public notice of the date, time, and place of its monthly meetings and any special, emergency, or other meetings it deems necessary. The Board shall give notice as required by law.

B. Special meetings. The chair of the Board may call special meetings of the Board. The Board shall give notice as required by law.

C. Emergency meetings. In the case of an emergency, the chair or vice chair of the Board may call a meeting. The Board shall give notice as required by law.

B.Agenda. The agenda shall be mailed or electronically provided, as required by law, to each member of the Board, a state agency indicating an interest in receiving the agenda, and all parties in a matter scheduled for a Board meeting. The Board's failure to mail or electronically provide the agenda, or failure of an agency to receive the agenda, does not affect the validity of the meeting or of any action taken by the Board at the meeting.

C. Minutes. The Board shall record in the Board's minutes the date, time, and place of each meeting of the Board, names of the Board members present, all official acts of the Board, the votes of each Board member except when the acts are unanimous, and, when requested by a member, a member's dissent with the member's reasons. Board staff shall prepare and present the minutes for approval by the Board members at the next regular meeting. The Board shall provide copies of the approved minutes to the appellant, complainant, and respondent within seven days of the regular meeting at which the minutes are approved.

History

• Adopted effective November 10, 1983 (Supp. 83-6). Amended subsection (B)(2) effective March 3, 1988 (Supp. 88-1). Corrections to subsections (B)(2) and (4) from revised format edition published February 1991 (Supp. 96-1). Former Section R2-5.1-102 renumbered to R2-5.1-103; new Section R2-5.1-102 renumbered from R2-5.1-101 and amended by final rulemaking at 7 A.A.R. 44, effective December 13, 2000 (Supp. 00-4). Manifest typographical error corrected in Section heading (Supp. 01-2). Amended by final rulemaking at 9 A.A.R. 22, effective February 7, 2003 (Supp. 02-4). Amended by final rulemaking at 20 A.A.R. 1359, effective 8/3/2014.

Ariz. Admin. Code § R2-5.1-103 Appeal Procedures

A. Appeal. A permanent status, covered employee who wishes to appeal a disciplinary action shall, no later than 10 business days after the effective date of the action, file a written appeal with the Board in accordance with A.R.S. § 41-783. The appeal shall include:

1. The appellant's name, telephone number, address and email address, if applicable;

2. The name of the agency taking the disciplinary action being appealed;

3. The name, telephone number, address, and email address of the appellant's representative, if applicable;

4. A specific response to the causes for disciplinary action upon which the appeal is based; and

5. The action requested of the Board.

B. Change of address. An appellant or respondent shall notify the Board in writing of a change of address or telephone number within five business days of the change. If written notice is not provided, future notices by the Board that are sent to the appellant's or respondent's prior address shall be deemed to have been received.

C B. Routing of appeal. The Board shall provide a copy of an appeal to the respondent within five business days from the date of filing, and not less than 20 days before the hearing.

D C. Hearing officer. The Board, including any member of the Board, may assign an appeal or may direct staff to assign an appeal to a hearing officer for hearing. When an appeal is assigned to a hearing officer, the hearing officer is the authorized representative of the Board and is empowered to grant or refuse extensions of time, to set proceedings for hearing, to conduct the hearing and to take any action in connection with the proceedings that the Board is authorized by law to take other than making the final findings of fact, conclusions of law, and order. The assignment of an appeal to a hearing officer does not preclude the Board, including any member of the Board, from withdrawing the assignment and the Board conducting the hearing or from reassigning the appeal to another hearing officer.

D. Ex parte communications. A party shall not communicate, either directly or indirectly, with the hearing officer about any substantive issue in a pending matter unless:

1. All parties are present;

2. It is during a scheduled proceeding, where an absent party fails to appear after proper notice; or

3. It is written by request or motion with copies to all parties.

E. Request to strike hearing officer. A party may request to change the hearing officer assigned to hear an appeal by filing a request in writing with the Board within five business days after receipt of the first hearing notice. The request shall state the reasons for the change of hearing officer. The Board shall not grant a change of hearing officer unless the party demonstrates a clear case of bias or prejudice.

F. Notice of hearing. The Board shall provide the appellant and respondent with written notice of the time, date, and place of hearing of an appeal, the docket number assigned by the Board and the name and contact information of the hearing officer at least 20 days before the date of the hearing.

G. Prehearing conference. The Board or the Board's hearing officer may hold a prehearing conference with the parties either in person or telephonically. Any agreement reached at the prehearing conference shall be binding at the hearing.

H. Time for hearing. The Board or the Board's hearing officer shall hold a hearing on an appeal within 60 calendar days after the Board receives the appeal unless the Board or the Board's hearing officer finds good cause to extend the time pursuant to a written request under this subsection. A request for continuance shall be made no less than five days prior to the scheduled hearing date and shall not be granted absent a showing of good cause. Good cause includes, but is not limited to, scheduling conflicts and unavailability of witnesses. The hearing officer shall grant or deny a request for continuance in his or her discretion.

I. Nature of hearing.

1. Every hearing shall be open to the public unless the appellant requests a confidential hearing.

2. A party may be self-represented or may designate a representative as provided by law.

3. Every hearing shall be conducted as a quasi-judicial proceeding.

4. All witnesses shall testify under oath.

5. Hearings shall be conducted in a manner that promotes and upholds the due process rights of the parties.

6. Conclusion of hearing. The Board shall consider the hearing concluded when the Board receives the hearing officer's proposed findings of fact, conclusions of law, and recommendation or, if objections are filed, on the date the objections are filed. The Board may request that the hearing officer be present during the consideration of the appeal by the Board, and, if requested, the hearing officer shall assist.

J. Record of Hearing. A record of the proceeding shall be made and kept by the Board for three years. Before the Board takes final action, the parties may request that the record be available for its review or duplication. Any party requesting a copy of the record or any portion of the record shall make a request to the Board and shall pay the reasonable cost for duplication.

K. Burden of Proof. The respondent has the burden of proof and shall present its case first.

J L. Rules of evidence. The Board or the Board's hearing officer shall grant a request for a confidential hearing made by the respondent if the hearing involves evidence the state is precluded by law from disclosing. The appellant, respondent, or hearing officer may request that portions of the record be sealed or adequately protected if testimony of a witness is of a sensitive nature. The Board or the Board's hearing officer is not bound by common law, statutory rules of evidence, or technical or formal rules of procedure, except the rule of privilege as recognized by law.

K M. Requesting, serving, and enforcing subpoenas. A party may request a subpoena to require the attendance of a witness or a subpoena duces tecum to require the production of a document. A party shall file with the Board a completed request for subpoena prior to the scheduled hearing date. The Board shall prepare the subpoena and return the subpoena to the requesting party for service. A person who is not a party and is at least 18 years of age may serve a subpoena. If enforcement of a subpoena for appearance of a witness is necessary, enforcement proceedings shall be taken to Superior Court by the party requesting enforcement, and enforcement shall be determined by the Superior Court. The party requesting enforcement shall name the Board as a party to any proceedings. The Board shall follow any orders entered by the court.

L N. Exhibits. A party introducing an exhibit shall furnish the opposing party and the Board office with a copy of the exhibit no later than 14 calendar days prior to the hearing. Both parties should be prepared with three additional copies of proposed exhibits for presentation of their cases on the day of the hearing for utilization by the opposing party, witness and the hearing officer. The hearing officer shall make the determination at the hearing as to whether additional evidence and exhibits are necessary to ensure the Board has a complete record for review. The hearing officer shall consider the prejudice to the party who has not seen the additional evidence when making the determination to either include or preclude the evidence.

M O. Witnesses. No later than 14 days prior to the hearing, parties shall furnish the opposing party and the Board office with a list of the witnesses each party intends to call to testify at the hearing, along with a brief statement as to the substance and relevancy of the testimony.

N P. Exclusion of witnesses. Upon the request or motion of an appellant or respondent, the hearing officer may exclude from the hearing room any witness who is not at the time under examination. The hearing officer shall not exclude a party to the hearing or a party's representative.

O Q. Witness fees. A witness who is not a state employee and is subpoenaed to attend a hearing is entitled to the same fee as is allowed witnesses in civil cases in the Arizona Superior Court. If the hearing officer, on the hearing officer's own motion, subpoenas a witness, fees and mileage shall be paid from funds of the Board. If the appellant or respondent subpoenas a witness, the fees and mileage shall be paid by the party requesting the witness. Reimbursement to state employees subpoenaed as witnesses is limited to payment of mileage at the current Arizona Department of Administration reimbursement rate, available from the DOA General Accounting Office website regarding travel reimbursement.

P R.Telephonic testimony. The appellant or respondent may request through a motion that a party or witness testify telephonically if personal attendance would present an undue or excessive hardship for the party or witness and would not cause undue prejudice to a party. Undue prejudice will be defined as improper or unfair treatment which impacts a due process right of a party. The hearing officer shall rule on the request, in his or her discretion, whether telephonic testimony is warranted and whether the moving party will be required to pay for the cost of obtaining the telephonic testimony.

S. Conclusion of hearing. The Board shall consider the hearing concluded when the Board receives the hearing officer's proposed findings of fact, conclusions of law, and recommendation or, if objections are filed, on the date the objections are filed. The Board may request that the hearing officer be present during the consideration of the appeal by the Board, and, if requested, the hearing officer shall assist and advise the Board.

Q S. Deposition. A party may request that a witness' deposition be used as evidence if the presence of a witness cannot be procured at the time of hearing. The hearing officer shall grant or deny the request.

R T. Failure of a party to appear. If a party fails to appear at a hearing, the hearing officer shall allow the appearing party to present evidence, or vacate the hearing and return to the Board for any further action.

T U. Proposed findings of fact. Appellant and respondent may request permission to file proposed findings of fact and conclusions of law. The hearing officer shall grant or deny the request.

U V. Hearing officer report. The hearing officer shall submit written proposed findings of fact, conclusions of law, and a recommendation, including a brief statement of reasons for the hearing officer's findings and conclusions, within 30 days after the last date of the hearing. If the parties are required to file written closing arguments or briefs to the hearing officer, the hearing officer shall submit proposed findings, conclusions, recommendation, and reasons within 30 days after the closing arguments or briefs are due.

V W. Objections to findings. The Board shall send a copy of the hearing officer's proposed findings of fact, conclusions of law, and recommendation to the appellant and respondent. The appellant and respondent may file written objections, but not post-hearing evidence, to the hearing officer's proposed findings of fact and conclusions of law with the Board within 15 calendar days after receipt of the hearing officer's proposed findings of fact and conclusions of law, unless extended by the Board upon a written motion filed with the Board, and shall serve copies of the objections upon the other party. The opposing party may file a written response to the objections with the Board within 15 calendar days from receipt of the appellant or respondent objections but must be 48 hours before a Board meeting. The Board shall not consider untimely objections or responses.

W X. Withdrawal of appeal. An appellant may withdraw an appeal at any time prior to the decision of the Board by submitting a written withdrawal letter to the Board.

X Y. State Personnel Board decision. Within the time required by law, the Board shall notify the appellant and respondent of the date, time, and place of the Board meeting at which the appeal will be decided. The Board may affirm, reverse, adopt, modify, supplement, or reject the hearing officer's proposed findings of fact and conclusions of law in whole or in part, may recommit the matter to the hearing officer with instructions, may convene itself as a hearing body, or may make any other disposition of the appeal allowed by law. The Board shall make a decision on the appeal in an open meeting within 45 days after the conclusion of the hearing and shall send a copy of the decision to the appellant and respondent by certified mail, return receipt requested. If the Board orders the respondent to rein- state the appellant, it may also order the respondent to reinstate the appellant with or without back pay in the amount and for the period the Board determined to be proper.

Y Z. Appeal of Board decisions in court. The appellant or respondent may appeal the Board's decision to the Superior Court as provided in A.R.S. § 41-783.

History

• New Section renumbered from R2-5.1-103 renumbered from R2-5.1-102 and amended by final rulemaking at 7 A.A.R. 44, effective December 13, 2000 (Supp. 00-4). Amended by final rulemaking at 9 A.A.R. 22, effective February 7, 2003 (Supp. 02-4). Amended by exempt rulemaking at 18 A.A.R. 2926, effective October 29, 2012 (Supp. 12-4). Amended by final rulemaking at 20 A.A.R. 1359, effective 8/3/2014. Amended by final expedited rulemaking at 31 A.A.R. 1257, effective 4/1/2025.

Ariz. Admin. Code § R2-5.1-104 Complaint Procedures

A. Complaint. An employee or former employee as defined in A.R.S. § 38-531 who wishes to file a complaint shall, no later than 10 calendar days after the effective date of the alleged prohibited personnel practice that is the subject of the complaint, file a written complaint with the Board in accordance with A.R.S. § 38-532. The complaint shall include:

1. The complainant's name, telephone number, address, and email address, if applicable;

2. The name, telephone number, address, and email address of the complainant's representative, if applicable;

3. A concise statement of the facts constituting the alleged prohibited personnel practice;

4. The name of the agency or employee believed to have knowingly committed the prohibited personnel practice; and

5. The date and place of the alleged prohibited personnel practice.

B. Change of address. A complainant or respondent shall notify the Board in writing of a change of address or telephone number within five business days of the change. If written notice is not provided, future notices by the Board that are sent to the complainant's or respondent's prior address shall be deemed to have been received.

C B. Routing of complaint. The Board shall provide a copy of a complaint to the respondent within five business days from the date of filing, and not less than 20 days before the hearing.

D C. Amending a complaint. A complainant may move to amend a complaint. An amendment shall relate only to the facts and circumstances under the original complaint and shall not relate to new causes of action. The hearing officer shall grant or deny the motion or shall refer the motion to the Board for disposition.

E D. Hearing officer. The Board, including any member of the Board, may assign a complaint or may direct staff to assign a complaint to a hearing officer for hearing. When a complaint is assigned to a hearing officer, the hearing officer is the authorized representative of the Board and is empowered to grant or refuse extensions of time, to set proceedings for hearing, to conduct the hearing, and to take any action in connection with the proceedings that the Board is authorized by law to take other than making the final findings of fact, conclusions of law, and order. The assignment of a complaint to a hearing officer does not preclude the Board, including any member of the Board, from withdrawing the assignment and the Board conducting the hearing or from reassigning the complaint to another hearing officer.

E. Ex parte communications. A party shall not communicate, either directly or indirectly, with the hearing officer about any substantive issue in pending matter unless:

All parties are present;

2. It is during a scheduled proceeding, where an absent party fails to appear after proper notice; or

3. It is written by request or motion with copies to all parties.

F. Request to strike hearing officer. A party may request to change the hearing officer assigned to hear a complaint by filing a request in writing with the Board within five business days after receipt of the first hearing notice. The request shall state the reasons for the change of hearing officer. The Board shall not grant a change of hearing officer unless the party demonstrates a clear case of bias or prejudice.

G. Notice of hearing. The Board shall provide the complainant and respondent with written notice of the time, date, and place of hearing of a complaint, the docket number assigned by the Board and the name and contact information of the hearing officer at least 20 days before the date of the hearing.

H. Prehearing conference. The Board or the Board's hearing officer may hold a prehearing conference with the parties either in person or telephonically. Any agreement reached at the prehearing conference shall be binding at the hearing.

I. Time for hearing. The Board or the Board's hearing officer shall hold a hearing on a complaint within 60 calendar days after the Board receives the complaint unless the Board or the Board's hearing officer finds good cause to extend the time pursuant to a written request under this subsection. A request for continuance shall be made no less than five days prior to the scheduled hearing date and shall not be granted absent a showing of good cause. Good cause includes, but is not limited to, scheduling conflicts and unavailability of witnesses. The hearing officer shall grant or deny a request for continuance in his or her discretion.

J. Nature of hearing.

1. Every hearing shall be open to the public unless the complainant requests a confidential hearing.

2. A party may be self-represented or may designate a representative as provided by law. Every hearing shall be conducted as a quasi-judicial proceeding.

All witnesses shall testify under oath or by affirmation.

4. Hearings shall be conducted in a manner that promotes and upholds the due process rights of the parties.

5. Conclusion of hearing. The Board shall consider the hearing concluded when the Board receives the hearing officer's proposed findings of fact, conclusions of law, and recommendation or, if objections are filed, on the date the objections are filed. The Board may request that the hearing officer be present during the consideration of the complaint by the Board, and, if requested, the hearing officer shall assist.

K. Record of Hearing. A record of the proceeding shall be made and kept by the Board for three years. Before the Board takes final action, the parties may request that the record be available for its review or duplication. Any party requesting a copy of the record or any portion of the record shall make a request to the Board office and shall pay the reasonable cost for duplication.

L. Burden of Proof. The complainant has the burden of proof and shall present its case first.

M. Witnesses. No later than 10 days prior to the hearing, parties shall exchange a list of the witnesses each party intends to call to testify at the hearing, along with a brief statement as to the substance and relevancy of the testimony.

K M. Rules of evidence. The Board or the Board's hearing officer shall grant a request for a confidential hearing made by the respondent if the hearing involves evidence the state is precluded by law from disclosing. The complainant, respondent, or hearing officer may request that portions of the record be sealed or adequately protected if testimony of a witness is of a sensitive nature. The Board or the Board's hearing officer is not bound by common law, statutory rules of evidence, or technical or formal rules of procedure, except the rule of privilege as recognized by law.

L N. Requesting, serving, and enforcing subpoenas. A party may request a subpoena to require the attendance of a witness or a subpoena duces tecum to require the production of a document. A party shall file with the Board a completed request for subpoena prior to the scheduled hearing date. The Board shall prepare the subpoena and return the subpoena to the requesting party for service. A person who is not a party and is at least 18 years of age may serve a subpoena. If enforcement of a subpoena for appearance of a witness is necessary, enforcement proceedings shall be taken to Superior Court by the party requesting enforcement, and enforcement shall be determined by the Superior Court. The party requesting enforcement shall name the Board as a party to any proceedings. The Board shall follow any orders entered by the court.

M O. Exhibits; Witness List. A party introducing an exhibit shall furnish the opposing party and the Board with a copy of the exhibit no later than 14 calendar days prior to the hearing. Both parties should be prepared with three additional copies of proposed exhibits for presentation of their cases on the day of the hearing for utilization by the opposing party, witness and the hearing officer. The hearing officer shall make the determination at the hearing as to whether additional evidence and exhibits are necessary to ensure the Board has a complete record for review. The hearing officer shall consider the prejudice to the party who has not seen the additional evidence when making the determination to either include or preclude the evidence. In addition to, parties shall furnish the opposing party and the Board office with a list of the witnesses each party intends to call to testify at the hearing, along with a brief statement as to the substance and relevancy of the testimony.

O P. Exclusion of witnesses. Upon the request or motion of a complainant or respondent, the hearing officer may exclude from the hearing room any witness who is not at the time under examination. The hearing officer shall not exclude a party to the hearing or a party's representative.

P Q. Witness fees. A witness who is not a state employee and is subpoenaed to attend a hearing is entitled to the same fee as is allowed witnesses in civil cases in the Arizona Superior Court. If the hearing officer, on the hearing officer's own motion, subpoenas a witness, fees and mileage shall be paid from funds of the Board. If the complainant or respondent subpoenas a witness, the fees and mileage shall be paid by the party requesting the witness. Reimbursement to state employees subpoenaed as witnesses is limited to payment of mileage at the current Arizona Department of Administration reimbursement rate, available from the DOA General Accounting Office website regarding travel reimbursement.

Q R. Telephonic testimony. The complainant or respondent may request through a request or motion that a party or witness testify tele-phonically if personal attendance would present an undue or excessive hardship for the party or witness and would not cause undue prejudice to a party. Undue prejudice will be defined as improper or unfair treatment which impacts a due process right of a party. The hearing officer shall rule on the request, in his or her discretion, whether telephonic testimony is warranted and whether the moving party will be required to pay for the cost of obtaining the telephonic testimony.

R S. Deposition. A party may request that a witness' deposition be used as evidence if the presence of a witness cannot be procured at the time of hearing. The hearing officer shall grant or deny the request.

T. Conclusion of hearing. The Board shall consider the hearing concluded when the Board receives the hearing officer's proposed findings of fact, conclusions of law, and recommendation or, if objections are filed, on the date the objections are filed. The Board may request that the hearing officer be present during the consideration of the complaint by the Board, and, if requested, the hearing officer shall assist and advise the Board.

S T. Failure of a party to appear. If a party fails to appear at a hearing, the hearing officer shall allow the appearing party to present evidence, or vacate the hearing and return to the Board for any further action.

U. Proposed findings of fact. Complainant and respondent may request permission to file proposed findings of fact and conclusions of law. The hearing officer shall grant or deny the request.

V. Hearing officer report. The hearing officer shall submit written proposed findings of fact, conclusions of law, and a recommendation, including a brief statement of reasons for the hearing officer's findings and conclusions, within 30 days after the last date of the hearing. If the parties are required to file written closing arguments or briefs to the hearing officer, the hearing officer shall submit proposed findings, conclusions, recommendation, and reasons within 30 days after the closing arguments or briefs are due.

W. Objections to findings. The Board shall send a copy of the hearing officer's proposed findings of fact, conclusions of law, and recommendation to the complainant and respondent. The complainant and respondent may file written objections, but not post-hearing evidence, to the hearing officer's proposed findings of fact and conclusions of law with the Board within 15 calendar days after receipt of the hearing officer's proposed findings of fact and conclusions of law, unless extended by the Board upon a written motion filed with the Board, and shall serve copies of the objections upon the other party. The opposing party may file a written response to the objections with the Board within 15 calendar days from receipt of the appellant or respondent objections but must be 48 hours before a Board meeting. The Board shall not consider untimely objections or responses.

X. Withdrawal of complaint. A complainant may submit a written request to withdraw a complaint at any time prior to the decision of the Board. The Board shall rule on the request

Y. State Personnel Board decision. Within the time required by law, the Board shall notify the complainant and respondent of the date, time, and place of the Board meeting at which the complaint will be decided. The Board may affirm, reverse, adopt, modify, supplement, or reject the hearing officer's proposed findings of fact and conclusions of law in whole or in part, may recommit the matter to the hearing officer with instructions, may convene itself as a hearing body, or may make any other disposition of the complaint allowed by law. The Board shall determine the validity of the complaint and whether a prohibited personnel practice was committed against the employee or former employee as a result of the employee or former employee's disclosure of information of a matter of public concern. The Board shall make a decision on the complaint in an open meeting within 45 days after the conclusion of the hearing and shall send a copy of the decision to the complainant and respondent by certified mail, return receipt requested. If the Board determines a prohibited personnel practice was committed as a result of a disclosure of information by the employee or former employee, the Board shall act in accordance with the requirements of A.R.S. § 38-532.

Z. Appeal of Board decisions in court. The complainant or respondent may appeal the Board's decision to the Superior Court as provided in A.R.S. § 38-532.

History

• New Section made by final rulemaking at 9 A.A.R. 22, effective February 7, 2003 (Supp. 02-4). . Amended by final rulemaking at 20 A.A.R. 1359, effective 8/3/2014. Amended by final expedited rulemaking at 31 A.A.R. 1257, effective 4/1/2025.

Chapter 5 Department of Administration - State Personnel System

Subchapter A COVERED AND UNCOVERED EMPLOYEES

Article 1 GENERAL

Ariz. Admin. Code § R2-5A-101 Definitions

In this subchapter, the following words and phrases have the defined meanings unless otherwise clearly indicated by the context:

"Agency head" means the chief executive officer of a state agency, or designee.

"Appeal" means a covered employee's request for a review of a disciplinary action by the State Personnel Board under A.R.S. § 41-782 or the Law Enforcement Merit System Council under A.R.S. § 41-1830.16, as applicable.

"Applicant" means a person who seeks appointment to a position in state employment.

"Appointing authority" means the person or group of persons authorized by law or delegated authority to make appointments to fill positions. A.R.S. § 41-741(1)

"Appointment" means the offer to and the acceptance by a candidate of a position in a state agency.

"At will" means an employment relationship where either party to the relationship may sever the relationship at any time for any reason other than an unlawful reason. A.R.S. § 41-741(2)

"Base salary" means an employee's salary excluding supplemental pay provided by R2-5A-403, overtime pay or other pay allowance provided by law.

"Break in service" means a separation from state employment, regardless of the reason for separation. A.R.S. § 41-741(3)

"Business day" means the hours between 8:00 a.m. and 5:00 p.m., Monday through Friday, excluding observed state holidays.

"Candidate" means a person whose education, experience, competencies and other qualifications meet the requirements of a position and who may be considered for employment.

"Cause" means any of the reasons for disciplinary action provided by A.R.S. § 41-773 or these rules.

"Change in assignment" means movement of an employee to a different position in the same state agency or another state agency. A.R.S. § 41-741(4)

"Child" means a natural child, adopted child, foster child, or stepchild.

"Class" means a group of positions with the same title and grade because each position in the group has similar duties, scope of discretion and responsibility, required qualifications, or other job-related characteristics.

"Class series" means a group of related classes as listed by the Arizona Department of Administration, Human Resources Division.

"Class specification" means a description of the type and level of duties and responsibilities of the positions assigned to a class.

"Competencies" means knowledge, skills, abilities, behaviors and other characteristics that contribute to successful job performance and the achievement of organizational results.

"Covered employee" means an employee who:

(a) Before September 29, 2012, is in the state service, is not uncovered pursuant to section 41-742, subsection A, and has remained in covered status without a break in service since that date.

(b) Before September 29, 2012, is in the state service, is employed as a Correctional Officer I, Correctional Officer II, Correctional Officer III or Community Corrections Officer and has remained in covered status without a break in service since that date.

(c) Before September 29, 2012, is in the state service, is a full authority peace officer as certified by the Arizona Peace Officer Standards and Training Board and has remained in that status without a break in service since that date.

(d) On or after September 29, 2012, is a Correctional Officer I, Correctional Officer II, Correctional Officer III or Community Corrections Officer and is appointed to a position in the covered service, but does not include a position in any other class in the correctional officer class series or the community correctional officer class series or in any other correctional class series.

(e) On or after September 29, 2012, is a full authority peace officer as certified by the Arizona Peace Officer Standards and Training Board and is appointed to a position that requires such a certification in the covered service. A.R.S. § 41-741(5)

(f) On or after September 14, 2024, is employed by the Arizona Department of Corrections as a Correctional Captain, Correctional Lieutenant, Correctional Sergeant, Correctional Corporal, Correctional Officer IV, Community Corrections Unit Supervisor or Community Corrections Group Supervisor and is appointed to a position in the covered service.

"Covered position" means a position in the covered service.

"Covered positions in the Arizona Department of Corrections" means, for the purposes of R2-5A-403, pertaining to supplemental pay, R2-5A-B611, pertaining to meritorious service leave, and R2-5B-102, pertaining to applicability, the job classes listed in A.R.S. § 41-745(D).

"Covered service" is defined in A.R.S. § 41-741 and means that employment status conferring rights of appeal as prescribed in A.R.S. §§ 41-782 and 41-783 or A.R.S. § 41-1830.16, as applicable.

"Days" means calendar days, unless otherwise stated.

"Demotion" means a change in the assignment of an employee from a position in one class to a position in another class that has a lower grade.

"Department" means the Arizona Department of Administration.

"Director" means the Director of the Arizona Department of Administration, or the Director's designee, who is responsible for administering the state personnel system pursuant to applicable state and federal laws. A.R.S. § 41-741(7)

"Disabled veteran" means, for the purposes of R2-5A-302, pertaining to preferences, an honorably separated veteran who served on active duty in the armed forces of the United States at any time and who has a service-connected disability.

"Disciplinary action" means a letter of reprimand, suspension, involuntary demotion, or dismissal.

"Employee" means all officers and employees of this state, whether in covered service or uncovered service, unless otherwise prescribed. A.R.S § 41-741(8)

"Employing agency" means the agency where the employee is employed or, if an applicant, the agency to which the person has applied.

"Essential job function" means a fundamental job duty of a position that an applicant or employee must be able to perform, with or without a reasonable accommodation.

"FLSA" means the federal Fair Labor Standards Act.

"FLSA exempt" means a position that is not entitled to overtime compensation under the FLSA.

"FLSA non-exempt" means a position that is entitled to overtime compensation under the FLSA.

"FMLA" means the federal Family and Medical Leave Act.

"Full authority peace officer" means a peace officer whose authority to enforce the laws of this state is not limited by the rules adopted by the Arizona Peace Officer Standards and Training Board. A.R.S. § 41-741(9)

"Grade" means the numeric identifier associated with one or more pay ranges, used to determine the internal worth of a class relative to other classes.

"Manifest error" means an act or failure to act that is, or clearly has caused, a mistake.

"Parent" means, for purposes of R2-5A-B602, pertaining to annual leave, R2-5A-B603, pertaining to sick leave, and R2-5A-B605, pertaining to bereavement leave, a birth parent, adoptive parent, stepparent, foster parent, grandparent, parent-in-law, or anyone who can be considered "in loco parentis."

"Part-time" means employment scheduled for less than 40 hours per week.

"3/4 time" means employment regularly scheduled for at least 30 hours but fewer than 40 hours per week.

"1/2 time" means employment regularly scheduled for at least 20 hours but fewer than 30 hours per week.

"1/4 time" means employment regularly scheduled for at least 10 hours but fewer than 20 hours per week.

"Pay status" means an employee is receiving pay for work or for a compensated absence.

"Premium/contribution" means the amount paid in exchange for insurance coverage. Depending on the type of coverage, the pre-mium/contribution is paid by the employee, the state, or a combination of both.

"Promotion" means a change in assignment of an employee from a position in one class to a position in another class that has a higher grade.

"Protected category" means race, color, national origin, religion, age, disability, genetic information, sex (including sexual orientation and gender identity), pregnancy, military or veteran status, or any other status protected by federal law, state law, or regulation.

"Reallocation" means changing the allocation of a position to a different class if a material and permanent change in duties or responsibilities occurs.

"Reversion" means the return of a covered employee on promotional probation to a position in the class in which the employee held permanent status immediately before the promotion or to a similar position in another class at the same grade as the class the employee held permanent status if the employee possesses the qualifications for that position.

"Rules" means the rules adopted by the Department of Administration, Human Resources Division. A.R.S. § 41-741(13)

"Special assignment" means the temporary assignment, for up to six months, of the duties and responsibilities of another position to an employee in the same agency.

"State agency" means a department, board, office, authority, commission or other governmental budget unit of this state and includes an agency assigned to a department for administrative purposes. State agency does not include the legislative and judicial branches, the Arizona Board of Regents, state universities, the Arizona State Schools for the Deaf and the Blind, the Department of Public Safety, the Arizona Peace Officer Standards and Training Board, the Cotton Research and Protection Council or public corporations. A.R.S. § 41-741(14)

"State Personnel Board" is defined in A.R.S. § 41-741 and means the board established by A.R.S. Title 41, Chapter 4, Article 6.

"State Personnel System" is defined in A.R.S. § 41-741 and means all state agencies and employees of those agencies that are not exempted by the provisions of A.R.S. Title 41, Chapter 4, Article 4.

"State service" is defined in A.R.S. § 41-741 and means all offices and positions of employment in state government that, before September 29, 2012, were subject to the provisions of A.R.S. Title 41, Chapter 4, Articles 5 and 6 that were in effect before September 29, 2012.

"Supervisor" means a state employee who has one or more other state employees reporting directly to the person and, for those state employees, typically has the authority to:

(a) Approve sick or annual leave.

(b) Recommend hiring, discipline or dismissal.

(c) Assign or schedule daily work.

(d) Complete a performance evaluation. A.R.S. § 41-741(18)

"Temporary appointment" means an appointment made for a maximum of 1,500 hours worked in any agency in each calendar year.

"Transfer" means the movement of an employee from one position to another position in the same or an equivalent grade.

"Uncovered employee" means an employee in uncovered service. A.R.S. § 41-741(19)

"Uncovered service" means employment at will and includes all state employees except those in covered service. A.R.S. § 41741(20)

"Working day" or "working hours" means a day or the hours an employee is regularly scheduled to work.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by final rulemaking at 30 A.A.R. 2765, effective 10/12/2024. Amended by final rulemaking at 31 A.A.R. 1939, effective 6/4/2025.

Ariz. Admin. Code § R2-5A-102 General Provisions

A. Authority of Director.

1. The Director may approve, modify or deny a request, plan or proposal submitted by a state agency for review or when the Director's approval is required by rule.

2. The Director may audit an agency's personnel policies and procedures at any time. If the Director determines that the agency's policies or procedures are inconsistent with these rules or are inconsistent with the procedures or guidelines issued by the Director, the Director may direct the agency head to modify them to achieve consistency or to discontinue them.

B. Delegation of authority.

1. The Director may, in writing, delegate authority to an agency head as consistent with legal requirements.

2. The Director may review or audit delegated authority to determine compliance with laws, rules, and policies.

3. Unless otherwise stated by law, or in these rules, an agency head may delegate authority granted to the agency head in these rules.

C. Availability of funds. The granting of any compensation under these rules is contingent upon the availability of funds, as determined by an agency head and the Director.

D. Service of notice. If a notice or document is to be given to a person or agency, the notice or document may be served personally or mailed to the last known residence or current business address of the person or agency. Unless otherwise provided by law or these rules, service is complete upon personal delivery or mailing.

E. Employee handbook. The Director may publish an employee handbook outlining pertinent rules and regulations and make the handbook available to all employees. If published, the employee handbook shall serve as the official handbook for all employees in the State Personnel System. An agency head may supplement the employee handbook with agency specific policies and directives.

F. Employment contracts. Unless otherwise provided by law, an appointing authority shall not execute an employment contract with any state employee.

G. Correction of errors. Only the Director, or designee, has authority to determine whether a manifest error exists and to correct the manifest error.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5A-103 Applicability

A. General. Except as provided in A.R.S., Title 41, Chapter 4, Article 4 and Article 5, or otherwise stated in rule, the rules in this subchapter are applicable to covered and uncovered positions, applicants for covered and uncovered positions and covered and uncovered employees in the State Personnel System. An employee who violates or fails to comply with these rules may be disciplined or separated from state employment. Any such actions involving a covered employee shall be in accordance with the rules in Subchapter B, Article 3.

B. Temporary procedures. The Director may:

1. Unless otherwise prescribed by statute, waive any rule and implement temporary procedures if the Director determines that essential public services are being hampered or it is in the best interest of the state.

2. Implement a temporary pilot project to improve efficiency, productivity, or accountability in the State Personnel System. The project may include an activity or procedure that is not in accordance with these rules and shall not exceed two years in duration.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5A-104 Prohibition Against Discrimination, Harassment and Retaliation

A. General. Agencies shall comply with all federal and state anti-discrimination laws. Agencies shall not unlawfully discriminate against any individual with regard to the terms and conditions of employment, including hiring, pay, leave, insurance benefits, retention, and rehiring. The information provided in this rule is intended to serve as a summary of agencies' and employees' obligations with regard to compliance with applicable federal and state laws, rules and regulations. Nothing in these rules shall be construed as providing rights in excess of, or in addition to those authorized under federal laws and Arizona Revised Statutes.

B. Equal Employment Opportunity. Each agency shall provide equal employment opportunity for all individuals regardless of race, color, national origin, religion, age, disability, genetic information, sex (including sexual orientation and gender identity), pregnancy, military or veteran status, or any other status protected by federal law, state law, or regulation. It is the policy of this state that all individuals are treated in a fair and non-discriminatory manner throughout the application and employment process.

C. Harassment Prohibited. Harassment of a sexual nature or harassment based on any protected category is prohibited. An agency shall prohibit the unlawful harassment of any employee in the course of the employee's work by supervisors, coworkers, or third parties, such as vendors or customers. Any employee who engages in unlawful harassment may be subject to disciplinary action, up to and including termination of employment.

D. Protection from Retaliation. The state prohibits retaliation against anyone for raising a concern about, assisting in an investigation of, or filing a complaint concerning unlawful discrimination or unlawful harassment.

E. Complaints.

1. An applicant for state employment who has a complaint alleging discrimination or harassment may file a complaint under the procedures in R2-5A-308.

2. It is every employee's responsibility to promptly bring any allegation of discrimination, harassment or retaliation to the attention of the employing agency. Such complaints shall be filed under the procedures established under Article 9.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by final rulemaking at 30 A.A.R. 2765, effective 10/12/2024.

Ariz. Admin. Code § R2-5A-105 Records

A. Definitions. For the purposes of this Section, "record" generally refers to a paper document; however, a document may be maintained electronically.

B. Application Materials.

1. An agency head shall maintain and keep confidential all resumes, applications, tests, test results, records, correspondence, and other documents used to seek state employment. The agency head shall not release any materials that the agency head determines would compromise the application process for future applicants and shall restrict the review of the applicant's application materials to:

a. The applicant,

b. An individual who has written authorization from the applicant,

c. State officials in the normal line of duty, or,

d. Officials acting in response to court orders or subpoenas.

2. The Director, or designee, shall ensure that when a person makes a public records request under A.R.S. Title 39, Chapter 1, Article 2 for applicant information:

a. Information shall only be provided if the position under recruitment is a high-level position and the public has a legitimate interest in the names of persons being seriously considered for the position, as determined by the Director; and

b. Only the names and resumés of the final candidates for the position as determined by the Director shall be released.

C. Official Personnel File.

1. An employee's official personnel file is the official record and documentation of the employee's employment.

2. An agency head shall, for each agency employee, maintain an official personnel file that contains:

a. A copy of the job application for the employee's current position;

b. A copy of all performance appraisals completed as required by Article 7;

c. Personnel action forms that authorize changes in employment status, position, classification, pay, or leave status;

d. Letters of commendation as established by agency policy; and

e. Correspondence consisting of:

i. Disciplinary actions;

ii. Acknowledgments of receipt of disciplinary actions; and

iii. Employee objections or responses to correspondence described in subsection (C)(2)(e)(i) that are not filed as complaints under Article 9 or grievances under Subchapter B, Article 4, if the objection or response is received within 30 calendar days of the date of the disciplinary action.

3. For the purpose of this subsection, an official is an individual who provides identification verifying that the individual is exercising powers and duties on behalf of the chief administrative head of a public body. An agency head shall limit access to an employee's official personnel file to:

a. The employee;

b. The employee's attorney or an individual who has written authorization from the employee to review the personnel file;

c. Agency personnel designated by the agency head as having a need for the information;

d. A Department official in the normal line of duty;

e. An official acting in response to a court order or subpoena;

f. An official of an agency to which the employee has applied; and

g. An official of an agency of the federal government, state government, or political subdivision, if the agency head of the employing agency deems access to the file to be appropriate.

4. When an employee moves from one state agency to another, the gaining agency shall request that the losing agency forward the employee's official personnel file to the gaining agency. The losing agency shall forward the file within 20 business days of the receipt of the request.

When a former employee returns to state employment within five years of the former employee's separation to an agency other than the agency in which the employee was last employed, the gaining agency shall request that the last agency forward the employee's official personnel file. The last agency shall forward the file within 20 business days of the receipt of the request.

D. Disclosure of information.

Definitions. For the purposes of this subsection:

a. "Disciplinary actions" means letters of reprimand, suspension, demotion or dismissal.

b.a. "Records that are reasonably necessary or appropriate to maintain an accurate knowledge of the employee's disciplinary actions" includes disciplinary actions, an official notice of charges of misconduct as applicable to covered employees, the final disciplinary letter, and any responses related to complaints, grievances or appeals upholding, amending, or overturning the discipline.

c.b. "Employee responses" means any written documents, submitted and signed by the employee, either:

i. In response to an official notice of charges of misconduct;

ii. As a formal complaint filed under the provisions of Article 9 or a formal grievance under Subchapter B, Article 4, of these rules pertaining to a specific disciplinary action; or

iii. As an objection to a specific disciplinary action and contained in the employee's official personnel file under subsection (C)(2)(e)(iii).

2. Personnel records are confidential and an agency head shall ensure that except as provided in subsection (C)(3), only the following information about a current or former employee is provided to any person making a public records request under A.R.S. Title 39, Chapter 1, Article 2.

a. Name of employee;

b. Date of employment;

c. Current and previous class titles and dates of appointment to the class;

d. Current and previous agencies to which the employee has been assigned and the location of the main office for each agency;

e. Current and previous salaries and dates of each change;

f. Name of employee's current or last known supervisor; and

g. Records that are reasonably necessary or appropriate to maintain an accurate knowledge of the employee's disciplinary actions, including the employee responses to all disciplinary actions, unless providing this information is contrary to law.

E. Insurance and medical records. An agency head:

1. May maintain group insurance enrollment forms in an employee's official personnel file for an employee hired prior to September 29, 2012.

2. Shall maintain in a separate file that is not part of the employee's official personnel file:

a. Medical records, and

b. Group insurance enrollment forms for an employee hired on or after September 29, 2012.

F. Employment eligibility records. An agency head shall retain I-9 forms and other documents required by law to prove employment eligibility in a separate file that is not part of the employee's official personnel file.

G. Employee access to files. An employee has the right to review only the employee's official personnel file.

H. Recordkeeping Requirements. An agency head shall ensure that agency recruitment and employee records are maintained in accordance with the General Records Retention Schedule for Human Resources/Personnel Records published by and on file with the Secretary of State, Arizona State Library, Archives and Public Records.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by final rulemaking at 30 A.A.R. 2765, effective 10/12/2024.

Article 2 CLASSIFICATION SYSTEM

Ariz. Admin. Code § R2-5A-201 Classification Plan

A. General. The Director shall group positions into classes based on similarities of duties and responsibilities. All positions are assigned a class specification with a specific title. An agency head may not appoint, transfer, promote, or demote an employee, or make any change in salary for any position until the position is allocated to a class.

B. Class title. An agency head shall use the class title of a position to designate the position in all budget estimates, payrolls, vouchers, and communications in connection with personnel processes.

C. Class specification. A class specification indicates the kinds of positions to be allocated to the class, as determined by the duties and responsibilities described for that class. Each class specification shall contain a statement of the minimum education, experience, competencies, and other qualifications required to perform the work. Required postsecondary education shall be attained in an institution that meets the standards established by an accrediting agency recognized by the U.S. Department of Education.

D. Position description. An agency head shall ensure that every position in the agency has a completed position description describing the current duties, responsibilities, and essential job functions specific to the position.

E. Allocation. The Director shall place every position in a class based on its duties and responsibilities.

F. Reallocation. Upon completion of a review of a position, the Director may determine that the position should be placed in a different class.

G. Regrade. Upon completion of a review of a classification, the Director may determine that the class should be placed in a different grade.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5A-202 Change in Classification

A. Change in classification plan. The Director may establish new classes and divide, combine, alter, or abolish existing classes, grades, or both, in consultation with affected agency heads.

B. Change in job duties.

1. An employee in a position or the agency head may file a written request with the Director for review of the classification of the position. The request shall contain an updated position description, a specific explanation of how and when the position's duties and responsibilities have changed and the reasons why the current classification does not match these job duties.

If a material and permanent change takes place in the duties and responsibilities of a position, the agency head shall report this change to the Director in an updated position description. The Director may order a reallocation of the position. The employee in the position at the time of reallocation shall continue to serve in the position.

C. Effective date. The effective date of a change in classification shall be the first day of the pay period immediately following the Director's determination, unless the Director authorizes an exception.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5A-203 Expired

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Section expired under A.R.S. § 41-1056(J) at 23 A.A.R. 2489, effective August 8, 2017 (Supp. 17-3).

Article 3 RECRUITMENT, SELECTION AND APPOINTMENT

Ariz. Admin. Code § R2-5A-301 General

An agency head shall follow the requirements outlined in this Article to identify and appoint qualified candidates to fill vacancies. The Director shall establish and maintain a centralized employment system that includes a job board for announcing vacancies in state employment, applicant tracking and candidate identification. The Director shall establish procedures for state agencies to request approval for transportation or other travel expenses or moving expenses provided by A.R.S. § 35-196.01 for out of state candidates.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by exempt rulemaking at 19 A.A.R. 717 effective April 13, 2013 (Supp. 13-1).

Ariz. Admin. Code § R2-5A-302 Recruitment

A. Job posting.

1. Unless exempted by A.R.S. Title 41, Chapter 4, Article 4, an appointing authority shall post an open position to the state's centralized job board. This includes recruitments open to only employees currently employed by the agency, to state employees currently employed in any state agency, or the general public. An agency head may authorize an exception to the job posting requirement for a position in an individual case. Any exceptions shall be documented by the agency head and subject to audit by the Director.

2. In addition to posting to the state's centralized job board, an appointing authority may post an open position in a publication or to a commercial job posting board or both, in compliance with applicable procurement rules.

B. Application form.

1. A candidate for a position shall complete the standardized application form developed by the Director.

2. In addition to the standardized application form, an agency head may develop supplemental application procedures and forms specific to the agency or to a certain class or classes within the agency.

C. Preferences.

1. The state will provide preference to qualified veterans and disabled veterans seeking employment with the state.

2. For positions in the covered service, preference points authorized by A.R.S. § 38-492 shall be added to an applicant's grade on any assessment or evaluation that results in a numeric grade after the final grade is determined, if a passing grade is earned without the addition of preference points. Preference points shall not be applied to promotional examinations. If an evaluation does not result in a numeric grade, preference shall be given by granting applicable preference codes to qualified applicants.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5A-303 Reference and Background Checks

A candidate may be required to furnish, at the candidate's own expense, evidence of education or other qualification. The appointing authority is responsible for verifying education, work experience, applicable license or licenses and references provided by candidates on the application form and in interviews. An appointing authority shall not conduct a criminal background check or a credit check on a candidate unless the agency has statutory or executive order authority to conduct such a check.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5A-304 Qualifications of Selected Candidate

An agency head shall ensure that any candidate selected for hire meets the established qualifications for the position filled.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5A-305 Employment of Relatives

A. Relationship to supervisors. An individual shall not be employed in a position if the immediate supervisor of the individual is related within the third degree of affinity (marriage) or consanguinity (blood), or by adoption.

B. Relationship to other employees. An individual shall not be employed in a position if the individual is related within the third degree to an employee who currently occupies a position under the same immediate supervisor.

C. Exceptions. The Director may grant an exception to the prohibitions in subsections (A) and (B) if there is no other qualified person for the position at the location.

D. Relationship to subordinate employees. A supervisor or manager at any level shall not make an employment decision specifically benefitting any individual who is related within the third degree, unless an exception under subsection (C) has been granted.

E. Relationship to interviewer or interview panel members. An employee shall not interview or serve on an interview panel of any job candidate if the candidate is related within the third degree. An agency head may authorize an exception in an individual case. Any exception shall be documented by the agency head and subject to audit by the Director.

F. Definition. For the purpose of this Section, persons related within the third degree include a spouse, child, parent, grandchild, grandparent, sister, brother, great grandchild, great grandparent, aunt, uncle, niece, nephew or first cousin.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by final rulemaking at 30 A.A.R. 2765, effective 10/12/2024.

Ariz. Admin. Code § R2-5A-306 Hiring Requirements

Agencies shall comply with federal and state law, including the verification of employment eligibility pursuant to A.R.S. § 23-214. An agency head shall ensure the completion of the Form I-9 and the employment eligibility verification process for all new hires.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5A-307 Appointment

A. General. Except as provided in A.R.S. Title 41, Chapter 4, Articles 4 and 5, all appointments shall be at will uncovered. An agency head may appoint a current state employee who accepts a change in assignment or an external candidate in accordance with these rules and the procedures established by the Director.

B. Types of Appointment.

1. A regular appointment may be:

a. Full-time employment;

b. Part-time employment;

c. Subject to funding availability, such as federal or grant funding; or

d. To a trainee position.

2. A temporary appointment may be made for a recurring period of time up to a maximum of 1500 hours in any one position per agency each calendar year. A temporary appointment employee may work full time for a portion of the year, intermittently, on a seasonal basis, or on an as needed basis. An employee in a pool classification is considered a temporary appointment.

3. An agency head may place an employee on special assignment within the agency. A special assignment may be made non-competitively and for up to 6 months with the concurrence of the agency head of the employing agency and the Director. A special assignment shall not exceed 6 months unless extended by the Director. An agency head shall not make successive special assignments of the same person to the same class.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by exempt rulemaking at 19 A.A.R. 717 effective April 13, 2013 (Supp. 13-1).

Ariz. Admin. Code § R2-5A-308 Applicant Complaint

An applicant who has a complaint alleging discrimination or harassment relating to the procedures used in the selection or evaluation process shall submit the applicant complaint to the agency human resources representative within 90 days of the action giving rise to the complaint. The agency human resources representative shall evaluate the complaint and notify the applicant of the final action to be taken.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Article 4 COMPENSATION SYSTEM

Ariz. Admin. Code § R2-5A-401 Salary Plans

A. General. The Director shall establish a salary plan. The salary plan shall allow for the following:

1. Minimum and maximum rates of pay for classes outlined in the classification plan.

2. Salary adjustments, including adjustments to base salary and pay supplements and incentives, including add-ons to base salary.

B. Alternative salary plan. The Director may establish a special salary plan or pay practice determined to be the prevailing practice in the labor market and in the best interest of the state.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5A-402 Salary Administration

A. General. The Director shall develop procedures for salary administration for use by all agencies when setting the salary of an employee. In setting an employee's salary, an agency head shall consider such factors as the employee's education, experience, skills, performance, and the current salaries of employees in the same class in the agency and the relative experience and performance of those employees.

B. Classes. The Director shall assign each class to a salary range and to a grade.

C. Salary. The base salary of an employee shall be not less than the minimum nor more than the maximum of the salary range of the class to which the employee's position is allocated, except as provided by these rules.

D. Salary adjustment. The salary used to compute a salary adjustment is the employee's base salary. Following an adjustment to the base salary, an agency shall add to the new rate of pay any special pay supplement still valid.

E. New hire starting rate. An agency head may offer a salary to a new hire within the salary range of the class to which the employee is being appointed in accordance with the procedures and guidelines published by the Director, unless an exception is approved by the Director.

F. Promotion. An employee who has a change in assignment from a position in one class to a position in another class having a higher grade shall receive a salary increase as determined by the agency head in accordance with the procedures and guidelines published by the Director, unless an exception is approved by the Director.

G. Demotion.

1. An employee who has a change in assignment from a position in one class to a position in another class having a lower grade, whether voluntary or involuntary, shall receive a salary decrease as determined by the agency head in accordance with the procedures and guidelines published by the Director, unless an exception is approved by the Director.

2. A demoted employee shall not be eligible for an increase to base salary for six months after the effective date of the demotion to the new position, other than a salary increase that is legislatively mandated. After six months, the employee may become eligible for a salary increase only after a performance evaluation in the new position for which the employee received an overall rating of "meets expectations" or higher.

H. Lateral transfer. An employee who has a change in assignment from a position in one class to a position in the same class or in another class having the same grade shall receive no increase in salary, unless an exception is approved by the Director. The Director may approve a salary increase based upon documentation of recruitment difficulties to fill the position, specific needs identified by the agency, or the employee's qualifications. Transferred employees are not eligible for increases to base salary during their first six months in the new job unless approved by the Director. An employee who transfers to another agency may become eligible for a salary increase only after a performance evaluation in the new position for which the employee received an overall rating of "meets expectations" or higher.

I. Reversion of covered employee. A covered employee who is reverted under the rules in Subchapter B shall be paid the same salary as that paid prior to the promotion, plus the percentage or dollar amount of increase of an intervening general salary adjustment for which the employee was eligible.

J. Job reallocation.

1. The base salary of an employee in a position that is reallocated to a class in a higher pay range may receive a salary increase in accordance with the procedures and guidelines published by the Director. If increasing the base salary of an employee would result in a salary level that is less than the minimum or greater than the maximum salary of the pay range, the employee's salary shall be the minimum or the maximum salary of the pay range, respectively.

2. The base salary of an employee in a position that is reallocated to a class with the same or lower pay range shall remain the same provided that the employee's salary is within the pay range of the position. If the employee's salary is less than the minimum of the salary range or greater than the maximum salary of the new pay range, the employee's salary shall be the minimum salary or the maximum salary of the new pay range, respectively.

K. Job regrade.

1. The base salary of an employee in a class that is reassigned to a higher grade shall be adjusted by the amount determined by the Director. If adjusting the base salary of an employee would result in a salary level that is less than the minimum or greater than the maximum salary of the pay range, the employee's salary shall be the minimum or the maximum salary of the pay range, respectively.

2. The base salary of an employee in a class that is reassigned to a lower grade shall remain the same provided that the employee's salary is at or above the minimum salary of the new pay range of the class, and may be greater than the maximum salary of the pay range. If the employee's salary is greater than the maximum, the employee is not eligible for an increase to base pay until the employee's salary is less than the maximum salary of the new pay range.

L. Merit increases.

1. The Director shall establish guidelines for merit increases to base pay.

2. Merit increases shall be available:

a. To uncovered employees.

b. To covered employees only if such increases are legislatively appropriated.

3. Subject to the guidelines established by the Director:

a. Merit increases may be implemented at the discretion of the agency head.

b. Merit increases are subject to the availability of funding and must be within an agency's appropriation unless otherwise legislatively appropriated.

4. An agency head shall report to the Director on the utilization of merit increases pursuant to the reporting requirements in the guidelines established by the Director.

M. Legislatively-appropriated salary adjustments. Subject to legislative appropriation, the Director shall determine employee eligibility and criteria for salary adjustments.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by exempt rulemaking at 19 A.A.R. 717 effective April 13, 2013 (Supp. 13-1). Amended by final rulemaking at 30 A.A.R. 2765, effective 10/12/2024.

Ariz. Admin. Code § R2-5A-403 Supplemental Pay

A. General. Supplemental pay is in addition to an employee's base pay. The salary of an employee may exceed the maximum salary of the pay range for the employee's class if the excess amount is due to the receipt of supplemental pay.

B. Shift differential. The Director may authorize a shift differential to be paid to an employee on other than a day shift. The Director shall establish a competitive shift differential rate periodically based on an annual survey of the market place. Employees in the same class in the same agency who work on the same shift shall receive the same shift differential pay.

C. Special assignment. An employee on a special assignment shall remain in the employee's current position with no change to base salary. If the classification to which the employee is on a special assignment is a higher grade, the employee shall be provided a conditional pay supplement in an amount that, when added to the employee's base salary, would be within the range of the higher classification. If the classification to which the employee is on a special assignment is the same or a lower grade, the employee shall not be eligible for a conditional pay supplement while on special assignment. Any conditional pay supplement received by the employee for the special assignment shall be discontinued at the conclusion of the special assignment.

D. Conditional pay supplements. The Director may establish conditional pay supplements. A conditional pay supplement provides additional compensation to an eligible employee and shall be discontinued when the qualifying conditions no longer apply. An employee may be awarded multiple conditional pay supplements. A conditional pay supplement does not:

1. Change base salary;

2. Provide a basis for the computation of a salary increase; or

3. Provide a basis for the computation of pay upon an employee's promotion, demotion or transfer.

E. Variable pay.

1. The Director may establish variable pay strategies determined to be the prevailing practices in the market and in the best interest of the state.

If the Director establishes variable pay strategies, the Director shall establish guidelines for the administration of variable pay.

3. Variable pay shall be available only to uncovered employees, except for employees in covered positions in the Arizona Department of Corrections, or covered positions that require full authority peace officer certification, as specified in the guidelines established by the Director.

4. Subject to the guidelines established by the Director:

a. Variable pay strategies may be implemented at the discretion of the agency head.

b. Variable pay strategies are subject to the availability of funding and must be within an agency's appropriation unless otherwise legislatively appropriated.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by final rulemaking at 30 A.A.R. 2765, effective 10/12/2024. Amended by final rulemaking at 31 A.A.R. 1939, effective 6/4/2025.

Ariz. Admin. Code § R2-5A-404 Overtime

A. Approval of overtime work. An agency head may require that an employee work overtime and:

1. Shall approve in advance all work in excess of 40 hours per workweek or in excess of a work period as defined by the Fair Labor Standards Act (FLSA). FLSA Regulations 29 CFR 553 and 778 (July 2012), are incorporated by this reference and on file with the Department and available from the U.S. Government Printing Office, 732 North Capitol Street N.W., Washington, D.C. 20401. This incorporation by reference contains no future editions or amendments; and

2. May assign an employee who volunteers for overtime before mandatory overtime is required.

B. Exemptions. The Director shall determine exemptions from minimum wage and maximum hour requirements in accordance with the Fair Labor Standards Act, 29 U.S.C. 213, January 2004, incorporated by this reference and on file with the Department and available from the U.S. Government Printing Office, 732 North Capitol Street N.W., Washington, D.C. 20401. This incorporation by reference contains no future editions or amendments.

C. Non-exempt employees.

1. An agency shall compensate an employee in a non-exempt position who works in excess of 40 hours per workweek or in excess of a work period as defined by the FLSA by either:

a. Additional pay at the rate of 1 1/2 times the employee's regular rate for each excess hour worked, or

b. Compensatory leave at the rate of 1 1/2 hours for each excess hour worked.

2. An employee shall select either overtime pay or compensatory leave for overtime compensation. If an employee's compensatory leave balance reaches the maximum allowed in subsection (E), the agency head shall compensate the employee by overtime pay.

D. Exempt employees.

1. Unless otherwise provided by statute or as specified in subsection (D)(2), an employee who is in a position that is exempt from the FLSA is excluded from receiving either overtime pay or compensatory leave.

2. An employee who is in a position that is exempt from the FLSA who works in excess of 40 hours per workweek or in excess of an established work period shall receive for each hour of overtime worked, either one hour of additional pay or earn one hour of compensatory leave, at the option of the agency head, if the employee is either:

a. Engaged in law enforcement activities;

b. Engaged in firefighting activities; or

c. A full authority peace officer as certified by the Arizona Peace Officer Standards and Training Board, is in a position that requires such certification, and is in the covered service.

3. An exempt employee may earn compensatory leave as provided by subsection (D)(2) until the employee's compensatory leave balance reaches the maximum allowed in subsection (E). When the maximum balance is reached, an agency head shall compensate the employee by overtime pay for excess hours worked.

4. For the purposes of this subsection, "engaged in law enforcement activities" has the same meaning as defined in A.R.S. Title 23, Chapter 2, Article 9.

E. Maximum accumulation. The maximum number of hours of accumulated compensatory leave is:

1. 480 hours for an employee who works in a public safety activity or an emergency response activity, or

2. 240 hours for an employee who works in any other activity.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by final rulemaking at 31 A.A.R. 1939, effective 6/4/2025.

Ariz. Admin. Code § R2-5A-405 Education Assistance

A. General. A state agency may assist an employee in the pursuit of educational goals by providing tuition reimbursement and student loan repayment assistance.

B. Tuition reimbursement. Prior to granting tuition reimbursement, an agency shall establish a policy which shall include the following conditions:

1. The educational program will provide a benefit to the state.

2. The employee shall successfully complete the required course work or the educational requirements of the program in order to receive reimbursement.

3. Education assistance may not exceed $5,250 per employee in any one calendar year unless approved in advance by the Director.

4. An employee who receives education assistance may be required to return all or a portion of the amount received if the employee does not remain employed with the agency for a defined period of time, as specified in the agency's policy.

C. Student loan repayment assistance. An agency that provides tuition reimbursement may also provide student loan assistance to an eligible employee in the repayment of student loans obtained by the employee and used for the actual costs paid for educational expenses and living expenses that occurred during the employee's undergraduate, graduate or professional education if the education is required or a selective preference for the employee's current position. Before granting student loan repayment assistance, an agency head shall develop a written policy that provides for equal consideration of all employees similarly situated. The policy will describe the need being addressed, and the benefit expected to be gained. The agency head shall submit the proposed policy and any subsequent changes to the Director for approval, and include at a minimum:

1. Eligibility requirements;

Request and approval procedures;

3. Documentation required to support the request for repayment assistance;

4. The monthly limit on student loan repayment assistance and a specified lifetime cap;

5. A requirement that the employee receiving student loan repayment assistance must provide to the agency monthly proof of payment of the monthly repayment amount for each active student loan approved for assistance;

6. Information regarding how an employee's leave of absence or separation affects student loan repayment assistance.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by final rulemaking at 30 A.A.R. 2765, effective 10/12/2024.

Ariz. Admin. Code § R2-5A-406 Reimbursement for Relocation

An agency head may reimburse reasonable relocation expenses to a current employee for a management initiated geographical transfer of more than 50 miles from the employee's current work site in accordance with the procedures established by the Director.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Article 5 CONDITIONS OF EMPLOYMENT

Ariz. Admin. Code § R2-5A-501 Standards of Conduct

A. Required conduct. A state employee shall at all times:

1. Comply with federal and state laws and rules, statewide policies and employee handbook, and agency policies and directives;

2. Maintain high standards of honesty, integrity, and impartiality, free from personal considerations, or favoritism;

Be courteous, considerate, and prompt in interactions with and serving the public and other employees; and

Conduct himself or herself in a manner that will not bring discredit or embarrassment to the state.

B. Prohibited conduct. A state employee shall not:

1. Use his or her official position for personal gain, or attempt to use, or use, confidential information for personal advantage;

2. Permit himself or herself to be placed under any kind of personal obligation that could lead a person to expect official favors;

3. Perform an act in a private capacity that may be construed to be an official act;

4. Accept or solicit, directly or indirectly, anything of economic value as a gift, gratuity, favor, entertainment, or loan that is, or may appear to be, designed to influence the employee's official conduct. This provision shall not prohibit acceptance by an employee of food, refreshments, or unsolicited advertising or promotional material of nominal value;

5. Directly or indirectly use or allow the use of state equipment or property of any kind, including equipment and property leased to the state, for other than official activities unless authorized by written agency policy or as otherwise allowed by these rules;

6. Inhibit a state employee from joining or refraining from joining an employee organization; or

7. Take disciplinary or punitive action against another employee that impedes or interferes with that employee's exercise of any right granted under the law or these rules.

C. Consequences of non-compliance. An employee who violates the standards of conduct requirements listed in subsection (A) or (B) may be disciplined or separated from state employment. Any such actions involving a covered employee shall be in accordance with the rules in Subchapter B, Article 3.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by exempt rulemaking at 19 A.A.R. 717 effective April 13, 2013 (Supp. 13-1).

Ariz. Admin. Code § R2-5A-502 Hours and Location of Work

A. State work week. The state work week is the period of seven consecutive days starting Saturday at 12:00 a.m. and ending Friday at 11:59 p.m. An agency head may apply to the Director for an exception from the work week period for all or part of an agency workforce. The Director may grant an exception from the work week period to promote efficiency in the State Personnel System.

B. Hours of work.

1. An agency head shall determine the hours of employment in the work week for each agency employee.

2.a. An agency head may provide for breaks during the work period consistent with carrying out the duties of the agency.

3.b. An agency head may require an employee to work overtime.

C. 2. An agency head may offer a flexible 40-hour work week option to an employee if the agency head determines the agency's services can be maintained.

D. 3. An agency head may establish a standard of attendance.

C. Location of work. Every employee shall have a designated work location in the State of Arizona.

1. An agency head shall determine the work location for each agency employee.

2. An agency head may allow an employee to work from an alternate location, subject to the employee's position requirements, the business needs of the agency, and in accordance with the procedures established by the Director. An employee who is authorized to work from an alternate location may be required to report to the employee's designated State of Arizona work location when directed.

3. The employee's designated State of Arizona work location shall be the geographic location of the position for the purposes of R2-5A-C601, pertaining to furlough, and R2-5B-602, pertaining to reduction in force.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by final rulemaking at 30 A.A.R. 2765, effective 10/12/2024.

Ariz. Admin. Code § R2-5A-503 Outside Employment

A. General. A state employee may seek employment and engage in a variety of activities outside of the employee's work for the state; however, the employee shall not engage in other employment or other activity that is not compatible with the full and proper discharge of the duties and responsibilities of state employment, or that tends to impair the employee's capacity to perform the employee's duties and responsibilities in an acceptable manner.

B. Definitions. For the purposes of this Section:

1. "Other employment" includes, but is not limited to:

a. Working as an employee for any employer, including another state agency;

b. Owning a business;

c. Contracting to provide services for a fee; or

d. Serving as a consultant for a fee or being self-employed;

e. Holding any elected or appointed public office, whether federal, state, or local; or

f. Holding a position in a political party or organization.

2. "Primary agency" means the agency in which the employee is employed at the time of the employee's request to obtain outside employment with another agency.

3. "Secondary agency" means the agency in which the employee is requesting to be employed while remaining employed with the primary agency.

C. Notice requirement. An employee who desires to engage in other employment shall notify the employee's supervisor and abide by the policies of the employing agency. An employee engaged in outside employment, including consultant relationships, shall inform the supervisor of the nature of the employment and corresponding work hours. An employee shall also disclose actual or potential conflicts of interest related to outside employment activities as soon as the employee becomes aware of the conflict. The determination as to whether a conflict or potential conflict exists shall be made by the agency head.

D. Outside employment with another state agency. An employee who seeks outside employment with another state agency must request approval from both the employee's primary agency and prospective secondary agency before commencing employment with the secondary agency. The primary and secondary agencies must ensure that the request complies with state and federal guidelines. Such request, if approved shall be in writing and on file with both agencies. Employment records are to be maintained in accordance with the provisions of R2-5A-105.

E. Outside employment as a paid public official or in a political party or organization. All employees shall comply with A.R.S. § 41-752 pertaining to political activities.

F. Termination of outside employment. If an agency head determines that an employee's outside employment interferes with the employee's performance or creates a conflict of interest, the employee will be required to terminate the outside employment.

G. Consequences of non-compliance. An employee who fails to make required disclosures or to take action to resolve any conflict of interest may be disciplined or separated from state employment. Any such actions involving a covered employee shall be in accordance with the rules in Subchapter B, Article 3.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5A-504 Alcohol and Drug-free Workplace

A. General. State agencies shall prohibit the manufacture, distribution, dispensation, possession or use of alcohol, illegal drugs, unauthorized drugs, inhalants, or other unauthorized controlled substances during an employee's working hours or while on state premises or worksites, including state vehicles and property leased to the state. A state employee shall not be impaired by alcohol or drugs while on duty.

B. Written policy. Each agency head shall adopt a written policy to address testing or retesting for the presence of alcohol or drugs of its employees and if applicable, prospective employees. The policy shall include all of the requirements listed in A.R.S. § 23-493.04. The agency head will submit its proposed alcohol and drug-free workplace policy and any subsequent changes to the Director for approval.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by final rulemaking at 30 A.A.R. 2765, effective 10/12/2024.

Article 7 PERFORMANCE MANAGEMENT

Ariz. Admin. Code § R2-5A-701 General

A. Performance management system. The Director shall establish a performance management system to evaluate the job performance of state employees. The performance management system established by the Director shall contain performance rating levels and shall contain numerical points to apply to each performance rating level established.

B. Administration. The Director shall develop an administrative manual and training on the performance management system.

C. Exceptions. The performance management system may be used:

1. As determined by the appointing authority for the agency head, to evaluate the job performance of the agency head.

2. As determined by the agency head, to evaluate the job performance of

a. Each deputy director, or equivalent, of the agency.

b. each subordinate uncovered employee in a position listed in A.R.S. § 41-742(F).

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by final rulemaking at 30 A.A.R. 2765, effective 10/12/2024.

Ariz. Admin. Code § R2-5A-702 Performance Management Process

A. Performance plan. For the purposes of this subsection, "performance plan" means a communication by an employee's supervisor that outlines what is expected of the employee and how the employee's performance will be measured. Subject to review by agency management, a supervisor:

1. Shall communicate performance expectations with each employee within 30 days of becoming the employee's supervisor.

2. May modify a performance plan at any time during a performance period.

Shall modify a performance plan when significant responsibilities or expectations are added to or removed from a position.

4. Shall notify the affected employee of any modifications made to a performance plan under subsection (A)(2) or (3).

B. Performance evaluation requirements.

Informal evaluation. A supervisor shall:

a. Monitor and evaluate an employee's performance throughout the rating period,

b. Provide feedback to the employee on a regular basis, and

c. Attempt to correct inadequate performance where possible and appropriate.

2. Formal evaluation. A supervisor shall:

a. Formally evaluate, document and rate the performance of each employee at least annually.

b. Submit the evaluation to agency management for review prior to the evaluation being administered to the employee.

3. Covered probationary employees. Prior to granting a covered probationary employee permanent status, a supervisor shall evaluate a probationary employee at least once prior to the end of the employee's probationary period.

C. Responsibilities.

1. An employee shall comply with the performance plan established by the supervisor.

2. A supervisor shall comply with performance evaluation requirements.

3. An agency head shall ensure that all performance evaluations are completed as required by this Section.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by final rulemaking at 30 A.A.R. 2765, effective 10/12/2024.

Article 8 DISCIPLINARY ACTIONS

Ariz. Admin. Code § R2-5A-801 General

A. Authority. An agency head has the primary authority and responsibility for managing the conduct of all employees within an agency. A covered employee may be disciplined only for cause. An agency head shall discipline a covered employee in accordance with this Article and the rules in Subchapter B of this Chapter. An uncovered employee serves at the pleasure of the appointing authority and may be dismissed at will. Except for an employee who is in a position listed in A.R.S. § 41-742(F), any action that involves a suspension greater than 80 working hours, an involuntary demotion, or a dismissal requires review by the Director prior to the agency head administering such action.

B. Level of discipline.

1. If an agency head deems it necessary to discipline an employee, the agency head may determine the level of discipline to be imposed, up to and including dismissal, subject to review by the Director, if applicable.

2. In determining the level of discipline to be imposed, the agency head may consider the following factors:

a. Consistent application of rules and standards,

i. Unless otherwise prescribed by statute, the agency head need only consider those cases decided under the administration of the current agency head. Decisions in cases prior to the administration of the current agency head are not binding upon the current agency head and are not relevant in determining consistent application of rules and standards.

ii. In determining consistent application of rules and standards, the disciplinary actions imposed by one agency may not be binding upon any other agency and may not be used for comparison purposes in hearings wherein the consistent application of rules and standards is at issue.

b. Prior knowledge of rules and standards,

c. The severity of the infraction,

d. The repeated nature of violations,

e. Prior corrective or disciplinary actions,

f. Previous oral discussions,

g. The employee's past work record,

h. The effect on agency operations,

i. The potential of the violations for causing damage to persons or property.

C. Limitations.

1. Except as otherwise provided by statute or rule, suspensions shall not exceed a total of 30 working days during any 12-month period. The 12-month period begins with the first day of the first suspension.

2. An employee who is involuntarily demoted must possess the qualifications for the position and:

a. A covered employee who has attained permanent status may be involuntarily demoted only to a regular position in the covered service.

b. An uncovered employee may be involuntarily demoted only to a position in the uncovered service.

D. Review by Director.

1. Letters of reprimand and suspensions without pay of 80 working hours or less are not subject to review by the Director.

2. Prior to imposing a suspension greater than 80 working hours, an involuntary demotion, or dismissal, the agency head shall submit the proposed action to the Director for review as prescribed in R2-5A-802, unless the employee is in a position listed in A.R.S. § 41-742(F). If the employee is in a position listed in A.R.S. § 41-742(F), a review by the Director is not required.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5A-802 Procedures for Review by the Director

A. Prior to administering any action requiring review by the Director, the agency head shall submit the proposed letter to the Director prior to the date the agency head intends to issue the letter to the employee.

B. The Director shall review the agency head's proposed action and provide notification of concurrence or recommend modification to the proposed action.

C. When the agency head administers the action to an employee, the agency head shall also send a copy of the employee's letter to the Director. If the agency head determines that no action will be taken, the agency head shall notify the Director.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5A-803 Employee Request for Review of Disciplinary Action

A. A covered employee who is issued a disciplinary action may have grievance or appeal rights, as applicable.

B. An uncovered employee does not have grievance rights or the right of appeal to the State Personnel Board or the Law Enforcement Merit System Council.

C. A covered employee who files a complaint on a disciplinary action alleging discrimination or harassment is precluded from also filing a grievance through the agency's grievance procedure on the same disciplinary action that is the subject of the employee's complaint.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by final rulemaking at 30 A.A.R. 2765, effective 10/12/2024.

Article 9 COMPLAINTS

Ariz. Admin. Code § R2-5A-901 Complaint System

A. General. Each agency head shall:

1. Adopt a procedure to address employee complaints concerning discrimination or harassment in compliance with this rule.

2. Designate an employee of the agency to serve as the agency's complaint coordinator, who shall be responsible for receiving complaints, determining applicability under the complaint system, investigating or assigning the complaint to the appropriate individual within the agency for review or investigation, and tracking the processing of complaints.

B. Matters subject to the complaint system. The adopted complaint procedure shall require the complainant to file the complaint with the agency complaint coordinator within 180 days of the action giving rise to the complaint and to clearly outline the allegations to be addressed, including whether the basis of the complaint is based on:

1. Unlawful discrimination based on race, color, religion, sex (including pregnancy), age, national origin, genetic information or on the basis of a disability.

2. Allegation of sexual harassment or other form of harassment.

3. Retaliation for filing a complaint.

Retaliation or intimidation for exercising any right under state or federal law.

C. Preparation. A complainant shall not be allowed the use of state time or state property to prepare a complaint, prepare for a meeting with agency management or to meet with a representative. Subject to supervisory approval, a complainant may request available compensatory or annual leave for this purpose.

D. Multiple complaints. Multiple complaints by an employee may be consolidated into a single complaint. Separate complaints filed by two or more employees regarding the same issue or issues may be consolidated into a group complaint. Employees having a common complaint may submit one group complaint, identifying one complainant as the selected spokesperson for the group. Employees who choose to file a group complaint are prohibited from filing separate complaints on the same issue.

E. Amendments. Once a complaint is submitted to the agency complaint coordinator, it may not be amended. If additional documentation is submitted by the complainant after the initiation of the complaint, the reviewing or investigating official may remand the complaint to the complainant for reconsideration and resubmission.

F. Approval. Each agency will submit its proposed complaint procedure and any subsequent changes to the Director for approval.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5A-902 Complaint Procedures

A. Content. Each agency complaint procedure shall include as a minimum that:

1. The agency head be notified of all verbal or written complaints of discrimination or harassment reported by an employee immediately upon receipt of a complaint.

2. Employees who are told or otherwise become aware that discrimination or harassment is occurring must immediately report the allegation or complaint to the agency's complaint coordinator.

3. The complaint include all facts and circumstances involved in the alleged violation, including:

a. Description of the incident(s),

b. Name(s) of individual(s) involved,

c. Name(s) of witness(es),

d. The date(s) the discrimination or harassment occurred (if known),

e. Resolution sought,

f. Federal or state law alleged to have been violated.

4. The agency complaint coordinator shall acknowledge receipt of the complaint in writing to the complainant not later than five business days after receipt of the written complaint.

5. The agency complaint coordinator shall initiate an investigation into the alleged complaint or assign the complaint to the appropriate individual within the agency for review or investigation within 10 business days and the review or investigation shall be completed within 60 business days of receipt of the written complaint. If extenuating circumstances exist, an extension shall be requested through the agency complaint coordinator.

Barring resolution of the complaint by agreement of the parties, the agency complaint coordinator shall forward a written recommendation to the agency head, or designee, within 10 business days of completion of the review or investigation.

7. The agency head, or designee, shall review the findings and recommendations and issue a decision in writing to the complainant.

8. A statement advising that retaliation against an employee for filing a complaint in good faith will not be tolerated or permitted.

9. A statement specifying that a grievance filed by a covered employee under R2-5B-403 that includes an allegation of discrimination or harassment shall be reviewed or investigated under the provisions of this Article, and not the grievance system.

B. Review by Director.

1. An employee, other than a Department of Administration employee, who is not satisfied with the agency head's response to a complaint alleging discrimination or harassment, may elevate the complaint to the Director within five business days after the receipt of the agency head's response. The Director will furnish a copy of the final decision to the agency head and the complainant within 20 business days following receipt of the complaint by the Director. The 20 business days may be extended by the Director with the concurrence of the complainant. The decision of the Director is the final step in the complaint procedure.

2. A complainant who is a Department of Administration employee and who is not satisfied with the Director's decision on a complaint alleging discrimination or harassment may resubmit the complaint to the Director within five business days after receipt of the Director's decision. The Director will appoint an individual who is not an employee of the Department of Administration and who serves in a position that is assigned to manage an agency's employee relations or investigations work unit to investigate the resubmitted complaint. The investigator shall conduct an investigation and furnish a copy of the findings and final decision to the Director and the complainant within 20 business days following receipt of the complaint by the investigator. The 20 business days may be extended by the investigator with the concurrence of the complainant. The decision of the investigator is the final step in the complaint procedure.

3. The response will refer the employee to the appropriate entity if the employee is dissatisfied with the final step of the complaint procedure.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Article 10 SEPARATIONS

Ariz. Admin. Code § R2-5A-1001 Voluntary Separation

A. Resignation. An employee may terminate employment with the state by submitting a written resignation to the agency head. An employee should submit a resignation at least 10 business days prior to the effective date of the resignation. If an employee resigns orally, the agency head shall confirm the resignation in writing. An agency head may refuse to accept a resignation and separate the employee pursuant to R2-5A-1002.

B. Job abandonment. An agency head may consider an employee to have voluntarily resigned from employment with the agency when the employee is absent from duty for three consecutive workdays or equivalent without proper authorization.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5A-1002 Involuntary Separation

A. General. An agency head may terminate an employee as deemed necessary to meet the needs of the agency and in keeping with federal and state laws and regulations. A covered employee may be dismissed only for cause. An agency head shall dismiss a covered employee in accordance with Article 8 and the rules in Subchapter B of this Chapter.

B. Staff reduction. At times, a staff reduction is necessary due to lack of work, lack of funds, economic slowdowns, technological or structural changes in the agency's operations, or because a staff reduction is determined to be necessary to ensure the financial health and viability of the agency.

1. Except for an employee who is in a position listed in A.R.S. § 41-742(F), a staff reduction of an uncovered employee requires review by the Director prior to the agency head administering such action.

2. An agency head shall conduct staff reductions of covered employees in accordance with Subchapter B, Article 6, Reduction in Force.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Article 6 LEAVE

Part A GENERAL

Ariz. Admin. Code § R2-5A-A601 Leave Administration

A. Leave plans. The Director shall adopt leave plans. Agency heads are responsible for administering leave for agency employees in accordance with the leave plans in this Article.

B. Eligibility for leave. All state employees, except temporary employees, are eligible for any type of leave with pay from the date of appointment. Temporary employees are eligible only for holidays subject to the provisions of R2-5A-B601, administrative leave, civic duty leave for the purpose of voting, living donor leave and military leave.

C. Amount of leave. Leave amounts are based on full-time employment and shall be pro-rated for part-time employees, even if not specified in an individual rule.

D. Family and Medical Leave Act (FMLA) leave. FMLA Regulations, 29 CFR 825.100 through 29 CFR 825.800 (July 2012), are incorporated by this reference and on file with the Department and available from the U.S. Government Printing Office, 732 N. Capitol Street N.W., Washington, D.C. 20401. This incorporation by reference contains no future editions or amendments. An employee who meets FMLA eligibility requirements and uses leave for any of the situations covered by the FMLA shall be subject to the following:

1. Counting FMLA leave. Periods of paid leave and periods of leave without pay shall count towards the employee's available FMLA leave.

2. Use of accrued paid leave. An employee shall use available paid leave for all or part of the employee's FMLA leave under the conditions in:

a. R2-5A-D602 for an employee on industrial leave,

b. R2-5A-D601 for an employee on FMLA leave for any other reason.

E. Insurance benefits continuation. An employee remains eligible for continued participation in the employee insurance plans while on leave pursuant to this Article.

F. Requests for leave. Except in an emergency, an employee shall obtain approval in advance and in writing before taking any leave.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Part B PAID LEAVE

Ariz. Admin. Code § R2-5A-B601 Holidays

A. State holidays.

1. January 1, "New Year's Day."

2. Third Monday in January, "Martin Luther King, Jr./Civil Rights Day."

Third Monday in February, "Lincoln/Washington Presidents' Day."

4. Last Monday in May, "Memorial Day."

5. July 4, "Independence Day."

6. First Monday in September, "Labor Day."

7. Second Monday in October, "Columbus Day."

November 11, "Veterans Day."

Fourth Thursday in November, "Thanksgiving Day."

10. December 25, "Christmas Day."

B. Employees scheduled to work. Unless required to work to maintain essential state services, an employee who is regularly scheduled to work on a day on which one of the holidays listed in subsection (A) is observed is entitled to be absent with pay for the number of hours regularly scheduled to work, not to exceed eight hours, provided the employee is not on leave without pay on the employee's work days immediately preceding or following the day on which the holiday is observed.

1. Part-time employees who work 1/4 time, 1/2 time, or 3/4 time are entitled to a proportional amount of holiday pay. Part-time employees who work a percentage of full-time other than 1/4 time, 1/2 time, or 3/4 time are entitled to holiday pay at the next lower rate. An employee who works less than 1/4 time is not entitled to holiday pay.

2. Temporary employees shall receive holiday pay provided they are in pay status the day before and the day after the holiday.

C. Employees not scheduled to work. An employee, excluding part-time and temporary employees, who is not scheduled to work on a day on which one of the holidays listed in subsection (A) above is observed shall receive holiday compensation for the number of hours normally worked per day, not to exceed eight, provided the employee is not on leave without pay on the employee's work days immediately preceding or following the day on which the holiday is observed.

D. Employees required to work. An employee who is required to work on a day on which a holiday listed in subsection (A) is observed shall receive:

Both holiday compensation and one hour of pay at the employee's current salary rate for each hour worked if the employee is in a position that is either:

a. FLSA non-exempt; or

b. Exempt from the FLSA, but meets the conditions in R2-5A-404(D)(2).

2. No additional compensation if the employee is in a position that is exempt from the FLSA and is employed in any other capacity.

E. Holiday compensation.

1. Except as modified by subsection (E)(2), an employee who is eligible for holiday compensation pursuant to subsection (C) or (D) shall receive for each hour of holiday compensation authorized, at the option of the agency head, either:

a. One hour of additional pay at the current salary rate; or

b. One hour of annual leave; or

c. One hour time off with pay on an alternate work day specified by the agency head after the holiday and during the pay period in which the holiday is observed, or the succeeding pay period.

2. Temporary employees do not accrue annual leave and shall receive either additional pay or time off as in subsection (E)(1)(c) above.

3. An employee may not receive more than eight hours of holiday compensation for any holiday.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5A-B602 Annual Leave

A. Definitions. For the purposes of this Section:

1. "Annual leave" means a period of approved absence with pay that is not chargeable to another category of leave.

2. "Hire date" means the employee's first day of work upon hire or, if the employee has a break in service, rehire.

B. Accrual.

1. All employees, except temporary and part-time employees shall accrue annual leave as follows:

a. Except as provided in subsection (B)(1)(b), covered employees shall accrue annual leave in accordance with the following schedule:

| Credited Service | Bi-weekly Accrual Hours Minutes (HH:MM) | | --- | --- | | Fewer than 3 years | 3 hours 42 minutes (3:42) | | 3 years but fewer than 7 years | 4 hours 38 minutes (4:38) | | 7 years but fewer than 15 years | 5 hours 33 minutes (5:33) | | 15 years or more | 6 hours 29 minutes (6:29) |

b. An employee of the Arizona Department of Corrections who was employed before September 14, 2024, as an uncovered Correctional Captain, Correctional Lieutenant, Correctional Sergeant, Correctional Corporal, Correctional Officer IV, Community Corrections Unit Supervisor or Community Corrections Group Supervisor and became covered on September 14, 2024, as amended by Laws 2024, Ch. 249, Sec. 3, and who remains in covered status without a break in service, shall accrue leave based on the following schedule:

| Credited Service | Bi-weekly Accrual Hours Minutes (HH:MM) | | --- | --- | | Fewer than 3 years | 4 hours 0 minutes (4:00) | | 3 years but fewer than 9 years | 5 hours 33 minutes (5:33) | | 9 years or more | 6 hours 29 minutes (6:29) |

b.c. Except as provided in subsection (B)(1)(d), uncovered employees shall accrue leave based on the following schedule:

| Credited Service | Bi-weekly Accrual Hours Minutes (HH:MM) | | --- | --- | | Fewer than 3 years | 4 hours 0 minutes (4:00) | | 3 years but fewer than 9 years | 5 hours 33 minutes (5:33) | | 9 years or more | 6 hours 29 minutes (6:29) |

c.d. An uncovered employee shall accrue annual leave at the rate of 6 hours 29 minutes (6:29) bi-weekly if:

i. The employee's hire date is prior to September 29, 2012, the employee has remained employed without a break in service since that date, and the employee either was uncovered prior to September 29, 2012 or became uncovered in accordance with A.R.S. Title 41, Chapter 4, Article 4; or

ii. The employee is in a position listed in A.R.S. § 41-742(F).

2. Temporary employees shall not accrue annual leave.

Part-time employees who:

a. Work 1/4 time, 1/2 time, or 3/4 time shall accrue a proportional amount of annual leave;

b. Work a percentage of full-time other than 1/4 time, 1/2 time, or 3/4 time shall accrue annual leave at the next lower rate;

c. Work less than 1/4 time shall not accrue annual leave.

4. Except as provided by R2-5A-D602 for an employee on industrial leave, an eligible employee accrues annual leave each biweekly pay period if the employee is in pay status for at least one-half of the employee's scheduled work hours in that pay period.

5. An annual leave accrual is credited on the last day of the bi-weekly pay period in which the accrual is earned and is available for use on the first day of the following pay period.

a. Annual leave accrued during the last pay period that begins in a calendar year is not subject to forfeiture under subsection (D).

b. An employee who is separating from state employment is compensated in accordance with subsection (I) for annual leave accrued through the employee's last date of employment.

6. The effective date for change in the accrual rate is the first day of the pay period immediately following the attainment of the required credited service.

C. Credited service.

1. Credited service shall be calculated from the first day of the first complete pay period worked.

2. Credited service shall include:

a. A period of service as an employee of a state budget unit before a break in service of less than two years;

b. A period of leave without pay of 240 hours or less;

c. Family and Medical Leave Act (FMLA) leave;

d. Military leave taken under A.R.S. §§ 26-168, 26-171, or 38-610; and

e. Active military service of an employee who is restored to state employment under A.R.S. § 38-298.

D. Accumulation.

1. Except as provided in subsections (D)(2) and (3), an employee shall forfeit annual leave in excess of the accumulation limit as of the last day of the last pay period that begins in a calendar year. The accumulation limit is:

a. Except as provided in subsection (D)(1)(c), 240 hours for a covered employee.

b. 320 hours for an uncovered employee.

c. 320 hours for an employee of the Arizona Department of Corrections who was employed before September 14, 2024, as an uncovered Correctional Captain, Correctional Lieutenant, Correctional Sergeant, Correctional Corporal, Correctional Officer IV, Community Corrections Unit Supervisor or Community Corrections Group Supervisor and became covered on September 14, 2024, as amended by Laws 2024, Ch. 249, Sec. 3, and who remains in covered status without a break in service.

2. An agency head may request an exception to the accumulation limit contained in subsection (D)(1) for an employee in an individual case.

a. An agency head seeking an exception shall submit a written request to the Director that contains a plan to use the excess hours during the following calendar year, pay the employee for the excess hours, or a combination of both.

b. The Director may approve, modify, or deny the request.

3. Annual leave earned for working on a day on which a state holiday is observed is not included in the accumulation limit specified in subsection (D)(1) and shall not be forfeited.

E. Use of annual leave.

1. An employee may take annual leave at any time approved by the agency head.

2. An agency head shall not advance annual leave to an employee.

F. Donation of annual leave.

1. Definitions. For the purposes of this subsection:

a. "Immediate family" means the recipient employee's parent, spouse, or child, whether natural, adopted, foster, or step. A.R.S. § 41-748(B)(1)

b. "Family" means spouse, natural child, adopted child, foster child, stepchild, natural parent, stepparent, adoptive parent, grandparent, grandchild, brother, sister, sister-in-law, brother-in-law, son-in-law, daughter-in-law, mother-in-law, father-in-law, aunt, uncle, nephew, or niece. A.R.S. § 41-748(B)(2)

c. "Disability that is caused by pregnancy or childbirth" means, as certified by a licensed health care practitioner:

i. An employee is unable to work due to the employee's pregnancy, childbirth, or medical care associated with the pregnancy or childbirth; or

ii. A member of the employee's immediate family requires assistance to perform regular daily activities due to the immediate family member's pregnancy, childbirth, or medical care associated with the pregnancy or childbirth.

d. "Extended" means a period of at least three consecutive weeks.

e. "Seriously incapacitating" means a licensed health care practitioner certifies that an illness, injury, or disability that is caused by pregnancy or childbirth:

i. Involves in-patient care, or

ii. Involves continuing treatment.

Eligibility to receive donation of annual leave. An employee who has exhausted all available leave balances is eligible to receive donations of annual leave if, as certified by a licensed health care practitioner:

a. The employee is unable to work due to:

i. A seriously incapacitating and extended illness or injury, or

ii. A seriously incapacitating and extended disability that is caused by pregnancy or childbirth, or

b. The employee needs to care for a member of the employee's immediate family who has:

i. A seriously incapacitating and extended illness or injury, or

ii. A seriously incapacitating and extended disability that is caused by pregnancy or childbirth.

3. Eligibility to donate annual leave. An employee may donate annual leave to another employee who has exhausted all available leave balances if:

a. The recipient employee is employed in the same state agency as the donating employee, or

b. The recipient employee is a family member of the donating employee and employed in another state agency.

4. Exhaustion of available leave. Before using donated annual leave, a recipient employee:

a. Who has a qualifying illness, injury, or disability caused by pregnancy or childbirth shall exhaust all available sick leave, compensatory leave, annual leave earned for working on a day on which a state holiday is observed and accrued annual leave; or

b. Whose immediate family member has a qualifying illness, injury, or disability caused by pregnancy or childbirth shall exhaust sick leave granted in accordance with R2-5A-B603(A)(4), if available, and all available compensatory leave, annual leave earned for working on a day on which a state holiday is observed and accrued annual leave.

5. Calculation of annual leave donated. An agency head shall adjust the number of hours of annual leave donated in proportion to the hourly rate of pay of the donating employee and the recipient employee. To calculate the number of hours of donated annual leave:

a. Multiply the actual number of hours donated by the donating employee's hourly rate of pay,

b. Divide the result by the recipient employee's hourly rate of pay, and

c. If the calculation results in a decimal, convert the decimal to minutes in accordance with the procedures established by the Director.

6. Maximum duration. A recipient employee is limited to using donated annual leave to allow the employee to be absent from work for a maximum of six consecutive months, or if the leave is intermittent, 1040 hours (the employee's available leave plus leave donated to the employee) for each qualifying occurrence. If the recipient employee has a seriously incapacitating and extended illness or injury, or a seriously incapacitating and extended disability that is caused by pregnancy or childbirth and the employee applies for Long-term Disability (LTD) by the end of the fifth month of the employee's leave, the recipient employee may continue to use donated annual leave for up to 60 additional days or until LTD benefit payments begin, whichever is sooner.

7. Unused donated leave. If the recipient employee separates from state employment, recovers before using all donated leave, attains the maximum donation of annual leave as permitted under subsection (F)(6), or the need for the donated annual leave is otherwise abated, the agency head shall return unused donated leave to employees who donated leave on a pro-rata basis.

G. Payment of annual leave. Subject to funding availability:

1. An agency head may pay an employee at any time at the employee's current rate of pay for all or any portion of the employee's annual leave that was earned as the result of working on a day on which a state holiday is observed.

2. An agency head may approve pay to a non-separating employee for all or any portion of the employee's accumulated and unused annual leave at the employee's current rate of pay subject to the following:

a. Agency procedures. Before paying an employee under this subsection, an agency head shall develop written standards and procedures that provide for equal consideration of all employees similarly situated. The agency head shall submit proposed standards and procedures and any subsequent changes to the Director for approval. The agency's procedures shall include at minimum:

i. Request and approval procedures;

ii. Documentation required to support the request for payment;

iii. Any limitations, as applicable, including, but not limited to: the maximum number of times an employee may receive payment under this subsection; the maximum number of hours an employee may be paid per occurrence; the minimum number of hours of annual leave an employee must have used in the previous 12 months; and the minimum balance an employee is required to maintain after payout, if any.

b. Restrictions. The agency head shall obtain the employee's concurrence if the payment would reduce the employee's annual leave balance to fewer than:

i. 240 hours for a covered employee;

ii. 320 hours for an uncovered employee.

H. Movement.

1. To another state agency. If an employee moves from one agency to another state agency, the employee's accumulated and unused annual leave shall be transferred to the employee's annual leave account in the new state agency, unless:

a. The provisions of subsection (H)(2) apply; or

b. The employee's leave exceeds the accumulation limit contained in subsection (D)(1). An agency head may pay an employee who transfers to another state agency for all excess annual leave at the time of the transfer. An agency head may transfer part or all of the employee's excess annual leave accumulated by the employee who transfers to another agency with the gaining agency's concurrence. If the gaining agency does not concur, the losing agency shall pay all of the unused excess annual leave that the gaining agency will not accept.

2. To an employment status ineligible for leave accrual. If an employee becomes ineligible for accrual of annual leave under R2-5A-A601(B), the agency head or the agency head of the losing agency if the employee moves to another state agency, shall pay the employee for all unused and unforfeited annual leave at the employee's current rate of pay immediately before the change in status.

I. Separation. An agency head shall pay an employee who separates from state employment for all unused and unforfeited annual leave at the employee's current rate of pay.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by exempt rulemaking at 19 A.A.R. 717 effective April 13, 2013 (Supp. 13-1). Amended by final rulemaking at 31 A.A.R. 1939, effective 6/4/2025.

Ariz. Admin. Code § R2-5A-B603 Sick Leave

A. Definition. "Sick leave" is any approved period of paid absence granted an employee due to:

1. Illness or injury that renders the employee unable to perform the duties of the employee's position.

2. Disability of the employee that is caused by pregnancy, childbirth, miscarriage, or abortion.

3. Examination or treatment of the employee by a licensed health care practitioner.

4. Illness, injury, disability caused by pregnancy or childbirth, or examination or treatment by a licensed health care practitioner of an employee's spouse, dependent child, or parent. Sick leave granted for this purpose shall be charged to the employee's sick leave account and shall not exceed 40 hours per calendar year. For the purposes of this Section:

a. The term "dependent child" means a natural child, an adopted child, a foster child, or a stepchild, more than one-half of whose support is received from the employee.

b. The term "parent" means a birth parent, adoptive parent, stepparent, foster parent, grandparent, parent-in-law, or an individual who stood "in loco parentis."

5. Attendance at court-related proceedings by the employee under A.R.S. § 8-420 or A.R.S. § 13-4439.

B. Accrual.

1. All state employees, except temporary and part-time employees, shall accrue sick leave at the rate of 3 hours 42 minutes (3:42) bi-weekly.

2. Temporary employees shall not accrue sick leave.

3. Part-time employees who:

a. Work 1/4 time, 1/2 time, or 3/4 time shall accrue a proportional amount of sick leave;

b. Work a percentage of full-time other than 1/4 time, 1/2 time, or 3/4 time will accrue sick leave at the next lower rate;

c. Work less than 1/4 time shall not accrue sick leave.

4. Except as provided by R2-5A-D602 for an employee on industrial leave, an eligible employee accrues sick leave each bi-weekly pay period if the employee has been in a pay status for at least one-half of the employee's scheduled work hours in that pay period or month.

5. A sick leave accrual is credited on the last day of the bi-weekly pay period or month in which the accrual is earned and is available for use on the first day of the following pay period or month. An employee who is separating from state employment accrues leave through the employee's last date of employment for the purpose of determining the employee's accumulated sick leave at the time of the employee's separation pursuant to subsection (F).

C. Accumulation. Sick leave accumulates without limit.

D. Use of sick leave.

1. Sick leave may be taken when approved by the agency head.

2. The agency head may require submission of evidence substantiating the need for sick leave. If the agency head determines the evidence is inadequate, the absence shall be charged to another category of leave or considered absence without leave.

3. An agency head may require an employee to be examined by a licensed health care practitioner designated by the agency head.

a. If the licensed health care practitioner determines that the employee should not work due to illness or injury, the agency head may place the employee on sick leave or, if the employee's sick leave is exhausted, charge the absence to another category of leave or leave without pay.

b. The agency head may require the employee to obtain approval from the licensed health care practitioner before returning to work.

c. The agency shall pay for all examinations required pursuant to this subsection. The employee shall not be charged any leave while participating in or traveling to or from any examination required pursuant to this subsection.

E. Movement to another state agency. An employee who moves to another state agency shall transfer all accumulated and unused sick leave to the employee's sick leave account in the new state agency.

F. Separation. All sick leave credits are forfeited upon separation from state employment except as provided in A.R.S. § 38-615 or otherwise provided by law. However, an employee who returns to state employment within two years after separation shall be credited with all unused sick leave accumulated at the time of separation if the employee was not paid for accumulated sick leave pursuant to A.R.S. § 38-615.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by final rulemaking at 30 A.A.R. 2765, effective 10/12/2024. Amended by final rulemaking at 31 A.A.R. 1939, effective 6/4/2025.

Ariz. Admin. Code § R2-5A-B604 Administrative Leave

A. General. An agency head may authorize an employee to be absent with pay on administrative leave during a state of emergency declared by the Governor or:

1. In other emergency situations such as extreme weather conditions, fire, flood, or malfunction of publicly-owned or controlled machinery or equipment.

2. To relieve an employee of duties temporarily during the investigation of alleged wrongdoing by the employee or during a disciplinary or dismiss al process, subject to the requirements outlined in subsections (B) and (C).

B. Reporting administrative leave. If an employee's administrative leave totals 80 consecutive hours, the agency head shall submit a report to the Director and for each week thereafter, until the employee's administrative leave is terminated. The report shall include:

1. The name of the agency,

2. The employee identification number (EIN) of the employee,

3. The name of the employee,

4. The employment status of the employee,

5. The date the employee was placed on administrative leave,

6. The number of hours the employee has been on administrative leave as of the date of the report, and

7. A brief description as to why the employee is on administrative leave.

C. Approval of Director. If an employee's administrative leave is anticipated to exceed 240 consecutive working hours, the agency head shall obtain the approval of the Director.

1. An agency head requesting approval to continue an employee's administrative leave for more than 240 working hours shall submit a request to the Director for approval at least five business days before the employee's administrative leave will total 240 working hours. If circumstances beyond the agency's control do not permit at least five business days' notice, the agency head shall submit the request as soon as the agency head is aware of the necessity for the request. The request shall include all of the information listed in subsection (B), the reason the administrative leave will extend beyond 240 working hours and the anticipated date the administrative leave will be terminated.

2. The Director shall review the request and approve, modify or deny the request within three business days of receipt.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by exempt rulemaking at 19 A.A.R. 717 effective April 13, 2013 (Supp. 13-1).

Ariz. Admin. Code § R2-5A-B605 Bereavement Leave

A. General. An employee may be absent with pay due to the death or funeral of a spouse, natural child, adopted child, foster child, stepchild, natural parent, stepparent, adoptive parent, an individual who stood "in loco parentis," grandparent, grandchild, brother, sister, brother-in-law, sister-in-law, mother-in-law, father-in-law, son-in-law, or daughter-in-law.

B. Amount of bereavement leave.

1. A full-time employee may be absent with pay for up to 24 regularly scheduled work hours. An agency head may extend the bereavement leave for up to 16 additional work hours if the employee travels out-of-state for the funeral.

2. A part-time employee who works 1/4 time, 1/2 time, or 3/4 time may be absent with pay for a proportional amount of bereavement leave. A part-time employee who works a percentage of full-time other than 1/4 time, 1/2 time, or 3/4 time may be absent with pay at the next lower rate. An employee who works less than 1/4 time is not entitled to bereavement leave.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5A-B606 Civic Duty Leave

A. General. Upon substantiated application, an employee shall receive absence with pay as civic duty leave while serving as a juror, complying with a subpoena, voting, serving as a voting location worker, or serving as a member of a governmental board, commission, or similarly constituted governmental body, subject to the conditions set forth in this rule and the limitations in R2-5A-A601(B).

B. Use of civic duty leave. Except for voting pursuant to A.R.S. § 16-401 (primary elections) or A.R.S. § 16-402 (general elections), an employee granted civic duty leave shall report for duty with the employing agency whenever the employee's presence is not required for the civic duty, unless:

1. The distance to the work location would preclude timely reporting for the civic duty, or

2. The employee cannot return to work at least one hour before the end of the work shift.

C. Appearance as a witness. An employee who is subpoenaed as a witness by any court or administrative, executive, or judicial body in this state may be absent with pay unless the testimony or evidence to be given relates to the employee's commercial, business, or personal matters.

D. Jury and witness fees. Employees who are granted civic duty leave when called for jury duty or subpoenaed as a witness shall remit any fees to the employing agency, except for mileage allowance.

E. Membership on a public service body. An employee serving as a member of a governmental board, commission, or similarly constituted governmental body may be absent with pay while performing official duties with the body.

F. Serving as a voting location worker. Subject to the guidelines established by the Director and following written approval from the employee's supervisor, an employee may be absent with pay during a statewide election in this State for the purpose of serving at a voting location and completing the required associated training. An employee who is granted civic duty leave for serving as a voting location worker shall remit to the employing agency any fees paid by the county administering the election for work performed while the employee is on civic duty leave.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by final rulemaking at 30 A.A.R. 2765, effective 10/12/2024.

Ariz. Admin. Code § R2-5A-B607 Compensatory Leave

A. General. Compensatory leave is leave that has been earned by an employee under the provisions of R2-5A-404.

B. Use of compensatory leave. An agency head:

1. Shall approve an employee's request for earned compensatory time off within a reasonable time after the employee makes the request if the use of such time off would not unduly disrupt agency operations.

2. May require an employee to use the employee's available compensatory leave during a period specified by the agency head.

C. Payment. Subject to funding availability, an agency head may pay an employee at any time for all or any portion of the employee's earned compensatory leave balance at the employee's regular rate of pay.

D. Movement.

1. To another state agency. An agency head may pay an employee who transfers to another state agency for all unused compensatory leave at the time of the transfer. An agency head may transfer part or all of the compensatory leave earned by an employee who transfers to another agency with the gaining agency's concurrence. If the gaining agency does not concur, the losing agency shall pay all of the unused compensatory leave that the gaining agency will not accept.

2. To an employment status or a position ineligible for compensatory leave. If an employee has a change in employment status or position that results in the employee being ineligible to earn compensatory leave, the agency head or the agency head of the losing agency if the employee moves to another state agency, shall pay the employee for all unused compensatory leave at the employee's regular rate of pay immediately before the employee's change in status or position.

E. Separation. An agency head shall pay an employee who separates from state employment for all unused compensatory leave at a rate of compensation not less than the higher of:

1. The average regular rate received by such employee during the last three years of the employee's employment, or

2. The final regular rate received by such employee.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5A-B608 Educational Leave

A. General. An employee may be sent with pay to participate in a formal educational or training course of study at a college, university, or technical school with the approval of the agency head and the Director, based on the determination that the leave is in the best interest of the state.

B. Application. The approved application shall be accompanied by a written agreement signed by the agency head and the employee containing the following provisions at a minimum:

1. A statement of the payments, if any, to be provided to the employee and the manner of their payment.

2. An agreement by the employee to return to or continue in state employment upon the completion of the educational or training course of study for a period of time specified by the agency head.

3. A statement by the employee that failure to successfully complete the course, to complete the specified state employment, or to fulfill all of the terms of the agreement, shall result in the employee's being required to repay all or a proportionate part of the salary and other payments received, if any.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5A-B609 Living Donor Leave

An employee who requests absence with pay for living donor leave under A.R.S. § 41-706 shall submit written verification that the employee is to serve as a donor. An employee may be absent with pay for the time specified for the following purposes:

1. Up to 40 working hours to serve as a bone marrow donor.

2. Up to 240 working hours to serve as an organ donor.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5A-B610 Leave for National Disaster Medical System (NDMS) Training

An employee who requests absence with pay on national disaster medical system leave under A.R.S. § 38-610 is entitled to be absent with pay for the number of hours regularly scheduled to work on all days the employee is on training duty.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5A-B611 Meritorious Service Leave

A. The Director shall establish guidelines for meritorious service leave.

B. Except for employees in covered positions in the Arizona Department of Corrections, or positions that require full authority peace officer certification, meritorious service leave is only available to uncovered employees.

C. The guidelines established by the Director shall include at a minimum:

1. The maximum number of hours of meritorious service leave that may be awarded to an employee per calendar year;

2. The maximum percentage of agency employees eligible for meritorious service leave;

3. A requirement that an employee shall use meritorious service leave within 12 months of receipt of the leave;

4. A requirement that if the employee does not use the meritorious service leave within 12 months of receipt, that the leave is forfeited; and

5. A statement that unused meritorious service leave is forfeited upon separation from state employment.

D. Subject to the guidelines established by the Director, a meritorious service leave program may be implemented at the discretion of the agency head.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by final rulemaking at 30 A.A.R. 2765, effective 10/12/2024. Amended by final rulemaking at 31 A.A.R. 1939, effective 6/4/2025.

Part C UNPAID LEAVE

Ariz. Admin. Code § R2-5A-C602 Leave without Pay

A. Approval. All leave without pay requires a written request by an employee in advance, including the reason for the employee's request, and approval by the agency head.

B. Use of leave. Except for military leave, an agency head shall not grant leave without pay in excess of 80 consecutive hours until all annual leave earned for working on a day on which a state holiday is observed, all accrued annual leave and, if the leave without pay is for medical reasons, sick leave are exhausted.

C. Return to work.

1. An employee who returns to work after an authorized period of leave without pay of 80 consecutive hours or less shall return to the same position occupied at the start of the leave without pay.

2. Except as provided in subsection (C)(4), an employee who returns to work after a period of leave without pay in excess of 80 consecutive hours may return to a position in the class held at the start of the leave without pay, if a position is available and funded, and if the leave without pay is terminated in one of the following ways:

a. Expiration of its term and the employee's return to work;

b. Rescission of the leave without pay by the agency head before its scheduled expiration due to an unforeseen need that results in an insufficient number of employees available to provide service and for which:

i. The agency head provides written notice of the rescission to the employee's last known address at least 15 days before the date the employee is directed to return to work; or

ii. If circumstances beyond the agency's control do not permit at least a 15-day notice, the agency head provides notice as soon as possible after becoming aware of the need for the employee to return to work; or

c. Curtailment of the leave without pay before its scheduled expiration date upon request of the employee and with approval of the agency head.

3. An agency head may consider the failure or inability of an employee to return to work on the first work day after an approved leave without pay as a resignation.

4. An employee returning to work from leave without pay granted:

a. For industrial illness or injury for up to six months shall return to the position occupied at the start of the leave without pay. If this position or a position in the same class is not available and funded, the agency head shall conduct a layoff or, if the employee is covered, a reduction in force in accordance with Subchapter B.

b. As military leave is subject to the provisions of the USERRA regulations incorporated by reference in R2-5A-D603.

c. As FMLA leave is subject to the provisions of the FMLA regulations incorporated by reference in R2-5A-D601.

D. Insurance benefits continuation. An employee who is on leave without pay may continue to participate in the employee insurance plans as follows:

Health benefit plan participation.

a. An employee who is on FMLA leave is eligible to continue to participate in the health benefit plan for the duration of the FMLA leave by paying the employee premium/contribution. An agency head may recover the state's portion of premium/contributions paid to maintain health coverage for an employee if the employee fails to return from FMLA leave under certain circumstances, in accordance with FMLA regulations incorporated by reference in R2-5A-D601.

b. An employee who is on leave without pay for a health-related reason that is not an industrial illness or injury and who either does not meet FMLA eligibility requirements or has exhausted FMLA leave and remains absent from work may continue to participate in the health benefit plan by paying both the state and employee premium/contribution. Authority to continue participation in the health benefit plan shall terminate on the earliest of:

i. Receipt of long-term disability benefits for which there is eligibility to continue health benefit plan participation under a state-sponsored retirement plan,

ii. A determination of eligibility for Medicare coverage, or

iii. 30 months after the incapacity began.

c. An employee who is on leave without pay for reasons other than those outlined in subsection (D)(1)(a), (b), or R2-5A-D602 pertaining to industrial leave, may continue to participate in the health benefit plan for a maximum of six months by paying both the state and employee premiums/contributions.

2. Life insurance plan participation.

a. An employee who is on FMLA leave continues to participate in the Basic Life and Accidental Death and Dismemberment Insurance Plan and may continue to participate in the supplemental life and dependent life insurance coverage by paying the full premium/contribution.

b. An employee who is on leave without pay for a health-related reason that is not an industrial illness or injury and who either does not meet FMLA eligibility requirements or has exhausted FMLA leave and remains absent from work may continue to participate in the basic life insurance plan by paying the state premium/contribution. An employee who elects to continue to participate in the basic plan may also continue any supplemental or dependent life coverage that is in force at the beginning of the leave without pay by continuing to pay the premium/contribution. Authority to continue in the life insurance plan shall terminate in accordance with the time limits specified in subsection (D)(1)(b).

c. An employee who is on leave without pay for reasons other than those outlined in subsection (D)(1)(a), (b), or R2-5A-D602 pertaining to industrial leave, may continue to participate in the basic life insurance plan by paying the state premium/contribution. An employee who elects to continue to participate in the basic plan may also continue any supplemental or dependent life coverage that is in force at the beginning of the leave without pay by continuing to pay the premium/contribution. Authority to continue in the life insurance plan shall be available for a maximum of six months.

3. Termination of insurance. The insurance coverage of an individual on leave without pay who fails to pay insurance premiums/contributions when due shall terminate at 11:59 p.m. on the last day of the period covered by the last premium/contribution paid.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Part D LEAVE THAT COULD BE PAID OR UNPAID

Ariz. Admin. Code § R2-5A-D601 Family and Medical Leave Act (FMLA) Leave

A. General. All state agencies are responsible for complying with the federal Family and Medical Leave Act (FMLA) of 1993 and all applicable revisions. FMLA Regulations, 29 CFR 825.100 through 29 CFR 825.800 (July 2012), are incorporated by this reference and on file with the Department and available from the U.S. Government Printing Office, 732 North Capitol Street N.W., Washington, D.C. 20401. This incorporation by reference contains no future editions or amendments. Any interference with, restraint of, or denial of an employee's rights provided by the FMLA is strictly prohibited.

B. Eligible employee.

1. An eligible employee for the purposes of the FMLA is an employee who:

a. Is an employee of the state of Arizona;

b. Has been employed by the state of Arizona for at least 12 months; and

c. Worked for at least 1,250 hours of service during the 12 months immediately preceding commencement of the leave.

2. An agency head shall not extend FMLA benefits to an ineligible employee.

C. Situations covered by the FMLA. A state agency shall grant an eligible employee FMLA leave when the employee takes leave for one or more of the following reasons:

1. The birth of a child or placement of a child with the employee for adoption or foster care, provided the leave concludes within 12 months of the birth or placement.

2. To care for the employee's spouse, child or parent with a serious health condition.

3. The employee is unable to work because of the employee's own serious health condition.

Any qualifying exigency arising out of the fact that the employee's spouse, child or parent is a covered military member on active duty or call to active duty status in support of a contingency operation.

5. To care for a covered service member with a serious injury or illness when the covered service member is the employee's spouse, child, parent or next of kin.

D. Amount of FMLA leave.

1. An employee who takes FMLA leave for any of the situations described in subsections (C)(1), (2), (3) or (4) may take a maximum of 12 workweeks of leave during any rolling 12-month period, measured backward from the first day of each approved period of FMLA leave.

2. An employee who takes FMLA leave for the situation described in subsection (C)(5) may take up to 26 workweeks of leave in a single 12-month period.

3. During a 12-month period, an eligible employee is able to take no more than 12 workweeks of FMLA leave for any of the situations described in subsections (C)(1), (2), (3) or (4) and a combined total of 26 workweeks of FMLA leave if the leave includes the situation described in subsection (C)(5).

4. If a husband and wife are both state employees, the husband and wife are limited in the amount of FMLA leave taken to a combined total of:

a. 12 workweeks of leave for the birth and care of a newborn child, placement of a child for adoption or foster care, or to care for a parent who has a serious health condition.

b. 26 workweeks of leave to care for a covered service member with a serious injury or illness.

E. Designation of FMLA leave. An employee need not specifically request FMLA leave to be placed on FMLA leave. If an eligible employee takes leave for any reason covered by the FMLA and has not already exhausted the employee's available FMLA leave, the agency head shall designate the employee's leave as FMLA leave.

F. Use of paid leave. Except for portions of industrial leave, an employee on FMLA leave shall be required to use the employee's available paid leave while on FMLA leave as follows and in the following order:

Sick leave or, as applicable, family sick leave subject to the provisions of R2-5A-B603.

2. Compensatory leave subject to the provisions of R2-5A-B607.

3. Annual leave subject to the provisions of R2-5A-B602.

4. Leave without pay subject to the provisions of R2-5A-C602.

G. Insurance benefits continuation. An employee who is using leave with pay remains eligible for continued participation in the employee insurance plans and the employee's share of premiums/contributions is paid through payroll deduction. An employee who is on leave without pay while on FMLA leave may continue to participate in the employee insurance plans as follows:

1. Health benefit plan participation. An employee is eligible to continue to participate in the health benefit plan for the duration of the FMLA leave by paying the employee premium/contribution. An agency head may recover the state's portion of premium/ contributions paid to maintain health coverage for an employee if the employee fails to return from FMLA leave under certain circumstances, in accordance with FMLA regulations incorporated by reference in subsection (A).

2. Life insurance plan participation. An employee continues to participate in the Basic Life and Accidental Death and Dismemberment Insurance Plan and may continue to participate in the supplemental life and dependent life insurance coverage by paying the full premium/contribution.

3. Termination of insurance. The insurance coverage of an employee on leave without pay who fails to pay insurance premiums/ contributions when due shall terminate at 11:59 p.m. on the last day of the period covered by the last premium/contribution paid.

H Return from FMLA leave. An agency head shall restore an employee returning from FMLA leave to the employee's original job, or to an equivalent job with equivalent pay, benefits, and other terms and conditions of employment. The provisions of the FMLA, not the provisions of R2-5A-C602(C), shall govern return to work from leave without pay granted to complete an FMLA-qualified leave.

I. Employee responsibilities. An employee is required to adhere to the employing agency's call-in procedures, give the agency 30 days' notice in the event of a foreseeable leave, provide requested documentation, and periodic updates of the employee's status and intent to return to work as requested by the agency.

J. Agency rights. Nothing in the FMLA or this rule should be construed as limiting an agency's right to manage, discipline or terminate an employee, including an employee's failure to comply with the agency's request for appropriate documentation to substantiate the employee's need for the leave. However, an employee's use of FMLA leave cannot be considered as a negative factor in any employment decision.

K. Conflict. If there is a conflict between the provisions of these rules and the FMLA, the provisions of the FMLA govern.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by final rulemaking at 30 A.A.R. 2765, effective 10/12/2024.

Ariz. Admin. Code § R2-5A-D602 Industrial Leave

A. Use of leave.

1. An agency head shall place an employee who sustains a job-related illness or injury that is compensable under the Workers' Compensation Law, A.R.S. Title 23, Chapter 6 on sick leave.

2. If an employee who is on leave under the Worker's Compensation laws meets Family and Medical Leave Act (FMLA) eligibility requirements and the leave qualifies for FMLA leave, an agency head shall count it as FMLA leave. An agency head shall apply industrial leave and FMLA concurrently.

3. An employee shall use leave in an amount necessary to receive total payments (leave payments plus Workers' Compensation payments) that do not exceed the gross salary of the employee.

4. If an employee exhausts all sick leave, compensatory leave and annual leave, an agency head shall place the employee on leave without pay.

B. Payments. If an employee receives a retroactive Workers' Compensation payment for any period of industrial illness or injury for which leave payments were received, the employee shall reimburse the agency for Workers' Compensation payments that exceed 100% of the employee's gross salary before the illness or injury, and the agency head shall restore the equivalent value of leave to the employee's appropriate leave account.

C. Light duty. If an employee has a job-related illness or injury that impairs performance on the former job, the agency head shall make every effort to place the employee in a suitable position within the agency, including a light duty assignment.

D. Restriction. An agency head shall not grant sick leave or leave without pay to an employee who fails to accept compensation available under the industrial injury and disease provisions of A.R.S. §§ 23-901 to 23-1091.

E. Insurance benefits continuation. An employee who is using leave with pay in accordance with subsection (A) remains eligible for continued participation in the employee insurance plans and the employee's share of premiums/contributions is paid through payroll deduction. An employee who is on leave without pay due to an industrial illness or injury may continue to participate in the employee insurance plans as follows:

1. Health benefit plan participation.

a. An employee may continue to participate in the health benefit plan for a maximum of six months from the date of illness or injury by paying the employee premium/contribution.

b. At the end of the six-month period, an employee who remains on leave without pay due to industrial illness or injury may continue to participate in the health benefit plan by paying both the state and employee premiums/contributions, until the employee returns to work or is determined to be eligible for Medicare coverage or Long-term Disability, whichever occurs first.

2. Life insurance plan participation. An employee who is on leave without pay continues to participate in the basic life and accidental death and dismemberment insurance plan without cost for six months after the month in which the illness or injury occurs. During this six-month period, the employee may continue supplemental life and dependent life coverages that were in effect at the start of the leave by paying the applicable premium/contribution.

3. Termination of insurance. The insurance coverage of an employee on leave without pay who fails to pay insurance premiums/ contributions when due shall terminate at 11:59 p.m. on the last day of the period covered by the last premium/contribution paid.

F. Accrual of leave. An employee shall continue to receive full leave accrual as long as the employee uses two or more hours of paid leave each day.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by final rulemaking at 30 A.A.R. 2765, effective 10/12/2024.

Ariz. Admin. Code § R2-5A-D603 Military Leave

An employee who requests absence with pay on military leave under A.R.S. § 26-168, 26-171, or 38-610 shall submit a copy of the orders for duty with the request for military leave. An employee who has not received the orders for duty prior to the start of the military leave shall submit a copy of the orders within five workdays of receipt. An employee may be absent with pay for military purposes for up to three times the average of regularly scheduled work hours in a weekly work period each year and up to six times the average of regularly scheduled work hours in a weekly work period in any two consecutive federal fiscal years. All state agencies are responsible for complying with the federal Uniformed Services Employment and Reemployment Rights Act (USERRA) of 1994 and all applicable revisions. USERRA Regulations, 20 CFR 1002.1 through 20 CFR 1002.314 (April 2012), are incorporated by this reference and on file with the Department and available from the U.S. Government Printing Office, 732 North Capitol Street N.W., Washington, D.C. 20401. This incorporation by reference contains no future editions or amendments.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by final rulemaking at 30 A.A.R. 2765, effective 10/12/2024.

Ariz. Admin. Code § R2-5A-D604 Victim Leave

An employee who is a victim of a juvenile offense or a crime and who requests absence from work to attend court-related proceedings under A.R.S. § 8-420 or 13-4439 shall submit a copy of the form provided to the employee by the law enforcement agency or a copy of the information the law enforcement agency provided to the employee with the request for victim leave. An employee shall use the employee's available sick leave, compensatory leave or annual leave for such absence. If an employee exhausts all sick leave, compensatory leave and annual leave, an agency head shall place the employee on leave without pay.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Subchapter B COVERED EMPLOYEES

Article 1 GENERAL

Ariz. Admin. Code § R2-5B-101 Definitions

In addition to the definitions provided in Subchapter A of this Chapter, the following definitions apply to this Subchapter:

"Limited appointment employee" means an employee who, before September 29, 2012, was subject to the provisions of A.R.S. Title 41, Chapter 4, Articles 5 and 6 that were in effect before September 29, 2012, was appointed to a position that was based on the duration of funding, and was not eligible to acquire reduction in force rights.

"Original probationary period" means the specified period following initial appointment to covered service. A.R.S. § 41-741(10)

"Permanent status" means the standing a covered employee achieves after the completion of an original probation or a promotional probation.

"Probationary period" means a working test period of employment in a covered service position for evaluation of the employee's work. A.R.S. § 41-741(11)

"Promotional probation" means the specified period of employment following promotion of a permanent status employee to another covered position that has a higher pay grade. A.R.S. § 41-741(12)

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5B-102 Applicability

A. The rules in this Subchapter are applicable to covered positions, applicants for covered positions and covered employees in the State Personnel System.

B. Covered service is limited to the following:

1. An employee who was in the state service as either a probationary or permanent status employee, was not required to become at will uncovered in accordance with A.R.S. Title 41, Chapter 4, Article 4, and who does not:

a. Voluntarily elect to become uncovered at will.

b. Voluntarily accept a change in assignment to a position in the uncovered service.

c. Have a break in service.

2. An employee of the Arizona Department of Corrections who was employed before September 14, 2024, as an uncovered Correctional Captain, Correctional Lieutenant, Correctional Sergeant, Correctional Corporal, Correctional Officer IV, Community Corrections Unit Supervisor or Community Corrections Group Supervisor and became covered on September 14, 2024, as amended by Laws 2024, Ch. 249.

2.3. A newly hired employee who is appointed or a current uncovered employee who voluntarily accepts a change in assignment to:

a. A covered position in the Arizona Department of Corrections; or

b. A position in any state agency that requires certification as a full authority peace officer by the Arizona Peace Officer Standards and Training Board, provided the position is not in the uncovered service.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by exempt rulemaking at 19 A.A.R. 717 effective April 13, 2013 (Supp. 13-1). Amended by final rulemaking at 31 A.A.R. 1939, effective 6/4/2025.

Article 2 EMPLOYMENT STATUS

Ariz. Admin. Code § R2-5B-201 Applicability

The rules under this Article are applicable only to positions in the covered service and covered employees.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5B-202 Original Probation

A. General. A new employee hired into a position in the covered service shall serve an original probation period of one year.

B. Extension of probation.

1. An agency head may extend an employee's original probation up to six additional months for employment-related reasons.

2. The probationary period shall be extended for any period for which a probationary employee is on leave without pay for more than 80 consecutive working hours. If original probation is extended for this reason, the employee's probation may exceed 18 months.

C. Completion of original probation.

1. In accordance with the rules in Subchapter 5A, Article 7, a supervisor shall evaluate an original probationary employee and submit a report to the agency head before expiration of the employee's probationary period. If the agency head takes no action to extend the probationary period or to terminate the employee, the agency head shall grant permanent status to the employee upon completion of the probationary period.

2. If an agency head determines at any time during an original probationary period that the services of a probationary employee are no longer required in that position for any reason or for no reason, the agency head may:

a. Dismiss the employee without a stated reason and without the right of appeal, providing the employee a letter of dismissal; or

b. Offer the employee another position for which the employee possesses the qualifications. An employee who accepts a position that is not in the covered service is an at will uncovered employee.

D. Change in position. An original probation employee who is selected for another position in the covered service shall serve an original probation period in the new position.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5B-203 Promotional Probation

A. General. A permanent-status employee who is promoted to a position in the covered service shall serve a promotional probation period of six months.

B. Extension of probation.

1. An agency head may extend an employee's promotional probation up to six additional months for employment-related reasons.

2. The probationary period shall be extended for any period for which a probationary employee is on leave without pay for more than 80 consecutive working hours. If promotional probation is extended for this reason, the employee's probation may exceed one year.

C. Completion of promotional probation.

1. In accordance with the rules in Subchapter 5A, Article 7, a supervisor shall evaluate a promotional probationary employee and submit a report to the agency head before expiration of the employee's probationary period. If the agency head takes no action to extend the probationary period, to revert or separate the employee, or offer the employee another position, the agency head shall grant permanent status to the employee upon completion of the probationary period.

2. If an employee fails to complete a promotional probation successfully the agency head may revert the employee in the current employing agency to:

a. A vacant position in the class in which the employee held permanent status immediately before promotion, or

b. A similar position in another class at the same grade as the class that the employee holds permanent status if the employee possesses the qualifications for that position.

D. Discipline. Neither subsection (C)(2)(a) nor (b) shall preclude the imposition of disciplinary action.

E. Failure to complete promotional probation. An employee who is reverted shall not have the right to appeal.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5B-204 Permanent Status

A covered employee who has successfully completed the employee's probationary period shall attain permanent status in the position.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5B-205 Change from Covered to Uncovered Service

A. Voluntary election. A covered employee may voluntarily elect to become an at will uncovered employee without a change in assignment. Such an election is subject to the approval of the head of the employing agency and the Director. If approved, the effective date of the employee's change to uncovered service shall be the first day of the pay period immediately following the Director's approval.

B. Change in assignment. Except for a special assignment, a covered employee who voluntarily accepts a change in assignment to a position that is not in the covered service, regardless of whether the voluntary change in assignment is a promotion, demotion, or lateral transfer, is an at will uncovered employee. The effective date of the employee's change to uncovered service shall be the same as the effective date of the change in assignment. A special assignment is not a change in assignment.

C. Return to state employment. A covered employee who has a break in service and returns to employment in an agency in the State Personnel System in any capacity shall be an at will uncovered employee, unless the appointment is to a position in the covered service.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by exempt rulemaking at 19 A.A.R. 717 effective April 13, 2013 (Supp. 13-1).

Article 3 DISCIPLINARY ACTIONS

Ariz. Admin. Code § R2-5B-301 General

A. Applicability. The rules under this Article are applicable only to covered employees.

B. Review by Director. Disciplinary actions for covered employees are subject to the review requirements outlined in R2-5A-801(D) and R2-5A-802.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5B-302 Reprimand

A. Authority. An agency head may issue a written reprimand to an employee for cause.

B. Reprimand Procedures. The agency head shall provide the employee with a written statement of the reasons for the reprimand and the employee's grievance rights.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5B-303 Suspension

A. Authority. An agency head may suspend an employee without pay for cause.

B. Limitation. Except as otherwise provided by statute or rule, suspensions shall not exceed a total of 30 working days during any 12-month period. The 12-month period begins with the first day of the first suspension.

C. Pre-suspension procedures for suspensions exceeding 80 working hours. Before an employee with permanent status can be suspended for more than 80 working hours, the agency head shall submit the proposed action to the Director for review as prescribed in R2-5A-802, give the employee written notice of the charges, a summary of the agency head's basis for the charges, and an opportunity for the employee to present a written response. The employee's response shall be made not later than three business days after the employee receives notice of the charges, unless extended in writing by the agency head.

D. Suspension procedures. The agency head shall provide the employee with a written statement of the reasons for the suspension. The statement shall specify the period of suspension and the employee's grievance or appeal rights.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5B-304 Involuntary Demotion

A. Authority. An agency head may involuntarily demote a permanent status employee for cause to any covered position in the employing agency, provided the employee possesses the qualifications for such position.

B. Pre-demotion procedures. Before an employee with permanent status can be involuntarily demoted, the agency head shall submit the proposed action to the Director for review as prescribed in R2-5A-802, give the employee written notice of the charges, a summary of the agency head's basis for the charges, and an opportunity for the employee to present a written response. The employee's response shall be made not later than three business days after the employee receives notice of the charges, unless extended in writing by the agency head.

C. Involuntary demotion procedures. Prior to the effective date of the involuntary demotion, a written notice containing specific reasons for the demotion and the employee's right of appeal shall be provided to the employee and the Director.

D. Probation. Except as otherwise provided in these rules, an employee who is involuntarily demoted shall not be required to serve a probationary period in the position to which demoted.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5B-305 Dismissal

A. Relief from duty. Nothing in this rule shall preclude the agency head from immediately placing an employee on administrative leave pending implementation of procedures under this Section, but no pay shall be withheld for such period.

B. Dismissal during original probation. An employee on original probation may be dismissed without a stated reason and without the right of appeal.

C. Pre-dismissal procedures. Before an employee with permanent status can be dismissed, the agency head shall submit the proposed action to the Director for review as prescribed in R2-5A-802, give the employee written notice of the charges, a summary of the agency head's basis for the charges, and an opportunity for the employee to present a written response. The employee's response shall be made not later than three business days after the employee receives notice of the charges, unless extended in writing by the agency head.

D. Dismissal procedures. The agency head may dismiss an employee with permanent status only for cause but not before attempting to serve the employee personally or by registered or certified mail, return receipt requested (addressee only), with written notice of the specific reasons for dismissal in sufficient detail to inform the employee of the facts, with a copy to the Director. The agency head shall include a statement of the employee's right to appeal.

E. Effective date of dismissal. The dismissal action is not effective until one of the following occurs:

1. The employee signs for receipt of the dismissal letter personally served or served by mail;

2. Three business days have passed since the letter was mailed to the employee; or

3. An attempt is made to personally serve the dismissal letter, but the employee refuses to sign for the letter. Such attempt to personally serve the letter shall be witnessed.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Article 4 GRIEVANCES

Ariz. Admin. Code § R2-5B-401 Applicability

The rules under this Article are applicable only to covered employees.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5B-402 Grievance System

A. General. Each agency that has one or more covered employees shall:

1. Adopt a grievance procedure which will afford each covered employee a systematic means of resolving an employee's disagreement with the receipt of a disciplinary action that is either:

a. A written reprimand, or

b. A suspension of:

i. 40 working hours or less if the employee is a full authority peace officer, or

ii. 80 working hours or less if the employee is a covered employee in any other capacity.

2. Designate an employee of the agency to serve as the agency's grievance coordinator, who shall be responsible for receiving grievances, determining applicability under the grievance system, forwarding the grievance to the appropriate individual within the agency for review or investigation, and tracking the processing of grievances.

B. Non-applicable matters. The adopted grievance procedure shall not apply to any matter for which another method of review is provided, including but not limited to:

1. Retirement, Life Insurance, or Health Insurance;

2. Any classification action;

3. Any recruitment, selection, or appointment;

4. Any compensation action;

5. A disciplinary action that is either:

a. A suspension of:

i. More than 40 working hours if the employee is a full authority peace officer, or

ii. More than 80 working hours if the employee is a covered employee in any other capacity,

b. A demotion, or

c. A dismissal.

6. A complaint alleging discrimination or harassment; or

7. Any reduction in force action.

C. Restrictions. An employee may not submit a grievance challenging the following management rights:

1. An agency head's right to direct agency employees.

2. An agency head's right to hire, promote, transfer, assign, and retain employees.

3. An agency head's right to maintain efficiency of government operations and to determine the methods, means, and personnel by which these operations are to be conducted.

D. Preparation. A grievant shall not be allowed the use of state time or state property to prepare a grievance, prepare for a meeting with agency management or to meet with a representative. Subject to supervisory approval, a grievant may request available compensatory or annual leave for this purpose.

E. Steps. An agency's grievance procedure shall have two steps for review.

1. As determined by the agency head, the first step in the grievance procedure shall be:

a. The employee's second line supervisor,

b. The assistant director or equivalent, or

c. Any level of management between (a) and (b).

2. The final step in the grievance procedure shall be the agency head, or designee.

3. An agency head may choose to incorporate an additional step in the agency grievance procedure after the first step review.

F. Amendments. Once a grievance is submitted to the first step, it may not be amended. If additional documentation is submitted by the grievant after the initiation of the grievance, the reviewing official may remand the grievance to the appropriate previous level for reconsideration.

G. Approval. Each agency head will submit the agency's proposed grievance procedure and any subsequent changes to the Director for approval.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5B-403 Grievance Procedures

Content. The grievance procedure established in each state agency shall include as a minimum:

1. An initial statement that any complaint alleging unlawful discrimination or unlawful harassment will be reviewed or investigated according to the provisions of the separate complaint process outlined in Subchapter A, Article 9, and not the grievance system.

2. A requirement that the grievant have an oral discussion with the individual designated as the first step in the agency's grievance procedure in an attempt to resolve the employee's disagreement with the disciplinary action, prior to initiating the written grievance procedure.

3. A requirement that the employee file the grievance in writing with the agency grievance coordinator, within 10 business days after the occurrence of the action being grieved. The date of occurrence of a:

a. Reprimand is the date the reprimand was issued to the employee.

b. Suspension is the first day of suspension.

4. A requirement that the grievance contain a complete statement of all the facts and circumstances involved and the specific redress sought.

5. A provision that the grievant may select a representative at any step in the procedure after the oral discussion with the immediate supervisor.

6. A requirement that another state employee who serves as the representative of a grievant must receive approval for annual or compensatory leave to represent the grievant.

7. A requirement that the grievant must have a minimum of five business days after receipt of a response to forward the grievance at any step, must sign the grievance at each step, and must state the reasons why the response at the previous step was unsatisfactory.

8. A requirement that the agency head will respond to the grievant not later than 30 business days after receipt of the grievance at the first step. Within the 30 business day period, the time for any step may be extended by the agency head with the concurrence of the grievant.

9. A statement that the decision of the agency head is the final step in the grievance process.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by final rulemaking at 30 A.A.R. 2765, effective 10/12/2024.

Article 5 APPEALS

Ariz. Admin. Code § R2-5B-501 Applicability

The rules under this Article are applicable only to covered employees who have attained permanent status.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5B-502 General

A. Except for an employee who is a full authority peace officer, an employee may file an appeal on the receipt of a disciplinary action that is either:

1. A suspension for more than 80 working hours,

2. An involuntary demotion, or

3. A dismissal.

B. Such appeals shall be filed with the State Personnel Board and in accordance with the rules established by the Board.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5B-503 Full Authority Peace Officers

A. A full authority peace officer may file an appeal on the receipt of a disciplinary action that is either:

1. A suspension for more than 40 working hours,

2. An involuntary demotion, or

3. A dismissal.

B. Such appeals shall be filed with the Law Enforcement Merit System Council and in accordance with the rules established by the Council.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Article 6 REDUCTION IN FORCE

Ariz. Admin. Code § R2-5B-601 Applicability

The rules under this Article are applicable only to covered positions and covered employees.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Ariz. Admin. Code § R2-5B-602 Reduction in Force Procedures

A. General.

1. An agency head shall submit to the Director a proposal to conduct a reduction in force if required for one or more of the following reasons:

a. Lack of funds or work,

b. Abolition of one or more covered positions,

c. Material change in job duties or agency organization, or

d. Introduction of a cost reduction initiative.

2. An agency head shall submit the proposal for a reduction in force at least 30 business days before the proposed effective date of the reduction in force. If circumstances beyond the agency's control do not permit at least 30 business days' notice, the agency head shall submit the proposal as soon as the agency head is aware of the necessity for a reduction in force.

3. An agency head shall include all of the following in the proposal for a reduction in force:

a. The reason for the reduction in force;

b. The proposed scope of the reduction in force, which shall be limited to either:

i. The agency,

ii. An organizational unit of the agency, or

iii. Agency operations within a geographic area,

c. Each specific covered position proposed for elimination and an organization chart identifying each position, and

d. The proposed effective date of the reduction in force.

4. An agency head shall submit a proposal that is consistent with A.R.S. § 41-772 and this Section.

5. An agency head shall not approve a personnel action that would have an effect on the reduction in force after the agency head has submitted a proposal for a reduction in force.

6. An agency head shall not re-establish a position that was abolished as a result of a reduction in force for two years if the position was filled when the reduction in force occurred, unless the position was abolished due to fiscal constraints, legislative action, or court order.

B. Administration of reduction in force. The Director shall review and approve, modify or deny a reduction in force within 20 business days of receipt. Upon approval of the Director to conduct a reduction in force:

1. An agency head shall separate a covered employee who is not a permanent status employee in the class affected by the reduction in force in the following order before any reduction in force action is taken that affects a permanent status employee, provided the separation of the non-permanent status employee will accomplish, or assist in accomplishing, the purpose of the reduction in force:

a. Temporary employee,

b. Original probationary employee, and

c. Limited appointment employee.

2. An agency head shall use retention points to identify a permanent status employee within a class series affected by a reduction in force for retention in the employee's current position, transfer, reduction, or separation based on the employee's relative standing on the retention point list.

3. An agency head shall base retention points upon performance calculated in accordance with the instructions in subsections (C) and (D).

4. An employee on promotional probation or special assignment shall compete for retention in the employee's permanent status class.

5. An employee in an underfill position shall compete for retention in the employee's permanent status class.

6. A permanent part-time employee shall compete for retention against another permanent part-time employee in the same class.

C. Calculation of retention points. An agency head shall compute the average score of a maximum of the three most recent performance evaluations in the 24 months concluded before the date of proposal for a reduction in force. An employee's average score shall be the employee's retention points. If an employee has not had a performance evaluation in the past 24 months, the employee shall receive 2.0 retention points.

D. Resolution of ties. An agency head shall break any tie in total retention points in the following manner and order:

1. The employee with the highest most recent performance evaluation shall be given preference.

2. If a tie continues to exist, the agency head shall break the tie by lot.

E. Offer of position.

1. An agency head shall provide written notice at least five business days in advance to each employee identified for transfer, reduction, or separation. If circumstances beyond the agency's control do not permit at least five business days' notice, the agency head shall provide notice as soon as the agency head is aware of the necessity to transfer, reduce, or separate the employee.

2. The notice shall include:

a. The reason for and effective date of the action;

b. A job offer, if any, including the salary, location of the position, and supervisor's name;

c. The availability of reduction in force procedures and records for review, with references to relevant statutes and rules; and

d. The employee's right to request a review of the determination as provided in R2-5B-603.

3. An agency head shall offer a position to an employee identified for transfer, reduction, or separation with the highest number of points on the retention point list in descending order as follows:

a. If a vacant covered position exists and an employee possesses the required qualifications for the position, an agency head shall make the single best offer, in terms of pay range, within the agency of:

i. A regular position at the same or lower pay range in the same class series as the employee's present permanent status position;

ii. A regular position at the same or lower pay range in any class series in which the employee has held permanent status during the past five years; or

iii. If both positions described in subsections (E)(3)(a)(i) and (ii) are available, the position described in subsection (E)(3)(a)(i).

b. If the offer under subsection (E)(3)(a) is a position at a lower pay range, the agency head shall provide the employee the option of accepting a vacant covered:

i. Funded, regular position at the employee's present pay range in a class series in which the employee has never held permanent status for which the employee is qualified; or

ii. Temporary or part-time position at the employee's present pay range for which the employee is qualified.

4. An employee shall possess the qualifications required when the position was last filled, unless the Director grants an exception.

5. Any job offer shall contain a time period of not less than three business days in which the employee may accept the offer. Failure of an employee to reply in writing within the stated time period, or failure to accept the job offer, shall constitute a resignation. An employee may accept a job offer and retain the right to request a review of the determination.

6. If no position exists, the agency head may separate the employee.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4). Amended by exempt rulemaking at 19 A.A.R. 717 effective April 13, 2013 (Supp. 13-1).

Ariz. Admin. Code § R2-5B-603 Employee Request for Review

A. An employee may request a review of the following determinations made during a reduction in force:

1. Calculation of the employee's retention points,

2. A job offer resulting in the employee's transfer or reduction, and

3. Notification of the employee's separation.

B. Within three business days of receipt of a determination notice, unless a longer period is authorized by an agency head, an employee may submit a written request to the agency head for a review of the determination. The request for review shall be based upon an error, contain specific information concerning the error involved, and include a proposed resolution of the problem.

C. The agency head shall review the request and respond to the employee within five business days after receipt of the request.

D. An agency head may postpone any portion of a reduction in force until completion of an employee request for review.

History

• Section made by exempt rulemaking at 18 A.A.R. 2782, effective September 29, 2012 (Supp. 12-4).

Chapter 6 Department of Administration - Benefit Services Division

Article 1 GENERAL PROVISIONS

Ariz. Admin. Code § R2-6-101 Definitions

In this Chapter, unless otherwise specified:

1. "Accident and health insurance," as used in A.R.S. Title 38, Chapter 4, Article 4, means health insurance and dental insurance.

2. "Agency" means a department, board, office, authority, commission, or other governmental budget unit of the state.

3. "Agency head" means the chief executive officer of an agency.

4. "Appeal" means a request to a plan provider for review of a decision made by the plan provider.

5. "Approved leave" means an employee's or officer's absence from assigned work that is authorized by the employee's or officer's supervisor.

6. "Base pay" means the fixed compensation paid to an employee or officer. Base pay excludes pay for overtime, shift differential, bonuses, special performance adjustment, special incentive program, or other allowance.

7. "Basic life insurance" means the amount of life insurance that the Department provides at no charge to an employee or officer.

8. "Child" means an individual who falls within one or more of the following categories:

a. A natural child, adopted child, stepchild, or foster child of an employee, officer, retiree, or former elected official who is younger than 26;

i. Younger than 19, or

ii. Younger than 25 if a full-time student;

b. A foster child who is younger than 19;

c. b. A child who is younger than 26 for whom the employee, officer, retiree, or former elected official has court-ordered guardianship;

d. c. A child who is younger than 26 and placed in the home of the employee, officer, retiree, or former elected official by court order pending adoption; or

e. d. A natural child, adopted child, stepchild or foster child of an employee, officer, retiree, or former elected official

i. Who was disabled as defined at 42 U.S.C. 1382c before the age of 26;

ii. Who continues to be disabled as defined at 42 U.S.C. 1382c;

iii. Who is dependent for support and maintenance upon the employee, officer, retiree, or former elected official, ; and

iv. For whom the employee, officer, retiree, or former elected official had custody before the child was 26.

9. "COBRA" means Consolidated Omnibus Budget Reconciliation Act of 1986, which is a federal law that provides the opportunity to continue group health insurance cover- age that might otherwise be terminated.

10. "COBRA member" means a former member or formerly eligible dependent of a member or former member who opts to continue health insurance through COBRA after no longer meeting the eligibility standards in Article 3.

11. "Compensation" means the total taxable remuneration provided by the state to an employee or officer in exchange for the employee's or officer's services.

12. "Creditable coverage" has the same meaning as prescribed at 29 U.S.C. 1181.

13. "Day" means a calendar day.

14. "Dental insurance" means an arrangement under which a policy holder makes advance payment to an insurer and the insurer pays amounts on behalf of an insured for certain preventive, diagnostic, and remedial care of the insured's teeth and gums.

15. "Department" means the Arizona Department of Administration.

16. "Director" means the Director of the Department or the Director's designee.

17. "Disability income insurance" means a form of insurance that insures a specified portion of the compensation of an employee or officer against the risk that disability will make working impossible.

18. "Disabled older child" means an older child who:

a. Is disabled, as defined at 42 U.S.C. 423 or 42 U.S.C. 1382c;

b. Became disabled on or after the older child's 19th birthday but before the older child's 25th birthday;

c. Is dependent for support and maintenance upon:

i. The employee, officer, retiree, or former elected official who enrolled the disabled older child in the insurance plan made available by the Department; or

ii. The domestic partner of the employee, officer, retiree, or former elected official; and

d. If the criteria in subsections (18)(a) through (18)(c) are met, may be more than 24 years old.

19. "Domestic partner" means an individual who is of the same or opposite gender to an employee, officer, or retiree and who:

a. Shares a permanent residence with the employee, officer, or retiree;

b. Has resided with the employee, officer, or retiree continuously for the last 12 consecutive months and expects to continue to reside with the employee, officer, or retiree indefinitely as evidenced by an affidavit filed at the time of enrollment;

c. Has not signed a declaration or affidavit of domestic partnership with another individual within the last 12 months;

d. Has not had another domestic partner within the last 12 months;

e. Does not currently have another domestic partner;

f. Is not currently married to or legally separated from anyone;

g. Is not related by blood to the employee, officer, or retiree to a degree that would prohibit marriage in Arizona;

h. Was mentally competent to consent when the domestic partnership was established;

i. Is not acting under fraud or duress with regard to the insurance plans made available by the Department;

j. Is at least 18 years old; and

k. Is financially interdependent with the employee, officer, or retiree in at least three of the following ways:

i. Holds a joint mortgage, joint property tax identification, or joint tenancy on a residential lease;

ii. Holds one or more credit or bank accounts jointly;

iii. Owns significant property, such as a vehicle or real estate, jointly;

iv. Has one or more joint liabilities;

v. Is named by or has named the employee, officer, or retiree as beneficiary of life insurance or under a will or retirement annuity;

vi. Has a written durable power of attorney in which each assumes financial responsibility for the other; or

vii. Other evidence of financial interdependence that is approved by the Director.

20. 18. "Eligible dependent" means a member's spouse or child, who is lawfully present in the U.S.

21. 19. "Employee" for the purposes of eligibility, means an individual who is hired by the state, including the state universities, and who is regularly scheduled to work at least 20 hours per week for at least 90 days, but does not include:

a. A patient or inmate employed at a state institution;

b. A non-state employee, officer, or enlisted personnel of the National Guard of Arizona;

c. A seasonal, temporary, or variable hour employee, unless the employee is determined to have been paid for an average of at least 30 hours per week using a 12-month measurement period;

d. An individual who fills a position designed primarily to provide rehabilitation to the individual;

e. A student or work-study employee; or

f. e. An individual hired by a state university or college for whom the state university or college does not contribute to a state-sponsored retirement plan unless the individual is:

i. A non-immigrant alien employee,

ii. Participating in a medical residency or post- doctoral training program,

iii. On federal appointment with Cooperative Extension, or

iv. A retiree who has returned to work under A.R.S. § 38-766.01.

22. 20. "Employee flexible benefit plan," is the State of Arizona Cafeteria Plan as approved by the Internal Revenue Service and means the insurance plans specified in R2-6-204, the value of which is excludable from an employee's or officer's compensation under Section 125 of the Internal Revenue Code.

23. 21. "Flexible spending account" means a financial arrangement under which an employee or officer authorizes the Department to reduce the employee's or officer's compensation on a pre-tax basis by a specified amount that the employee or officer uses to pay for eligible out-of- pocket expenses for health care, dependent care, or both.

24. 22. "Former elected official" means an individual who was elected by popular vote in this state to serve, but who no longer serves as a:

a. State official;

b. County official;

c. Justice of the Supreme Court;

d. Judge of the court of appeals or superior court;

e. Full-time superior court commissioner except a full- time superior court commissioner who did not make a timely election of membership under the judges' retirement plan repealed on August 7, 1985; and

f. Official of an incorporated city or town if the incorporated city or town has executed an agreement with the state for coverage of the official.

25. 23. "Grievance" means a written expression of dissatisfaction about any benefits matter other than a decision by a plan provider.

26. 24. "Health insurance" means an arrangement under which a policy holder makes advance payments to an insurer and the insurer pays amounts on behalf of an insured for routine, preventive, and emergency health-care procedures and pharmaceuticals.

27. 25. "Incumbent" means the employee or officer who currently holds a position or office.

28. 26. "Institution" means a facility that provides supervision or care for residents on a 24-hours-per-day, seven-days-per- week basis.

29. 27. "Life insurance" means a contract between an insurer and a policy holder under which the insurer agrees to pay a sum of money upon the occurrence of an insured's death in exchange for the policy holder paying a stipulated amount at regular intervals.

30. 28. "Long-term disability insurance" means an insurance product that replaces part of an employee's or officer's compensation after an initial waiting period for the duration of time that the employee or officer is medically determined to be totally disabled as a result of a covered injury, illness, or pregnancy.

31. 29. "Manifest error" means an act or failure to act that clearly is or has caused a mistake.

32. 30. "Member" means an employee, officer, retiree, or former elected official who meets the criteria at R2-6-301(B), who enrolls in one or more of the insurance plans made available by the Department.

33. 31. "Officer" means an individual who:

a. Is elected or appointed to a state office, including a member of the state legislature; or

b. Is a member of a state board, commission, or council and serves at least 1,000 hours per year.

34. "Older child" means an individual who meets one of the criteria in subsections (a) through (c) and all of the criteria in subsections (d) through (g):

a. Is a natural child, adopted child, or stepchild of an employee, officer, retiree, or former elected official;

b. Is a natural child, adopted child, or stepchild of a domestic partner; or

c. Is a child for whom an employee, officer, retiree, or former elected official received a court-ordered guardianship when the child was 18 years old or younger;

d. Is younger than 25 years old;

e. Is unmarried;

f. Was covered by a health insurance plan made avail- able by the Department during the year that the individual was 18 years old; and

g. Resides in Arizona.

35. 32. "Open enrollment" means a specified period during which a member may make additions, changes, or deletions to the member's participation in the insurance plans made available by the Department.

36. 33. "Ophthalmic goods" means eyeglasses or contact lenses for which a prescription is required and components of the eyeglasses.

37. 34. "Plan provider" means an entity that enters into a contract with the Department to provide an insurance plan to members and their eligible dependents.

38. 35. "Plan year" means a specified period of 12 consecutive months during which a member is able to change the member's participation in the insurance plans made available by the Department only if the member experiences a qualified life event.

39. "Post-tax dependent" means an older child, disabled older child, domestic partner, and natural child, adopted child, or stepchild of the domestic partner of an employee or officer.

40. "Pre-tax dependent" means an eligible dependent who is not a post-tax dependent.

41. 36. "QMCSO" means qualified medical child support order and has the same meaning as prescribed at 29 U.S.C. 1169.

42. 37. "Qualified life event" means a change in a member's dependents, employment status, or residence that entitles the member to change the member's or an eligible dependent's participation in the insurance plans made available by the Department before the open enrollment period. Qualified life event includes:

a. Change in marital status caused by marriage, divorce, legal separation, annulment, or death of spouse;

b. Change in domestic partnership status caused by creation or termination of a domestic partnership or death of a domestic partner;

c b. Change in dependent status caused by birth, adoption, placement for adoption, court-ordered guardianship, death, or dependent eligibility due to age;

d c. Change in employment status or work schedule that affects a member's eligibility to participate in the insurance plans made available by the Department; and

e d. Change in residence that affects available insurance plan options.

43. 38. "Retiree" means an employee or officer who is retired under a state-sponsored retirement plan or who receives long-term disability payments under a plan made available by the Department.

44. 39. "Salary-reduction order" means a document signed by an employee or officer who elects to participate in the employee flexible benefit plan authorizing the state to reduce the employee's or officer's compensation under Section 125 of the Internal Revenue Code.

40. "Seasonal employee" means an individual who is employed by the state for not more than six months of the year and whose state employment is dependent on an easily identifiable increase in work associated with a specific and reoccurring season. Seasonal employees do not include employees of education entities who work during the active portions of the academic year.

45. 41. "Short-term disability insurance" means an insurance product that replaces part of an employee's or officer's compensation for a predetermined period if the employee or officer is medically determined to be unable to work due to illness, pregnancy, or a non-work-related injury.

46. 42. "Spouse" means a member's husband or wife under Arizona law.

47. 43. "Supplemental life insurance" means life insurance that is in addition to basic life insurance.

48. 44. "Surviving dependent," as used in A.R.S. § 38- 651.01(A) or A.R.S. § 38-1114, means:

a. An insured eligible dependent of an insured retiree who dies, or

b. An insured spouse or insured eligible dependent child of an insured employee or officer who dies when eligible for retirement under the Arizona State Retirement System, or

c. An insured or uninsured dependent of a deceased law enforcement officer killed in the line of duty.

49.45. "Surviving spouse," as used in A.R.S. § 38-651.01(B) or A.R.S. § 38-1114, means the insured spouse of:

a. An incumbent elected official who dies when the incumbent elected official would be qualified for eligibility under R2-6-301(B) if the incumbent elected official had not been in office at the time of death, or

b. An insured former elected official who dies when qualified for eligibility under R2-6-301(B), or

c. An insured or uninsured spouse of a deceased law enforcement officer killed in the line of duty.

46. "Temporary employee" means an appointment made for a maximum of 1,500 hours worked in any agency in each calendar year. A temporary appointment employee may work full time for a portion of the year, intermittently, on a seasonal basis, or on an as needed basis.

47. "Variable hour employee" means an individual who is employed by the state, if based on the facts and circumstances at the employee's start date, for whom the state cannot determine whether the employee is reasonably expected to be employed an average of at least 30 hours per week, including any paid leave, because the employee's hours are variable or otherwise uncertain.

50. 48. "Vision insurance" means a form of insurance that provides coverage for the services rendered by an eye-care professional and for the purchase of ophthalmic goods.

History

• Adopted effective August 31, 1984 (Supp. 84-4). Former Section R2-6-101 renumbered to R2-6-201, new Section R2-6-101 adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4). New Section made by final rulemaking at 15 A.A.R. 258, effective March 7, 2009 (Supp. 09-1). Amended by final rulemaking at 23 A.A.R. 1719, effective 6/6/2017.

Ariz. Admin. Code § R2-6-102 [REPEALED]

History

• Adopted effective August 31, 1984 (Supp. 84-4). Former Section R2-6-102 renumbered to R2-6-202, new Section R2-6-102 adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4). New Section made by final rulemaking at 15 A.A.R. 258, effective March 7, 2009 (Supp. 09-1). Repealed by final rulemaking at 23 A.A.R. 1719, effective 6/6/2017.

Ariz. Admin. Code § R2-6-103 Authority of the Director

A. Within the limits prescribed by law, the Director shall determine the type, structure, and components of the insurance plans made available by the Department.

B. The Director has authority to administer the insurance plans made available by the Department including:

1. Construing and interpreting each plan;

2. Deciding questions of eligibility; and

3. Determining the amount of and manner and time that benefits are paid.

C. The Director shall determine whether an insurance plan made available by the Department needs to be amended or terminated.

D. The Director shall establish a procedure for ensuring that a member makes timely payments for participation in an insurance plan made available by the Department.

E. If the Director determines that it is in the best interest of the state and consistent with law, the Director may delegate authority regarding the insurance plans to an agency head.

F. The Director shall determine whether a manifest error exists and correct the manifest error.

History

• Adopted effective August 31, 1984 (Supp. 84-4). Former Section R2-6-103 renumbered to R2-6-203, new Section R2-6-103 adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4). New Section made by final rulemaking at 15 A.A.R. 258, effective March 7, 2009 (Supp. 09-1).

Ariz. Admin. Code § R2-6-104 [REPEALED]

History

• Adopted effective August 31, 1984 (Supp. 84-4). Former Section R2-6-104 renumbered to R2-6-204, new Section R2-6-104 adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4). New Section made by final rulemaking at 15 A.A.R. 258, effective March 7, 2009 (Supp. 09-1). Repealed by final rulemaking at 23 A.A.R. 1719, effective 6/6/2017.

Ariz. Admin. Code § R2-6-105 Times for Enrollment

A. An employee, officer, retiree, or former elected official may enroll or may enroll an eligible dependent in one or more of the insurance plans made available by the Department only at the following times:

Within 31 days of becoming eligible to participate in an insurance plan,

2. Within 31 days of a qualified life event, and

3. At open enrollment.

B. A surviving dependent, as defined in R2-6-101, who wishes to continue enrollment in the health, dental, and vision insurance plans made available by the Department shall enroll within six months after the death that makes the surviving dependent eligible to continue enrollment.

C. A surviving spouse, as defined in R2-6-101, who wishes to continue enrollment in the health, dental, vision, or life insurance plans made available by the Department shall enroll within 31 days after the death of the incumbent or former elected official.

D. If a surviving spouse or surviving dependent of a deceased law enforcement officer killed in the line of duty was enrolled in the health insurance program made available by the Department or the health insurance program that is offered by the state retirement system or a plan from which the surviving spouse or surviving dependent is receiving benefits at the time the law enforcement officer was killed in the line of duty or died from injuries suffered in the line of duty, and is eligible to receive health insurance premium payments but is no longer enrolled in either health insurance program, the employer shall allow the surviving spouse and any surviving dependent to enroll in the employer's health insurance program to receive health insurance premium payments pursuant to A.R.S. § 38-1114.

D E. To be covered under the health or dental insurance plans made available by the Department, a retiree shall enroll at the time specified in subsection (A) and shall maintain enrollment in the health or dental insurance plan. If a retiree terminates participation in both the health and dental insurance plans made available by the Department, neither the retiree nor the retiree's eligible dependent is eligible to enroll at a later time.

History

• Adopted effective August 31, 1984 (Supp. 84-4). Former Section R2-6-105 renumbered to R2-6-205, new Section R2-6-105 adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4). New Section made by final rulemaking at 15 A.A.R. 258, effective March 7, 2009 (Supp. 09-1). Amended by final rulemaking at 23 A.A.R. 1719, effective 6/6/2017.

Ariz. Admin. Code § R2-6-106 Effective Date of Coverage

A. If an individual enrolls in an insurance plan made available by the Department or provides notice of a qualified life event within the time specified in R2-6-105, the Department shall ensure that the insurance coverage becomes effective on the following dates:

1. Newly hired employee or officer. The date determined by the Director following submission of a properly completed enrollment form and supporting documentation;

2. Retiree, former elected official, surviving dependent, or surviving spouse. The first day of the first pay period following the end of active coverage or the first day of the first month following submission of a properly completed enrollment form and supporting documentation, whichever is applicable;

3. Qualified life event change other than a change in the number of dependents due to birth, adoption, legal placement for adoption, or grant of legal guardianship:

a. Non-university employee or officer. The first day of the first pay period following submission of a properly completed enrollment form and supporting documentation;

b. University employee. The date determined by the Director; and

c. Retiree, former elected official, surviving dependent, or surviving spouse. The first of the month following submission of a properly completed enrollment form and supporting documentation; and

Change in the number of dependents due to birth, adoption, legal placement for adoption, or grant of legal guardianship. On the date of birth, adoption, legal placement for adoption, or grant of legal guardianship if a properly completed enrollment form and supporting documentation are submitted.

B. If a retiree, former elected official, eligible dependent, surviving dependent, or surviving spouse becomes eligible for Medicare, the retiree, former elected official, eligible dependent, surviving dependent, or surviving spouse may cancel or reduce coverage under the health plan made available by the Department. If a retiree, former elected official, eligible dependent, surviving dependent, or surviving spouse ceases to be eligible for Medicare, the retiree, former elected official, eligible dependent, surviving dependent, or surviving spouse may enroll or increase coverage under the health plan made available by the Department. A change made under this subsection becomes effective on the first day of the first month following submission of a properly completed enrollment form and supporting documentation if the enrollment form and supporting documentation are submitted within 31 days of the change in Medicare eligibility.

C. If a member experiences one of the following changes in coverage, the member may make a corresponding change to the member's coverage under the health plan made available by the Department by submitting a properly completed enrollment form and supporting documentation within 31 days of the change. A change made under this subsection becomes effective on the first day of the first pay period or first month, as applicable, following submission of a properly completed enrollment form and supporting documentation:

1. Elected coverage provided under the plan is significantly restricted or eliminated,

2. Non-elected coverage provided under the plan is significantly improved,

The member's spouse makes a change in the coverage provided by the spouse's employer,

4. The member or an eligible dependent loses coverage under another group health plan sponsored by a governmental or educational entity, or

5. The member becomes subject to a QMCSO or another person becomes subject to a QMCSO that requires the other person to provide health insurance for the member's eligible dependent.

History

• Adopted effective August 31, 1984 (Supp. 84-4). Former Section R2-6-106 renumbered to R2-6-206, new Section R2-6-106 adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4). New Section made by final rulemaking at 15 A.A.R. 258, effective March 7, 2009 (Supp. 09-1). Amended by final rulemaking at 23 A.A.R. 1719, effective 6/6/2017.

Ariz. Admin. Code § R2-6-107 Termination of Coverage

A. Insurance coverage of an employee or officer and the employee's or officer's eligible dependent terminates at 11:59 p.m. on the last day of the period for which an insurance premium was paid if the employee or officer ceases to be eligible to participate in the insurance plan.

B. Insurance coverage of an eligible dependent terminates at 11:59 p.m. on the last day of the month that the individual is an eligible dependent under this Chapter.

C. Insurance coverage of a retiree or former elected official terminates:

1. Automatically if the retiree or former elected official dies, or

2. At 11:59 p.m. on the last day of the period for which the last insurance premium was paid.

D. Insurance coverage of a surviving dependent or surviving spouse terminates:

At 11:59 p.m. on the last day of the period for which the last insurance premium was paid, or

2. Shall be in accordance with A.R.S. § 38-1114 for surviving spouse and dependents of a deceased law enforcement officer killed in the line of duty, including the termination of payments for health insurance premiums payable by the employer.

E. Insurance coverage of a COBRA member terminates at 11:59 p.m. on the last day that the COBRA member is eligible for coverage under COBRA or of the period for which the last insurance premium was paid.

F. By providing written notice to the Director at any time, an employee, officer, or former elected official, as applicable, may cease purchasing:

1. Supplemental life insurance in excess of $35,000;

2. Life insurance for an eligible dependent; or

Short-term disability insurance.

History

• Adopted effective August 31, 1984 (Supp. 84-4). Former Section R2-6-107 renumbered to R2-6-207, new Section R2-6-107 adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4). New Section made by final rulemaking at 15 A.A.R. 258, effective March 7, 2009 (Supp. 09-1). Amended by final rulemaking at 23 A.A.R. 1719, effective 6/6/2017.

Ariz. Admin. Code § R2-6-108 COBRA

A. When a member or an insured eligible dependent ceases to be eligible to participate in the health, dental, or vision insurance plans made available by the Department because of a change in the work status of the member, the Director shall inform the member or eligible dependent of whether the member or eligible dependent is eligible for coverage under COBRA.

B. When an insured eligible dependent of a member ceases to be eligible to participate in the health, dental, or vision insurance plans made available by the Department because the member dies or because of divorce, legal separation, or ceasing to meet the criteria for a child, the member or affected dependent shall provide written notice of the change to the Director within 60 days of the change. The Director shall inform the affected dependent whether the affected dependent is eligible for coverage under COBRA. The Department shall not make COBRA coverage available to an affected dependent if notice is not provided as specified in this subsection.

C. When an employee or officer ceases to be eligible for a health care flexible spending account because of termination of status as an employee or officer, the Director shall inform the former employee or officer and all qualified beneficiaries of whether they are eligible for coverage under COBRA.

D. The state shall not pay any of the cost for COBRA coverage. An individual who elects COBRA coverage shall pay all costs plus a small amount for administrative expenses.

E. COBRA coverage is determined by federal law.

History

• Adopted effective August 31, 1984 (Supp. 84-4). Former Section R2-6-108 renumbered to R2-6-208, new Section R2-6-108 adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4). New Section made by final rulemaking at 15 A.A.R. 258, effective March 7, 2009 (Supp. 09-1). Amended by final rulemaking at 23 A.A.R. 1719, effective 6/6/2017.

Ariz. Admin. Code § R2-6-109 Expired

History

• Adopted effective August 31, 1984 (Supp. 84-4). Former Section R2-6-109 renumbered to R2-6-209, new Section R2-6-109 adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4).

Ariz. Admin. Code § R2-6-110 Expired

History

• Adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4).

Ariz. Admin. Code § R2-6-111 Expired

History

• Adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4).

Ariz. Admin. Code § R2-6-112 Expired

History

• Adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4).

Ariz. Admin. Code § R2-6-113 Expired

History

• Adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4).

Ariz. Admin. Code § R2-6-114 Expired

History

• Adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4).

Article 2 INSURANCE PLANS

Ariz. Admin. Code § R2-6-201 Insurance Plans

A. As provided by law, any expenditure of public monies for an insurance plan described in this Chapter is contingent upon the legislature making an appropriation for the plan and the availability of funds.

B. The Department shall make available the following types of insurance plans:

1. Health insurance,

2. Dental insurance,

3. Vision insurance,

4. Flexible spending account,

5. Life insurance, and

6. Short-term disability insurance.

C. The Department shall comply with all federal, state, and local laws regarding use and disclosure of protected health information of an individual who participates in an insurance plan made available by the Department.

History

• Historical Notes Adopted effective July 27, 1983 (Supp. 83-4). Former Section R2-6-201 repealed, new Section R2-6-201 renumbered from R2-6-101 effective September 16, 1997 (Supp. 97-3). Section repealed; new Section adopted by final rulemaking at 5 A.A.R. 2514, effective July 15, 1999 (Supp. 99-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4). New Section made by final rulemaking at 15 A.A.R. 258, effective March 7, 2009 (Supp. 09-1). Amended by final rulemaking at 23 A.A.R. 1719, effective 6/6/2017.

Ariz. Admin. Code § R2-6-202 Long-term Disability Insurance

A. The state shall automatically enroll an employee or officer in a long-term disability insurance plan. The long-term disability insurance plan in which an employee or officer is enrolled depends on the state-sponsored retirement plan to which the employee or officer contributes.

B. The state may offset the amount that an employee or officer receives under a long-term disability insurance plan by amounts that the employee or officer receives as Social Security payments, retirement benefits, and other disability benefits.

History

• Adopted effective July 27, 1983 (Supp. 83-4). Former Section R2-6-202 repealed, new Section R2-6-202 renumbered from R2-6-102 effective September 16, 1997 (Supp. 97-3). Section repealed; new Section adopted by final rulemaking at 5 A.A.R. 2514, effective July 15, 1999 (Supp. 99-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4). New Section made by final rulemaking at 15 A.A.R. 258, effective March 7, 2009 (Supp. 09-1).

Ariz. Admin. Code § R2-6-203 Flexible Spending Accounts

A. The state shall provide an employee or officer with the opportunity to establish a flexible spending account for:

Health-care expenses,

Dependent-care expenses, or

3. Both health-care and dependent-care expenses.

B. An employee or officer who elects to establish a flexible spending account shall annually sign a salary reduction order specific for the flexible spending account.

C. A flexible spending account is regulated by federal law.

History

• Adopted effective July 27, 1983 (Supp. 83-4). Former Section R2-6-203 repealed, new Section R2-6-203 renumbered from R2-6-103 effective September 16, 1997 (Supp. 97-3). Section repealed; new Section adopted by final rulemaking at 5 A.A.R. 2514, effective July 15, 1999 (Supp. 99-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4). New Section made by final rulemaking at 15 A.A.R. 258, effective March 7, 2009 (Supp. 09-1).

Ariz. Admin. Code § R2-6-204 Employee Flexible Benefit Plan

A. The Director shall ensure that the premium paid by an employee or officer for participation in the insurance plans listed in R2-6-201(1) through (3) and for a maximum of $35,000 in supplemental life insurance and the amount set aside in a flexible spending account reduces the employee's or officer's compensation as allowed by Section 125 of the Internal Revenue Code.

B. Director shall ensure that the premium paid by an employee or officer to enroll a dependent in the insurance plans listed in R2-6-201(1) through (3) reduces the employee's or officer's compensation as allowed by Section 125 of the Internal Revenue Code.

C. The Director shall ensure that the amount paid by the state to enable a dependent of an employee or officer to participate in the insurance plans listed in R2-6-201(1) through (3) increases the employee's or officer's compensation and is taxed as required by law.

D. If an employee or officer experiences a qualified life event during a plan year that adds or deletes a dependent, the Director shall ensure that the compensation of the employee or officer is adjusted accordingly and taxed as required by law.

E. The Director shall ensure that the method of adjusting an employee's or officer's compensation under this Section is not changed or canceled until the end of a plan year.

History

• Adopted effective July 27, 1983 (Supp. 83-4). Former Section R2-6-204 repealed, new Section R2-6-204 renumbered from R2-6-104 effective September 16, 1997 (Supp. 97-3). Section repealed; new Section adopted by final rulemaking at 5 A.A.R. 2514, effective July 15, 1999 (Supp. 99-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4). New Section made by final rulemaking at 15 A.A.R. 258, effective March 7, 2009 (Supp. 09-1). Amended by final rulemaking at 23 A.A.R. 1719, effective 6/6/2017.

Ariz. Admin. Code § R2-6-205 Performance Standards for Health, Dental, and Vision Insurance Plans

As required under A.R.S. § 38-651, the Department establishes and shall require that a plan provider comply with the following minimum performance standards:

1. Cost competitiveness. A plan provider shall offer the Department a discount from full-billed charges that is significant and an administrative fee that is reasonable when compared with the discount and administrative fee of other potential plan providers.

2. Utilization review. A plan provider of medical management services shall employ utilization review standards that are generally accepted in the industry and specified by the Department in contract.

3. Network development and access. A plan provider of a medical network shall comply with the access and availability requirements that the Department develops based on the location of participants and specifies in contract.

4. Conversion and implementation. A plan provider shall fully perform in accordance with all requirements that the Department specifies in contract from the date on which the contract begins until the date on which the contract ends or is terminated after giving proper notice.

5. Report accuracy and timeliness. A plan provider shall ensure that all reports are complete, accurate, and submitted as specified in contract.

6. Quality outcomes. A plan provider shall comply with the quality-outcome standards that the Department specifies in contract. The Department may offset expenses, costs, or damages incurred as a result of the plan provider failing to comply with the specified quality-outcome standards against any sums due to the plan provider.

7. Customer satisfaction. The Department shall annually measure the extent to which participants are satisfied with a plan provider's services.

History

• Historical Notes Adopted effective July 27, 1983 (Supp. 83-4). Former Section R2-6-205 repealed, new Section R2-6-205 renumbered from R2-6-105 effective September 16, 1997 (Supp. 97-3). Section repealed; new Section adopted by final rulemaking at 5 A.A.R. 2514, effective July 15, 1999 (Supp. 99-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4). New Section made by final rulemaking at 15 A.A.R. 258, effective March 7, 2009 (Supp. 09-1).

Ariz. Admin. Code § R2-6-206 Expired

History

• Historical Notes Adopted effective July 27, 1983 (Supp. 83-4). Former Section R2-6-206 repealed, new Section R2-6-206 renumbered from R2-6-106 effective September 16, 1997 (Supp. 97-3). Section repealed; new Section adopted by final rulemaking at 5 A.A.R. 2514, effective July 15, 1999 (Supp. 99-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4).

Ariz. Admin. Code § R2-6-207 Expired

History

• Adopted effective July 27, 1983 (Supp. 83-4). Former Section R2-6-207 repealed, new Section R2-6-207 renumbered from R2-6-107 effective September 16, 1997 (Supp. 97-3). Section repealed; new Section adopted by final rulemaking at 5 A.A.R. 2514, effective July 15, 1999 (Supp. 99-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4).

Ariz. Admin. Code § R2-6-208 Expired

History

• Adopted effective July 27, 1983 (Supp. 83-4). Former Section R2-6-208 repealed, new Section R2-6-208 renumbered from R2-6-108 effective September 16, 1997 (Supp. 97-3). Section repealed; new Section adopted by final rulemaking at 5 A.A.R. 2514, effective July 15, 1999 (Supp. 99-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4).

Ariz. Admin. Code § R2-6-209 Expired

History

• Adopted effective July 27, 1983 (Supp. 83-4). Former Section R2-6-209 repealed, new Section R2-6-209 renumbered from R2-6-109 effective September 16, 1997 (Supp. 97-3). Section repealed; new Section adopted at 5 A.A.R. 2514, effective July 15, 1999 (Supp. 99-2). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4).

Ariz. Admin. Code § R2-6-210 Repealed

History

• Adopted effective July 27, 1983 (Supp. 83-4). Repealed effective September 16, 1997 (Supp. 97-3).

Ariz. Admin. Code § R2-6-211 Repealed

History

• Adopted effective July 27, 1983 (Supp. 83-4). Repealed effective September 16, 1997 (Supp. 97-3).

Ariz. Admin. Code § R2-6-212 Repealed

History

• Adopted effective July 27, 1983 (Supp. 83-4). Repealed effective September 16, 1997 (Supp. 97-3).

Article 3 ELIGIBILITY CRITERIA

Ariz. Admin. Code § R2-6-301 Eligibility to Participate in Health, Dental, and Vision Insurance Plans

A. Employees, officers, and retirees. An employee, officer, or retiree may participate in the health, dental, and vision insurance plans made available by the Department by enrolling at the time specified in R2-6-105 and agreeing to pay the contracted cost of each insurance plan chosen.

B. Former elected officials. A former elected official may participate in the health, dental, and vision insurance plans made available by the Department if the former elected official:

1. Has at least five years of credited service in the Elected Officials' Retirement Plan established at A.R.S. § 38-802;

2. Participated in a group health, dental, or vision insurance plan made available to elected officials at the time of leaving office;

3. Served as an elected official on or after January 1, 1983;

4. Enrolls at the time specified in R2-6-105; and

5. Agrees to pay the contracted cost of the insurance plan.

C. Eligible dependents. A member may enroll an eligible dependent in the health, dental, and vision insurance plans made available by the Department at the time specified in R2-6-105 . The member who enrolls an eligible dependent shall pay the contracted cost of the insurance plan.

D. Surviving dependents. A surviving dependent, as defined at R2-6-101, may continue coverage under the health, dental, and vision insurance plans made available by the Department by enrolling at the time specified in R2-6-105 and paying the contracted cost of the insurance plan.

E. Surviving spouse. A surviving spouse, as defined at R2-6-101, may continue coverage under the health, dental, and vision insurance plans made available by the Department by enrolling at the time specified in R2-6-105 and paying the contracted cost of the insurance plan.

F. Eligibility exception. An employee or officer who is on approved leave without pay and the enrolled eligible dependents of the employee or officer may continue enrollment in the health, dental, and vision insurance plans made available by the Department under the conditions specified in R2-5A-C602.

1. R2-5-405 if the employee or officer is on approved leave without pay because of an industrial illness or injury,

2. R2-5-413 if the employee or officer is on approved medical leave without pay, and

3. R2-5-414 if the employee or officer is on approved leave without pay for another reason.

G. Coverage of a newborn infant.

1. The state shall provide health insurance to an infant born to a member or the member's spouse from the time the infant is born until the infant reaches its 31st day. To ensure that the infant continues to have health insurance coverage, the member shall enroll the infant in the health insurance plan made available by the Department before the infant reaches its 31st day.

2. In compliance with the Newborns' and Mothers' Health Protection Act of 1996, the state shall provide health insurance to an infant born to a member's eligible dependent other than the member's spouse. As permitted under the Newborns' and Mothers' Health Protection Act of 1996, the state shall limit health insurance provided under this subsection to 48 hours for a vaginal delivery and 96 hours for delivery by cesarean section. A member who wishes to obtain health insurance for the infant beyond the time required under the Newborns' and Mothers' Health Protection Act of 1996, may enroll the infant in the health insurance plan made available by the Department if the infant is eligible.

History

• Adopted effective July 27, 1983 (Supp. 83-4). Former Section R2-6-301 renumbered to R2-6-501, new Section R2-6-301 adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4). New Section made by final rulemaking at 15 A.A.R. 258, effective March 7, 2009 (Supp. 09-1). Amended by final rulemaking at 23 A.A.R. 1719, effective 6/6/2017.

Ariz. Admin. Code § R2-6-302 Eligibility to Participate in Life and Short-term Disability Insurance Plans

A. Employees and officers.

1. Life insurance. An employee or officer may participate in the life and short-term disability insurance plans made available by the Department by enrolling at the time specified in R2-6-105 . The state shall provide basic life insurance to an employee or officer at no charge.

2. Short-term disability insurance. An employee or officer who chooses to participate in the short-term disability insurance plan made available by the Department shall agree to pay the contracted cost of the plan.

Supplemental life insurance. The state shall make supplemental life insurance available to an employee or officer. An employee or officer may purchase an amount of supplemental life insurance that, does not exceed three times the employee's or officer's base pay, rounded down to the nearest $5,000 or the maximum amount established by the Director, whichever is less. An employee or officer who chooses to participate in the supplemental life insurance plan shall agree to pay the contracted cost for the supplemental life insurance.

B. Former elected officials. A former elected official may purchase life insurance made available by the Department if the former elected official meets the criteria at R2-6-301(B)(1) and (3).

C. Eligible dependents. An employee, officer, or former elected official who meets the criteria at R2-6-301(B)(1) and (3) may purchase life insurance through the plan made available by the Department for an eligible dependent in an amount determined by the Director. An employee, officer, or former elected official who chooses to purchase life insurance for an eligible dependent shall agree to pay the contracted cost for the life insurance.

D. Surviving spouse of a former elected official. Under A.R.S. § 38-651.02(C), the surviving spouse of a former elected official who met the criteria at R2-6-301(B)(1) and (3) at the time of death may continue to purchase life insurance through the plan made available by the Department if the surviving spouse:

1. Makes application within the time specified in R2-6-105,

2. Agrees to pay the contracted cost for the life insurance, and

3. Is receiving a monthly survivor's retirement check from the Elected Officials' Retirement Plan.

History

• Adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4). New Section made by final rulemaking at 15 A.A.R. 258, effective March 7, 2009 (Supp. 09-1). Amended by final rulemaking at 23 A.A.R. 1719, effective 6/6/2017.

Ariz. Admin. Code § R2-6-303 Audit of Dependent Eligibility

A. A member shall not enroll an individual in an insurance plan made available by the Department unless the individual is an eligible dependent as defined in R2-6-101.

B. The Department shall conduct audits to determine whether individuals enrolled by members in an insurance plan made available by the Department are eligible dependents. The Department shall choose a particular member for audit either randomly or in response to uncertainty concerning dependent eligibility.

C. If a member is chosen for audit, the Department shall provide the member with written notice and 60 days in which to produce evidence that an individual enrolled by the member in an insurance plan made available by the Department is an eligible dependent. The Director may extend the 60-day requirement in an individual case. Evidence of dependent eligibility may include one or more of the following:

1. Marriage certificate,

2. Birth certificate,

3. Documentation of lawful presence in the U.S.,

4. Documentation of sharing a permanent residence and financial interdependence as described in R2-6-101(19) ,

5 3. Receipts for insurance payments made while on leave without pay,

6 4. Court order regarding adoption or placement for adoption,

7 5. Court order regarding guardianship,

8 6. Documentation of foster-child placement,

9 7. Tax return,

10. School registration form or transcript,

11 8. Declaration of disability from the Social Security Administration,

12 9. Documentation of Arizona residence, or

13 10. Other documentation acceptable to the Director.

D. If a member chosen for audit fails to produce evidence of dependent eligibility within the time specified in subsection (C), the Department shall:

1. Upon providing advance notice of at least 30 days to the member, terminate insurance coverage of the individual whose eligibility was not proven;

Require that the member reimburse the Department for all premiums and claims paid since October 1, 2004, on behalf of the individual whose eligibility was not proven; and

3. Report an employee or officer who misrepresented dependent eligibility to the employee's or officer's agency for possible disciplinary action.

History

• Adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4). New Section made by final rulemaking at 15 A.A.R. 258, effective March 7, 2009 (Supp. 09-1). Amended by final rulemaking at 23 A.A.R. 1719, effective 6/6/2017.

Ariz. Admin. Code § R2-6-304 Expired

History

• Adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4).

Ariz. Admin. Code § R2-6-305 Expired

History

• Adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4).

Ariz. Admin. Code § R2-6-306 Expired

History

• Adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4).

Ariz. Admin. Code § R2-6-307 Expired

History

• Adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4).

Ariz. Admin. Code § R2-6-308 Expired

History

• Adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4).

Ariz. Admin. Code § R2-6-309 Expired

History

• Adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4).

Ariz. Admin. Code § R2-6-310 Expired

History

• Adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4).

Ariz. Admin. Code § R2-6-311 Expired

History

• Adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4).

Article 4 APPEALS AND GRIEVANCES

Ariz. Admin. Code § R2-6-401 Appeal of a Plan-provider Decision

A. The Department has delegated to each plan provider the authority to:

1. Interpret and apply the terms of the plan provider's particular insurance plan;

2. Determine whether a particular benefit is included in the plan and, if included, the amount of payment to be made under the plan; and

3. Perform a full and fair review of any decision by the plan provider regarding benefits included in or payments to be made under the plan if the decision is appealed in accordance with the plan provider's specified procedures.

B. An individual who is enrolled in an insurance plan made available by the Department and who wishes to appeal a decision by the plan provider shall follow the appeal procedures specified in the applicable plan description.

History

• Adopted effective July 27, 1983 (Supp. 83-4). Section repealed, new Section adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4). New Section made by final rulemaking at 15 A.A.R. 258, effective March 7, 2009 (Supp. 09-1).

Ariz. Admin. Code § R2-6-402 Grievance of a Department Decision

A. An individual who participates in one or more of the insurance plans made available by the Department may file a grievance with the Director regarding:

Determination of creditable coverage,

2. Determination of whether a medical child support order is qualified,

Determination of eligibility,

Dissatisfaction with care,

Dissatisfaction with an insurance plan,

6. Dissatisfaction with a plan provider,

7. Access to care, and

8. Inconsistent application of statute or rule.

B. To file a grievance, an individual shall submit a letter to the Director that contains the following information:

1. Name and contact information of the individual filing the grievance,

2. Name of the particular insurance plan that is the subject of the grievance,

Nature of the grievance, and

Nature of the resolution requested.

C. The Director shall provide a written response to a grievance within 60 days.

History

• Adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4). New Section made by final rulemaking at 15 A.A.R. 258, effective March 7, 2009 (Supp. 09-1).

Ariz. Admin. Code § R2-6-403 Expired

History

• Adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4).

Ariz. Admin. Code § R2-6-404 Expired

History

• Adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4).

Ariz. Admin. Code § R2-6-405 Expired

History

• Adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4).

Ariz. Admin. Code § R2-6-406 Expired

History

• Adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4).

Ariz. Admin. Code § R2-6-407 Expired

History

• Adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4).

Ariz. Admin. Code § R2-6-408 Expired

History

• Adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4).

Ariz. Admin. Code § R2-6-409 Expired

History

• Adopted effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4).

Article 5 EXPIRED

Ariz. Admin. Code § R2-6-501 Expired

History

• Section R2-6-501 renumbered from R2-6-301 and amended effective September 16, 1997 (Supp. 97-3). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 5017, effective September 30, 2002 (Supp. 02-4).

Chapter 7 Department of Administration State Procurement Office

Article 1 GENERAL PROVISIONS

Ariz. Admin. Code § R2-7-101 Definitions

In this Chapter, unless the context otherwise requires:

1. "Affiliate" means any person whose governing instruments require it to be bound by the decision of another person or whose governing board includes enough voting representatives of the other person to cause or prevent action, whether or not the power is exercised. The term applies to persons doing business under a variety of names, persons in a parent-subsidiary relationship, or persons that are similarly affiliated.

2. "Agency chief procurement officer" means the procurement officer within a state governmental unit, who is acting under specific, written authority from the state procurement administrator in accordance with R2-7-202 or any person delegated that authority, in writing, under R2-7-203 . The term does not include any other person within a state governmental unit who does not have this written delegation of authority.

3. "Aggregate dollar amount" means purchase price, including taxes and delivery charges, for the term of the contract and accounting for all allowable extensions and options.

4. "Alternate project delivery methods" means design-build, construction-management-at-risk, and job-order-contracting construction services.

5. "Arizona Procurement Code" means A.R.S. Title 41, Chapter 23 and this Chapter.

6. "Arizona state contract" means a contract established or authorized by the state procurement administrator for use by state governmental units and eligible procurement units.

7. "Award" means a determination by the state that it is entering into a contract with one or more offerors.

8. "Best and Final Offer" means a revision to an offer submitted after negotiations are completed that contain the offeror's most favorable terms for price, service, and products to be delivered.

9. "Bid" means an offer in response to solicitation.

"Bidder" means "offeror" as defined in R2-7-101(35).

11. "Brand name or equivalent specification" means a written description that uses one or more manufacturers' product name or catalog item, to describe the standard of quality, performance, and other characteristics that meet state requirements and provides for submission of equivalent products or services.

12. "Brand name specification" means a written description limited to a list of one or more items by manufacturers' product name or catalog item to describe the standard of quality, performance, and other characteristics that meet state requirements.

13. "Clergy" includes the same persons described in A.R.S. § 32-3271(A)(3).

14. "Component" means a part of a manufactured product.

15. "Contract amendment" means a written modification of a contract under A.R.S. § 41-2503(8) or a unilateral exercise of a right contained in the contract.

"Cost data" means information concerning the actual or estimated cost of labor, material, overhead, and other cost elements that have been incurred or will be incurred by the offeror or contractor in performing the contract.

17. "Cost-plus-a-percentage-of-cost contract" means the parties to a contract agree that the fee will be a predetermined percentage of the cost of work performed and the contract does not limit the cost and fee before authorization of performance.

18. "Day" means a calendar day and time is computed under A.R.S. § 1-243, unless otherwise specified in the solicitation or contract.

19. "Debarment" means an action taken by the director under R2-7-C901 that prohibits a person from participating in the state procurement process.

20. "Defective data" means data that is inaccurate, incomplete, or outdated.

21. "Dentist" means a person licensed under A.R.S. Title 32, Chapter 11.

"Descriptive literature" means information available in the ordinary course of business that shows the characteristics, construction, or operation of an item or service offered.

23. "Eligible procurement unit" means a local public procurement unit, any other state or agency of the United States, or a nonprofit educational or public health institution, including any certified non-profit agency that serves individuals with disabilities as defined in A.R.S. § 41- 2636, that is eligible under a cooperative agreement to use Arizona state contracts.

24. "eProcurement System" means the State's official electronic procurement system as authorized by the state procurement administrator under R2-7-201.

24.25. "Filed" means delivery to an agency chief procurement officer or to the director, whichever is applicable, in a manner specified by the Arizona Procurement Code or a solicitation.

25.26. "Finished goods" means units of a manufactured product awaiting sale.

26.27. "Force account" as used in A.R.S. § 41-2572, means work performed by the state's regularly employed personnel.

27.28. "Governing instruments" means legal documents that establish the existence of an organization and define its powers, including articles of incorporation or association, constitution, charter, by-laws, or similar documents.

28.29. "In writing" has the same meaning as "written" or "writing" in A.R.S. § 47-1201, which includes printing, typewriting, electronic transmission, facsimile, or any other intentional reduction to tangible form.

29.30. "Interested party" means an offeror or prospective offeror whose economic interest is affected substantially and directly by issuance of a solicitation, an award or loss of an award. Whether an offeror or prospective offeror has an economic interest depends upon the circumstances of each case.

30.31. "Legal counsel" means a person licensed as an attorney by the Arizona Supreme Court.

31.32. "May" means something is permissive.

32.33. "Negotiation" means an exchange or series of exchanges between the state and an offeror or contractor that allows the state or the offeror or contractor to revise an offer or contract, unless revision is specifically prohibited by this Chapter.

33.34. "Offer" means a response to a solicitation.

34.35. "Offeror" means a person who responds to a solicitation.

35.36. "Physician" means a person licensed under A.R.S. Title 32, Chapters 7, 8, 13, 14, 15.1, 16, or 17.

36.37. "Price data" means information concerning prices, including profit, for materials, services, or construction substantially similar to the materials, services, or construction to be procured under a contract or subcontract. In this definition, "prices" refers to offered selling prices, historical selling prices, or current selling prices of the items to be purchased.

37.38. "Procurement file" means the official records file of the director whether located in the office of the director, at a public procurement unit, or in the eProcurement System. The procurement file shall include (electronic or paper) the following:

a. List of notified vendors,

b. Final solicitation,

c. Solicitation amendments,

d. Bids and offers,

e. Offer revisions and best and final offers,

f. Discussions,

g. Clarifications,

h. Final evaluation reports, and

i. Additional information, if requested by the agency chief procurement officer and approved by the state procurement administrator.

38.39. "Procurement request" means the document that initiates a procurement.

39.40. "Proposal" means an offer submitted in response to a solicitation.

40.41. "Prospective offeror" means a person that expresses an interest in a specific solicitation.

41.42. "Raw materials" means goods, excluding equipment and machinery, purchased for use in manufacturing a product.

42.43. "Reverse auction" means a procurement method in which offerors are invited to bid on specified goods or services through online bidding and real-time electronic bidding. During an electronic bidding process, offerors' prices or relative ranking are available to competing offerors and offerors may modify their offer prices until the closing date and time.

43.44. "Shall" means something is mandatory.

44.45. "Small business" means a for-profit or not-for-profit organization, including its affiliates, with fewer than 100 full-time employees or gross annual receipts of less than $4 million for the last complete fiscal year.

45.46. "Solicitation" means an invitation for bids, a request for technical offers, a request for proposals, a request for quotations, or any other invitation or request issued by the purchasing agency to invite a person to submit an offer.

46.47. "Source selection method" means a process that is approved by an agency chief procurement officer and used to select a person to enter into a contract for procurement.

47.48. "State procurement administrator" means the individual appointed by the director as a chief procurement officer for the state, or a state procurement administrator's authorized designee. A different title may be used for this position.

48.49. "State procurement office" means an office that acts under the authority delegated to the state procurement administrator.

49.50. "Suspension" means an action taken by the director under R2-7-C901 that temporarily disqualifies a person from participating in a state procurement process.

50.51. "Trade secret" means information, including a formula, pattern, device, compilation, program, method, technique, or process, that is the subject of reasonable efforts to maintain its secrecy and that derives independent economic value, actual or potential, as a result of not being generally known to and not being readily ascertainable by legal means.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed; new Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 18 A.A.R. 3118, effective January 7, 2013 (Supp. 12-4). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015. Amended by final expedited rulemaking at 28 A.A.R. 2117, effective 8/12/2022.

Ariz. Admin. Code § R2-7-102 Written Determinations

A. If a written determination is required under applicable law, an agency chief procurement officer shall include the basis for the action taken in the written determination.

B. The agency chief procurement officer shall place the written determination into the purchasing agency's procurement file.

C. A procurement file located at a state agency is considered the official records file of the director as required by A.R.S. § 41-2502, if the file is maintained by an agency chief procurement officer.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed; new Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-103 Confidential Information

A. If a person wants to assert that a person's offer, specification, or protest contains a trade secret or other proprietary information, a person shall include with the submission a statement supporting this assertion. A person shall clearly designate any trade secret and other proprietary information, using the term "confidential". Contract terms and conditions, pricing, and information generally available to the public are not considered confidential information under this Section.

B. Until a final determination is made under subsection (C), an agency chief procurement officer shall not disclose information designated as confidential under subsection (A) except to those individuals deemed by an agency chief procurement officer to have a legitimate state interest.

C. Upon receipt of a submission, an agency chief procurement officer shall make one of the following written determinations:

1. The designated information is confidential and the agency chief procurement officer shall not disclose the information except to those individuals deemed by the agency chief procurement officer to have a legitimate state interest;

2. The designated information is not confidential; or

3. Additional information is required before a final confidentiality determination can be made.

D. If an agency chief procurement officer determines that information submitted is not confidential, a person who made the submission shall be notified in writing. The notice shall include a time period for requesting a review of the determination by the state procurement administrator.

E. An agency chief procurement officer may release information designated as confidential under subsection (A) if:

1. A request for review is not received by the state procurement administrator within the time period specified in the notice; or

2. The state procurement administrator, after review, makes a written determination that the designated information is not confidential.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed; new Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-104 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-105 Repealed

History

• Adopted effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Article 2 PROCUREMENT ORGANIZATION

Ariz. Admin. Code § R2-7-201 State Procurement Administrator: Duties and Qualifications

A. The director shall hire a state procurement administrator with executive and organizational skills and relevant, recent experience in public procurement.

B. The state procurement administrator shall:

1. Administer the procurement of materials, services, and construction needed by the state;

2. Establish procurement policy and procedure;

3. Establish procurement training standards;

4. Designate if an Arizona state contract is mandatory;

5. Delegate procurement authority under R2-7-202; and

6. Monitor compliance of state governmental units with state procurement laws.

C. The state procurement administrator shall maintain a record of each contract awarded under A.R.S. §§ 41-2536 (sole source procurement) and 41-2537 (emergency procurement) that exceeds the amount prescribed in A.R.S. § 41-2535(A). The record shall be maintained for a minimum of five years. The state procurement administrator shall ensure that the record is available for public inspection and contains all of the following:

1. Each contractor's name;

2. The estimated amount of each contract; and

3. A description of the item or service procured.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed; new Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-202 Delegation of Procurement Authority to State Governmental Units

A. The state procurement administrator shall delegate procurement authority to a state governmental unit based upon the following criteria:

1. The procurement expertise, knowledge, experience, and performance of the state governmental unit's agency chief procurement officer, as identified by the state governmental unit; and

2. The impact of the delegation on procurement efficiency and effectiveness.

B. The state procurement administrator shall delegate procurement authority in a written document that specifies all of the following:

1. The agency chief procurement officer,

2. The specific authority delegated,

3. Any limits or restrictions upon the delegated authority,

4. Whether the authority may be further delegated, and

5. The duration of the delegation.

C. The head of a purchasing agency shall immediately report any significant change regarding the criteria considered under subsection (A) to the state procurement administrator.

D. A purchasing agency shall exercise delegated authority according to A.R.S. Title 41, Chapter 23 and A.A.C. Title 2, Chapter 7.

E. An agency chief procurement officer shall submit to the state procurement administrator any procurement that exceeds the agency's delegated authority.

F. The state procurement administrator may revoke, suspend, or modify delegated authority for failure to comply with A.R.S. Title 41, Chapter 23 or A.A.C. Title 2, Chapter 7, or a significant change regarding the criteria considered under subsection (A).

G. The state procurement administrator retains all authorities and duties delegated to an agency chief procurement officer at a state governmental unit.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed; new Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-203 Agency Chief Procurement Officer

A. An agency chief procurement officer may further delegate procurement authority within the purchasing agency, within the limits specified by the state procurement administrator.

B. The agency chief procurement officer shall notify the state procurement administrator in writing of employees who have delegated procurement authority.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed; new Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-204 State Employee or Public Officer Use of State Contracts

State employees and public officers shall not purchase materials or services for their own personal or business use from contracts entered into by the state unless authorized in writing by the director. The determination shall state how the purchase will further the interests of the state.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-205 Expired

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Section expired under A.R.S. § 41-1056(J) at 23 A.A.R. 1757, effective May 9, 2017 (Supp. 17-2).

Ariz. Admin. Code § R2-7-206 Authorized Procurement Officers

A procurement officer shall perform all procurement duties in accordance with the Arizona Procurement Code and within the authority delegated to the procurement officer in accordance with this Chapter.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-207 Resolution of Intra-agency Procurement Disputes

Procurement disputes between a purchasing agency and its agency chief procurement officer shall be resolved by the state procurement administrator.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-208 Expired

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Section expired under A.R.S. § 41-1056(J) at 23 A.A.R. 1757, effective May 9, 2017 (Supp. 17-2).

Ariz. Admin. Code § R2-7-209 Prospective Suppliers List

A. The state procurement administrator shall compile and maintain a prospective suppliers list. To be included on the prospective suppliers list, a person shall register with the state procurement office.

B. The state procurement administrator may remove suppliers from the prospective suppliers list if a notice sent to the supplier is returned. The state procurement administrator shall maintain a record of the date and reason for removal of a supplier from the prospective suppliers list.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Article 3 SOURCE SELECTION AND CONTRACT FORMATION

Ariz. Admin. Code § R2-7-301 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Amended effective July 6, 1994 (Supp. 94-3). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-302 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-303 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-304 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-305 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-306 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-307 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-308 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-309 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-310 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-311 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-312 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-313 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-314 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-315 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-316 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-317 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-318 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-319 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-320 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-321 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-322 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-323 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-324 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-325 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-326 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-327 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-328 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section heading amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-329 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-330 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-331 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-332 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-333 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-334 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-335 Repealed

History

• Adopted effective July 6, 1994 (Supp. 94-3). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-336 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Amended effective July 6, 1994 (Supp. 94-3). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-337 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-338 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-339 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-340 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-341 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-342 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-343 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-344 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-345 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-346 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-347 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-348 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-349 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-350 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-351 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-352 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-353 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-354 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-355 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-356 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-357 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-358 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-359 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-360 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-361 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-362 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-363 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-364 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-365 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-366 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-367 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-368 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-369 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-370 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-1). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Article 4 SPECIFICATIONS

Ariz. Admin. Code § R2-7-401 Preparation of Specifications

A. State governmental units may prepare and utilize specifications only under the authority delegated by the state procurement administrator under R2-7-202.

B. An agency chief procurement officer delegated the authority to prepare and utilize specifications shall comply with the requirements of A.R.S. § 41-2561 through A.R.S. § 41-2568 and ensure specifications used support maximum practical competition.

C. The agency chief procurement officer may contract for the preparation of specifications with persons other than state personnel.

D. Notwithstanding the provisions of this Section, the state procurement administrator retains the authority to prepare, issue, revise, and monitor all specifications and plans.

E. If a mandatory specification has been designated by the state procurement administrator for a particular material, service, or construction item, it shall be used unless the state procurement administrator makes a written determination that its use is not advantageous to the state and that another specification may be used.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Definitions placed in alphabetical order (Supp. 93-2). Section repealed; new Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-402 Utilization of Specifications

The agency chief procurement officer may use any type of specification that describes the procurement requirement and promotes competition, except that the agency chief procurement officer shall not use proprietary or restrictive specifications without the prior written approval of the state procurement administrator.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-403 Determination for Use of Brand Name Type Specifications

A. The state procurement administrator may authorize the use of a brand name only specification if the state procurement administrator makes a written determination that only the identified brand name item will satisfy the state's needs.

B. The agency chief procurement officer shall, to the extent practicable, identify sources from which the designated brand name item can be obtained and shall solicit such sources to achieve the maximum practical competition.

C. The agency chief procurement officer may use a brand name or equivalent specification when the agency chief procurement officer determines this type of specification is in the best interest of the state.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Amended by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-404 Conflict of Interest

A. No person preparing or assisting in the preparation of specifications, plans or scopes of work shall receive any direct benefit from the utilization of those specifications, plans or scopes of work.

B. The state procurement administrator may waive the restriction set forth in subsection (A) of this Section if the state procurement administrator determines in writing that the rule's application would not be in the state's best interest. The determination shall state the specific reasons that the restriction in subsection (A) of this Section has been waived.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). New Section made by final rulemaking at 18 A.A.R. 3118, effective January 7, 2013 (Supp. 12-4).

Ariz. Admin. Code § R2-7-405 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-407 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-408 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-409 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-410 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-411 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Article 5 PROCUREMENT OF CONSTRUCTION AND SPECIFIC PROFESSIONAL SERVICES

Ariz. Admin. Code § R2-7-501 [Repealed]

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed; new Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). New Section made by final rulemaking at 18 A.A.R. 3118, effective January 7, 2013 (Supp. 12-4). Amended by final rulemaking at 18 A.A.R. 3118, effective January 7, 2013 (Supp. 12-4). Repealed by final expedited rulemaking at 28 A.A.R. 2117, effective 8/12/2022.

Ariz. Admin. Code § R2-7-502 Compliance with the Department

A purchasing agency shall comply with the procurement and contract administration requirements of the Department as required by A.R.S. § 41-790 et seq.

History

• Adopted effective April 2, 1993 (Supp. 93-2). Amended by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-503 Procurement of Construction Using Alternate Project Delivery Method

The agency chief procurement officer may use an alternate project delivery method if it is in the best interest of the state pursuant to A.R.S. §§ 41-2578 and 41-2579, based on the following factors:

Cost and cost control method,

Value engineering,

3. Market conditions,

4. Schedule,

5. Required specialized expertise,

6. Technical complexity of the project, or

7. Project management.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed; new Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 18 A.A.R. 3118, effective January 7, 2013 (Supp. 12-4). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-504 Notice

A. The agency chief procurement officer shall provide a copy of a solicitation for specified professional services or construction services to any person who requests a copy of the solicitation.

B. For procurements not estimated to exceed the amount prescribed in A.R.S. § 41-2535, the agency chief procurement officer shall provide notice of the procurement in accordance with Part D of Article 3 of this Chapter, unless otherwise authorized pursuant to A.R.S. §§ 41-2536 or 41-2537.

C. For procurements estimated to exceed the amount prescribed in A.R.S. § 41-2535:

1. The agency chief procurement officer shall make the solicitation available to prospective offerors registered at the State Procurement Office for the specific material, service, or construction being solicited; and

2. The agency chief procurement officer shall advertise at least once in a general circulation or industry trade publication. If practicable, the date of the advertisement shall be at least 14 days before the offer due date.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed; new Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 18 A.A.R. 3118, effective January 7, 2013 (Supp. 12-4).

Ariz. Admin. Code § R2-7-505 Selection Committee

A. The agency chief procurement officer shall appoint a selection committee when required under A.R.S. §§ 41-2578, 41-2579, or 412581.

B. For the procurement of specified professional services not estimated to exceed the amount prescribed in A.R.S. § 41-2581, the selection committee shall meet the requirements of A.R.S. § 41-2578(C)(1) and shall consist of three to five members who are appropriately qualified including the agency chief procurement officer as chair.

C. For the procurement of specified professional services estimated to exceed the amount prescribed in A.R.S. § 41-2578, 41-2579, or 41-2581 .

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed; new Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 18 A.A.R. 3118, effective January 7, 2013 (Supp. 12-4). Amended by final expedited rulemaking at 28 A.A.R. 2117, effective 8/12/2022.

Ariz. Admin. Code § R2-7-506 Bid Security

A. The agency chief procurement officer shall include the bid security requirements of A.R.S. § 41-2573 in the solicitation.

B. If an offeror fails to submit the bid security required by A.R.S. § 41-2573 with the offer, the agency chief procurement officer shall reject the offer.

C. The offeror shall submit bid security in one of the following forms:

1. An annual or one-time surety bond executed solely by a surety company authorized to transact surety business in this state, issued by the Director of the Department of Insurance under A.R.S. Title 20, Chapter 2, Article 1, and in a format prescribed by A.R.S. § 41-2573 and this Section; or

2. A certified or cashier check.

D. The state procurement administrator or, in the case of construction on state property, the Assistant Director of General Services, may issue a written determination to accept the bid security if the bid security fails to comply in a nonsubstantial manner when:

1. Only one offer is received and there is not sufficient time to re-solicit;

2. The amount of the bid security submitted, although less than the amount required by the solicitation, is equal to or greater than the difference between the apparent low offer and the next higher acceptable offer; or

3. The bid security is inadequate as a result of correcting or modifying an offer in accordance with R2-7-B310, if the offeror increases the amount of the security to required limits within two days after notification.

E. The state procurement administrator or, in the case of construction on state property, the Assistant Director of General Services, shall determine if the bid security may be released without penalty under § 41-2573(E).

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Amended by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-507 Offer Mistakes Discovered After Offer Opening and Before Award

A. If an apparent mistake, relevant to the award determination is discovered after offer opening and before award, the agency chief procurement officer shall contact the offeror for written confirmation of the offer. The agency chief procurement officer shall designate a time-frame within which the offeror shall either:

1. Confirm that no mistake was made and assert that the offer stands as submitted; or

2. Acknowledge that a mistake was made, and include all of the following in a written response:

a. Explanation of the mistake and any other relevant information;

b. A request for correction including the corrected offer or a request for withdrawal; and

c. The reasons why correction or withdrawal is consistent with fair competition and in the best interest of the state.

B. An offeror who discovers a mistake in its offer may request correction or withdrawal in writing, and shall include all of the following in the written request:

1. Explanation of the mistake and any other relevant information;

A request for correction including the corrected offer or a request for withdrawal; and

3. The reasons why correction or withdrawal is consistent with fair competition and in the best interest of the state.

C. An agency chief procurement officer may permit an offeror to correct a mistake if the mistake and the intended offer are evident in the uncorrected offer; for example, an error in the extension of unit prices. The agency chief procurement officer shall not permit a correction that is prejudicial to the state or fair competition.

D. An agency chief procurement officer shall permit an offeror to furnish information called for in the solicitation but not supplied if the intended offer is evident and submittal of the information is not prejudicial to other offerors.

E. An agency chief procurement officer shall make a written determination of whether correction or withdrawal is permitted, based on whether the action is consistent with fair competition and in the best interest of the state.

F. If the offeror fails to act under subsection (A), the offeror is considered nonresponsive and the agency chief procurement officer shall place a written determination that the offeror is nonresponsive in the procurement file.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective January 13, 1987 (Supp. 87-1). Amended effective April 2, 1993 (Supp. 93-2). Section repealed; new Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-508 Performance and Payment Bonds

A. The agency chief procurement officer shall ensure that performance and payment bonds are executed solely by a surety company or companies holding a certificate of authority to transact surety business in this state issued by the Department of Insurance under A.R.S. Title 20, Chapter 2, Article 1 and in a format prescribed by A.R.S. § 41-2574.

B. The contractor shall submit to the state the performance bond and the payment bond upon request of the agency chief procurement officer. If a contractor fails to deliver the required performance bond or payment bond by the designated date, the contractor's offer shall be rejected, its bid security shall be enforced, and award of the contract shall be made as prescribed in this Chapter.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Repealed effective April 2, 1993 (Supp. 93-2). New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-509 Conditions for Use of Substitute Security in Lieu of Retention

A contractor may submit substitute security to replace contract payment retention if:

1. The contractor requests the use of substitute security before the first progress payment;

2. The contractor submits an invoice with each progress payment in an amount of no less than 10% of the progress payment, or the contractor submits an invoice once at the beginning of the project in an amount no less than 5% of the total contract amount;

3. The interest earned on the security shall accrue to the benefit of the contractor but shall be retained by the contractor until the agency chief procurement officer has approved completion and acceptance of all work to be performed under the contract; and

4. The contractor ensures that the date of maturity of the security is after the estimated contract completion date, but no later than one year after the estimated contract completion date.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed; new Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-510 The Form of Substitute Security in Lieu of Retention

If the conditions identified under R2-7-506 are met, the agency chief procurement officer shall accept a substitute security from a contractor in the form of one of the following:

1. An assignment of a time certificate of deposit by a financial institution licensed by this state;

2. Share certificates of a financial institution or credit union authorized to transact business in this state; or

3. Security issued or guaranteed as to principal and interest by:

a. The United States;

b. The state; or

c. Counties, municipalities, and school districts within this state.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed; new Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-511 Individual Job Order Contracting

A. The state procurement administrator may award or authorize an agency chief procurement officer to award job order contracts for construction, construction services or professional services to a single contractor or multiple contractors.

B. Contracts shall be awarded based on scoring of technical proposals, followed by scoring of price proposals.

1. The agency chief procurement officer obtains a cost estimate for the job order, before obtaining a cost proposal from the job order contractor; and

2. The agency chief procurement officer makes a written determination that award of the job order is in the best interest of the state before awarding a job order.

C. Price proposals shall be based on an adjustment factor or factors applied to a catalog of construction tasks.

1. The agency chief procurement officer obtains a cost estimate for the job order from a person as defined in A.R.S. Title 32, Chapter 1, Article 1 before requesting a cost proposal from the job order contractor; and

2. The agency chief procurement officer makes a written determination that award of the job order is in the best interest of the state before awarding a job order.

D. Individual job orders issued under a job order contract shall not exceed $2,000,000.00, unless authorized by the state procurement administrator.

E. All individual job orders exceeding $1,000,000 shall obtain authorization from the chief procurement officer of the General Services Division.

F. Individual job orders shall include an itemized list of each construction task required to complete the work with the task's associated unit price and applied adjustment factor.

D. G. The agency chief procurement officer may request cost proposals from multiple job order contractors or negotiate with a single job order contractor.

E. H. The agency chief procurement officer may authorize contract change orders or amendments that result in the individual job order cost exceeding $2,000,000 only with authorization from the state procurement administrator.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed; new Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 18 A.A.R. 3118, effective January 7, 2013 (Supp. 12-4). Amended by final expedited rulemaking at 28 A.A.R. 2117, effective 8/12/2022.

Ariz. Admin. Code § R2-7-512 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-513 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-514 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-515 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Article 6 CONTRACT CLAUSES

Ariz. Admin. Code § R2-7-601 Contract Clauses

The agency chief procurement officer shall include in solicitations and contracts all contract clauses necessary to ensure the state's interests are addressed.

History

• Adopted effective April 2, 1993 (Supp. 93-2). Section repealed; new Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-602 Assignment of Rights and Duties

A contractor shall not assign or transfer the rights or duties of a state contract without the written consent of the agency chief procurement officer.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-603 Change of Name

If a contractor requests to change the name in which it holds a state contract, the agency chief procurement officer may, upon receipt of a document indicating name change, enter into a written amendment with the contractor to effect the name change. The amendment shall provide that no other terms and conditions of the contract are changed.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-604 Contract Change Orders and Amendments

A. The agency chief procurement officer may extend or authorize options in a contract provided the price of the extension or option was evaluated under the contractor's original offer.

B. Any contract change order or amendment or aggregate change orders or amendments of a contract not covered under sub-section (A) that exceeds 25% of the original contract amount may be executed only if the state procurement administrator or, in the case of construction on state property, the Assistant Director of General Services, determines in writing that the change order or amendment is advantageous to the state and the price is determined fair and reasonable pursuant to R2-7-702.

C. The agency chief procurement officer may, in situations in which time or economic consideration preclude resolicitation, negotiate a reduction to the contract, including scope, price, and contract requirements under A.R.S. § 41-2537.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-605 Multi-term Contracts

A. The agency chief procurement officer may enter into a contract for materials or services for a period exceeding the time identified in A.R.S. § 41-2546(A), if a written approval from the state procurement administrator is issued prior to offer due date and time.

B. The agency chief procurement officer shall submit a request to the state procurement administrator in writing indicating:

1. The time period requested for the contract;

2. Documentation that the estimated requirements are reasonable and continuing;

3. Documentation to demonstrate why more frequent competition is not practicable and that such a contract will serve the best interests of the state.

C. The agency chief procurement officer shall include in all multi-term contracts a clause specifying that the contract shall be cancelled if monies are not appropriated or otherwise made available to support the continuation of performance in a sub-sequent fiscal year. If the contract is cancelled under this Section, the contractor may only be reimbursed for the reason-able value of any nonrecurring costs incurred but not amortized in the price of the materials or services delivered under the contract or which are otherwise not recoverable.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-606 Terms and Conditions

A. The state procurement administrator may publish uniform terms and conditions for use in solicitations and contracts issued by a state governmental unit.

B. Prior to offer due date and time, the state procurement administrator may authorize an agency chief procurement officer to make changes to uniform terms and conditions.

C. After offer due date and time, an agency chief procurement officer may negotiate the uniform terms and conditions, as appropriate.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3511, effective 2/2/2015.

Ariz. Admin. Code § R2-7-607 Mandatory Statewide Contracts

State governmental units shall use existing Arizona state contracts to satisfy their needs for those materials and services covered under such contracts, unless authorized by the state procurement administrator.

History

• New Section made by final rulemaking, 18 A.A.R. 3118, effective January 7, 2013 (Supp. 12-4). Amended by final rulemaking at 20 A.A.R. 3511, effective 2/2/2015.

Ariz. Admin. Code § R2-7-608 Multiple Source Contracts

Multiple award contracts shall be limited to the least number of suppliers necessary to meet the requirements of the state or the cooperative procurement members, unless authorized by the state procurement administrator.

History

• New Section made by final rulemaking, 18 A.A.R. 3118, effective January 7, 2013 (Supp. 12-4).

Article 7 COST PRINCIPLES

Ariz. Admin. Code § R2-7-701 Expired

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Amended by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Section expired under A.R.S. § 41-105 6(J) at 23 A.A.R. 1757, effective May 9, 2017 (Supp. 17-2).

Ariz. Admin. Code § R2-7-702 Determination of Fair and Reasonable Price

A. For contracts or contract modifications that exceed $100,000, the agency chief procurement officer shall determine in writing that the price is fair and reasonable only when one of the following requirements is met:

1. The contract or modification is based on adequate price competition;

2. Price is supported by an established catalog or market prices;

3. Price is set by law or rule; or

4. Price is supported by relevant, historical price data.

B. The agency chief procurement officer shall request the submission of cost or pricing data from the offeror or contractor when:

1. The agency chief procurement officer cannot determine the price is fair and reasonable based on the criteria in subsection (A); or

2. The agency chief procurement officer determines in writing that it is in the best interest of the state regardless of the amount of the contract or contract modification.

C. The agency chief procurement officer shall submit a request to the state procurement administrator to waive the requirement for submission of cost or pricing data to the state procurement administrator if the proposed contract or contract modification exceeds $100,000. The request shall be in writing and state the reasons for the waiver.

D. The state procurement administrator shall either:

1. Issue written approval of the request for waiver;

2. Request additional information from the agency chief procurement officer upon which to base a decision; or

3. Deny the request.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-703 Submission and Certification of Cost or Pricing Data

A. The offeror or contractor shall submit certified cost or pricing data in the manner, and within the time-frames, prescribed by the agency chief procurement officer.

B. The offeror or contractor shall keep all cost or pricing data submitted current until the negotiations are concluded.

C. The offeror or contractor shall certify cost or pricing data by including a signed statement with the submission that all data is accurate, complete, and current to the best of the offeror's or contractor's knowledge and belief as of a date mutually determined with the agency chief procurement officer.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-704 Refusal to Submit Cost or Pricing Data

A. If an offeror fails to submit cost or pricing data in the required form and within the time-frames required, the agency chief procurement officer may reject the offer.

B. If a contractor fails to submit data to support a contract modification in the form required and within the time-frames required, the agency chief procurement officer may:

1. Reject the contract modification; or

2. Set the amount of the contract modification subject to the contractor's rights under Article 9 of the Arizona Procurement Code.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-705 Defective Cost or Pricing Data

A. The agency chief procurement officer may reduce the contract price if, upon written determination, the cost or pricing data is defective.

B. The agency chief procurement officer shall reduce the contract price in the amount of the defect plus related overhead and profit or fee, if the defective data was used in awarding the contract or contract modification.

C. The offeror or contractor may appeal any dispute regarding the existence of defective cost or pricing data or the amount of an adjustment due to defective cost or pricing data as a contract claim under Article 9 of this Chapter. The price, as adjusted by the agency chief procurement officer, shall remain in effect until any claim is settled or resolved under Article 9 of this Chapter.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Article 8 TRANSFERRED

Ariz. Admin. Code § R2-7-801 Transferred

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Transferred to R2-15-801 (Supp. 91-3).

Ariz. Admin. Code § R2-7-802 Transferred

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Transferred to R2-15-802 (Supp. 91-3).

Ariz. Admin. Code § R2-7-803 Transferred

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Transferred to R2-15-803 (Supp. 91-3).

Ariz. Admin. Code § R2-7-804 Transferred

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Transferred to R2-15-804 (Supp. 91-3).

Ariz. Admin. Code § R2-7-805 Transferred

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Transferred to R2-15-805 (Supp. 91-3).

Ariz. Admin. Code § R2-7-806 Transferred

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Transferred to R2-15-806 (Supp. 91-3).

Ariz. Admin. Code § R2-7-807 Transferred

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Transferred to R2-15-807 (Supp. 91-3).

Ariz. Admin. Code § R2-7-808 Transferred

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Transferred to R2-15-808 (Supp. 91-3).

Ariz. Admin. Code § R2-7-809 Transferred

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Transferred to R2-15-809 (Supp. 91-3).

Ariz. Admin. Code § R2-7-810 Transferred

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Transferred to R2-15-810 (Supp. 91-3).

Article 9 LEGAL AND CONTRACTUAL REMEDIES

Ariz. Admin. Code § R2-7-901 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-902 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-903 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-904 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-905 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-906 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-907 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-908 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-909 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-910 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-911 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-912 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-913 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-914 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-915 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-916 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-917 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-918 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-919 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-920 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-921 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-922 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-923 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-924 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-925 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-926 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-927 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-928 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-929 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-930 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-931 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-932 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-933 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-934 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-935 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-936 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-937 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Article 10 INTERGOVERNMENTAL PROCUREMENT

Ariz. Admin. Code § R2-7-1001 Approval to Enter into a Cooperative Purchasing Agreement

A. Agency chief procurement officers may use Arizona state contracts without a cooperative purchasing agreement.

B. Agency chief procurement officers shall submit a written request to the state procurement administrator before participating in a cooperative purchasing agreement with another public procurement unit or group of public procurement units. The written request for approval shall specify the manner which the administering public procurement unit complies with A.R.S. § 41-2634.

C. The state procurement administrator shall either:

1. Issue written approval, with any conditions or restrictions;

Request additional information from the state government unit; or

3. Deny the request.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed; new Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-1002 Cooperative Purchasing Agreement Administered by an Agency Chief Procurement Officer

A. An agency chief procurement officer shall ensure that any cooperative purchasing agreement administered for use by other eligible procurement units under A.R.S. § 41-2632 provides that:

1. Payment for materials or services and inspection and acceptance of materials or services are the responsibility of the using eligible procurement unit;

2. Failure of an eligible procurement unit to secure performance from the contractor in accordance with the terms and conditions of its purchase order does not necessarily require the state to exercise rights or remedies;

3. The exercise of any rights or remedies by the eligible procurement unit shall be the exclusive obligation of that unit. The state, as the contract administrator and without subjecting itself to any liability, may join in the resolution of any controversy;

4. The eligible procurement unit shall not use an Arizona state contract as a method for obtaining additional concessions or reduced prices for similar material or services; and

5. An agency chief procurement officer may terminate without notice any cooperative purchasing agreement if the eligible procurement unit fails to comply with the terms of the contract.

B. The state procurement administrator may authorize a state governmental unit to establish an Arizona state contract which may be used by designated eligible procurement units.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed; new Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-1003 Purchasing from a Cooperative Contract

A. The agency chief procurement officer shall not procure materials, services, professional services, construction or construction services from any cooperative contracts available under an existing Arizona state contract, unless authorized by the state procurement administrator.

B. If it is in the best interest of the state and at the discretion of the agency chief procurement officer, a cooperative contract may be used if the following criteria, at a minimum, are met:

1. The cooperative contract was awarded through the competitive process and documentation is available to substantiate the award, including:

a. Bidder's list,

b. Solicitation included evaluation factors,

c. Multiple offers received,

d. Bid tabulation and evaluation offers, and

e. Basis for cooperative contract award with established evaluation factors.

2. Cost analysis to determine price is fair and reasonable as prescribed by R2-7-702;

3. Review of cooperative contract terms and conditions; and

4. Vendor's willingness to extend cooperative contract to the state.

C. Purchases under a cooperative contract as permitted by this subsection shall not, in the aggregate, exceed 25% of the initial value, or estimated value for term contracts, of the cooperative contract or $500,000, whichever is lesser, unless the state procurement administrator determines in writing that the purchase is in the best interest to the state and the price is determined fair and reasonable pursuant to R2-7-702.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed; new Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Section R2-7-1003 renumbered to R2-7-1004; new Section R2-7-1003 made by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-1004 Establishment of a Committee as Required by A.R.S. Section 41-2636

A. The Director shall appoint a committee as required by A.R.S. § 41-2636.

B. The committee shall be comprised of at least seven members, including the committee chair, representing:

1. Arizona Correctional Industries ("ACI");

2. Arizona Industries for the Blind ("AIB");

3. Certified nonprofit agency that serves individuals with disabilities (CNAID) as defined in A.R.S. § 41-2636(G);

4. Other public procurement units.

C. The state procurement administrator or the state procurement administrator's designee shall chair the committee.

D. The committee chair may appoint sub-committees to assist in the evaluation of materials and services under consideration by the committee as a set-aside.

E. The committee shall meet at least once each fiscal year quarter to report compliance with A.R.S. § 41-2636(F).

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed; new Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Section R2-7-1004 renumbered to R2-7-1005; new Section R2-7-1004 renumbered from R2-7-1003 and amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-1005 Certification as Non-profit Agency for Disabled Individuals

A. A non-profit organization may request written approval from the committee for certified status as a non-profit agency for disabled individuals for the purpose of being eligible for set-aside contracts by submitting information that satisfies the criteria identified in A.R.S. § 41-2636(A) and 41-2636(G).

B. The committee shall review the information submitted and respond to the requestor in writing by:

1. Approving the request for certification;

2. Denying the request for certification; or

Requesting more information.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Amended effective April 2, 1993 (Supp. 93-2). Section repealed; new Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Section R2-7-1005 renumbered to R2-7-1006; new Section R2-7-1005 renumbered from R2-7-1004 and amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-1006 Application for Approval as Required by A.R.S. Section 41-2636 to Become a Certified Non-profit Agency for Disabled Individuals

A. A non-profit organization requesting certification by the committee as a non-profit agency for disabled individuals shall submit the following written information to the State Procurement Office, attention of the committee chair:

1. Name of organization, address, contact name, and contact information;

2. Description of the non-profit activity center;

3. Evidence of the organization's non-profit status;

4. A statement that the business is operated in accordance with A.R.S. § 41-2636(G);

5. A statement of Occupational Safety and Health Administration compliance; and

6. The signature and title of the responsible party within the applicant's organization.

B. The committee shall review the submitted application at the next scheduled committee meeting and may do any of the following:

1. Approve the organization as a certified non-profit agency for disabled individuals;

2. Table the application and request additional information; or

Decline the application.

History

• Former Section R2-7-1006 adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section repealed, new Section R2-7-1006 renumbered from R2-7-1007 and amended effective April 2, 1993 (Supp. 93-2). Section repealed; new Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Section R2-7-1006 renumbered to R2- 7-1007; new Section R2-7-1006 renumbered from R2-7- 1005 and amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-1007 Approval of Specific Materials or Services for Set-aside Use

A. ACI, AIB, CNAID shall submit information to the committee to request approval of the material or service for mandatory set-aside use. The applicant shall include the following information:

1. A description of the specific material or service;

2. The pricing offered;

3. Documentation that the pricing offered is fair market pricing; and

Information regarding availability.

B. The committee shall evaluate each offered material or service to determine:

1. The existence and extent of a need within state governmental units for the material or service;

2. The ability to produce and deliver the material or service to meet the reasonable requirements of the state governmental units; and

3. Whether the offered price for the material or service is reasonable.

C. The committee may:

1. Approve the requested material or service for use as a mandatory set-aside contract;

2. Establish a sub-committee to study and make a recommendation on the request;

3. Request additional information;

4. Deny the request; or

5. Designate the material or service as available for optional use by a state governmental unit or local public procurement unit under A.R.S. § 41-2636(E).

History

• Former Section R2-7-1007 adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Section renumbered to R2-7-1006, new Section R2-7-1007 adopted effective April 2, 1993 (Supp. 93-2). Section repealed; new Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Section R2-7-1007 renumbered to R2-7-1008; new Section R2-7-1007 renumbered from R2-7-1006 and amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-1008 Expired

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Former Section R2-7-1008 renumbered to R2-7-1009, new Section R2-7-1008 adopted effective April 2, 1993 (Supp. 93-2). Section repealed; new Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3511, effective 2/2/2015. Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Former Section R2-7-1008 renumbered to R2-7-1009, new Section R2-7-1008 adopted effective April 2, 1993 (Supp. 93-2). Section repealed; new Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Section R2-7-1008 renumbered to R2-7-1009; new Section R2-7-1008 renumbered from R2-7-1007 and amended by final rulemaking at 20 A.A.R. 3510, effective February 2, 2015 (Supp. 14-4). Section expired under A.R.S. § 41-1056(J) at 23 A.A.R. 1757, effective May 9, 2017 (Supp. 17-2).

Ariz. Admin. Code § R2-7-1009 Contract Awards Initiated by an Agency Chief Procurement Officer or Local Public Procurement Unit

A. Competition is not required under A.R.S. § 41-2636(D) to enter into a contract for a material or service that is offered from a set-aside agency, but may be used at the discretion of the agency chief procurement officer or local public procurement unit. If competition is used, an agency chief procurement officer may either:

1. Seek competition only from applicable set-aside agencies; or

2. Seek competition under A.R.S. §§ 41-2533, 41-2534, or 2535.

B. Contracts awarded under this Section, shall not exceed five years, including any renewal options.

History

• Emergency rule adopted effective July 17, 1991, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 91-3). Emergency expired. Emergency rule re-adopted without change effective December 18, 1991, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 91-4). Emergency expired, text rescinded. Former Section R2-7-1009 renumbered to R2-7-1010, new Section R2-7-1009 renumbered from R2-7-1008 and amended effective April 2, 1993 (Supp. 93-2). Section repealed; new Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3511, effective 2/2/2015.

Ariz. Admin. Code § R2-7-1010 Set-aside Application Dispute Process

A. Any interested party may dispute any committee decision.

B. An interested party shall submit the dispute of a committee decision to the committee chair in writing and shall include:

1. Name, address, and telephone number of the person submitting the dispute;

Signature of the person or the person's representative;

3. Identification of the set-aside application disputed;

4. A detailed statement of the legal and factual grounds for the dispute including copies of relevant documents; and

5. The form of relief requested.

C. A dispute of a set-aside application shall be filed with the committee chair through the State Procurement Office within 14days after the person who submits the dispute knows or should have known the basis of the dispute.

D. The committee chair shall promptly give written notice of the dispute to the set-aside applicant and the committee.

E. The committee chair shall resolve the dispute. The committee chair shall issue a written decision within 14 days after the date the dispute has been filed. If the committee chair fails to issue a decision within 14 days, the person who submits the dispute may proceed as if the dispute has been denied.

F. An appeal of the decision of the committee chair shall be made to the director under R2-7-A905, substituting "committee chair" for "agency procurement officer."

History

• Former Section R2-7-1009 renumbered to R2-7-1010 effective April 2, 1993 (Supp. 93-2). Amended by final rulemaking at 20 A.A.R. 3511, effective 2/2/2015.

Article 13 REPEALED

Ariz. Admin. Code § R2-7-1301 Repealed

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Repealed by final rulemaking at 18 A.A.R. 3118, effective January 7, 2013 (Supp. 12-4).

Article 3 SOURCE SELECTION AND CONTRACT FORMATION

Part A GENERAL PROVISIONS

Ariz. Admin. Code § R2-7-A301 Source Selection Method: Determination Factors

A. A state governmental unit shall use any existing Arizona state contract designated as mandatory to satisfy requirements for those materials and services covered by such contracts.

B. If a state governmental unit believes that an Arizona state contract, designated as mandatory, does not satisfy its requirements, the state governmental unit may only procure the material or service from another source with the written approval of the state procurement administrator and in conformance with the applicable source selection method.

C. The agency chief procurement officer shall determine the applicable source selection method for a procurement, estimating the aggregate dollar amount of the contract and ensuring that the procurement is not artificially divided, fragmented, or combined to circumvent the Arizona Procurement Code.

D. The agency chief procurement officer shall not award a contract or incur an obligation on behalf of the state unless sufficient funds are available for the procurement, consistent with A.R.S. § 35-154. If it is reasonable to believe that sufficient funds will become available for a procurement, the agency chief procurement officer may issue a notice with the solicitation indicating that funds are not currently available and that any contract awarded will be conditioned upon the availability of funds.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Article 9 LEGAL AND CONTRACTUAL REMEDIES

Part A PROTEST OF SOLICITATIONS AND CONTRACT AWARDS

Ariz. Admin. Code § R2-7-A901 Protest of Solicitations and Contract Awards

A. Any interested party may protest a solicitation, a determination of not susceptible for award, or the award of a contract.

B. The interested party shall file the protest in writing with the agency chief procurement officer, with a copy to the state procurement administrator, and shall include the following information:

1. The name, address and telephone number of the interested party;

2. The signature of the interested party or the interested party's representative;

3. Identification of the purchasing agency and the solicitation or contract number;

4. A detailed statement of the legal and factual grounds of the protest including copies of relevant documents; and

5. The form of relief requested.

C. If the protest is based upon alleged improprieties in a solicitation that are apparent before the offer due date and time, the interested party shall file the protest before the offer due date and time.

D. In cases other than those covered in subsection (C), the interested party shall file the protest within 10 days after the agency chief procurement officer makes the procurement file available for public inspection.

E. The interested party may submit a written request to the agency chief procurement officer for an extension of the time limit for protest filing set forth in subsection (D). The written request shall be submitted before the expiration of the time limit set forth in subsection (D) and shall set forth good cause as to the specific action or inaction of the purchasing agency that resulted in the interested party being unable to submit the protest within the 10 days. The agency chief procurement officer shall approve or deny the request in writing, state the reasons for the determination, and, if an extension is granted set forth a new date for submission of the filing.

F. If the interested party shows good cause, the agency chief procurement officer may consider a protest that is not timely filed.

G. The agency chief procurement officer shall immediately give notice of a protest to all offerors.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-A902 Stay of Procurements during the Protest

A. If a protest is filed before the solicitation due date, before the award of a contract, or before performance of a contract has begun, the agency chief procurement officer shall make a written determination to either:

1. Proceed with the award or contract performance, or

2. Stay all or part of the procurement if there is a reasonable probability the protest will be upheld or that a stay is in the best interest of the state.

B. The agency chief procurement officer shall provide the interested party, state procurement administrator, and other interested parties with a copy of the written determination.

C. The agency chief procurement officer may stay all or part of the procurement if it is determined that there is a reasonable probability the protest will be upheld or that a stay is in the best interest of the state. Determination of the stay decision shall be issued no later than the time of issuance of a procurement officer's decision in accordance with R2-7-A903.

D. Should the stay request be denied by the agency chief procurement officer the protestant may request a procurement stay from the state procurement administrator. Such requests for a procurement stay shall be submitted within 10 days of notification of the stay denial by the agency chief procurement officer.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 18 A.A.R. 3118, effective January 7, 2013 (Supp. 12-4).

Ariz. Admin. Code § R2-7-A903 Resolution of Solicitation and Contract Award Protests

A. The agency chief procurement officer has the authority to resolve a protest.

B. The agency chief procurement officer shall issue a written decision within 14 days after a protest has been filed under R2-7-A901 . The decision of the agency chief procurement officer shall contain the basis for the decision and a statement that the decision may be appealed to the Director within 30 days from receipt of the decision.

C. The agency chief procurement officer shall furnish the decision to the interested party, by certified mail, return receipt requested, or by any other method that provides evidence of receipt, with a copy to the state procurement administrator and the director.

D. The agency chief procurement officer may submit a written request to the director for an extension of the time limit for decisions under subsection (B). The director shall approve or deny the request in writing, state the reasons for the determination, and, if an extension is granted, set forth a new date for submission of the decision, not to exceed an additional 30 days. The director shall notify the agency chief procurement officer, the interested party, and the state procurement administrator in writing that the time for the issuance of a decision has been extended and the date by which a decision shall be issued.

E. If the agency chief procurement officer fails to issue a decision within the time limits set forth in this Article, the interested party may proceed as if the agency chief procurement officer had issued an adverse decision.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-A904 Remedies by the Agency Chief Procurement Officer

A. If the agency chief procurement officer sustains a protest in whole or part and determines that a solicitation, a determination of not susceptible for award, or contract award does not comply with the procurement statutes and regulations, the agency chief procurement officer shall implement an appropriate remedy.

B. In determining an appropriate remedy, the agency chief procurement officer shall consider all the circumstances surrounding the procurement or proposed procurement including:

1. The seriousness of the procurement deficiency;

2. The degree of prejudice to other interested parties or to the integrity of the procurement system;

3. The good faith of the parties;

4. The extent of performance;

5. The costs to the state;

6. The urgency of the procurement;

7. The impact on the agency's mission; and

8. Other relevant issues.

C. An agency chief procurement officer may implement any of the following appropriate remedies:

1. Decline to exercise an option to renew under the contract;

Terminate the contract;

3. Amend the solicitation;

4. Issue a new solicitation;

5. Award a contract consistent with procurement statutes and regulations; or

6. Render such other relief as determined necessary to ensure compliance with procurement statutes and regulations.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-A905 Appeals to the Director

A. An interested party may appeal the decision entered or deemed to be entered by the agency chief procurement officer to the director within 30 days after the date the decision is received or deemed received under R2-7-A903 . The interested party shall file a copy of the appeal with the director, the agency chief procurement officer, and the state procurement administrator.

B. The interested party shall file the appeal in writing and shall include the following information:

1. The information prescribed in R2-7-A901(B) including the identification of confidential information under R2-7-103;

2. A copy of the decision of the agency chief procurement officer; and

3. The precise factual or legal error in the decision of the agency chief procurement officer from which an appeal is taken.

C. The director may consider any appeal that is not filed timely if:

1. The interested party shows good cause; or

2. The director finds there is good cause.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-A906 Notice of Appeal to the Director

A. The agency chief procurement officer shall promptly give notice of the appeal to all offerors.

B. The director shall, upon request, furnish copies of the appeal to all offerors subject to the provisions of R2-7-103 .

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-A907 Stay of Procurement during Appeal to Director

A. If a stay is issued under R2-7-A902, the filing of an appeal shall automatically continue the stay, unless the Director makes a written determination that the award of the contract or a notice to proceed with contract performance is necessary to protect the substantial interests of the state.

B. Following a review of the agency chief procurement officer's or the state procurement officer's decision and the interested party's appeal, the director may stay the procurement if the director determines that there is a reasonable probability the protest will be upheld or that a stay is in the best interests of the state.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-A908 Agency Report

A. The agency chief procurement officer shall file a complete report on the appeal with the director and the state procurement administrator within 21 days after the date the appeal is filed, at the same time furnishing a copy of the report to the interested party. The agency chief procurement officer shall also provide a copy of the report to any interested parties who request a copy, at their cost. The report shall contain copies of:

1. The appeal;

2. The offer submitted by the interested party;

3. The offer of the firm that is being considered for award;

4. The solicitation, including the specifications or portions relevant to the appeal;

5. The abstract of offers or relevant portions;

6. Any other documents that are relevant to the protest; and

7. A statement by the agency chief procurement officer setting forth findings, actions, recommendations and any additional evidence or information necessary to determine the validity of the appeal.

B. The agency chief procurement officer may submit a written request to the director for an extension of the time period for filing the report as prescribed in subsection (A), identifying the reason for extension. The director shall approve or deny the request in writing, state the reasons for the determination, and, if an extension is granted, set forth a new date for the submission of the report. The director shall notify the agency chief procurement officer, the state procurement administrator, and the interested party in writing that the time for the submission of the report is extended, providing the date on which the report must be submitted.

C. The interested party shall file comments on the agency report with the director within 10 days after receipt of the report. The interested party shall provide copies of the comments to the agency chief procurement officer, the state procurement administrator, and other interested parties.

D. The interested party may submit a written request to the director for an extension of the period for submission of comments, identifying the reasons for the extension. The director shall approve or deny the request in writing, state the reasons for the determination, and, if an extension is granted, set forth a new date for the submission of filing comments. The director shall notify the agency chief procurement officer and the state procurement administrator of any extension.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 18 A.A.R. 3118, effective January 7, 2013 (Supp. 12-4).

Ariz. Admin. Code § R2-7-A909 Remedies by the Director

If the Director sustains the appeal in whole or part and determines that a solicitation, a not susceptible for award determination, or an award does not comply with procurement statutes and regulations, the director shall implement remedies as provided in R2-7-A904 or R2-7-A910.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3511, effective 2/2/2015.

Ariz. Admin. Code § R2-7-A910 Informal Settlement Conference

In any protest, claim or debarment proceeding, the Director may request to hold an informal settlement conference with all interested parties. The conference may be held at any time prior to a final administrative decision. If an informal settlement conference is held, a person with the authority to act on behalf of the interested party must be present. The agency chief procurement officer shall notify the interested parties in writing that statements, either written or oral, made at the conference, including a written document, created or expressed solely for the purpose of settlement negotiations are inadmissible in any subsequent administrative or judicial hearing. Should any interested party choose not to participate in an informal settlement conference, the Director, or the Director's designee, in his or her discretion, may conduct the conference with those interested parties that appear, or reschedule the conference, or terminate the conference. If the informal settlement conference results in a full settlement agreement between all interested parties, that agreement shall be reduced to writing, signed by the interested parties, and entered as the final administrative decision in the proceeding. If the interested parties do not reach agreement on all matters at issue in the proceedings, but do agree to resolve one or some of the issues, that partial agreement shall be reduced to writing, be signed by the interested parties, and bind the interested parties through the remainder of the proceedings. If the Director, or the Director's designee, participates in an informal settlement conference, the Director, or the Director's designee, may not participate in or attempt to influence the outcome of the final administrative decision. Further, in making a final administrative decision, the Director shall not give any weight to whether or not an informal settlement conference has been held, or to any consideration of the perceived success or failure of the informal settlement conference.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3511, effective 2/2/2015.

Ariz. Admin. Code § R2-7-A911 Dismissal before Hearing

A. The Director may dismiss, upon written determination, an appeal in whole or in part before scheduling a hearing if:

1. The appeal does not state a valid basis for protest;

2. The appeal is untimely as prescribed under R2-7-A905; or

3. The appeal attempts to raise issues not raised in the protest.

B. The Director shall notify the interested party, the agency chief procurement officer, and the state procurement administrator in writing of a determination to dismiss an appeal before hearing.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3511, effective 2/2/2015.

Ariz. Admin. Code § R2-7-A912 Hearing

The Director shall resolve appeals of solicitation or contract award decisions as contested cases under A.R.S. § 41-1092.07.

History

• Adopted by final rulemaking at 20 A.A.R. 3511, effective 2/2/2015.

Article 3 SOURCE SELECTION AND CONTRACT FORMATION

Part B COMPETITIVE SEALED BIDDING

Ariz. Admin. Code § R2-7-B301 Solicitation

A. An agency chief procurement officer shall issue an invitation for bids at least 14 days before the offer due date and time, unless the agency chief procurement officer determines a shorter time is necessary for a particular procurement. If as horter time is necessary, the agency chief procurement officer shall document the specific reasons in the procurement file.

B. An agency chief procurement officer shall:

1. Advertise the procurement in accordance with A.R.S. § 41-2533(C); and

2. At a minimum, provide written notice to the prospective suppliers that have registered with the state procurement office for the specific material, service, or construction solicited.

C. An agency chief procurement officer shall include the following in the solicitation:

1. Instruction to offerors, including:

a. Instructions and information to offerors concerning the offer submission requirements, offer due date and time, the location where offers or other documents will be received, and the offer acceptance period;

b. The deadline date for requesting a substitution or exception to the solicitation;

c. The manner by which the offeror is required to acknowledge amendments;

d. The minimum required information in the offer;

e. The specific requirements for designating trade secrets and other proprietary information as confidential;

f. Any specific responsibility criteria;

g. Whether the offeror is required to submit samples, descriptive literature, or technical data with the offer;

h. Any evaluation criteria;

i. A statement of where documents incorporated by reference are available for inspection and copying;

j. A statement that the agency may cancel the solicitation or reject an offer in whole or in part;

k. Certification by the offeror that submission of the offer did not involve collusion or other anticompetitive practices;

l. Certification by the offeror of compliance with A.R.S. § 41-3532 when offering electronics or information technology products, services, or maintenance;

m. That the offeror is required to declare whether the offeror has been debarred, suspended, or otherwise lawfully prohibited from participating in any public procurement activity, including, but not limited to, being disapproved as a subcontractor of any public procurement unit or other governmental body;

n. Any bid security required;

o. The means required for submission of an offer. The solicitation shall specifically indicate whether hand delivery, U.S. mail, electronic mail, facsimile, or other means are acceptable methods of submission;

p. Any designation of the specific bid items and amounts to be recorded at offer opening; and

q. Any other offer submission requirements;

Specifications, including:

a. Any purchase description, specifications, delivery or performance schedule, and inspection and acceptance requirements;

b. If a brand name or equivalent specification is used, instructions that the use of a brand name is for the pur-pose of describing the standard of quality, performance, and characteristics desired and is not intended to limit or restrict competition. The solicitation shall state that products substantially equivalent to the brands designated qualify for consideration; and

c. Any other specification requirements;

3. Terms and Conditions, including:

a. Whether the contract will include an option for extension; and

b. Any other contract terms and conditions.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-B302 Pre-offer Conferences

An agency chief procurement officer may conduct one or more pre-offer conferences. If a pre-offer conference is conducted, it shall be a reasonably sufficient time prior to the offer due date and time. Statements made during a pre-offer conference are not amendments to the solicitation.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-B303 Solicitation Amendment

A. An agency chief procurement officer shall issue a solicitation amendment to do any or all of the following:

1. Make changes in the solicitation;

2. Correct defects or ambiguities;

3. Provide additional information or instructions; or

4. Extend the offer due date and time if the agency chief procurement officer determines that an extension is in the best interest of the state.

B. If a solicitation is changed by a solicitation amendment, the agency chief procurement officer shall notify suppliers to whom the agency chief procurement officer distributed the solicitation.

C. It is the responsibility of the offeror to obtain any solicitation amendments. An offeror shall acknowledge receipt of an amendment in the manner specified in the solicitation or solicitation amendment on or before the offer due date and time.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-B304 Modification or Withdrawal of Offer Before Offer Due Date and Time

A. An offeror may modify or withdraw its offer, in writing, before the offer due date and time.

B. The agency chief procurement officer shall place the document submitted by the offeror in the procurement file as a record of the modification or withdrawal.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-B305 Cancellation of a Solicitation Before Offer Due Date and Time

A. Based on the best interest of the state, an agency chief procurement officer may cancel a solicitation before the offer due date and time.

B. The agency chief procurement officer shall notify suppliers to whom the agency chief procurement officer distributed the solicitation.

C. The agency chief procurement officer shall not open offers after cancellation. The agency chief procurement officer may discard the offer after 30 days from notice of solicitation cancellation, unless the offeror requests the offer be returned.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-B306 Receipt, Opening, and Recording of Offers

A. An agency chief procurement officer shall maintain a record of offers received for each solicitation and shall record the time and date when an offer is received. The agency chief procurement officer shall store each unopened offer in a secure place until the offer due date and time. When practical, an agency chief procurement officer should use the eProcurement system for this process.

B. A purchasing agency may open an offer to identify the offeror. If this occurs, the agency chief procurement officer shall record the reason for opening the offer, the date and time the offer was opened, and the solicitation number. The agency chief procurement officer shall secure the offer and retain it for public opening.

C. The agency chief procurement officer shall open offers after the offer due date and time. The agency chief procurement officer shall record the name of each offeror, the amount of each offer, and any other relevant information as determined by the agency chief procurement officer. The agency chief procurement officer shall make the record of offers available for public viewing.

D. Except for the information identified in subsection (C), the agency chief procurement officer shall ensure that information contained in the offer remains confidential until contract award and is shown only to those persons assisting in the evaluation process.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015. Amended by final expedited rulemaking at 28 A.A.R. 2117, effective 8/12/2022.

Ariz. Admin. Code § R2-7-B307 Late Offers, Modifications, Withdrawals

A. If an offer, modification, or withdrawal is received after the due date and time, at the location designated in the solicitation (which may be the eProcurement system), an agency chief procurement officer shall determine the offer, modification, or withdrawal as late. If the eProcurement system is the designated location for the offer, modification, or withdrawal, prospective offerors are responsible for allowing sufficient time to ensure that their submission is properly filed in the eProcurement system by the appropriate due date and time.

B. The agency chief procurement officer shall reject a late offer, modification, or withdrawal unless:

1. The document is received before the contract award at the location designated in the solicitation; and

2. The document would have been received by the offer due date and time, but for the action or inaction of personnel directly serving the purchasing agency.

C. Upon receiving a late offer, modification, or withdrawal, the agency chief procurement officer shall:

1. If the document is hand delivered, refuse to accept delivery; or

2. If the document is not hand delivered, record the time and date of receipt and promptly send written notice of late receipt to the offeror. The agency chief procurement officer may discard the document within 30 days after the date on the notice unless the offeror requests the document be returned.

D. The agency chief procurement officer shall document a refusal under subsection (C)(1) and place the document or a copy of the notice required in subsection (C)(2) in the procurement file.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final expedited rulemaking at 28 A.A.R. 2117, effective 8/12/2022.

Ariz. Admin. Code § R2-7-B308 Cancellation of Solicitation After Receipt of Offers and Before Award

A. Based on the best interest of the state, an agency chief procurement officer may cancel a solicitation after offer due date and time. The agency chief procurement officer shall prepare a written justification for cancellation and place it in the procurement file.

B. The agency chief procurement officer shall notify offerors of the cancellation in writing.

C. The agency chief procurement officer shall retain offers received under the canceled solicitation in the procurement file. If the purchasing agency intends to issue another solicitation within six months after cancellation of the procurement, the agency chief procurement officer shall withhold the offers from public inspection. After award of a contract under the subsequent solicitation, the agency chief procurement officer shall make offers submitted in response to the canceled solicitation available for public inspection except for information determined to be confidential pursuant to R2-7-103.

D. In the event of cancellation, the agency chief procurement officer shall promptly return any bid security provided by an offeror.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-B309 One Offer Received

If only one offer is received in response to a solicitation, the agency chief procurement officer shall review the offer and either:

1. Award the contract to the offeror and prepare a written determination that:

a. The price submitted is fair and reasonable under R2-7-702,

b. The offer is responsive, and

c. The offeror is responsible, or

2. Reject the offer and:

a. Resolicit for new offers,

b. Cancel the procurement, or

c. Use a different source selection method authorized under the Arizona Procurement Code.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 18 A.A.R. 3118, effective January 7, 2013 (Supp. 12-4).

Ariz. Admin. Code § R2-7-B310 Offer Mistakes Discovered After Offer Opening and Before Award

A. If an apparent mistake in an offer, relevant to the award determination, is discovered after opening and before award, an agency chief procurement officer shall contact the offeror for written confirmation of the offer. The agency chief procurement officer shall designate a time-frame within which the offeror shall either:

1. Confirm that no mistake was made and assert that the offer stands as submitted; or

2. Acknowledge that a mistake was made, and include all of the following in a written response:

a. Explanation of the mistake and any other relevant information;

b. A request for correction including the corrected offer or a request for withdrawal; and

c. The reasons why correction or withdrawal is consistent with fair competition and in the best interest of the state.

B. An offeror who discovers a mistake in its offer may request correction or withdrawal in writing and shall include all of the following in the written request:

1. Explanation of the mistake and any other relevant information;

A request for correction including the corrected offer or a request for withdrawal; and

3. The reasons why correction or withdrawal is consistent with fair competition and in the best interest of the state.

C. An agency chief procurement officer may permit an offeror to correct a mistake if the mistake and the intended offer are evident in the uncorrected offer; for example, an error in the extension of unit prices. The agency chief procurement officer shall not permit a correction that is prejudicial to the state or fair competition.

D. An agency chief procurement officer shall permit an offeror to furnish information called for in the solicitation but not supplied if the intended offer is evident and submittal of the information is not prejudicial to other offerors.

E. An agency chief procurement officer shall make a written determination of whether correction or withdrawal is permitted, based on whether the action is consistent with fair competition and in the best interest of the state.

F. If the offeror fails to act under subsection (A) the offeror is considered nonresponsive and the agency chief procurement officer shall place a written determination that the offeror is nonresponsive in the procurement file.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-B311 Extension of Offer Acceptance Period

A. To extend the offer acceptance period, an agency chief procurement officer shall notify all offerors in writing of an extension and request written concurrence from each offeror.

B. To be eligible for a contract award, an offeror shall submit a written concurrence to the extension. The agency chief procurement officer shall reject an offer as nonresponsive if written concurrence is not provided as requested.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-B312 Bid Evaluation

A. An agency chief procurement officer shall evaluate offers to determine which offer provides the lowest cost to the state in accordance with any objectively measurable factors set forth in the solicitation.

2. B. An agency chief procurement officer shall consider total life cycle costs including residual value when evaluating offers for the procurement of materials or services identified in A.R.S. § 41-2554.

B C. An agency chief procurement officer shall conduct an evaluation to determine whether an offeror is responsive, based upon the requirements set forth in the solicitation. The agency chief procurement officer shall reject as nonresponsive any offer that does not meet the solicitation requirements.

C D. If there are two or more low, responsive offers from responsible offerors that are identical in price, the agency chief procurement officer shall make the award by drawing lots. If time permits, the agency chief procurement officer shall provide the offerors involved an opportunity to attend the drawing. The agency chief procurement officer shall ensure that the drawing is witnessed by at least one person other than the agency chief procurement officer.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-B313 Responsibility Determinations

A. The agency chief procurement officer shall determine before an award whether an offeror is responsible or nonresponsible.

B. The agency chief procurement officer shall consider the following factors before determining that an offeror is responsible or nonresponsible:

1. The offeror's financial, business, personnel, or other resources, such as subcontractors;

2. The offeror's record of performance and integrity;

3. Whether the offeror has been debarred or suspended;

4. Whether the offeror is legally qualified to contract with the state;

5. Whether the offeror promptly supplied all requested information concerning its responsibility; and

6. Whether the offeror meets the responsibility criteria specified in the solicitation.

C. If the agency chief procurement officer determines an offeror is nonresponsible, the agency chief procurement officer shall promptly send a determination to the offeror stating the basis for the determination. The agency chief procurement officer shall file a copy of the determination in the procurement file.

D. The agency chief procurement officer shall only disclose responsibility information furnished by an offeror in accordance with A.R.S. § 41-2540.

E. For the offeror awarded a contract, the agency chief procurement officer's signature on the contract constitutes a determination that the offeror is responsible.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-B314 Contract Award

A. An agency chief procurement officer shall award the contract to the lowest responsible and responsive offeror whose offer conforms in all material respects to the requirements and criteria set forth in the solicitation. Unless otherwise provided in the solicitation, an award may be made for an individual line item, any group of line items, or all line items.

B. The agency chief procurement officer shall keep a record showing the basis for determining the successful offeror or offerors in the procurement file.

C. The agency chief procurement officer shall notify all offerors of an award.

D. After a contract is awarded, the agency chief procurement officer shall return any bid security provided by the offeror.

E. Within 3 days after a contract is awarded, the agency chief procurement officer shall make the procurement file, including all offers, available for public inspection, redacting information that is confidential under R2-7-103.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-B315 Mistakes Discovered After Award

A. If a mistake in the offer is discovered after the award, the offeror may request withdrawal or correction in writing and shall include all of the following in the written request:

1. Explanation of the mistake and any other relevant information;

2. A request for correction including the corrected offer or a request for withdrawal; and

3. The reasons why correction or withdrawal is consistent with fair competition and in the best interest of the state.

B. Based on the considerations of fair competition and the best interest of the state, the agency chief procurement officer may:

1. Allow correction of the mistake, if the resulting dollar amount of the correction is less than the next lowest offer;

Cancel all or part of the award; or

3. Deny correction or withdrawal.

C. After cancellation of all or part of an award, the agency chief procurement officer may award all or part of the contract to the next lowest responsible and responsive offeror, within 120 days from the date of award, based on the considerations of fair competition and the best interest of the state.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-B316 Multistep Sealed Bidding

A. An agency chief procurement officer shall obtain approval from the state procurement administrator before using multi-step sealed bidding as a source selection method.

B. To obtain approval for multistep sealed bidding, an agency chief procurement officer shall submit a written request to the state procurement administrator.

1. The written request shall contain all of the following:

a. An explanation that specifications or purchase descriptions are not available or sufficiently complete to permit full competition without technical evaluations and negotiations to ensure mutual understanding between each offeror and the state;

b. An identification of definite criteria that exist for evaluation of technical offers;

c. An identification that more than one available and technically qualified source exists; and

d. Confirmation that a fixed-price contract will be used.

2. The state procurement administrator shall:

a. Issue written approval, with any conditions or restrictions;

b. Request additional information from the agency chief procurement officer; or

c. Deny the request.

C. A. Multi-step sealed bidding is initiated by the issuance of an invitation to submit technical offers. An agency chief procurement officer shall issue an invitation to submit technical offers that contains all of the following information:

1. Notice that the procurement is conducted in two phases. In phase one unpriced technical offers are considered and selected. In phase two there is competitive bidding by offerors whose offers were selected in phase one;

2. The best description of the material or service solicited;

3. The requirements for each technical offer, such as drawings and descriptive literature;

4. The criteria for evaluating each technical offer;

5. The closing date and time for receipt of technical offers and the location where offers should be delivered or mailed; and

6. A statement that negotiations may be held regarding the unpriced technical offer.

D. B.An agency chief procurement officer may conduct a pre-offer conference. If a pre-offer conference is conducted, it shall be not less than seven days before the offer due date and time, unless the agency chief procurement officer makes a writ-ten determination that the specific needs of the procurement justify a shorter time period . Statements made during the pre-offer conference shall not be considered modifications to the solicitation. An agency chief procurement officer may con-duct a pre-offer conference within a reasonably sufficient time before offer due date and time to discuss the procurement requirements and solicit comments from prospective offerors. Amendments to the solicitation may be issued, if necessary, in accordance with R2-7-B303.

E. C. An agency chief procurement officer may amend an invitation to submit technical offers before or after submission of unpriced technical offers. The agency chief procurement officer shall notify all suppliers who received the solicitation of the amendment and specify a revised offer due date and time. These suppliers may submit new offers or revise existing offers. It is the responsibility of the offeror to obtain any solicitation amendments. An offeror shall acknowledge receipt of an amendment in the manner specified in the solicitation or solicitation amendment on or before the offer due date and time.

F. D. Unpriced technical offers shall not be opened publicly but shall be opened in the presence of two or more procurement officials. Late technical offers are not considered except under the circumstances set forth in R2-7-B307(B) . The agency chief procurement officer shall not disclose the contents of an unpriced technical offer to unauthorized persons.

G. E. Each unpriced technical offer shall be evaluated in accordance with the criteria in the invitation to submit technical offers to determine whether the offer is acceptable, potentially acceptable, or unacceptable. If the offer is unacceptable, the agency chief procurement officer shall issue a written determination that the offer is unacceptable, state the basis for the determination, and place the determination in the procurement file. If the agency chief procurement officer determines that an offeror's unpriced technical offer is unacceptable, the agency chief procurement officer shall notify that offeror in writing of the determination and indicate in the notice that the offeror is not afforded an opportunity to amend a technical offer.

H. F. An agency chief procurement officer may conduct negotiations with any offeror that submits an acceptable or potentially acceptable technical offer. During negotiations, the agency chief procurement officer shall not disclose any information obtained from an unpriced technical offer to any other offeror. After negotiations, the agency chief procurement officer shall establish a closing date for receipt of final technical offers and provide written notice of the closing date to offerors that submitted acceptable or potentially acceptable offers. The agency chief procurement officer shall maintain a record of all negotiations.

I. G. After receipt of final technical offers, an agency chief procurement officer shall determine which technical offers are acceptable for consideration in phase two. The agency chief procurement officer shall notify in writing each offeror whose technical offer was determined unacceptable.

J. H. At any time during phase one, an offeror may withdraw an offer.

K. I. Upon completion of phase one, an agency chief procurement officer shall issue a solicitation and conduct phase two as prescribed under R2-7-B301 through R2-7-B315 as a competitive sealed bidding procurement, except that the solicitation shall be issued only to offerors that submitted acceptable technical offers in phase one.

L. J. An agency chief procurement officer shall ensure that unpriced technical offers of unsuccessful offerors are available for public inspection except to the extent that the offer is confidential under R2-7-B306.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Article 9 LEGAL AND CONTRACTUAL REMEDIES

Part B CONTRACT CLAIMS

Ariz. Admin. Code § R2-7-B901 Controversies Involving Contract Claims Against the State

A. A claimant shall file a contract claim with the agency chief procurement officer, with a copy to the state procurement administrator, within 180 days after the claim arises. A claim filed after 180 days of the date on which the claim arose shall be considered untimely and rejected. The claim shall include the following:

1. The name, address, and telephone number of the claimant;

2. The signature of the claimant or claimant's representative;

3. Identification of the purchasing agency and the solicitation or contract number;

4. A detailed statement of the legal and factual grounds of the claim including copies of the relevant documents; and

5. The form and dollar amount of the relief requested

B. The agency chief procurement officer shall have the authority to settle and resolve contract claims, except that the agency chief procurement officer shall receive prior written approval of the state procurement administrator for the settlement or resolution of a claim in excess of the amount prescribed in A.R.S. § 41-2535.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final expedited rulemaking at 28 A.A.R. 2117, effective 8/12/2022.

Ariz. Admin. Code § R2-7-B902 Agency Chief Procurement Officer's Decision

A. The agency chief procurement officer shall take reasonable steps to work with the parties to a claim to resolve all or some of the issues in the claim through either discussions or an informal settlement conference under R2-7-A910.

B. The parties to a claim shall have 60 days to resolve the claim, unless this period is modified by the agency chief procurement officer as described in this subsection. The agency chief procurement officer may end the 60-day period early, if the agency chief procurement officer determines that the claim cannot be resolved by the parties. The agency chief procurement officer may also allow additional time for the parties to resolve the claim, upon request by all parties to the claim.

C. If any issues in the claim are not resolved by a mutual agreement between the parties to the claim as described in subsections (A) and (B) of this Section, then the agency chief procurement officer shall issue a decision within 60 days of the end of the time period for discussions or settlement described in subsection (B) of this Section. Before issuing a decision, the agency chief procurement officer shall review the facts pertinent to the claim and secure any necessary assistance from legal, fiscal, and other advisors. Upon a showing of good cause, the director may grant the agency chief procurement officer up to 30 additional days to issue this decision.

B. D. The agency chief procurement officer shall furnish the decision to the claimant, by certified mail, return receipt requested, or by any other method that provides evidence of receipt, with a copy to the state procurement administrator. The decision shall include:

1. A description of the claim;

2. A reference to the pertinent contract provision;

3. A statement of the factual areas of agreement or disagreement;

4. A statement of the agency chief procurement officer's decision, with supporting rationale; and

5. A paragraph which substantially states: "This is the final decision of the agency chief procurement officer. This decision may be appealed to the director of the Department of Administration. If you appeal, you must file a written notice of appeal containing the information required in R2-7-B904(B) with the director within 30 days from the date you receive this decision."

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final expedited rulemaking at 28 A.A.R. 2117, effective 8/12/2022.

Ariz. Admin. Code § R2-7-B903 Issuance of a Timely Decision

If the agency chief procurement officer fails to issue a decision within the appropriate time period as described in R2-7-B902, the claimant may proceed as if the agency chief procurement officer had issued an adverse decision.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final expedited rulemaking at 28 A.A.R. 2117, effective 8/12/2022.

Ariz. Admin. Code § R2-7-B904 Appeals and Reports to the Director

A. The claimant may appeal the final decision of the agency chief procurement officer to the director within 30 days from the date the decision is received. The claimant shall file a copy of the appeal with the director, the agency chief procurement officer, and the state procurement administrator.

B. The claimant shall file the appeal in writing and shall include the following:

1. A copy of the decision of the agency chief procurement officer;

2. A statement of the factual areas of agreement or disagreement; and

3. The precise factual or legal error in the decision of the agency chief procurement officer from which an appeal is taken.

C. The agency chief procurement officer shall file a complete report on the appeal with the director and the state procurement administrator within 14 days from the date the appeal is filed, providing a copy to the claimant at that time by certified mail, return receipt requested, or by any other method that provides evidence of receipt. The report shall include a copy of the claim, a copy of the agency chief procurement officer's decision, if applicable, and any other documents that are relevant to the claim.

D. The director shall resolve appeals on claim decisions as contested cases under A.R.S. § 41-1092.07.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-B905 Controversies Involving State Claims Against the Contractor

If the agency chief procurement officer is unable to resolve, by mutual agreement, a claim asserted by the state against a contractor, the agency chief procurement officer shall promptly refer the matter in writing to the director for resolution under A.R.S. § 41-1092.07. The agency chief procurement officer shall furnish a copy of the claim to the state procurement administrator.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Article 3 SOURCE SELECTION AND CONTRACT FORMATION

Part C COMPETITIVE SEALED PROPOSALS

Ariz. Admin. Code § R2-7-C301 Solicitation

A. Before soliciting for offers under this Section, an agency chief procurement officer shall determine in writing that an invitation for bid is not practicable or advantageous to the state before soliciting for offers under this Section. Competitive sealed bidding may not be practicable or advantageous if it is necessary to:

1. Use a contract other than a fixed-price type;

2. Negotiate with offerors concerning the technical and price aspects of their offers and any other aspects of their offeror the solicitation;

3. Permit offerors to revise their offers; or

4. Compare the different price, quality, and contractual factors of the offers submitted.

B. The state procurement administrator may make a class determination that it is either not practicable or not advantageous to the state to procure specified types of materials or services by invitation for bid. The state procurement administrator may modify or revoke a class determination at any time.

C. A. An agency chief procurement officer shall issue a request for proposal at least 14 days before the offer due date and time, unless the agency chief procurement officer determines a shorter time is necessary for a particular procurement. If as horter time is necessary, the agency chief procurement officer shall document the specific reasons in the procurement file.

D. B. The agency chief procurement officer shall:

1. Advertise in accordance with A.R.S. § 41-2534(C); and

2. At a minimum, provide written notice to prospective suppliers that have registered with the state procurement office for the specific material, service, or construction solicited.

E. C. The agency chief procurement officer shall include the following in the solicitation:

Instructions to offerors, including:

a. Instructions and information to offerors concerning the offer submission requirements, offer due date and time, the location where offers will be received, and the offer acceptance period;

b. The deadline date for requesting a substitution or exception to the solicitation;

c. The manner by which the offeror is required to acknowledge amendments;

d. The minimum information required in the offer;

e. The specific requirements for designating trade secrets and other proprietary information as confidential;

f. Any specific responsibility or susceptibility criteria;

g. Whether the offeror is required to submit samples, descriptive literature, and technical data with the offer;

h. Evaluation factors and the relative order of importance;

i. A statement of where documents incorporated by reference are available for inspection and copying;

j. A statement that the agency may cancel the solicitation or reject an offer in whole or in part;

k. Certification by the offeror that submission of the offer did not include collusion or other anti competitive practices;

l. Certification by the offeror of compliance with A.R.S. § 41-3532 when offering electronics or information technology products, services, or maintenance;

m. That the offeror is required to declare whether the offeror has been debarred, suspended, or otherwise lawfully prohibited from participating in any public procurement activity, including, but not limited to, being disapproved as a subcontractor of any public procurement unit or other governmental body;

n. Any offer security required;

o. The means required for submission of offer. The solicitation shall specifically indicate whether hand delivery, U.S. mail, electronic mail, facsimile, or other means are acceptable methods of submission;

p. Any cost or pricing data required;

q. The type of contract to be used;

r. A statement that negotiations may be conducted with offerors reasonably susceptible of being selected for award; and

s. Any other offer requirements specific to the solicitation.

2. Specifications, including:

a. Any purchase description, specifications, delivery or performance schedule, and inspection and acceptance requirements;

b. If a brand name or equivalent specification is used, instructions that the use of a brand name is for the purpose of describing the standard of quality, performance, and characteristics desired and is not intended to limit or restrict competition. The solicitation shall state that products substantially equivalent to those brands designated shall qualify for consideration; and

c. Any other specification requirements specific to the solicitation.

3. Terms and Conditions, including:

a. Whether the contract is to include an extension option; and

b. Any other contract terms and conditions.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-C302 Pre-offer Conferences

An agency chief procurement officer may conduct one or more pre-offer conferences within a reasonable time before offer due date and time to discuss the procurement requirements and solicit comments from prospective offerors. Amendments to the solicitation may be issued, if necessary, in accordance with R2-7-C303.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015. Amended by final expedited rulemaking at 28 A.A.R. 2117, effective 8/12/2022.

Ariz. Admin. Code § R2-7-C303 Solicitation Amendment

A. An agency chief procurement officer shall issue a solicitation amendment to do any or all of the following:

1. Make changes in the solicitation;

2. Correct defects or ambiguities;

3. Provide additional information or instructions; or

4. Extend the offer due date and time if the agency chief procurement officer determines that an extension is in the best interest of the state.

B. If a solicitation is changed by a written solicitation amendment, the agency chief procurement officer shall notify suppliers to whom the agency chief procurement officer distributed the solicitation.

C. It is the responsibility of the offeror to obtain any solicitation amendments. An offeror shall acknowledge receipt of an amendment in a manner specified in the solicitation amendment on or before the offer due date and time.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-C304 Modification or Withdrawal of Offer Before Offer Due Date and Time

A. An offeror may modify or withdraw their offer at any time, in writing, before the offer due date and time.

B. The agency chief procurement officer shall place the document submitted in the procurement file as a record of the modification or withdrawal.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-C305 Cancellation of Solicitation Before Offer Due Date and Time

A. Based on the best interest of the state, an agency chief procurement officer may cancel a solicitation before the offer due date and time.

B. The agency chief procurement officer shall notify suppliers to whom the agency chief procurement officer distributed the solicitation.

C. The agency chief procurement officer shall not open offers after cancellation. The agency chief procurement officer may discard the offer after 30 days from notice of solicitation cancellation unless the offeror requests the offer be returned.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-C306 Receipt, Opening, and Recording of Offers

A. An agency chief procurement officer shall maintain a record of offers received for each solicitation and shall record the time and date when an offer is received. The agency chief procurement officer shall store each unopened offer in a secure place until the offer due date and time. When practical, an agency chief procurement officer should use the eProcurement system for this process.

B. A purchasing agency may open an offer to identify the offeror. If this occurs, the agency chief procurement officer shall record the reason for opening the offer, the date and time the offer was opened, and the solicitation number. The agency chief procurement officer shall secure the offer and retain it for public opening.

C. The agency chief procurement officer shall open offers after the offer due date and time. The agency chief procurement officer shall record the name of each offeror and any other relevant information as determined by the agency chief procurement officer. The agency chief procurement officer shall make the record of offers available for public viewing.

D. Except for the information identified in subsection (C), the agency chief procurement officer shall ensure that information contained in the offer remains confidential until contract award and is shown only to those persons assisting in the evaluation process.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015. Amended by final expedited rulemaking at 28 A.A.R. 2117, effective 8/12/2022.

Ariz. Admin. Code § R2-7-C307 Late Offers, Modifications, and Withdrawals Before Offer Due Date and Time

A. If an offer, modification, or withdrawal is not received by the offer due date and time, at the location designated in the solicitation (which may be the eProcurement system), an agency chief procurement officer shall determine the offer, modification, or withdrawal as late. If the eProcurement system is the designated location for the offer, modification, or withdrawal, prospective offerors are responsible for allowing sufficient time to ensure that their submission is properly filed in the eProcurement system by the appropriate due date and time. This rule does not apply to revision or withdrawal of offers as described in R2-7-C314 .

B. The agency chief procurement officer shall reject a late offer, modification, or withdrawal unless:

1. The document is received before contract award at the location designated in the solicitation; and

2. The document would have been received by the offer due date and time, but for the action or inaction of personnel directly serving the purchasing agency.

C. Upon receiving a late offer, modification, or withdrawal, the agency chief procurement officer shall:

1. If the document is hand delivered, refuse to accept the delivery; or

2. If the document is not hand delivered, record the time and date of receipt and promptly send written notice of late receipt to the offeror. The agency chief procurement officer may discard the document within 30 days after the date on the notice unless the offeror requests the document be returned.

D. The agency chief procurement officer shall document a refusal under (C)(1) and place the document or a copy of the notice required in (C)(2) in the procurement file.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final expedited rulemaking at 28 A.A.R. 2117, effective 8/12/2022.

Ariz. Admin. Code § R2-7-C308 Cancellation of Solicitation After Offer Opening and Before Award

A. Based on the best interest of the state, an agency chief procurement officer may cancel a solicitation after offer due date and time. The agency chief procurement officer shall prepare a written justification for cancellation and place it in the procurement file.

B. The agency chief procurement officer shall notify offerors of the cancellation in writing.

C. The agency chief procurement officer shall retain offers received under the canceled solicitation in the procurement file. If the purchasing agency intends to issue another solicitation within six months after cancellation of the procurement, the agency chief procurement officer may withhold the offers from public inspection. After award of a contract under the subsequent solicitation, the agency chief procurement officer shall make offers submitted in response to the cancelled solicitation open for public inspection except for information determined to be confidential pursuant to R2-7-103.

D. In the event of cancellation, the agency chief procurement officer shall promptly return any offer security provided by an offeror.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-C309 Only One Offer Received

If only one offer is received in response to a solicitation, the agency chief procurement officer shall review the offer and either:

1. Award the contract to the offeror and prepare a written determination that:

a. The price submitted is fair and reasonable pursuant to R2-7-702; and

b. The offeror is responsive; and

c. The offeror is responsible; or

2. Reject the offer and:

a. Resolicit for new offers;

b. Cancel the procurement; or

c. Use a different source selection method authorized under the Arizona Procurement Code.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 18 A.A.R. 3118, effective January 7, 2013 (Supp. 12-4).

Ariz. Admin. Code § R2-7-C310 Extension of Offer Acceptance Period

A. To extend the offer acceptance period, an agency chief procurement officer shall notify offerors in writing of an extension and request written concurrence from all offerors.

B. To be eligible for a contract award, an offeror shall submit written concurrence to the extension. The agency chief procurement officer shall not consider the offer from an offeror who fails to respond to the notice of extension.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-C311 Determination of Not Susceptible for Award

A. An agency chief procurement officer may determine at any time during the evaluation period and before award that an offer is not susceptible for award. The agency chief procurement officer shall place a written determination, based on one or more of the following, in the procurement file:

1. The offer fails to substantially meet one or more of the mandatory requirements of the solicitation;

2. The offer fails to comply with any susceptibility criteria identified in the solicitation; or

3. The offer is not susceptible for award in comparison to other offers based on thecriteria set forth in the solicitation. When there is doubt as to whether an offer is susceptible for award, the offer should be included for further consideration.

B. The agency chief procurement officer shall promptly notify the offeror in writing of the final determination that the offer is not susceptible for award, unless the agency chief procurement officer determines notification to the offeror would compromise the state's ability to negotiate with other offerors.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 18 A.A.R. 3118, effective January 7, 2013 (Supp. 12-4). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-C312 Responsibility Determinations

A. An agency chief procurement officer shall determine, at any time during the evaluation period and before award, that an offeror is responsible or nonresponsible.

B. The agency chief procurement officer may consider the following factors before determining that an offeror is responsible or nonresponsible:

1. The offeror's financial, business, personnel, or other resources, including subcontractors;

2. The offeror's record of performance and integrity;

3. Whether the offeror has been debarred or suspended;

Whether the offeror is legally qualified to contract with the state;

5. Whether the offeror promptly supplied all requested information concerning its responsibility; and

6. Whether the offeror meets any responsibility criteria specified in the solicitation.

C. The agency chief procurement officer shall promptly notify the offeror in writing of the final determination that the offer is nonresponsible unless the agency chief procurement officer determines notification to the offeror would compromise the state's ability to negotiate with other offerors. The agency chief procurement office shall file a copy of the determination in the procurement file.

D. The agency chief procurement officer shall only disclose responsibility information furnished by an offeror in accordance with A.R.S. § 41-2540(B).

E. For the offeror awarded a contract, the agency chief procurement officer's signature on the contract constitutes a determination that the offeror is responsible.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-C313 Clarification of Offers

A. The purpose for clarifications is to provide for a greater mutual understanding of the offer. Clarifications are not negotiations and material changes to the request for proposal or offer shall not be made by clarification.

B. The agency chief procurement officer may request clarifications from offerors at any time after receipt of offers. Clarifications may be requested orally or in writing. If clarifications are requested orally, the offeror shall confirm the request in writing. A request for clarifications shall not be considered a determination that the offeror is susceptible for award.

C. The agency chief procurement officer shall retain any clarifications in the procurement file.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-C314 Negotiations with Responsible Offerors and Revisions of Offers

A. An agency chief procurement officer shall establish procedures and schedules for conducting negotiations. The agency chief procurement officer shall ensure there is no disclosure of one offeror's price or any information derived from competing offers to another offeror.

B. Negotiations may be conducted orally or in writing. If oral negotiations are conducted, the agency chief procurement officer shall confirm the negotiations in writing and provide to the offeror.

C. If negotiations are conducted, negotiations shall be conducted with all offerors determined to be reasonably susceptible for award. Offerors may revise offers based on negotiations provided that any revision is con-firmed in writing.

D. An agency chief procurement officer may conduct negotiations with responsible offerors to improve offers in such areas as cost, price, specifications, performance, or terms, to achieve best value for the state based on the requirements and the evaluation factors set forth in the solicitation.

E. Responsible offerors determined to be susceptible for award, with which negotiations have been held, may revise their offer in writing during negotiations.

F. An offeror may withdraw an offer at any time before the best and final offer due date and time by submitting a written request to the agency chief procurement officer.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 18 A.A.R. 3118, effective January 7, 2013 (Supp. 12-4). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-C315 Offer Revisions and Best and Final Offers

A. An agency chief procurement officer may request one or more written revisions to an offer. The agency chief procurement officer shall include in the written request:

1. The date, time, and place for submission of offer revisions; and

statement that if offerors do not submit a written notice of withdrawal or a written offer revision, their immediate previous written offer will be accepted as their final offer.

B. An agency chief procurement officer shall request best and final offers from any offeror with whom negotiations have been conducted. The agency chief procurement officer shall include in the written request:

1. The date, time, and place for submission of best and final offer; and

2. A statement that if offerors do not submit a written best and final offer, their immediate previous written offer will be accepted as their best and final offer.

C. The agency chief procurement officer shall request written best and final offers only once, unless the state procurement administrator makes a written determination that it is advantageous to the state to conduct further negotiations or change the state's requirements.

D. If an apparent mistake, relevant to the award determination, is discovered after opening of best and final offers, the agency chief procurement officer shall contact the offeror for written confirmation. The agency chief procurement officer shall designate a time-frame within which the offeror shall either:

1. Confirm that no mistake was made and assert that the offer stands as submitted; or

2. Acknowledge that a mistake was made, and include the following in a written response:

a. Explanation of the mistake and any other relevant information,

b. A request for correction including the corrected offer or a request for withdrawal, and

c. The reasons why correction or withdrawal is consistent with fair competition and in the best interest of the state.

E D. An offeror who discovers a mistake in their best and final offer may request withdrawal or correction in writing, and shall include the following in the written request:

1. Explanation of the mistake and any other relevant information,

2. A request for correction including the corrected offer or a request for withdrawal, and

3. The reasons why correction or withdrawal is consistent with fair competition and in the best interest of the state.

F. E. In response to a request made under subsections (C) or (D), the agency chief procurement officer shall make a written determination of whether correction or withdrawal will be allowed based on whether the action is consistent with fair competition and in the best interest of the state. If an offeror does not provide written confirmation of the best and final offer, the agency chief procurement officer shall make a written determination that the most recent written best and final offer submitted is the final best and final offer.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 18 A.A.R. 3118, effective January 7, 2013 (Supp. 12-4). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015. Amended by final expedited rulemaking at 28 A.A.R. 2117, effective 8/12/2022.

Ariz. Admin. Code § R2-7-C316 Evaluation of Offers

A. An agency chief procurement officer shall evaluate offers and best and final offers based on the evaluation criteria contained in the request for proposals. The agency chief procurement officer shall not modify evalua-tion criteria or their relative order of importance after offer due date and time.

B. An agency chief procurement officer may appoint an evaluation committee to assist in the evaluation of offers. If offers are evaluated by an evaluation committee, the evaluation committee shall prepare an evaluation report for the agency chief procurement officer. The evaluation report shall supersede all previous draft evaluations or evaluation reports. The agency chief procurement officer may:

1. Accept or reject the findings of the evaluation committee,

2. Request additional information from the evaluation committee, or

3. Replace the evaluation committee.

C. The agency chief procurement officer shall prepare an award determination and place the determination, including any evaluation report or other supporting documentation, in the procurement file.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 18 A.A.R. 3118, effective January 7, 2013 (Supp. 12-4). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-C317 Contract Award

A. An agency chief procurement officer shall award the contract to the responsible offeror whose offer is determined to be most advantageous to the state based on the evaluation factors set forth in the solicitation. The agency chief procurement officer shall make a written determination explaining the basis for the award and place it in the procurement file.

B. Before awarding any cost reimbursement contract, the agency chief procurement officer shall determine in writing that:

1. The offeror's accounting system will permit timely development of all necessary cost data in the form required by thespecific contract type contemplated, and

2. It is adequate to allocate costs pursuant to Article 7.

C. B. The agency chief procurement officer shall notify all offerors of an award.

C. After contract award, the agency chief procurement officer shall return any offer security provided by the offeror.

E. D. Within 3 days after contract award the agency chief procurement officer shall make the procurement file, including alloffers, available for public inspection, redacting information that is confidential under R2-7-103.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-C318 Mistakes Discovered After Award

A. If a mistake in the offer is discovered after the award, the offeror may request correction or withdrawal in writing, and shall include all of the following in their written request:

1. Explanation of the mistake and any other relevant information;

2. A request for correction including the corrected offer or a request for withdrawal; and

3. The reasons why correction or withdrawal is consistent with fair competition and in the best interest of the state.

B.Based on the considerations of fair competition and the best interest of the state, the agency chief procurement officer may:

1. Allow correction of the mistake;

Cancel all or part of the award; or

3. Deny correction or withdrawal.

C. After cancellation of all or part of an award, the agency chief procurement officer may award all or part of the contract to the next responsible offeror, within 120 days of contract award, whose offer is determined to be the next most advantageous to the state according to the evaluation factors contained in the solicitation.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Article 9 LEGAL AND CONTRACTUAL REMEDIES

Part C DEBARMENTS AND SUSPENSIONS

Ariz. Admin. Code § R2-7-C901 Authority to Debar or Suspend

The director has the sole authority to debar or suspend a person from participating in state procurements under A.R.S. § 41-2613.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-C902 Initiation of Debarment

Upon receipt of information concerning a possible cause for debarment, the director shall investigate the possible cause. If the director has a reasonable basis to believe that a cause for debarment exists, the director may propose debarment under R2-7-C904 .

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-C903 Period of Debarment

A. The director shall not establish the period of time for a debarment that exceeds three years from the date of the debarment determination.

B. If debarment is based solely upon debarment by another governmental agency, the director may establish that the period of debarment is to run concurrently with the period established by the other debarring agency.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-C904 Notice of Debarment and Hearing

A. If debarment is proposed, the director shall notify the person and affected affiliates in writing within seven days by certified mail, return receipt requested, or any other method that provides evidence of receipt. The notice shall state that the person and affected affiliates have the right to a hearing to contest the proposed debarment.

B. The person proposed for debarment and any affected affiliates shall file a written request for a hearing within 10 days of receipt of the director's notice of proposed debarment.

C. The hearing shall be conducted as a contested case under A.R.S. §§ 41-1092.07 and 41-2613.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-C905 Imputed Knowledge

A. The director may attribute improper conduct to an affiliate for purposes of debarment where the impropriety occurred in connection with the affiliate's duties for or on behalf of, or with the knowledge, approval, or acquiescence of, the contractor.

B. The director may attribute improper conduct of a person or its affiliate having a contract with a contractor to the contractor for purposes of debarment where the impropriety occurred in connection with the person's duties for or on behalf of, or with the knowledge, approval, or acquiescence of, the contractor.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-C906 Reinstatement

A. The director may at any time after a final decision on a debarment reinstate a debarred person or rescind the debarment upon a determination that the cause upon which the debarment is based no longer exists.

B. Any debarred person may request reinstatement by submitting a petition to the director supported by documentary evidence showing that the cause for debarment no longer exists or has been substantially mitigated.

C. The director may require a hearing on the request for reinstatement.

D. The director shall make a written decision on reinstatement within 30 days after the request is filed and specify the factors on which it is based.

E. Reinstatement decisions by the director are not subject to administrative review.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-C907 Limited Participation

The director may allow a debarred person to participate in state contracts on a limited basis during the debarment period upon a written determination that participation is advantageous to the state. The determination shall specify the factors on which it is based and define the extent of the limits imposed.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-C908 Suspension

A. If the director determines that reasonable grounds for debarment exist, the director may suspend a person from receiving any award under R2-7-C910.

B. For purposes of suspension, a person's conduct may be attributed to an affiliate or another person under R2-7-C905.

C. The director shall not suspend a person pending debarment unless compelling reasons require suspension to protect state interests.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-C909 Period and Scope of Suspension

Unless otherwise agreed to by the parties, the director shall not implement a period of suspension of more than 35 days without satisfying the notice requirements of R2-7-C910 .

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-C910 Notice, Hearing, Determination, and Appeal

A. The director shall notify the person suspended by certified mail, return receipt requested, or by any other method that provides evidence of receipt.

B. The notice of suspension shall state:

1. The basis for suspension;

2. The period, including dates, of the suspension;

3. That offers received from the person will not be considered; and

4. That the person is entitled to a hearing on the suspension if the person files a written request for a hearing with the director within 30 days after receipt of the notice.

C. Within 30 days receipt of the notice of suspension, the suspended party may file a written request for hearing with the director. The appeal shall include the following information:

1. A copy of the decision of the director; and

2. The precise factual or legal error in the decision from which the appeal is taken.

D. The suspension shall be resolved as an appealable agency action under A.R.S. §§ 41-1092.03 and 41-2613.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-C911 Master List

A. The director shall maintain a master list of debarments, suspensions, and voluntary exclusions under this Article.

B. The master list shall show at a minimum, the following information:

1. The names and vendor numbers of those persons whom the state has debarred or suspended under this Article;

2. The statutory authority for the action;

3. The period of debarment or suspension, including the expiration date;

4. The name of the debarring or suspending agency, if the state's debarment or suspension is based on debarment or suspension by another governmental agency; and

5. A separate section listing persons voluntarily excluded from participation in state contracts.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Article 3 SOURCE SELECTION AND CONTRACT FORMATION

Part D PROCUREMENTS NOT EXCEEDING THE AMOUNT PRESCRIBED IN A.R.S. SECTION 41-2535

Ariz. Admin. Code § R2-7-D301 Applicability

For purchases not exceeding the amount prescribed in A.R.S. § 41-2535, including construction, the agency chief procurement officer shall issue a request for quotation under R2-7-D302 unless any of the following apply:

The purchase can be made from a state or agency contract;

2. The purchase can be made from a set-aside organization as established in Article 10;

3. The purchase is not expected to exceed $10,000.00;

4. The purchase is made as a sole-source procurement under A.R.S. § 41-2536 ;

5. 4. The agency chief procurement officer makes a written determination that competition is not practicable under the circumstances. The purchase shall be made with as much competition as is practicable under the circumstances.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-D302 Solicitation - Request for Quotation

A.A request for quotation shall be issued for purchases estimated to exceed $10,000 but less than that specified in A.R.S. § 41-2535. The agency chief procurement officer shall include the following in the solicitation:

1. Offer submission requirements, including offer due date and time, where offers will be received, and offer acceptance period;

2. Any purchase description, specifications, delivery or performance schedule, and inspection and acceptance requirements;

3. The minimum information that the offer shall contain;

4. Any evaluation factors;

5. Whether negotiations may be held;

6. Any contract options including renewal or extension;

7. The uniform terms and conditions by text or reference; and

8. Any other terms, conditions, or instructions specific to the procurement.

B. The request for quotation shall include a statement that only a small business, as defined in R27-101, shall be awarded a contract, unless any of the following apply:

1. The purchase has been unsuccessfully competed under R27-D303, including failure to obtain fair and reasonable prices; or

2. The agency chief procurement officer has made a written determination that restricting the procurement to small business is not practical under the circumstances.

B. The agency chief procurement officer shall issue the request for quotation by distributing the request for quotation to a minimum of three small businesses registered on the prospective suppliers list.

C. The request for quotation shall include a statement that only a small business, as defined in R2-7-101, shall be awarded a contract, unless any of the following apply:

1. The purchase has been unsuccessfully competed under Subsection (B) of this Section, including failure to obtain fair and reasonable prices;

2. The agency chief procurement officer has made a written determination that less than three small businesses are registered on the prospective suppliers list; or

3. The agency chief procurement officer has made a written determination prior to issuing a request for quotation that restricting the procurement to small business is not practical under the circumstances.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-D303 Contract Award

A. If only one responsive offer is received, the agency chief procurement officer shall determine if the price is fair and reasonable, and in the best interest of the state to award a contract and place the determination in the procurement file. If time permits, the agency chief procurement officer may initiate a second request for quotation if it is reasonable to believe that additional responses will be received.

B. The agency chief procurement officer shall award a contract to the small business determined to be most advantageous to the state in accordance with any evaluation factors identified in the request for quotation. If award is pursuant to R2-7-D302(C), the agency chief procurement officer shall award a contract to the offeror determined to be most advantageous to the state in accordance with any evaluation factors identified in the request for quotation.

C. The agency chief procurement officer shall place the written basis for the award in the procurement file.

D. The agency chief procurement officer shall make the procurement file available to the public on the date of contract award, except for those items considered confidential under R2-7-103.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 18 A.A.R. 3118, effective January 7, 2013 (12-4). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-D304 Purchases of $10,000 and Less

The agency chief procurement officer shall use reasonable judgment in awarding contracts of $10,000 and less that are advantageous to the state. The agency chief procurement officer may but is not required to request quotations.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-D305 Renumbered

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Renumbered by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Article 9 LEGAL AND CONTRACTUAL REMEDIES

Part D HEARING PROCEDURES

Ariz. Admin. Code § R2-7-D901 Hearings

If a hearing is required or permitted under this Chapter, the director shall refer the matter to the Office of Administrative Hearings for findings of fact, conclusions of law, and a recommended decision. The director may also direct the parties to engage in settlement negotiations or alternative dispute resolution procedures before referring the matter for a hearing.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-D902 Rehearing of Director's Decision

A. Any person, including an agency chief procurement officer, who is aggrieved by the director's decision may file a written request for rehearing of the decision under A.R.S. § 41-1092.09.

B. The director, within the time for filing a request for rehearing under this rule, may upon the director's own initiative, order a rehearing for any reason for which a rehearing may have been granted on request of a party.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Article 3 SOURCE SELECTION AND CONTRACT FORMATION

Part E LIMITED COMPETITION FOR PROCUREMENTS EXCEEDING THE AMOUNT PRESCRIBED IN A.R.S. SECTION 41-2535

Ariz. Admin. Code § R2-7-E301 Sole Source Procurements

A. For the purposes of this Section, the term "sole-source procurement" means a material or service procured without competition when:

1. There is only a single source for the material or service, or

2. No reasonable alternative source exists.

B. The state procurement administrator may delegate this authority to the agency chief procurement officer in accordance with R2-7-202 . If not delegated to the agency chief procurement officer, the agency chief procurement officer shall submita written request for approval to procure from a sole source to the state procurement administrator before proceeding. The request shall include the following information:

1. A description of the procurement need and the reason why there is only a single source available or no reasonable alternative exists,

2. The name of the proposed supplier,

3. The duration and estimated total dollar value of the proposed procurement,

4. Documentation that the price submitted is fair and reasonable pursuant to R27-702, and

5. A description of efforts made to seek other sources.

B. This Section applies to only sole source procurements, estimated to exceed the amount prescribed in A.R.S. § 41-2535.

C. The state procurement administrator may delegate this authority to the agency chief procurement officer in accordance with R2-7-202 . If not delegated to the agency chief procurement officer, the agency chief procurement officer shall submit a written request for approval to procure from a sole source to the state procurement administrator before proceeding. The request shall include the following information:

1. A description of the procurement need and the reason why there is only a single source available or no reasonable alternative exists,

2. The name of the proposed supplier,

3. The duration and estimated total dollar value of the proposed procurement,

4. Documentation that the price submitted is fair and reasonable pursuant to R2-7-702, and

5. A description of efforts made to seek other sources.

C. D. The state procurement administrator shall send notice to registered vendors on the electronic system to invite comments on the sole-source request for three working days. Following this period, the state procurement administrator shall either:

1. Issue written approval, with any conditions or restrictions;

Request additional information from the agency chief procurement officer; or

3. Deny the request if input or information received shows that more than one source is available or a reasonable alter-native source exists for the procurement need.

D. E. If the sole-source procurement is authorized or approved, the agency chief procurement officer shall negotiate a contract advantageous to the state.

E. F. The agency chief procurement officer shall keep a record of all sole-source procurements pursuant to A.R.S. § 41-2551.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 18 A.A.R. 3118, effective January 7, 2013 (12-4). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-E302 Emergency Procurements

A. For the purposes of Section, the term "Semergency" means any condition creating an immediate and serious need for materials, services, or construction in which the state's best interests are not met through the use of other source-selection methods. The condition must seriously threaten the functioning of state government, the preservation or protection of property, or the health or safety of a person.

B. This Section applies to only emergency procurements, estimated to exceed the amount prescribed in A.R.S. § 41-2535. The agency chief procurement officer may procure a material or service without competition when there is an emergency by complying with this Section.

C. The state procurement administrator may delegate this authority to the agency chief procurement officer in accordance with R2-7-202 . If not delegated to the agency chief procurement officer, the agency chief procurement officer shall submit the written request for, or notification of, the emergency procurement to the state procurement administrator. The request shall include the following information:

1. A description of the procurement need and the reason for the emergency;

2. The name of the supplier;

3. The duration and estimated total dollar value of the procurement; and

Documentation that the price submitted is fair and reasonable pursuant to R2-7-702.

D. The agency chief procurement officer shall obtain approval from the state procurement administrator before proceeding with an emergency procurement. The state procurement administrator shall either:

1. Issue written approval, with any conditions or restrictions;

Request additional information from the agency chief procurement officer; or

3. Deny the request.

E. An employee acting within the authority of a using agency may proceed with an emergency procurement without approval from the state procurement administrator if the emergency necessitates immediate response and it is impracticable to contact the state procurement administrator. The agency chief procurement officer shall submit a written confirmation of the emergency procurement to the state procurement administrator within five working days of the emergency.

F. A using agency making an emergency procurement shall limit the procurement to such actions necessary to address the emergency.

G. A using agency making an emergency procurement shall employ maximum competition, given the circumstances, to protect the interests of the state.

H. The agency chief procurement officer shall keep a record of all emergency procurements pursuant to A.R.S. § 41-2551.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-E303 Competition Impracticable Procurements

A. For the purposes of this Section, "Scompetition impracticable" means a procurement requirement exists which makes compliance with A.R.S. §§ 41-2533, 41-2534, 41-2538, or 41-2578 impracticable, unnecessary, or contrary to the public interest, but which is not an emergency under R2-7-E302 . Procurements with a documented lack of available vendors in the marketplace and which require an open and continuous availability of offerors may be procured by this method.

B. An agency chief procurement officer seeking a competition impracticable procurement shall obtain the approval of the state procurement administrator before proceeding. The state procurement administrator may delegate this authority to the agency chief procurement officer in accordance with R2-7-202.

C. The agency chief procurement officer shall submit a written request for approval containing the following:

1. An explanation of the competition impracticable need and the unusual or unique situation that makes compliance with A.R.S. §§ 41-2533, 41-2534, 41-2538, or 41-2578 impracticable, unnecessary, or contrary to the public interest;

2. A definition of the proposed procurement process to be utilized and an explanation of how this process will foster as much competition as is practicable;

3. An explanation of why the proposed procurement process is advantageous to the state; and

4. The scope, duration, and estimated total dollar value of the procurement need.

D. The state procurement administrator shall:

1. Issue written approval, with any conditions or restrictions;

Request additional information from the agency chief procurement officer; or

3. Deny the request.

E. Before modifying the scope, duration, or cost of an approved competition impracticable procurement, the agency chief procurement officer shall request approval for the modifications in writing from the state procurement administrator.

F. The agency chief procurement officer shall keep a record of all competition impracticable procurements as required by A.R.S. § 41-2551.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 18 A.A.R. 3118, effective January 7, 2013 (12-4).

Part F COMPETITIVE SELECTION PROCESS FOR SERVICES OF CLERGY, PHYSICIANS, DENTISTS, LEGAL COUNSEL, OR CERTIFIED PUBLIC ACCOUNTANTS

Ariz. Admin. Code § R2-7-F301 Statement of Qualifications

A. The agency chief procurement officer may request that persons desiring to provide the services specified in A.R.S. § 41-2513 submit statements of qualifications on a prescribed form which shall include, but not be limited to the following information:

1. Technical education and training;

2. General or special experience, certifications, licenses, and memberships in professional associations, societies, or boards; and

3. Any other relevant information requested by the purchasing agency.

B. Persons who have submitted statement of qualifications may submit additional information or change information that was previously submitted at any time.

C. The agency chief procurement officer may, in lieu of subsection (A), incorporate the statement of qualifications as part of the solicitation pursuant to R2-7-F302.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-F302 Solicitation

A. For procurements not exceeding the amount prescribed in A.R.S. § 41-2535, except as authorized under A.R.S. § 41-2536, the agency chief procurement officer shall comply with Part D of this Article.

B. For procurements exceeding the amount prescribed in A.R.S. § 41-2535, the agency chief procurement officer shall follow the procedures below, except as authorized under A.R.S. §§ 41-2536 or 41-2537:

1. The agency chief procurement officer shall issue a request for proposal providing adequate notice based on the circumstances.

2. The agency chief procurement officer shall provide notice to prospective suppliers registered at the state procurement office for the specific service and, if R2-7-F301 has been implemented, to persons who have submitted statements of qualifications for the particular services solicited, or both.

3. The agency chief procurement officer shall include the following in the solicitation:

a. A specific offer due date and time, or that offers will be accepted on an open and continuous basis. If offers are accepted on an open and continuous basis, the designated, continuous day and time in which offers will be opened;

b. The location where offers will be received;

c. The offer acceptance period;

d. The manner by which the offeror is required to acknowledge amendments;

e. A description of the services needed;

f. The type of qualifications, experience, licensing, or other information required;

g. The minimum information in the offer;

h. Any evaluation criteria;

i. Any applicable contract terms and conditions;

j. A statement that negotiations may be conducted to determine the offeror's qualifications for further consideration;

k. Any cost or pricing data required;

l. The type of contract to be used;

m. A statement that the agency may cancel the solicitation or reject an offer in whole or in part;

n. Certification by the offeror that submission of the offer did not involve collusion or other anti competitive practices; and

o. A statement of whether the services shall be retained for a stated or ongoing period of time and whether the con-tract is to include any option for renewal or extension.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-F303 Solicitation Amendment

A.A The agency chief procurement officer shall issue a solicitation amendment to do any or all of the following:

1. Make changes in the solicitation;

2. Correct defects or ambiguities;

3. Provide additional information or instructions; or

Extend the offer due date and time if the agency chief procurement officer determines that an extension is in the be stinterest of the state.

B. If a solicitation is changed by a written solicitation amendment, the agency chief procurement officer shall notify suppliers to whom the agency chief procurement officer distributed the solicitation.

C. It is the responsibility of the offeror to obtain any solicitation amendments. An offeror shall acknowledge receipt of an amendment in a manner specified in the solicitation amendment on or before the offer due date and time.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-F304 Cancellation of Solicitation

A. Based on the best interest of the state, the agency chief procurement officer may cancel a solicitation at any time before award.

B. Based on the best interest of the state, the agency chief procurement officer may cancel an open and continuous solicitation at any time during the active period of the solicitation. Contracts that have already been awarded in accordance with the solicitation shall not be affected by the cancellation.

C. The agency chief procurement officer shall notify offerors of the cancellation in writing.

D. The agency chief procurement officer shall return any offers received to the offerors.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-F305 Receipt, Opening, and Recording of Offers

A.A The agency chief procurement officer shall maintain a record of offers received for each solicitation and shall record the time and date when an offer is received. The agency chief procurement officer shall store each unopened offer in a secure place until the offer due date and time.

B. A purchasing agency may open an offer to identify the offeror. If this occurs, the agency chief procurement officer shall record the reason for opening the offer, the date and time the offer was opened, and the solicitation number. The agency chief procurement officer shall secure the offer and retain it for public opening.

C. The agency chief procurement officer shall open offers after the offer due date and time. The agency chief procurement officer shall announce and record the name of each offeror and any other relevant information as determined by the agency chief procurement officer. The agency chief procurement officer shall make the record of offers available for public viewing.

D. Except for the information identified in R2-7-C306(C), the agency chief procurement officer shall ensure that information contained in the offer remains confidential until contract award and is shown only to those persons assisting in the evaluation process.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-F306 Timely and Late Modifications or Withdrawals of Offer

A. An authorized representative of an offeror may withdraw an offer in writing if the written request for withdrawal is received by the agency chief procurement officer before the designated offer due date and time or the designated, continuous offer due day and time.

B. An offeror may withdraw or modify an offer at any time before the due date and time or designated, continuous day and time for offer opening and before contract award by submitting a written request to the agency chief procurement officer.

C. If a modification or a withdrawal is not received by the designated offer due date and time or the designated, continuous day and time for offer opening, the agency chief procurement officer shall determine the modification or withdrawal as late. The agency chief procurement officer shall reject a late modification or withdrawal unless:

1. The document is received before the contract award; and

2. The document would have been received by the designated offer due date and time or the designated, continuous day and time for offer opening but for the action or inaction of state personnel directly serving the purchasing agency.

D. Upon receiving a late modification or withdrawal, the procurement officer shall:

1. If the document is hand delivered, refuse to accept delivery; or

2. If the document is not hand delivered, record the time and date of receipt, and promptly send written notice of late receipt to the offeror. The agency chief procurement officer may discard the document within 30 days after the date on the notice unless the offeror requests the document be returned.

E. The agency chief procurement officer shall document a refusal under (D)(1) and place this document or a copy of the notice required in (D)(2) in the procurement file.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-F307 Late Offers

A. If a specific offer due date and time has been identified in the solicitation, the agency chief procurement officer shall rejectany offer received after the specified offer due date and time unless:

It was transmitted through an eProcurement system designated in the solicitation, and the offer has a submitted status in the system prior to the offer due date and time; or

1 2. There is evidence to establish that the hand-delivered offer was received before contract award at the location designated in the solicitation and would have been received by the offer due date and time but for the failure of state personnel directly serving the purchasing agency.

2 B. Upon receiving a late offer, the agency chief procurement officer shall:

a. 1. If the document is hand delivered, refuse to accept the delivery; or

b. 2. If the document is not hand delivered, record the time and date of receipt and promptly send written notice of latereceipt to the offeror. The agency chief procurement officer may discard the document within 30 days after the date on the notice unless the offeror requests the document be returned.

3. C. The agency chief procurement officer shall document a late offer in the procurement file; with as much information as available.

B. D. If the solicitation has a designated, continuous day and time for offer opening and an offer is received after the day and time for offer opening, the agency chief procurement officer shall accept and log in the offer for the next scheduled day and time for offer opening.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 18 A.A.R. 3118, effective January 7, 2013 (12-4). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-F308 Negotiations with Offerors

A. The agency chief procurement officer may conduct negotiations with any or none of the offerors.

B. The agency chief procurement officer may conduct negotiations to improve offers in such areas as cost, price, specifications, performance, or terms and conditions, and to achieve best value for the state.

C. The agency chief procurement officer shall document the results of negotiations in writing by requesting a best and final offer as defined in R2-7-C315.

D. The agency chief procurement officer shall ensure that negotiations do not disclose any information derived from other offers.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-F309 Contract Award

A. The agency chief procurement officer shall award the contract to the offeror best qualified based on the evaluation factors set forth in the request for proposal and after making a written determination that the price is fair and reasonable. The agency chief procurement officer shall not award a contract based solely on price.

B. The agency chief procurement officer shall make a written determination explaining the basis for the award and place it in the procurement file.

C. The agency chief procurement officer shall award contracts pursuant to A.R.S. § 41-2513(B) through (D) where applicable.

D. Within 3 days after contract award the agency chief procurement officer shall make the procurement file, including all offers, available for public inspection, redacting information that is confidential under R2-7-103.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Ariz. Admin. Code § R2-7-F310 Mistakes Discovered after Award

A. If a mistake in the offer is discovered after the award, the offeror may request correction or withdrawal in writing, and shall include all of the following in the written request:

1. Explanation of the mistake and any other relevant information;

2. A request for correction including the corrected offer or a request for withdrawal; and

3. The reasons why correction or withdrawal is consistent with fair competition and in the best interest of the state.

B. Based on the considerations of fair competition and the best interest of the state, the agency chief procurement officer may:

1. Allow correction of the mistake;

Cancel all or part of the award; or

3. Deny correction or withdrawal.

C. After cancellation of all or part of an award, the agency chief procurement officer may award all or part of the contract to the next responsible offeror, within 120 days of contract award, based on whose offer is determined to be the next most advantageous to the state according to the evaluation factors contained in the solicitation.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 20 A.A.R. 3510, effective 2/2/2015.

Part G OTHER SOURCE SELECTION

Ariz. Admin. Code § R2-7-G301 Request for Information

An agency chief procurement officer may issue a request for information to obtain price, delivery, technical information or capabilities for planning purposes.

1. Responses to a request for information are not offers and cannot be accepted to form a binding contract.

2. Information contained in a response to a request for information shall be considered confidential until the procurement process is concluded or two years, whichever occurs first unless authorized by the state procurement administrator.

3. There is no required format to be used for requests for information.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1). Amended by final rulemaking at 18 A.A.R. 3118, effective January 7, 2013 (12-4).

Ariz. Admin. Code § R2-7-G302 Demonstration Projects

A. An agency chief procurement officer shall submit a written request to the state procurement administrator to award a contract for a demonstration project. The written request shall contain the following:

1. Name of the agency or agencies;

2. Name of the contractor;

3. Description of the project, including unique and innovative features of the project;

4. Statement and explanation that the project is in best interest of the state;

5. Duration of the project; and

6. Proposed contract terms and conditions.

B. The agency chief procurement officer shall obtain approval from the state procurement administrator before proceeding with a demonstration project. The state procurement administrator shall either:

1. Issue written approval, with any conditions or restrictions;

Request additional information from the agency chief procurement officer; or

3. Deny the request.

C. Demonstration projects shall be provided by the contractor at no cost, and the state shall not be obligated to purchase or lease the services or materials from the contractor.

D. The agency chief procurement officer may submit a written request to the state procurement administrator to purchase or lease from the demonstration contractor. The written request shall be submitted within 12 months after the demonstration project begins or within 12 months after the demonstration project ends and contain the following:

1. Name of the agency or agencies;

2. Name of the contractor;

3. Description of the project, including unique and innovative features of the project;

4. Statement and explanation that lease or purchase is in best interest of the state;

5. Cost to the state;

6. Duration of the proposed contract; and

7. Proposed contract terms and conditions.

E. The agency chief procurement officer shall obtain approval from the state procurement administrator before proceeding with purchasing or leasing from the demonstration contractor. The state procurement administrator shall:

1. Issue written approval, with any conditions or restrictions;

Request additional information from the agency chief procurement officer; or

3. Deny the request.

F. The term of the contract resulting from a demonstration project shall not exceed two years.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-G303 Unsolicited Proposals

A. An unsolicited proposal shall be a proposal that is submitted at the initiative of the offeror, and not in response to a solicitation.

B. An unsolicited proposal shall be submitted in writing and in sufficient detail for the agency chief procurement officer to understand the proposal.

C. An unsolicited proposal shall not be an advance offer to a known state requirement.

D. An agency chief procurement officer shall submit a written request to the state procurement administrator to award a contract resulting from an unsolicited proposal. The written request shall contain the following:

1. Name of the agency or agencies;

2. Name of the contractor;

3. Description of the project, including unique and innovative features of the project;

4. Statement and explanation that project is in best interest of the state;

Duration of the project; and

Proposed contract terms and conditions.

E. The agency chief procurement officer shall obtain approval from the state procurement administrator before proceeding with an unsolicited proposal. The state procurement administrator shall:

1. Issue written approval, with any conditions or restrictions;

Request additional information from the agency chief procurement officer; or

3. Deny the request.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-G304 General Services Administration Contracts

A. An agency chief procurement officer may purchase products or services using General Services Administration (GSA) schedules or contracts under the following conditions:

1. Use of the GSA contract or schedule is cost effective and in the best interest of the state;

2. Price is equal to or less than the contractor's current GSA price;

Price is fair and reasonable;

Contractor is willing to offer GSA pricing and terms to the state;

5. Comparable products or services are not available under a state or agency contract;

6. Comparable products or services are not restricted under a set-aside contract; and

7. Contractor accepts required state contract terms and conditions.

B. An agency chief procurement officer shall make a written determination that use of the GSA contract or schedule is in the best interest of the state. The determination shall contain the following:

Name of the contractor;

2. GSA contract or schedule number;

Procurement description;

Analysis of price, quality, and other relevant factors; and

5. Statement that the price is fair and reasonable.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-7-G305 Public-private Partnership Contracts

A. As referenced in this Article, a public-private partnership contract is a government contract and not a partnership. The government shall not jointly own or share property with the contractor and the government shall not be responsible for the contractor's liabilities.

B. An agency chief procurement officer shall submit a written request to the state procurement administrator to enter into a public-private partnership contract. The written request shall contain the following:

1. Name of the agency or agencies;

2. Name of the contractor;

3. Description of the public-private partnership, including obligations of the agency and the contractor;

4. Statement and explanation that the project is in best interest of the state;

5. Proposed contract price and assessment of the proposed value;

6. Description of the proposed performance measurement criteria and methods;

7. Duration of the project; and

8. Proposed contract terms and conditions.

C. The agency chief procurement officer shall obtain approval from the state procurement administrator before proceeding with a public-private partnership. The state procurement administrator shall either:

1. Issue written approval, with any conditions or restrictions;

Request additional information from the agency chief procurement officer; or

3. Deny the request.

D. If the request is approved, the contract shall be awarded in accordance with A.R.S. §§ 41-2533, 41-2534, 41-2535, 41-2536, or 41-2537.

E. The using agency is responsible for obtaining all necessary approvals, including approvals from the Government Information Technology Agency and Joint Legislative Budget Committee, before entering into a public-private partnership contract.

History

• New Section made by final rulemaking at 12 A.A.R. 508, effective April 8, 2006 (Supp. 06-1).

Chapter 8 STATE RETIREMENT SYSTEM BOARD

Article 1 RETIREMENT SYSTEM

Ariz. Admin. Code § R2-8-101 Repealed

History

• Former Rule, Social Security Regulation 1; Former Section R2-8-01 renumbered as Section R2-8-101 without change effective May 21, 1982 (Supp. 82-3). Amended subsections (A) and (C) effective April 12, 1984 (Supp. 84-2). Section repealed by final rulemaking at 10 A.A.R. 669, effective February 3, 2004 (Supp. 04-1).

Ariz. Admin. Code § R2-8-102 Repealed

History

• Former Rule, Social Security Regulation 2; Amended effective April 15, 1980 (Supp. 80-2). Former Section R2-8-02 renumbered as Section R2-8-102 without change effective May 21, 1982 (Supp. 82-3). Amended as an emergency by adding subsection (E) effective January 1, 1984, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 83-6). Emergency expired. Permanent rule, subsections (A), (B), and (D), amended effective April 12, 1984 (Supp. 84-2). Correction, subsection (B), as amended effective April 12, 1984 (Supp. 84-3). Section repealed by final rulemaking at 10 A.A.R. 669, effective February 3, 2004 (Supp. 04-1).

Ariz. Admin. Code § R2-8-103 Repealed

History

• Former Rule, Social Security Regulation 3; Amended effective April 15, 1980 (Supp. 80-2). Former Section R2-8-03 renumbered as Section R2-8-103 without change effective May 21, 1982 (Supp. 82-3). Amended as an emergency by adding subsection (E) effective January 1, 1984, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 83-6). Emergency expired. Permanent rule, subsections (A) thru (C), amended effective April 12, 1984 (Supp. 84-2). Section repealed by final rulemaking at 10 A.A.R. 669, effective February 3, 2004 (Supp. 04-1).

Ariz. Admin. Code § R2-8-104 Definitions

A. The definitions in A.R.S. § 38-711 apply to this Chapter.

B. Unless otherwise specified, in this Chapter:

"Actuarial assumption" means an estimate of an uncertain future event that affects pension liabilities, or assets, or both.

2. "Assumed actuarial investment earnings rate" means the assumed rate of investment return approved by the Board and contained in R2-8-118(A).

3. "Authorized employer representative" means an individual specified by the Employer to provide the ASRS with information about a member who previously worked for the ASRS employer.

4. "Contribution" means:

a. Amounts required by A.R.S. Title 38, Chapter 5, Articles 2 and 2.1 to be paid to the ASRS by a member or an employer on behalf of a member;

b. Any voluntary amounts paid to the ASRS pursuant to 2 A.A.C. 8, Article 5 by a member to be placed in the member's account; and

c. Amounts credited by transfer under 2 A.A.C. 8, Article 11.

"Day" means a calendar day, and excludes the:

a. Day of the act or event from which a designated period of time begins to run; and

b. Last day of the period if a Saturday, Sunday, or official state holiday.

6. "Designated beneficiary" means the same as in A.R.S. § 38-762(G) or another person designated as a beneficiary by law.

7. "Director" means the Director appointed by the Board as provided in A.R.S. § 38-715.

8. "Individual retirement account" or "IRA" means the types of eligible retirement plans specified in A.R.S. § 38-770(D)(3)(a) and (b).

9. "DRO" means a copy of an original domestic relations order specified in A.R.S. § 38-773(H)(1) that contains all of the following:

a. The requirements of A.R.S. § 38-773(C);

b. The date of the member and alternate payee's marriage;

c. The date of divorce or the date in which the community property interest ended;

d. A court stamp indicating the domestic relations order is a true and correct copy of the original domestic relations order on file with the court;

e. How the member's ASRS benefits should be split in specific amounts for the following possible events;

i. The member's retirement;

ii. Return of contributions and termination of membership according to R2-8-115; and

iii. The death of the member prior to retirement;

f. Whether the member may transfer all ASRS service credit to another retirement system;

g. Whether the member is required to maintain the alternate payee as the member's beneficiary;

h. Whether the member may rescind their retirement option according to A.R.S. § 38-760; and

i. The judge's dated signature.

9. 10. "Party" means the same as in A.R.S. § 41-1001(14).

10. 11. "Person" means the same as in A.R.S. § 41-1001(15).

11. 12. "Plan" means the same as "defined benefit plan" in A.R.S. § 38-712(B), and as administered by the ASRS.

12. 13. "Retirement account" means the same as in A.R.S. § 38-771(J)(2).

13. 14. "Rollover" means a contribution to the ASRS by an eligible member of an eligible rollover distribution from one or more of the retirement plans listed in A.R.S. § 38-747(H)(2) and (H)(3).

14. 15. "Terminate employment" means to end the employment relationship between a member and an ASRS employer with the intent that the member does not return to employment with an ASRS employer.

15. 16. "United States" means the same as in A.R.S. § 1-215(39).

History

• Former Rule, Social Security Regulation 4; Former Section R2-8-04 renumbered as Section R2-8-104 without change effective May 21, 1982 (Supp. 82-3). Amended subsections (G), (J), and (K) effective April 12, 1984 (Supp. 84-2). Typographical error corrected in subsection (5)(c) "reqired" corrected to "required" (Supp. 97-1). Amended by final rulemaking at 21 A.A.R. 2515, effective 12/5/2015. Amended by final rulemaking at 24 A.A.R. 1861, effective 6/11/2018. Amended by final expedited rulemaking at 27 A.A.R. 479, effective 3/5/2021. Amended by final rulemaking at 28 A.A.R. 1746, effective 9/4/2022.

Ariz. Admin. Code § R2-8-105 Repealed

History

• Former Rule, Social Security Regulation 5; Amended effective April 15, 1980 (Supp. 80-2). Former Section R2-8-05 renumbered as Section R2-8-105 without change effective May 21, 1982 (Supp. 82-3). Amended as an emergency by adding subsection (E) effective January 1, 1984, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 83-6). Emergency expired. Permanent rule amended effective April 12, 1984 (Supp. 84-2). Section repealed by final rulemaking at 10 A.A.R. 669, effective February 3, 2004 (Supp. 04-1).

Ariz. Admin. Code § R2-8-113 Emergency Expired

History

• New Section made by emergency rulemaking at 11 A.A.R. 579, effective January 4, 2005 (05-1). Emergency rule expired (Supp. 05-2).

Ariz. Admin. Code § R2-8-114 Emergency Expired

History

• New Section made by emergency rulemaking at 11 A.A.R. 579, effective January 4, 2005 (05-1). Emergency rule expired (Supp. 05-2).

Ariz. Admin. Code § R2-8-116 Alternate Contribution Rate

A. For purposes of this section, the following definitions apply:

1. "ACR" means an alternate contribution rate pursuant to A.R.S. § 38-766.02, the resulting amount of which is not deducted from the employee's compensation.

2. "Class of positions" means all employment positions of the employer that perform the same, or substantially similar, function or duties, for the employer as determined by the ASRS in subsection (B).

3. "Compensation" has the same meaning as A.R.S. § 38-711(7) and does not include ACR amounts.

4. "Leased from a third party" means:

a. The employee is not employed by an employer; and

b. A co-employment relationship, as defined in A.R.S. § 23-561(4), does not exist.

B. An employer that employs a retired member shall pay an ACR to the ASRS, unless the employer provides proof that:

1. The retired member is leased from a third party; and

2. All employees in the entire class of positions, to which the retired member's position belongs, have been leased from a third party; and

3. No employee who has not been leased is performing the same, or substantially similar, function or duties, as the retired member.

C. In order to determine whether an employer satisfies the criteria in subsection (B), the employer shall submit information and documentation, pursuant to A.R.S. § 38-766.02(E), within 14 days of written request by the ASRS.

D. The employer shall directly remit payment of an ACR to the ASRS from the employer's funds, through the employer's secure ASRS account within 14 days of the first pay period end date after the hire of the retired member.

E. If the employer does not remit the ACR by the date it is due pursuant to subsection (D), the ASRS shall charge interest on the ACR amount from the date it was due to the date the ACR payment is remitted to the ASRS at the assumed actuarial investment earnings rate listed in R2-8-118(A).

F. A payment of an ACR on behalf of a retired member pursuant to A.R.S. § 38-766.02, shall not entitle a retired member to a refund of an ACR payment or any additional ASRS benefit as described in A.R.S. § 38-766.01(E).

History

• Former Rule, Retirement System Regulation 2; Former Section R2-8-16 renumbered as Section R2-8-116 without change effective May 21, 1982 (Supp. 82-3). Section expired under A.R.S. § 41-1056(E) at 16 A.A.R. 1765, effective July 14, 2010 (Supp. 10-3). New section made by final rulemaking at 22 A.A.R. 1341, effective 7/4/2016. Amended by final rulemaking at 24 A.A.R. 1861, effective 6/11/2018.

Ariz. Admin. Code § R2-8-117 Return to Work After Retirement

A. Unless otherwise specified, in this Section:

1. "Commencing employment" means the date a retired member who is not independently contracted or leased from a third party pursuant to R2-8-116(A)(4) renders services directly to an Employer for which the retired member is entitled to be paid.

2. "Returns to work" means the member retired from the ASRS prior to Commencing Employment with an Employer.

B. Pursuant to A.R.S. § 38-766.01(C), a retired member who returns to work directly with an Employer shall submit a Working After Retirement form to each of the retired member's current Employers through the retired member's secure website account within 30 days of the retired member Commencing Employment with an Employer.

C. Pursuant to A.R.S. § 38-766.02(E), within 14 days of receipt of a Working After Retirement form, an Employer shall verify the retired member's employment information and submit the verified Working After Retirement form to the ASRS through the Employer's secure website account for each retired member who returns to work with the Employer.

D. After a retired member returns to work, the Employer shall submit a verified Working After Retirement form to the ASRS through the Employer's secure website account within 30 days of a change in the actual hours or intent of each retired member's employment that results in:

1. The member's number of hours worked per week increasing from less than 20 hours per week to 20 or more hours per week; or

2. The member's number of weeks worked in a fiscal year increasing from less than 20 weeks per fiscal year to 20 or more weeks per fiscal year.

E. The Working After Retirement form shall contain the following information:

1. The retired member's Social Security number or U.S. Tax Identification number;

2. The retired member's full name;

3. The date the member retired;

4. Whether the retired member terminated employment, and if so, the date the retired member terminated employment;

5. The first date of Commencing Employment upon the retired member's return to work;

6. The intent of the retired member's employment reflected as:

a. The anticipated number of hours the retired member is engaged to work per week and the anticipated number of weeks the retired member is engaged to work per fiscal year; or

b. The actual number of hours the retired member works for an Employer per week and the actual number of weeks the retired member works for an Employer in a fiscal year.

7. Acknowledgement by the retired member that the retired member has read the Return to Work information on the ASRS website and intends to submit the Working After Retirement form to the Employer and submit any additional Working After Retirement forms to the Employer as required.

F. Upon discovering that the retired member's employment violates A.R.S. §§ 38-766 or 38-766.01, the ASRS shall send the retired member a Retiree Return to Work Notice of Non-Compliance with ASRS Statutes form.

G. By the due date specified on the Retiree Return to Work Notice of Non-Compliance with ASRS Statutes form, the retired member shall return the completed form and any supporting documentation to the ASRS indicating the action the retired member will take to correct the violation of A.R.S. §§ 38-766 or 38-766.01.

H. If the member does not submit the Retiree Return to Work Notice of Non-Compliance with ASRS Statutes form pursuant to subsection (G), the ASRS shall suspend the retired member's retirement benefits from the date on the Retiree Return to Work Notice of Non-Compliance with ASRS Statutes form.

I. If the ASRS suspends the retired member's retirement benefits pursuant to subsection (H), the ASRS shall reinstate the retired member's retirement benefits upon notice from the Employer that all violations pursuant to subsection (F) have been corrected.

J. Notwithstanding any other Section, a member who meets the required minimum distributions age according to A.R.S. § 38-775, may not elect to suspend the member's retirement benefit.

K. If a member elects to continue receiving the member's retirement benefit when the member Returns to Work according to A.R.S. § 38-766.01, the member's election is irrevocable, unless the member terminates employment with the Employer for which the member made the election.

L. The ASRS shall suspend any Premium Benefit a member is receiving according to 2 A.A.C. 8, Article 2 if the member Returns to Work and resumes active membership in ASRS.

M. A member who Returns to Work is not eligible to request a return of contributions according to R2-8-115 for contributions remitted during the period of employment for which the member Returns to Work.

N. If a member received a lump sum payment according to R2-8-126(P), the ASRS shall not include any compensation and credited service the member earned prior to the date the member Returns to Work when the member re-retires according to R2-8-127.

History

• Former Rule, Retirement System Regulation 3; Former Section R2-8-17 renumbered as Section R2-8-117 without change effective May 21, 1982 (Supp. 82-3). Section repealed by final rulemaking at 11 A.A.R. 2640, effective June 30, 2005 (Supp. 05-2). Amended by final rulemaking at 23 A.A.R. 209, effective 3/5/2017. Amended by final expedited rulemaking at 27 A.A.R. 479, effective 3/5/2021. Amended by final rulemaking at 28 A.A.R. 1255, effective 7/17/2022. Amended by final rulemaking at 30 A.A.R. 725, effective 5/17/2024.

Ariz. Admin. Code § R2-8-118 Application of Interest Rates

A. Application of interest from inception of the ASRS Plan through the present is as follows:

| Effective Date of Interest Rate Change | Assumed Actuarial Investment Earnings Rate | Interest Rate Used to Determine Return of Contributions Upon Termination of Membership by Separation from Service by Other Than Retirement or Death | | --- | --- | --- | | 7-1-1953 | 2.50% | 2.50% | | 7-1-1959 | 3.00% | 3.00% | | 7-1-1966 | 3.75% | 3.75% | | 7-1-1969 | 4.25% | 4.25% | | 7-1-1971 | 4.75% | 4.75% | | 7-1-1975 | 5.50% | 5.50% | | 7-1-1976 | 6.00% | 5.50% | | 7-1-1981 | 7.00% | 5.50% | | 7-1-1982 | 7.00% | 7.00% | | 7-1-1984 | 8.00% | 8.00% | | 7-1-2005 | 8.00% | 4.00% | | 7-1-2013 | 8.00% | 2.00% | | 7-1-2018 | 7.50% | 2.00% | | 7-1-2022 | 7.00% | 2.00% |

B. At the beginning of each fiscal year, interest is credited to the retirement account of each member on the June 30 that marks the end of the fiscal year based on the balance in the member's account as of the previous June 30. The balance on which interest is credited includes:

1. Employer and employee contributions;

2. Voluntary additional contributions made by members pursuant to A.R.S. §§ 38-742, 38-743, 38-744, and 38-745, if applicable;

3. Amounts credited by transfer under 2 A.A.C. 8, Article 11; and

Interest credited in previous years.

C. Notwithstanding subsection (B), the retirement account of each member stops accruing interest the last full month prior to the member's retirement date.

D. A member's retirement account that the ASRS deems abandoned according to A.R.S. § 38-722 shall receive interest at the applicable interest rates according to subsection (A) upon reinstatement of the retirement account.

E. For a member whose address and birthdate are on file with the ASRS, the ASRS shall deem a retirement account of a member who is not retired or deceased as abandoned if:

1. The ASRS has not received any contributions for at least 180 days;

2. The member has reached the required minimum distribution age according to A.R.S. § 38-775; and

3. The ASRS has sent the member at least three annual notices of the member's responsibility to submit an application for disbursement of benefits according to A.R.S. § 38-775 and the member has not responded to those notices.

F. For a member whose address and birthdate are not on file with the ASRS, the ASRS shall deem a retirement account of a member who is not retired or deceased as abandoned if:

1. The ASRS has not received any contributions for at least 180 days; and

2. The ASRS has posted the member's full name to the abandoned monies section of the ASRS website for at least three consecutive years.

G. The ASRS shall deem a retirement account of a deceased member as abandoned if:

1. The ASRS has sent the designated beneficiary at least three annual notices of the beneficiary's responsibility to begin receiving benefits according to A.R.S. § 38-775; and

2. The designated beneficiary has not responded to those notices.

H. The ASRS shall reinstate an abandoned retirement account if the apparent owner notifies the ASRS that the member would like the retirement account reinstated.

History

• Former Rule, Retirement System Regulation 4; Amended effective July 1, 1975 (Supp. 75-1). Amended effective June 23, 1976 (Supp. 76-3). Former Section R2-8-18 renumbered and amended as Section R2-8-118 effective May 21, 1982 (Supp. 82-3). Amended by final rulemaking at 11 A.A.R. 1416, effective April 5, 2005 (Supp. 05-2). Amended by final rulemaking at 19 A.A.R. 764, effective June 1, 2013 (Supp. 13-2). Amended by final rulemaking at 21 A.A.R. 2515, effective 12/5/2015. Amended by final rulemaking at 22 A.A.R. 79, effective 3/6/2016. Amended by final rulemaking at 24 A.A.R. 1861, effective 6/11/2018. Amended by final expedited rulemaking at 27 A.A.R. 479, effective 3/5/2021. Amended by final rulemaking at 28 A.A.R. 1481, effective 6/6/2022. Amended by final rulemaking at 30 A.A.R. 727, effective 5/17/2024.

Ariz. Admin. Code § R2-8-119 Expired

History

• Former Rule, Retirement System Regulation 5; Amended effective July 1, 1975 (Supp. 75-1). Amended effective June 23, 1976 (Supp. 76-3). Former Section R2-8-19 renumbered and amended as Section R2-8-119 effective May 21, 1982 (Supp. 82-3). Section R2-8-119 and Appendix A and B expired under A.R.S. § 41-1056(E) at 16 A.A.R. 1765, effective July 14, 2010 (Supp. 10-3).

Ariz. Admin. Code § R2-8-120 [Repealed]

History

• Former Rule, Social Security Regulation 6; Amended effective June 19, 1975 (Supp. 75-1). Amended effective July 13, 1979 (Supp. 79-4). Former Section R2-8-20 renumbered and amended as Section R2-8-120 effective May 21, 1982 (Supp. 82-3). Repealed effective July 24, 1985 (Supp. 85-4). New Section made by final rulemaking at 20 A.A.R. 2236, effective 10/4/2014. Amended by final rulemaking at 21 A.A.R. 2515, effective 12/5/2015. Repealed by final rulemaking at 26 A.A.R. 2036, effective 11/8/2020.

Ariz. Admin. Code § R2-8-121 Employer Payments for Ineligible Contributions; Unfunded Liability Invoice

A. Upon calculating an unfunded liability amount under A.R.S. § 38-748, the ASRS shall send an Unfunded Liability Invoice to the Employer through the Employer's secure ASRS account.

B. An Employer that owes an unfunded liability amount to the ASRS pursuant to A.R.S. § 38-748, shall remit full payment of the unfunded liability amount within 90 days of being notified of the unfunded liability pursuant to subsection (A).

C. Pursuant to A.R.S. § 38-735(C), if the ASRS does not receive full payment from the Employer of the unfunded liability amount within 90 days of being notified of the unfunded liability amount, the unpaid portion of the unfunded liability amount shall accrue interest at the assumed actuarial investment earnings rate listed in R2-8-118(A).

D. The ASRS may collect any unfunded liability and interest amount pursuant to A.R.S. §§ 38-723 and 38-735(C).

History

• Former Rule, Retirement System Regulation 7; Amended effective April 15, 1980 (Supp. 80-2). Former Section R2-8-21 renumbered as Section R2-8-121 without change effective May 21, 1982 (Supp. 82-3). Amended subsection (A) effective May 30, 1985 (Supp. 85-3). Section repealed by final rulemaking at 11 A.A.R. 444, effective January 4, 2005 (05-1). New section made by final rulemaking at 27 A.A.R. 458, effective 5/2/2021.

Ariz. Admin. Code § R2-8-122 Remittance of Contributions

A. Each Employer shall remit the amount of employee member contributions to the ASRS not later than 14 days after the last day of each payroll period. Payments of employee member contributions not received in the offices of the ASRS by the 14th day after the last day of the applicable pay-roll period shall become delinquent after that date and shall accrue interest at the assumed actuarial investment earnings rate listed in R2-8-118(A) per annum from and after the date of delinquency until payment is received by the ASRS.

B. Each Employer shall remit the amount of employer contributions to the ASRS not later than 14 days after the last day of each payroll period. Payments of employer contributions not received in the offices of the ASRS by the 14th day after the last day of the applicable payroll period shall become delinquent after that date and shall accrue interest at the assumed actuarial investment earnings rate listed in R2-8-118(A) per annum from and after the date of delinquency until payment is received by the ASRS.

C. Each Employer shall remit contributions pursuant to this Section based on the contribution rate in effect on the pay period end date.

D. Each Employer shall certify on each payroll that each employee included on that payroll has met the requirements for active member eligibility and that all contributions to be remitted are for eligible compensation under A.R.S. § 38-711.

E. If an Employer improperly certifies that an employee has met the requirements for active member eligibility and that all contributions remitted for the employee are eligible for compensation under subsection (D), the ASRS may charge the employer an unfunded liability amount under A.R.S. § 38-748.

History

• Former Rule, Retirement System Regulation 8; Amended effective Dec. 8, 1978 (Supp. 78-6). Former Section R2-8-22 renumbered as Section R2-8-122 without change effective May 21, 1982 (Supp. 82-3). Amended by final rulemaking at 22 A.A.R. 79, effective 3/6/2016. Amended by final rulemaking at 24 A.A.R. 1861, effective 6/11/2018. Amended by final rulemaking at 26 A.A.R. 371, effective 4/11/2020. Amended by final rulemaking at 27 A.A.R. 458, effective 5/2/2021.

Ariz. Admin. Code § R2-8-123 Actuarial Assumptions and Actuarial Value of Assets

A. For the purposes of this Section.

1. "Actuarial assumption" means an estimate of an uncertain future event that affects pension liabilities.

2. "Board" means the same as in A.R.S. § 38-711 .

3. "Investment return rate" means a percentage of total return on an asset.

4. "market Market value" means an estimated monetary worth of an asset based on the current demand for the asset and the amount of that type of asset available for sale.

B. The Board adopts the following actuarial assumptions and asset valuation method:

1. The interest and investment return rate assumptions are determined by the Board.

2. The actuarial value of assets equals the market value of assets:

a. Minus a 10-year phase-in of the excess for years in which actual investment return exceeds expected investment return; and

b. Plus a 10-year phase-in of the shortfall for years in which actual investment return falls short of expected investment return.

History

• Adopted effective July 1, 1975 (Supp. 75-1). Amended effective June 23, 1976 (Supp. 76-3). Amended effective December 20, 1977 (Supp. 77-6). Former Section R2-8-23 renumbered and amended as Section R2-8-123 effective May 21, 1982 (Supp. 82-3). Emergency amendments effective July 6, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Emergency amendments adopted again effective September 29, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Permanent amendments adopted effective December 22, 1993 (Supp. 93-4). Emergency amendments adopted effective January 30, 1997, pursuant to A.R.S. § 41-1026 for a maximum of 180 days (Supp. 97-1). Emergency expired. Permanent amendments adopted effective September 12, 1997 (Supp. 97-3). Amended by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 1006, effective February 24, 2003 for a period of 180 days (Supp. 03-1). Emergency rulemaking renewed at 9 A.A.R. 3963, effective August 21, 2003 for a period of 180 days (Supp. 03-3). Amended by final rulemaking at 9 A.A.R. 4614, effective December 6, 2003 (Supp. 03-4). Amended by emergency rulemaking under A.R.S. § 41-1026 at 10 A.A.R. 2496, effective August 2, 2004 for 180 days (Supp. 04-2). Amended by final rulemaking at 10 A.A.R. 4012, effective November 13, 2004 (Supp. 04-3). Section expired under A.R.S. § 41-1056(E) at 16 A.A.R. 1765, effective July 14, 2010 (Supp. 10-3). Amended by final rulemaking at 20 A.A.R. 3043, effective 1/3/2015. Amended by final rulemaking at 21 A.A.R. 2515, effective 12/5/2015.

Ariz. Admin. Code § R2-8-124 Termination Incentive Program by Agreement; Unfunded Liability Calculations

A. The following definitions apply to this Section unless otherwise specified:

1. "Compensation" means the same as in A.R.S. § 38-711(7).

2. "Termination Incentive Program" means the same as in A.R.S. § 38-749(D)(2).

B. An Employer that intends to implement a Termination Incentive Program shall provide the following information to the ASRS through the Employer's secure ASRS account:

1. Within 90 days before implementation of the program, a complete description of the program terms and conditions, including the program contract, understanding, or agreement; and

2. Within 90 days before implementation of the program, the following information for each member who may be eligible to participate in the program:

a. The member's full name;

b. The member's date of birth; and

c. The member's current Compensation;

C. The ASRS may use the information provided by the Employer pursuant to subsection (B) and the information on file with the ASRS to determine an estimated unfunded liability amount in consultation with the ASRS actuary, which may result from the implementation of the Employer's Termination Incentive Program.

D. If the ASRS determines an estimated unfunded liability amount pursuant to subsection (C), the ASRS may send a Notice of Estimated Liability to the Employer through the Employer's secure ASRS account, in order to notify the Employer of the estimated unfunded liability amount the Employer may owe to the ASRS as a result of implementing the Termination Incentive Program identified under subsection (B). An Employer may owe the ASRS more or less than the estimated unfunded liability amount based on actual employee participation in the Employer's Termination Incentive Program pursuant to subsection (F).

E. Within 30 days of termination of employment of each member who participated in a Termination Incentive Program identified under subsection (B), the Employer shall provide the following information to the ASRS through the Employer's secure ASRS account:

1. The member's full name;

2. The member's date of birth;

3. The member's Compensation at termination;

4. The date the member terminated employment; and

5. The amount and type of any additional pay the member received, or was entitled to receive, from the Employer as a result of participating in the Employer's Termination Incentive Program.

F. Upon receipt of all the information identified in subsection (E) and in consultation with the ASRS actuary, the ASRS shall calculate the actual unfunded liability amount which resulted from the implementation of the Employer's Termination Incentive Program.

G. If the ASRS calculates an unfunded liability of less than $0.00 for any member who participated in the Employer's Termination Incentive Program, the amount will be applied against the aggregate unfunded liability of the Employer.

H. Upon calculating the unfunded liability pursuant to subsections (F) and (G), the ASRS shall send the Employer a Termination Incentive Program Liability Invoice through the Employer's secure ASRS account.

I. An Employer that owes an unfunded liability amount to the ASRS pursuant to A.R.S. § 38-749, shall remit full payment of the unfunded liability amount by the due date specified in the Termination Incentive Program Liability Invoice.

J. Pursuant to A.R.S. § 38-735(C), if the ASRS does not receive full payment from the Employer of the unfunded liability amount by the due date specified in the Termination Incentive Program Liability Invoice, the unpaid portion of the unfunded liability amount shall accrue interest at the assumed actuarial investment earnings rate listed in R2-8-118(A).

K. The ASRS may collect any unfunded liability amount pursuant to A.R.S. §§ 38-723 and 38-735(C).

History

• Adopted as an emergency effective August 25, 1975 (Supp. 75-1). Former Section R2-8-24 renumbered as Section R2-8-124 without change effective May 21, 1982 (Supp. 82-3). Section repealed by final rulemaking at 10 A.A.R. 669, effective February 3, 2004 (Supp. 04-1). New Section made by final rulemaking at 23 A.A.R. 2743, effective 1/1/2018. Amended by final rulemaking at 24 A.A.R. 1861, effective 6/11/2018.

Ariz. Admin. Code § R2-8-125 Termination Incentive Program by 30% Salary Increase; Unfunded Liability Calculations

A. The following definitions apply to this Section unless otherwise specified:

1. "Average monthly compensation" means the same as in A.R.S. § 38-711(5).

2. "Baseline salary" means the average of a member's monthly Compensation during the 12 consecutive months in which the member received Compensation immediately preceding the first month of Compensation used to calculate the member's retirement benefit. The Baseline Salary shall include only Compensation from the Same Employer that paid the Compensation used in the calculation of a member's retirement benefit. If the member has less than 12 consecutive months in which the member received Compensation immediately preceding the first month of Compensation used to calculate the member's retirement benefit, then the ASRS will calculate the member's Baseline Salary as the total of the 12 months of Compensation the member received:

a. Starting with the first month of Compensation the member received in the 12 months immediately preceding the member's Average Monthly Compensation, or within the Average Monthly Compensation; and

b. Ending with the 12th month of Compensation the member received after the first month of Compensation used in subsection (A)(2)(a).

3. "Compensation" means the same as in A.R.S. § 38-711(7).

4. "Job reclassification" means a change in the classification of an employment position made by the Employer when it finds the duties and responsibilities of the position have changed significantly, materially, and permanently from when the position was last classified.

5. "Promotion" means, excluding a Salary Regrade or Job Reclassification, the act of advancing an employee to a higher salary or higher rank within the organization, which is characterized by:

a. A change in the employee's primary job responsibilities; and

b. A pay increase that is supported by a standard salary administration practice that is documented by the Employer; and

c. A competitive selection process or a noncompetitive selection process supported by a standard hiring practice that is documented by the Employer.

6. "Salary regrade" means a change in the salary scale of an employment position made by the Employer in order to align the position's salary scale with market factors and/or the Employer's current salary practices.

7. "Same employer" means the Employer has the same ownership as another Employer, except that for purposes of this Section, each agency, board, commission, and department of the State of Arizona shall be considered a separate Employer.

8. "Termination Incentive Program" means the same as in A.R.S. § 38-749(D)(1).

B. Upon a member's retirement on or after January 1, 2018, the ASRS shall compare the member's Baseline Salary to the Average Monthly Compensation used to calculate the member's retirement benefit in order to determine whether an Employer utilized a Termination Incentive Program as defined in A.R.S. § 38-749(D)(1). This subsection only applies to members who earned the Compensation used to calculate the member's Baseline Salary, on or after July 1, 2005.

C. Upon determining that a Termination Incentive Program exists under subsection (B), the ASRS shall send a Request for Documentation to the Employer through the Employer's secure ASRS account, in order to notify the Employer that the ASRS has identified a Termination Incentive Program for a particular member and the Employer may be required to pay the ASRS for the unfunded liability resulting from the Termination Incentive Program, unless the Employer can prove the increase in the member's salary was the result of a Promotion.

D. Within 90 days of the date on the Request for Documentation, the Employer shall respond to the Request for Documentation by:

1. Submitting documentation through the Employer's secure ASRS account that shows the member's increase in Compensation was the result of a Promotion; or

2. Acknowledging in writing that the increase in the member's salary was not the result of a Promotion.

E. Pursuant to subsection (D), the Employer bears the burden of producing evidence that a Promotion has occurred as defined in subsection (A)(5).

F. The ASRS shall use any evidence the Employer submits to the ASRS pursuant to subsection (D) to determine whether a Promotion occurred.

G. If the Employer does not respond to the Request for Documentation within 90 days of the date on the Request for Documentation, the ASRS shall determine that the increase in the member's salary was not the result of a Promotion.

H. If the ASRS determines that the increase in the member's salary was not the result of a Promotion pursuant to subsections (F) or (G), the ASRS shall calculate the unfunded liability amount pursuant to subsection (I).

I. In consultation with the ASRS actuary, the ASRS shall use the calculation under subsection (B) to calculate the unfunded liability resulting from the implementation of the Employer's Termination Incentive Program.

J. Upon calculating an unfunded liability amount pursuant to subsection (I), the ASRS shall send a Termination Incentive Program Liability Invoice to the Employer through the Employer's secure ASRS account, in order to notify the Employer of the unfunded liability amount the Employer shall owe to the ASRS as a result of implementing the Termination Incentive Program identified under subsection (B).

K. An Employer that owes an unfunded liability amount to the ASRS pursuant to A.R.S. § 38-749, shall remit full payment of the unfunded liability amount by the due date specified in the Termination Incentive Program Liability Invoice.

L. Pursuant to A.R.S. § 38-735(C), if the ASRS does not receive full payment from the Employer of the unfunded liability amount by the due date specified in the Termination Incentive Program Liability Invoice, the unpaid portion of the unfunded liability amount shall accrue interest at the assumed actuarial investment earnings rate listed in R2-8-118(A).

M. The ASRS may collect any unfunded liability amount pursuant to A.R.S. §§ 38-723 and 38-735(C).

History

• Adopted as an emergency effective July 30, 1975 (Supp. 75-1). Former Section R2-8-25 renumbered as Section R2-8-125 without change effective May 21, 1982 (Supp. 82-3). Section repealed by final rulemaking at 10 A.A.R. 669, effective February 3, 2004 (Supp. 04-1). New Section made by final rulemaking at 23 A.A.R. 2743, effective 1/1/2018. Amended by final rulemaking at 24 A.A.R. 1861, effective 6/11/2018. Amended by final rulemaking at 30 A.A.R. 730, effective 5/17/2024.

Ariz. Admin. Code § R2-8-126 Retirement Application

A. For the purposes of this Section, the following definitions apply, unless stated otherwise:

1. "Acceptable documentation" means any written request containing all the accurate, required information, dates, and signatures necessary to process the request.

2. "Acceptable form" means any ASRS form request containing all the accurate, required information, dates, and signatures necessary to process the form request.

3. "Applicable retirement date" means the later of:

a. The date a member retires from the ASRS for the first time; or

b. The date a member re-retires from the ASRS after returning to active membership.

"Conservator" means the same as in A.R.S. § 14-7651.

5. "DRO" means the same as in R2-8-115.

6. "Joint and survivor retirement benefit option" means an optional form of retirement benefits described in A.R.S. § 38-760(B)(1).

7. "Legal documentation" means:

a. One document issued from a United States government entity; or

b. Two documents issued from one or more federal, state, local, sovereign, medical, or religious institutions.

8. "LTD" means the same as in R2-8-301.

9. "Irrevocable PDA" means the same as in R2-8-501.

"On File" means the same as in R2-8-115.

11. "Original retirement date" means the later of:

a. The date a member retires from the ASRS for the first time; or

b. The date a member re-retires from the ASRS after returning to active membership for 60 consecutive months or more according to A.R.S. § 38-766(C).

11. "Period certain and life annuity retirement benefit option" means an optional form of retirement benefits described in A.R.S. § 38-760(B)(2).

12. "Spouse" means the individual to whom a member is married under Arizona law.

13. "Straight life annuity" means the same as monthly life annuity according to A.R.S. § 38-757.

B. A member may retire from the ASRS by submitting a Retirement Application to the ASRS that contains the following information:

1. The member's full name;

2. The member's Social Security number or U.S. Tax Identification number;

3. The member's marital status, if not On File with ASRS;

4. The member's current mailing address; if not On File with ASRS;

5. The member's date of birth, if not On File with ASRS;

6. A retirement date according to A.R.S. § 38-764(A);

7. The retirement option the member is electing;

8. If the member is electing to roll over a lump sum distribution amount to another retirement account, then:

a. The type of account and account number, if applicable, to which the member is electing to roll over the lump sum distribution; and

b. The name and address of the financial institution of the account to which the member is electing to roll over the lump sum distribution;

9. The following information for each primary beneficiary, unless the member is receiving a mandatory lump sum distribution under subsection (M):

a. The beneficiary's full name;

b. The beneficiary's Social Security number, if the beneficiary is a U.S. citizen;

c. The beneficiary's date of birth;

d. The beneficiary's relationship to the member; and

e. The percent of benefit the beneficiary may receive upon death of the member, if the member is designating more than one beneficiary.

10. Whether the member is electing the Optional Health Insurance Premium Benefit;

11. The following spousal consent information, if the member is married and is electing a retirement option other than a Joint and Survivor Retirement Benefit Option with at least 50% of the retirement benefit designated to the member's spouse:

a. Whether the member's spouse consents to the member making a beneficiary election that provides the member's spouse with less than 50% of the member's account balance;

b. Whether the member's spouse consents to the member electing a retirement option other than a Joint and Survivor Retirement Benefit Option;

c. The member's spouse's full name; and

d. The member's spouse's notarized signature;

12. Whether the member is electing to receive a partial lump sum distribution according to A.R.S. § 38-760 and if so:

a. How many months of annuity, up to 36 months, the member is electing to receive as a partial lump sum;

b. Whether the member is electing to directly receive the partial lump sum distribution reduced by applicable tax withholding amounts;

c. Whether the member is electing to roll over all or a portion of the partial lump sum distribution amount to one other retirement account; and

d. Whether the member is electing to use the partial lump sum distribution to purchase service credit with ASRS based on a service purchase request dated before January 6, 2013;

13. Acknowledgement of the following statements of understanding:

a. The member is aware of the member's LTD stop-payment date and any disability benefits the member is receiving shall cease upon the retirement date the member elects according to subsection (B)(6);

b. The member understands that if an overpayment exists, ASRS shall collect the remaining overpayment amount according to 2 A.A.C. 8, Article 8 and all repayment plans previously established with ASRS LTD claims administrator shall cease;

c. The member understands that if the member is submitting written notice of a changed retirement date, benefit option, or partial lump sum increment selection, ASRS shall distribute the member's benefit as of the later of:

i. The date ASRS receives the most recent Acceptable Documentation; or

ii. The retirement date contained in the most recent Acceptable Documentation.

d. The member has received the Special Tax Notice Regarding Plan Payments;

e. The member has received the Return to Work information and will comply with the laws and rules governing the member's return to work;

f. The member authorizes ASRS and the banking institution identified in subsection (W) to debit the member's account for the purposes of correcting errors and returning any payments inadvertently made after the member's death;

g. The member understands that the member may have a one-time option to rescind a Joint and Survivor Retirement Benefit Option or a Period Certain and Life Annuity Retirement Benefit Option according to R2-8-130;

h. The member understands that any person who knowingly makes any false statement with the intent to defraud ASRS is guilty of a Class 6 felony in accordance with A.R.S. § 38-793; and

i. The member acknowledges that the member has complied with A.R.S. §§ 38-755 and 38-776 regarding spousal consent; and

14. The member's notarized signature.

C. If a Retirement Application is completed through the member's secure ASRS account, the member's notarized signature is not required under subsection (B)(14).

D. If the retirement date the member elects according to subsection (B)(6) is not allowed, the ASRS shall change the retirement date to the earliest eligible date according to A.R.S. 38-764(A), unless the member is not eligible to retire.

E. A member who elects to roll over all or a portion of the partial lump sum distribution amount according to subsection (B)(12)(c), shall submit the following written information to the ASRS:

1. The type of account and account number to which the member is electing to roll over;

2. The name and address of the financial institution of the account to which the member is electing to roll over; and

3. If the member is electing to roll over a portion of the partial lump sum distribution, then the amount the member is electing to roll over.

F. If the member elects to roll over all or a portion of their lump sum or partial lump sum distribution, the ASRS shall only roll over the distribution to one retirement account.

G. Any portion of the partial lump sum distribution that is not rolled over to another retirement account according to subsection (B) shall be distributed directly to the member.

H. If the member elects to use the partial lump sum distribution to purchase service credit according to subsection (B)(12)(d) the member shall submit the following written information to the ASRS:

1. The number of the service purchase invoice;

2. Whether the member is electing to apply the partial lump sum distribution to all eligible service on that invoice;

3. If the member is not electing to apply the partial lump sum distribution to all eligible service on that invoice, then:

a. The amount of the partial lump sum distribution to be applied to that invoice; or

b. The number of years on that invoice the member is electing to purchase with the partial lump sum distribution;

4. If the member is electing to make a payment on that service purchase invoice with after-tax payments, a rollover, or termination pay according to A.R.S. § 38-747;

5. Whether the member is electing to authorize the ASRS to increase the number of months of annuity, not to exceed 36 months, to purchase the eligible service on that service purchase invoice, if the member elected an insufficient number of months of annuity to receive as a partial lump sum according to subsection (G) to complete the service purchase invoice;

6. If the member does not have eligible service to purchase on that invoice, whether the member is electing to cancel the member's election to receive a partial lump sum distribution.

I. A member who elects to receive a partial lump sum distribution shall receive an actuarially reduced annuity retirement benefit according to A.R.S. § 38-760.

J. ASRS shall disburse any partial lump sum amount that is not applied to a service purchase invoice according to subsection (G) directly to the member after withholding applicable taxes.

K. After submitting a Retirement Application according to subsection (B), a member may make changes to the member's Retirement Application by submitting written notice to the ASRS of the specific changes according to A.R.S. § 38-764(G).

L. If ASRS has received contributions for the member within the three years immediately preceding the member's retirement date, the ASRS shall send a New Retirement Ending Payroll Verification form to the Employer. If ASRS has received contributions for the member within the six months immediately preceding the member's retirement date and the member shall receive a one-time lump sum payment according to subsection (P), the ASRS shall send a New Retirement Ending Payroll Verification form to the Employer.

M. If the member has reached the age for minimum required distribution according to A.R.S. § 38-775(H)(4), the ASRS shall send a New Retirement Ending Payroll Verification form to the member's most recent Employer.

N. The Employer shall submit the completed New Retirement Ending Payroll Verification form to ASRS with the following information:

1. The member's Termination date or last day of ASRS membership with that Employer, if applicable;

2. The member's total salary paid during their last fiscal year;

3. The member's compensation for the last pay period;

4. The name and title of the authorized Employer representative;

Certification by the authorized Employer representative that:

a. Any person who knowingly makes any false statement or who falsifies any record of the retirement plan with an intent to defraud the plan, is guilty of a Class 6 felony according to A.R.S. § 38-793; and

b. The authorized Employer representative certifies that they are the Employer user named on the New Retirement Ending Payroll Verification form and their title and contact information is current and correct.

O. The ASRS shall cancel a member's Retirement Application if ASRS does not receive all forms and information required under this Section within six months immediately after the member's retirement date.

P. As authorized under A.R.S. § 38-764(F), if a member's Straight Life Annuity, after any applicable early retirement reduction factor, is less than a monthly amount of $100, the ASRS shall not pay the annuity. Instead, the ASRS shall make a one-time mandatory lump sum payment in the amount determined by using appropriate actuarial assumptions.

Q. For purposes of calculating a member's retirement benefit according to A.R.S. §§ 38-758 and 38-759, ASRS shall calculate age to the nearest day as of the member's retirement date.

R. Based on the retirement option the member elects according to A.R.S. § 38-760, the ASRS shall calculate a member's actuarially reduced benefits, based on the attained age of the member, and if necessary, the attained age of the contingent annuitant as of the date of the member's retirement as follows:

1. For a partial lump sum retirement benefit option, ASRS shall calculate age to the nearest day as of the member's retirement date;

2. For a Joint and Survivor Retirement Benefit Option, ASRS shall calculate age to the nearest day as of the member's retirement date; and

3. For a mandatory lump sum payment according to subsection (O) or a Period Certain and Life Annuity Retirement Benefit Option, ASRS shall calculate age to the nearest full month in addition to calculating age according to subsection (P) as necessary.

S. If the ASRS is unable to verify the age of the member or a contingent annuitant, the member or contingent annuitant shall provide Legal Documentation showing the member's or contingent annuitant's age.

T. If a member does not retire by the date minimum distribution payments are required according to A.R.S. §§ 38-759 and 38-775, the required minimum distribution payments will accrue interest at the Assumed Actuarial Investment Earnings Rate specified in R2-8-118(A) and in effect on the date the required minimum distribution payments should have begun.

U. The ASRS shall distribute any required minimum distribution payments with interest according to subsection (T) with the member's first finalized benefits payment.

V. If a member submits a retirement application after the member's minimum required distribution date, the ASRS shall determine that the member's Applicable Retirement Date is the date the required minimum distribution payments should have begun.

W. Notwithstanding any other Section, an inactive member who does not have contributions related to compensation is not eligible for retirement.

X. The ASRS shall issue a debit benefit card if the annuitant does not provide the following direct deposit information through the annuitant's secure ASRS account or by a notarized Direct Deposit form:

1. The member's full name;

2. The member's bank account routing number;

3. The member's bank account number; and

4. The type of the account.

Y. If the annuitant does not activate the debit benefit card the ASRS issues to the annuitant within 75 days, the ASRS shall reclaim all the retirement benefits issued on the debit benefit card and suspend the annuitant's retirement benefits until the annuitant:

1. Activates the debit benefit card or provides the direct deposit information according to subsection (X); and

2. Returns the notice of benefit suspension with the following information:

a. The annuitant's Social Security number or U.S. Tax Identification number;

b. The annuitant's address; and

c. The annuitant's notarized signature.

Y.Z. The ASRS shall disburse benefits payments according to subsection (R), only retroactive to the later date specified in A.R.S. § 38-759(B).

Z.AA. ASRS shall not issue additional estimate checks to a member whose retirement is canceled.

History

• Adopted effective September 12, 1977 (Supp. 77-5). Amended effective July 13, 1979 (Supp. 79-4). Former Section R2-8-26 renumbered and amended as Section R2-8-126 effective May 21, 1982 (Supp. 82-3). Amended subsections (A) through (D) effective October 18, 1984 (Supp. 84-5). Amended subsections (A) through (D) effective July 24, 1985 (Supp. 85-4). Amended by emergency effective July 6, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Emergency amendments adopted again effective September 29, 1993, pursuant to A.R.S. § 41-1026, valid for only 90 days (Supp. 93-3). Permanent rule adopted effective December 22, 1993 (Supp. 93-4). Amended by emergency rulemaking at 7 A.A.R. 1621, effective March 21, 2001 (Supp. 01-1). Amended by emergency rulemaking under A.R.S. § 41-1026 at 10 A.A.R. 2496, effective August 2, 2004 for 180 days (Supp. 04-2). Amended by final rulemaking at 10 A.A.R. 4012, effective November 13, 2004 (Supp. 04-3). Amended by final rulemaking at 19 A.A.R. 332, effective April 6, 2013 (Supp. 13-1). Amended by final rulemaking at 21 A.A.R. 2515, effective 12/5/2015. Amended by final rulemaking at 22 A.A.R. 79, effective 3/6/2016. Amended by final rulemaking at 22 A.A.R. 3081, effective 12/3/2016. Amended by final rulemaking at 26 A.A.R. 2036, effective 11/8/2020. Amended by final rulemaking at 28 A.A.R. 1746, effective 9/4/2022. Amended by final rulemaking at 30 A.A.R. 732, effective 5/17/2024.

Ariz. Admin. Code § R2-8-127 Re-Retirement Application

A. The definitions in R2-8-126 apply to this section.

B. If a member has previously retired from ASRS, the member may re-retire from ASRS by submitting a Re-Retirement Application to the ASRS that contains:

1. The information identified in R2-8-126(B)(1) through (B)(8);

2. The retirement option the member is electing, if the member suspended the member's annuity from the member's previous retirement from ASRS and returned to work for 60 consecutive months or more according to A.R.S. § 38-766(C);

3. The information identified in R2-8-126(B)(11);

4. Whether the member is electing the Optional Health Insurance Premium Benefit, if the member suspended the member's annuity from the member's previous retirement from ASRS and returned to work for 60 consecutive months or more according to A.R.S. § 38-766(C);

5. The information identified in R2-8-126(B)(13), if the member suspended the member's annuity from the member's previous retirement from ASRS and returned to work for 60 consecutive months or more according to A.R.S. § 38-766(C);

6. Acknowledgement of the following statements of understanding:

a. The member's signature confirms the member's intent to re-retire and applies to all the sections included in the Re-Retirement Application.

b. The member understands that as a re-retiree, the member must keep the same retirement option and beneficiary the member elected when the member previously retired from ASRS, unless the member returned to active membership for 60 consecutive months or more according to A.R.S. § 38-766(C);

c. The member may change the member's beneficiary after re-retiring and changing the beneficiary may change the member's monthly annuity;

d. The member has complied with A.R.S. §§ 38-755 and 38-766 regarding spousal consent;

e. The member certifies that the member has read and understands the instructions and Special Tax Notice Regarding Plan Payments;

f. The member authorizes ASRS and the banking institution the member listed for direct deposit to debit the member's account for the purpose of correcting errors and returning any payments inadvertently paid after the member's death;

g. The member understands that any person who knowingly makes any false statement with the intent to defraud ASRS is guilty of a Class 6 felony in accordance with A.R.S. § 38-793; and

h. The member understands that if an overpayment exists, the ASRS shall collect the remaining overpayment amount according to 2 A.A.C. 8, Article 8 and all repayment plans previously established with the ASRS LTD claims administrator shall cease.

7. The member's notarized signature.

C. If the retirement date the member elects according to R2-8-126(B)(6) is not allowed, the ASRS shall change the retirement date to the earliest eligible date according to A.R.S. 38-764(A), unless the member is not eligible to retire.

History

• Adopted by final rulemaking at 26 A.A.R. 2036, effective 11/8/2020.

Ariz. Admin. Code § R2-8-128 Joint and Survivor Retirement Benefit Options

A. The definitions in R2-8-126 apply to this Section.

B. A member who is ten years and one day, or more, older than the member's non-spouse contingent annuitant is not eligible to elect a 100% Joint and Survivor Retirement Benefit Option.

C. A member who is 24 years and one day, or more, older than the member's non-spouse contingent annuitant is not eligible to elect a 66 2/3% Joint and Survivor Retirement Benefit Option.

D. For members whose Original Retirement Date is on or after March 6, 2016, notwithstanding subsection (B), a member who is ten years and one day, or more, older than the member's ex-spouse contingent annuitant is eligible to participate in a 100% Joint and Survivor Retirement Benefit Option, if:

1. The member elected the ex-spouse as the contingent annuitant prior to divorce from the ex-spouse; and

2. The member submits a DRO to ASRS which requires the ex-spouse to remain as the contingent annuitant on the member's account.

E. For members whose Original Retirement Date is on or after March 6, 2016, notwithstanding subsection (C), a member who is 24 years and one day, or more, older than the member's ex-spouse contingent annuitant is eligible to participate in a 66 2/3% Joint and Survivor Retirement Benefit Option, if:

1. The member elected the ex-spouse as the contingent annuitant prior to divorce from the ex-spouse; and

2. The member submits a DRO to the ASRS which requires the ex-spouse to remain as the contingent annuitant on the member's account.

F. Notwithstanding any other Section, for purposes of determining whether a member is eligible to participate in a Joint and Survivor Retirement Benefit Option, the ASRS shall calculate the difference in a member's age and the contingent annuitant's age based on the birthdates of the member and the contingent annuitant. For purposes of this Section, a contingent annuitant must be a living person.

History

• Adopted by final rulemaking at 26 A.A.R. 2036, effective 11/8/2020. Amended by final rulemaking at 28 A.A.R. 1746, effective 9/4/2022.

Ariz. Admin. Code § R2-8-129 Period Certain and Life Annuity Retirement Options

A. The definitions in R2-8-126 apply to this section.

B. An individual who is 104 years of age or older at the time of retirement is not eligible to elect a Period Certain and Life Annuity Retirement Benefit Option.

C. An individual who is 93 years of age or older at the time of retirement is not eligible to elect a Period Certain and Life Annuity Retirement Benefit Option with ten years certain or 15 years certain.

D. An individual who is 85 years of age or older at the time of retirement is not eligible to elect a Period Certain and Life Annuity Retirement Benefit Option with 15 years certain.

E. The ASRS shall calculate the period certain term as beginning on the first day of the first full calendar month following the member's Applicable Retirement Date.

F. Notwithstanding subsection (E), the ASRS shall calculate the period certain term as beginning on the member's Applicable Retirement Date if the member's Applicable Retirement Date is the first day of the month.

History

• Adopted by final rulemaking at 26 A.A.R. 2036, effective 11/8/2020.

Ariz. Admin. Code § R2-8-130 Rescind or Revert Retirement Election; Change of Contingent Annuitant

A. The definitions in R2-8-126 apply to this Section.

B. According to A.R.S. § 38-760(B)(2), for a member whose Original Retirement Date is after August 9, 2001, upon the expiration of a member's period certain term the ASRS shall rescind the member's election and the ASRS shall provide the member a Straight Life Annuity retirement benefit subject to any retirement reductions applicable at the member's Original Retirement Date.

C. According to A.R.S. § 38-760(B)(2), a member whose Original Retirement Date is after August 9, 2001 and before July 1, 2008 and who elected a Period Certain and Life Annuity Retirement Benefit Option, may rescind the election and elect to receive a Straight Life Annuity retirement benefit prior to the expiration of the member's period certain term.

D. According to A.R.S. § 38-760(B)(1), a member whose Original Retirement Date is before July 1, 2008 and who elected a Joint and Survivor Retirement Benefit Option may rescind the election and elect to receive a Straight Life Annuity retirement benefit prior to the member's death.

E. A member whose Original Retirement Date is on or after July 1, 2008 and who elected a Period Certain and Life Annuity Retirement Benefit Option may exercise a one-time election to rescind the election and elect to receive a Straight Life Annuity retirement benefit prior to the expiration of the member's period certain term if the member provides proof to ASRS of the death of the primary beneficiary or a DRO showing that the primary beneficiary has ceased to be a primary beneficiary.

F. A member whose Original Retirement Date is on or after July 1, 2008 and who elected a Joint and Survivor Retirement Benefit Option may exercise a one-time election to rescind the election and elect to receive a Straight Life Annuity retirement benefit prior to the death of the member if the member provides proof to ASRS of the death of the contingent annuitant a DRO showing that the contingent annuitant has ceased to be a contingent annuitant.

G. A member who elected to rescind a Period Certain and Life Annuity Retirement Benefit Option according to subsection (C) may elect to revert to the Period Certain and Life Annuity Retirement Benefit Option by submitting an Application to Rescind, Revert or Change Contingent Annuitant as specified in subsection (M).

H. A member who elected to rescind a Joint and Survivor Retirement Benefit Option according to subsection (D) may elect to revert to the Joint and Survivor Retirement Benefit Option by submitting an Application to Rescind, Revert or Change Contingent Annuitant as specified in subsection (M).

I. A member may only revert to the same Period Certain and Life Annuity Retirement Benefit Option the member rescinded according to subsection (C) prior to the expiration of the period certain term the member elected at the member's most recent retirement.

J. A member who rescinds their election according to subsections (E) or (F) is not eligible to revert to a Period Certain and Life Annuity Retirement Benefit Option or a Joint and Survivor Retirement Benefit Option.

K. Notwithstanding any other provision, the time period of a Period Certain and Life Annuity Retirement Benefit Option shall be continuous from the member's retirement date until the term expires regardless of whether the member rescinds or reverts to another retirement option.

L. A member who wants to rescind or revert a retirement election according to subsections (C) through (H) shall ensure ASRS receives an Application to Rescind, Revert or Change Contingent Annuitant at least one day prior to the member's death.

M. In order to rescind, revert, or change a contingent annuitant, the member shall submit an Application to Rescind, Revert or Change Contingent Annuitant with the following information:

1. The member's full name;

2. The member's Social Security number or U.S. Tax Identification number;

The member's marital status, if not On File with ASRS;

4. Whether the member is electing to rescind, revert, or change a contingent annuitant;

5. The member's notarized signature acknowledging the following statements of understanding:

a. For rescinding a retirement election:

i. By this action, and the member's signature, the member is aware that the member's designated beneficiary or contingent annuitant will not continue with monthly benefits after the member's death;

ii. The member is aware that a certified copy of the member's designated beneficiary's or contingent annuitant's death certificate or a DRO is required if the member retired or re-retired on or after July 1, 2008;

iii. At the time of the member's death, if the ASRS has not disbursed the total employee contributions on the member's account, plus interest at the Assumed Actuarial Investment Earnings Rate specified in R2-8-118(A) through the month prior to the member's retirement date, the balance will be payable in a lump sum to the beneficiary named on the member's most recent Acceptable Form.

b. For changing a contingent annuitant or beneficiary:

i. For a Joint and Survivor Retirement Benefit Option, by this action, and the member's signature, the contingent annuitant named on the member's most recent Acceptable Form will receive the previously elected percentage amount of the member's monthly benefit for their lifetime following the member's death;

ii. For a Joint and Survivor Retirement Benefit Option, the member is aware that a copy of the contingent annuitant's Legal Documentation is required and the member's benefit will be recalculated based on the member's age and the age of the member's new contingent annuitant as of the effective date of the member's request according to this Section;

iii. For a Joint and Survivor Retirement Benefit Option, the member is in compliance with the age difference limitations in R2-8-128; and

iv. For a Period Certain and Life Annuity Retirement Benefit Option, by this action, and the member's signature, the beneficiary named on the member's most recent Acceptable Form will receive the remaining term of monthly payments.

c. For reverting to a previously elected retirement benefit option according to A.R.S. § 38-760:

i. For a Joint and Survivor Retirement Benefit Option, by this action, and the member's signature, the contingent annuitant named the member's most recent Acceptable Form will receive the previously elected percentage amount of the member's monthly benefit for their lifetime following the member's death;

ii. For a Joint and Survivor Retirement Benefit Option, the member is aware that a copy of Legal Documentation showing the contingent annuitant's date of birth is required and the member's benefit will be recalculated based on the member's age and the age of the member's contingent annuitant as of the effective date of the member's request according to this Section;

iii. For a Joint and Survivor Retirement Benefit Option, the member is in compliance with the age difference limitations in R2-8-128; and

iv. For a Period Certain and Life Annuity Retirement Benefit Option, by this action, and the member's signature, the beneficiary named on the member's most recent Acceptable Form will receive the remaining term of monthly payments.

6. If the member is electing to change a contingent annuitant, the following information for the new contingent annuitant:

a. Full name;

b. Social Security number, if the contingent annuitant is a U.S. citizen;

c. Date of birth; and

d. Legal relationship to the member.

7. If the member is married, whether the member's spouse consents to the following with the spouse's notarized signature:

a. The member making a beneficiary designation that provides the member's spouse with less than 50% of the member's account balance;

b. The member electing a retirement option other than a Joint and Survivor Retirement Benefit Option; or

c. The member changing or ending the spouse's contingent annuitant status.

8. Whether the spouse's consent is not required because:

a. The spouse predeceased the member and if so, provide a copy of the spouse's death certificate; or

b. The member is divorced and if so, provide a DRO.

N. If the ASRS is unable to verify the age of the member or a contingent annuitant, the member or contingent annuitant shall provide Legal Documentation showing the member's or contingent annuitant's age.

O. The effective date of the member's request according to this Section is the date on which ASRS receives the Application to Rescind, Revert or Change Contingent Annuitant.

P. According to A.R.S. § 38-760(B)(2), a member whose Original Retirement Date is on or after July 1, 2008 and who elects a Period Certain and Life Annuity Retirement Benefit Option, may rescind the election according to subsection (E) and elect to receive a Straight Life Annuity prior to the expiration of the member's period certain term if one or more of the member's primary beneficiaries dies or ceases to be a beneficiary according to the terms of a DRO.

Q. The ASRS shall cancel a member's Application to Rescind, Revert, or Change Contingent Annuitant if ASRS does not receive all forms and information required under this Section within six months immediately after the ASRS receives the application.

History

• Adopted by final rulemaking at 26 A.A.R. 2036, effective 11/8/2020. Amended by final rulemaking at 28 A.A.R. 1746, effective 9/4/2022.

Ariz. Admin. Code § R2-8-131 Designating a Beneficiary; Spousal Consent to Beneficiary Designation

A. The definitions in R2-8-126 apply to this Section.

B. In order to designate a beneficiary, a member shall submit an Acceptable Form containing the following information:

1. The Member's full name and one or more of the following information:

a. The Member's Social Security number or U.S. Tax Identification number; or

b. The Member's address; or

c. The Member's date of birth;

2. The following information for the beneficiary:

a. The full name of the person or entity the member is designating as beneficiary;

b. Whether the beneficiary is being designated as primary or secondary beneficiary;

c. The percentage of the benefit the member is allocating to the beneficiary; and

3. The member's notarized signature.

C. If a change in a designated beneficiary is completed through the member's secure ASRS account, the member's notarized signature is not required under subsection (B)(3).

D. If a member submits an Acceptable Form designating a beneficiary without indicating the percentage of the benefit the member is allocating to the beneficiary, the ASRS shall determine that each beneficiary is designated to receive an equal amount of the benefit.

E. Effective July 1, 2013, a married member:

1. Who is not retired shall name and maintain the member's current spouse as primary beneficiary of at least 50% of the member's retirement account unless:

a. Naming or maintaining the current spouse as beneficiary violates another law, existing contract, or court order; or

b. The spouse consents to an alternate beneficiary;

2. Who retires shall choose a Joint and Survivor Retirement Benefit Option and name the member's current spouse as contingent annuitant unless:

a. Naming or maintaining the current spouse as contingent annuitant violates another law, existing contract, or court order; or

b. The spouse consents to an alternate contingent annuitant; or

c. The spouse consents to an alternate annuity option under A.R.S. §§ 38-757 or 38-760.

F. The ASRS shall honor a beneficiary designation last made or a retirement election submitted before July 1, 2013, even if the beneficiary designation or retirement election fails to comply with subsection (E).

G. Subsection (E) does not apply to a member who is receiving a mandatory lump sum distribution according to A.R.S. § 38-764.

H. Subsection (E) does not apply to a member who submits a Spousal Consent Exception form that contains the member's notarized signature to the ASRS affirming under penalty of perjury that the member's spouse's consent is not required because of one of the reasons specified in A.R.S. § 38-776(C).

I. In order to change a beneficiary designation, a member shall submit the information contained in subsection (B) and:

1. A married member who changes a beneficiary designation on or after July 1, 2013, shall ensure the new beneficiary designation is consistent with subsection (E); or

2. A married member who retired before July 1, 2013, and who wishes to change the contingent annuitant or beneficiary, shall ensure that the new designation is consistent with subsection (E).

J. A married member who re-retires according to A.R.S. § 38-766:

1. Within less than 60 consecutive months of active membership from the member's previous retirement date, is not eligible to elect a different annuity option or different beneficiary than the member elected at the time of the previous retirement; or

2. At least 60 consecutive months of active membership after the member's previous retirement date, may elect a different annuity option and different beneficiary than the member elected at the time of the previous retirement, and the election shall comply with subsection (E).

K. If a married member submits a retirement application that fails to comply with subsection (E), the member shall submit a new retirement application or written notice of new retirement elections that comply with subsection (E) within six months of the member's Original Retirement Date. The member's new Original Retirement Date is the date ASRS receives the new application or written notice unless the member elects a later date according to A.R.S. § 38-764.

L. If a married member made a beneficiary designation on or after July 1, 2013 that is not consistent with the requirements specified in subsection (E), the ASRS shall, at the time of the member's death:

1. Notify both the spouse and designated beneficiary and:

a. Provide the spouse with an opportunity to waive the right under subsection (E); and

b. Provide the designated beneficiary with an opportunity to provide documentation that revokes the spouse's right under subsection (E); and

2. Designate 50% of the member's retirement benefit to the spouse if neither the spouse nor designated beneficiary respond to notification according to subsection (L)(1) within 30 days after notification.

M. If a married member designated a beneficiary before July 1, 2013 that does not comply with subsection (E), upon the death of the member, the member's spouse may submit written notice to the ASRS prior to disbursement of the member's account with the following information:

1. The member's full name;

2. The member's Social Security number or U.S. Tax Identification number;

3. The spouse's assertion to the spouse's right to community property;

4. An original or copy of the marriage certificate; and

5. An original or certified copy of the member's death certificate.

N. If a spouse submits written notice according to subsection (M), the ASRS shall designate the spouse as beneficiary of a percentage of the member's account according to A.R.S. §§ 25-211 and 25-214 and notify the member's designated beneficiary of the spouse's assertion.

O. The ASRS shall determine a spouse's percentage of the member's account according to subsection (L) based on the amount of service credit the member acquired during the marriage divided by the total amount of service credit the member acquired, multiplied by 50%.

P. If a beneficiary is notified of a spouse's assertion according to subsection (N), then before ASRS disburses a survivor benefit, the beneficiary may notify ASRS of the beneficiary's intent to appeal the spouse's right to a survivor benefit.

Q. Within 30 days, a beneficiary who has notified ASRS of the beneficiary's intent to appeal a survivor benefit disbursement according to subsection (P), shall submit an appeal to ASRS according to 2 A.A.C. 8, Article 4.

R. A DRO may supersede the requirements in subsection (B).

S. To consent to an alternative retirement benefit option or beneficiary designation, a member's spouse shall complete and have notarized a Spousal Consent form containing the following information:

1. Member's full name;

2. Member's Social Security number or U.S. Tax Identification number;

3. Whether the member's spouse is consenting to one or more of the following:

a. The member making a beneficiary designation that provides the spouse with less than 50% of the member's account balance;

b. The member electing a retirement option other than a Joint and Survivor Retirement Benefit Option;

c. The member naming a contingent annuitant other than the spouse; and

d. The spouse's notarized signature.

T. A member's spouse may revoke the spouse's consent to an alternative retirement benefit option or beneficiary designation by sending written notice to ASRS with the following information:

1. The member's full name

2. The member's Social Security number or U.S. Tax Identification number;

The spouse's full name;

4. The spouse's dated signature indicating the spouse is revoking all previous Spousal Consent forms.

U. A spouse who is revoking a Spousal Consent form shall ensure the written notice is received no later than the earlier of one day before the member dies or ASRS disburses a retirement benefit to the member.

History

• Adopted by final rulemaking at 26 A.A.R. 2036, effective 11/8/2020. Amended by final rulemaking at 28 A.A.R. 1746, effective 9/4/2022.

Ariz. Admin. Code § R2-8-132 Survivor Benefit Options

A. The definitions in R2-8-126 apply to this section.

B. If the beneficiary is eligible to elect the survivor benefit as monthly income for life according to A.R.S.§ 38-762(C), the ASRS shall calculate the benefits based on the attained age of the beneficiary, calculated to the nearest full month, as of the date of the member's death.

C. If the beneficiary elects to receive the survivor benefit as monthly income for life according to A.R.S. § 38-762(C), the ASRS shall calculate the benefits effective date as of the day after the member's death and the ASRS shall pay interest up to the benefits effective date.

D. According to A.R.S. § 38-763, if the member elected a Period Certain and Life Annuity Retirement Benefit Option and deceases prior to the expiration of the period certain term, the member's beneficiary may elect to complete the remaining period certain term or the beneficiary may elect to receive a lump sum distribution which is the greater of:

1. The present value of the benefits based on the remaining period certain term; or

2. The member's ASRS account balance plus interest at the Assumed Actuarial Investment Earnings Rate specified in R2-8-118(A) through the month prior to the member's retirement date, reduced by all retirement benefits due to the member.

E. Notwithstanding subsection (D), a beneficiary is not eligible to elect to complete the remaining period certain term if the period certain term has expired.

F. If the beneficiary elects to complete the remaining period certain term or elects to receive a lump sum that is the present value of the benefits based on the remaining period certain term according to subsection (D), the ASRS shall not pay interest.

G. If a member's beneficiary or contingent annuitant does not want to receive a survivor benefit according to 26 U.S.C. § 2518, within nine months after the member's death, the beneficiary or contingent annuitant may submit a written request to the ASRS with the following information for the beneficiary or contingent annuitant:

1. Full name;

2. Social Security number if the beneficiary or contingent annuitant is a U.S. citizen;

3. Address; and

4. Notarized signature acknowledging the following statements:

a. The beneficiary or contingent annuitant is aware that, as a beneficiary or contingent annuitant of the member, the beneficiary or contingent annuitant is entitled to a survivor benefit in the amount specified by the ASRS;

b. The beneficiary is renouncing a portion or all of the beneficiary's rights to the member's benefit;

c. The contingent annuitant is renouncing all of the contingent annuitant's rights to the member's benefit;

d. The beneficiary understands that by renouncing rights to the member's benefit, the portion that the beneficiary is renouncing will be paid to any other survivor on the member's account, or if there is no other designated survivor, the benefit will be paid to the member's estate; and

e. The contingent annuitant understands that by renouncing rights to the member's benefit, the ASRS shall pay the member's ASRS account balance plus interest at the Assumed Actuarial Interest and Investment Return Rate specified in R2-8-118(A) through the month prior to the member's retirement date, reduced by all retirement benefits due to the member, to any other survivor on the member's account, or if there is no other designated survivor, to the member's estate.

H. According to 26 U.S.C. § 2518, a minor beneficiary's or contingent annuitant's survivor benefit cannot be renounced.

History

• Adopted by final rulemaking at 26 A.A.R. 2036, effective 11/8/2020.

Ariz. Admin. Code § R2-8-133 Survivor Benefit Applications

A. The definitions in R2-8-126 apply to this Section.

B. The ASRS shall not distribute a survivor benefit until a claimant notifies the ASRS of a member's death by telephone or submission of a death certificate, unless the member elected a Joint and Survivor Benefit Option upon retirement.

C. Upon notification of the death of a member, the ASRS shall distribute the survivor benefits according to the most recent, Acceptable Form that is On File with the ASRS that was received at least one day prior to the date of the member's death, unless otherwise provided by law.

D. The designated beneficiary or other person specified in A.R.S. § 38-762(E) shall provide the following:

1. An original certified death certificate or a certified copy of a court order that establishes the member's death;

2. If the claimant is not a designated beneficiary, but is a person specified in A.R.S. § 38-762(E), a copy of a document issued from a federal, state, local, sovereign, or medical institution showing the claimant's relationship to the deceased member;

3. A certified copy of the court order of appointment as administrator, if applicable; and

4. Except if the deceased member was retired and elected the joint and survivor option, complete and have notarized an Application for Survivor Benefits, provided by the ASRS that includes:

a. The deceased member's full name,

b. The deceased member's Social Security number or U.S. Tax Identification number,

c. The benefit the designated beneficiary or other person specified in A.R.S. § 38-762(E) is electing;

d. If the designated beneficiary or other person specified in A.R.S. § 38-762(E) is electing to roll over a benefit, the following information:

i. The claimant's full name;

ii. The name of the institution to which the claimant is electing to roll over;

iii. The address of the institution to which the claimant is electing to roll over;

iv. The full name of the authorized representative of the institution to which the claimant is electing to roll over;

v. The signature of the authorized representative of the institution to which the claimant is electing to roll over;

e. If the beneficiary is electing to have any of the survivor benefits directly deposited into a bank account, the following information:

i. Whether the bank account is a checking or savings account;

ii. The name of the banking institution to which the benefit is being sent;

iii. The routing number;

iv. The account number; and

f. The following information for the designated beneficiary or other person specified in A.R.S. § 38-762(E):

i. Full name;

ii. Mailing address, if not On File with ASRS;

iii. Date of birth, if applicable; and

iv. Social Security number or U.S. Tax Identification number, if not On File with ASRS.

g. The following statements of understanding:

i. The designated beneficiary or other person specified in A.R.S. § 38-762(E) has read and understands the Special Tax Notice Regarding Plan Payments they received with this application;

ii. The designated beneficiary or other person specified in A.R.S. § 38-762(E) authorizes the ASRS to make payments as indicated above and agree on behalf of themselves and their heirs that such payments shall be a complete discharge of the claim and shall constitute a release of the ASRS from any further obligation on account of the benefit;

iii. The designated beneficiary or other person specified in A.R.S. § 38-762(E) authorizes the ASRS and the Banking Institution listed above to debit their account for the purposes of correcting errors and returning any payments inadvertently made after their death;

iv. Under penalties of perjury, the designated beneficiary or other person specified in A.R.S. § 38-762(E) certifies that:

(1) The Social Security number or U.S. Tax Identification number shown on this application is correct;

(2) They are not subject to backup withholding because:

(a) They are exempt from backup withholding, or

(b) They have not been notified by the Internal Revenue Service that they are subject to backup withholding as a result of a failure to report all interest or dividends, or

(c) The Internal Revenue Service has notified them that they are no longer subject to backup withholding; and

(3) They are a legal resident of the United States, unless they are an estate or trust.

v. The designated beneficiary or other person specified in A.R.S. § 38-762(E) understands their right to a 30-day notice period to consider a rollover or a cash distribution and they elect to waive the notice period by their election for payment on this application;

vi. The designated beneficiary or other person specified in A.R.S. § 38-762(E) understands if they elect to roll over all or any portion of their distribution to another eligible retirement plan, it is their responsibility to verify that the receiving plan will accept the rollover and, if applicable, agree to separately account for the taxable and nontaxable amounts rolled over and the related subsequent earnings on such amounts;

vii. The designated beneficiary or other person specified in A.R.S. § 38-762(E) understands if they elect to roll over all or any portion of their distribution to an IRA plan, it is their responsibility to verify that the receiving IRA institution will accept the rollover and, if applicable, it is their responsibility to separately account for taxable and nontaxable amounts;

viii. The designated beneficiary or other person specified in A.R.S. § 38-762(E) understands if they elect to roll over to another eligible retirement plan, any portion of the distribution not designated for a rollover will be paid directly to them and any taxable amounts will be subject to federal and state income tax withholding;

ix. The designated beneficiary or other person specified in A.R.S. § 38-762(E) understands if they elect to roll over to an inherited IRA plan, any portion of the distribution not designated for a rollover will be paid directly to them and any taxable amounts will be subject to federal and state income tax withholding.

xi. The designated beneficiary or other person specified in A.R.S. § 38-762(E) understands if they elect to roll over to an inherited IRA plan, they may be required to receive a minimum distribution and they certify that the date of birth shown on this form is correct.

5. For a member who elected a Joint and Survivor Retirement Benefit Option, a contingent annuitant shall submit a Joint and Survivor Certification form containing:

a. The following information for the member:

i. Full name;

ii. Social Security number or U.S. Tax Identification number;

iii. Date of death; and

b. The following information for the beneficiary:

i. Legal relationship to the member;

ii. Full name;

iii. Social Security number or United States Tax Identification number, if not On File with ASRS;

iv. Mailing address, if not On File with ASRS;

v. Date of birth, if not On File with ASRS;

vi. If the contingent annuitant is electing to have any of the survivor benefits directly deposited into a bank account, the following information:

(1) Whether the bank account is a checking or savings account;

(2) The name of the banking institution to which the benefit is being sent;

(3) The routing number;

(4) The account number; and

c. The following statements of understanding:

i. The contingent annuitant has read and understands the Special Tax Notice Regarding Plan Payments they received with the Joint and Survivor Certification form;

ii. The contingent annuitant authorizes the ASRS to make payments as indicated above and agree on behalf of themselves and their heirs that such payments shall be a complete discharge of the claim and shall constitute a release of the ASRS from any further obligation on account of the benefit; and

iii. The contingent annuitant authorizes the ASRS and the Banking Institution listed above to debit their account for the purposes of correcting errors and returning any payments inadvertently made after their death.

d. The contingent annuitant's notarized signature.

E. Notwithstanding R2-8-132(H), if the beneficiary or contingent annuitant is a minor as of the date of the member's death, the beneficiary or contingent annuitant may submit a written request with the information contained in R2-8-132(G)(1) through (4) within nine months after the minor attains 18 years of age.

F. For a member who deceases prior to the member's retirement date, if there is no designation of beneficiary or if the designated beneficiary predeceases the member, the ASRS shall pay a survivor benefit as specified in A.R.S. § 38-762(E).

G. The ASRS shall begin disbursing a survivor benefit to a contingent annuitant according to A.R.S. § 38-760(B)(1) upon notification and verification of the member's death by a third party.

H. The ASRS shall suspend a survivor benefit for a contingent annuitant unless the contingent annuitant provides the information in subsection (D) within two months of the ASRS disbursing a survivor benefit.

I. If the member is domiciled in Arizona, according to A.R.S. § 14-3971, and there is no designated beneficiary, the ASRS shall distribute the balance of a member's account to a claimant if the claimant submits an Affidavit for Collection of Personal Property to ASRS with the following:

1. The claimant's name;

2. The claimant's Social Security number or U.S. Tax Identification number;

The claimant's mailing address;

The member's name;

5. The member's Social Security number or U.S. Tax Identification number;

6. The date of the member's death;

7. The state and county where the member died;

8. Statements indicating:

a. According to A.R.S. § 14-3971(B)(2)(a), no application or petition for the appointment of a personal representative is pending or has been granted in any jurisdiction and the value of the member's entire estate, less liens and encumbrances, does not exceed the amount in A.R.S. § 14-3971 as valued as of the date of the member's death;

b. According to A.R.S. § 14-3971(B)(2)(b), the personal representative has been discharged, or more than a year has elapsed since a closing statement has been filed and the value of the member's entire estate, less liens and encumbrances, does not exceed the amount in A.R.S. § 14-3971 as valued as of the date the ASRS receives the Affidavit for Collection of Personal Property;

c. The claimant is the successor of the member and is entitled to the member's personal property because:

i. The claimant is named in the member's will; or

ii. The member did not have a will and the claimant is entitled to the member's personal property by right of intestate succession according to A.R.S. § 14-2103;

d. If the claimant is entitled to the member's personal property according to subsection (I)(8)(c)(i), then a copy of the member's will;

e. If the claimant is entitled to the member's personal property according to subsection (I)(8)(c)(ii), then the relationship between the member and the claimant and whether there are other surviving heirs;

f. If there are other surviving heirs, then the name and relationship of each surviving heir;

g. A statement indicating the claimant is making the Affidavit for Collection of Personal Property according to A.R.S. § 14-3971 for the purpose of making a claim to the member's ASRS account; and

h. The claimant's notarized signature.

J. If the member is not domiciled in Arizona and there is no designated beneficiary, the ASRS shall distribute the balance of a member's account to a claimant if the claimant submits legal documentation to claim the member's ASRS account that complies with the statutory requirements of the state in which the member was domiciled at the time of the member's death.

K. Notwithstanding any other provision, if the amount of the survivor benefit as valued at the date of disbursement is less than $10,000 per annum, the ASRS shall not distribute a survivor benefit to a minor beneficiary unless the minor beneficiary's legal guardian submits the following written information:

1. The member's full name;

2. The member's Social Security number or U.S. Tax Identification number;

3. The minor beneficiary's full name;

4. The minor beneficiary's Social Security number or U.S. Tax Identification number;

5. The full name of the minor beneficiary's legal guardian;

6. The minor beneficiary's legal guardian's address, if not On File with ASRS; and

7. The minor beneficiary's legal guardian's signature certifying the minor beneficiary's legal guardian has care and custody of the minor beneficiary.

L. Notwithstanding any other provision, if the amount of the survivor benefit as valued at the date of disbursement is $10,000 or more per annum, the ASRS shall not distribute a survivor benefit to a minor beneficiary unless the minor beneficiary's conservator submits proof of court-appointed fiduciary responsibility for the minor beneficiary.

M. The ASRS shall remit payment to the minor beneficiary according to subsection (K) by sending the minor beneficiary's conservator a check, if the document providing proof of the court-appointed fiduciary responsibility requires payment to be made to a restricted or secure account.

N. If a person claims that a beneficiary or claimant is not entitled to a survivor benefit, then before ASRS disburses a survivor benefit, the person may notify ASRS of the person's intent to appeal the beneficiary's or claimant's right to a survivor benefit.

O. Within 30 days, a person who has notified ASRS of the person's intent to appeal a survivor benefit disbursement according to subsection (N), shall submit an appeal to ASRS according to 2 A.A.C. 8, Article 4.

P. If the ASRS receives documentation from, or confirmed by, a law enforcement agency, that a beneficiary or claimant may be guilty of the felonious and intentional killing of the member, the ASRS shall not distribute any benefits to the beneficiary or claimant that may be guilty of the felonious and intentional killing of the member until the matter has been adjudicated.

Q. If the member's estate has an appointed personal representative, the member's estate shall submit a court document identifying the personal representative for the member's estate before ASRS may distribute a survivor benefit.

R. If the member's estate is closed, the person claiming a right to the member's ASRS account shall provide a court document proving the estate is closed.

S. If the survivor receives a monthly annuity and does not provide the direct deposit information according to subsection (D)(4)(e) or (D)(5)(b)(vi), ASRS shall issue a debit benefit card.

T. If the survivor does not activate the debit benefit card the ASRS issues to the survivor within 75 days, the ASRS shall reclaim all the survivor benefits issued on the debit benefit card and suspend the survivor's benefits until the survivor:

1. Activates the debit benefit card or provides the direct deposit information according to subsection (D)(4)(e) or (D)(5)(b)(vi); and

2. Returns the notice of benefit suspension with the following information:

a. The survivor's Social Security number or U.S. Tax Identification number;

b. The survivor's address; and

c. The survivor's notarized signature.

History

• Adopted by final rulemaking at 26 A.A.R. 2036, effective 11/8/2020. Amended by final rulemaking at 30 A.A.R. 732, effective 5/17/2024.

Article 2 HEALTH INSURANCE PREMIUM BENEFIT

Ariz. Admin. Code § R2-8-201 Definitions

The following definitions apply to this Article unless otherwise specified:

1. "Coverage" means a medical and/or dental insurance plan a retired member, Disabled member, or beneficiary obtains through the ASRS or an Employer.

2. "Contingent annuitant" means the same as in A.R.S. § 38-711(8) and the person is eligible for Coverage.

3. "Disabled" means the member has a disability and is receiving long-term disability benefits pursuant to A.R.S. § 38-797 et seq.

4. "Family calculation" means the family Coverage premium described in A.R.S. § 38-783(B).

5. "Joint & survivor" means the annuity option described in A.R.S. § 38-760(B)(1).

6. "Net premium" means the amount of the Coverage premium reduced by the amount of the Premium Benefit provided by the ASRS.

7. "On file" means the same as in R2-8-115.

7. 8. "Original retirement date" means the same as in R2-8-126.

8. 9. "Optional premium benefit" means the election, upon retirement, to have the Premium Benefit paid on behalf of the member's Contingent Annuitant upon death of the member pursuant to A.R.S. § 38-783.

9. 10. "Period-certain" means the annuity option described in A.R.S. § 38-760(B)(2).

10. 11. "Premium benefit" means the amount the ASRS provides on behalf of a retired member or Disabled member in order to offset the Coverage premium of the retired or Disabled member pursuant to A.R.S. § 38-783.

11. 12. "Single calculation" means the single Coverage premium calculation described in A.R.S. § 38-783(A).

12. 13. "Subsidized" means the same as in A.R.S. § 38-783(M)(4).

History

• New Section made by final rulemaking at 10 A.A.R. 1962, effective May 4, 2004 (Supp. 04-2). Adopted by final rulemaking at 23 A.A.R. 1414, effective 7/3/2017. Amended by final expedited rulemaking at 27 A.A.R. 479, effective 3/5/2021.

Ariz. Admin. Code § R2-8-202 Premium Benefit Eligibility and Benefit Determination

A. A retired member or Disabled member who has five or more years of service and who elects to maintain Coverage is eligible for a Premium Benefit as follows:

A retired member or Disabled member who elects to maintain Coverage for the retired member or Disabled member only, is eligible for a Single Calculation of the Premium Benefit as described in R2-8-204(A);

2. A retired member or Disabled member who elects to maintain Coverage for the retired member or Disabled member and a dependent who is not a retired member or Disabled member is eligible for a Family Calculation of the Premium Benefit as described in R2-8-204(B).

3. A retired member or Disabled member who elects to maintain Coverage for the retired member or Disabled member and a dependent who is a retired member or Disabled member is eligible for the greater of:

a. Two Single Calculations of the Premium Benefit described in R2-8-204(A); or

b. One Family Calculation of the Premium Benefit described in R2-8-204(B).

4. A retired member or Disabled member who is enrolled as a dependent on a member's insurance plan is eligible for a Single Calculation of the Premium Benefit described in R2-8-204(A) if:

a. The retired member has an Original Retirement Date prior to August 2, 2012; or

b. The Disabled member became Disabled prior to August 2, 2012;

5. A retired member or Disabled member who elects to maintain Coverage for the retired member or Disabled member and multiple dependents, some of whom are retired members or Disabled members, is eligible for the greater of:

a. Two Single Calculations of the Premium Benefit described in R2-8-204(A); or

b. One Family Calculation of the Premium Benefit described in R2-8-204(B).

B. Pursuant to A.R.S. § 38-783(E), a retired member who returns to work with an Employer and elects to maintain Coverage is eligible to receive a Premium Benefit if the member has an Original Retirement Date prior to August 2, 2012.

C. Pursuant to A.R.S. § 38-783(E), a Disabled member who elects to maintain Coverage is eligible to receive a Premium Benefit if the Disabled member became Disabled prior to August 2, 2012.

D. A member who receives a lump sum distribution from the ASRS upon retirement is eligible to receive a Premium Benefit pursuant to this Article.

E. Notwithstanding any other Section, a retired member who has an Original Retirement Date on or after August 2, 2012, or a Disabled member who became Disabled on or after August 2, 2012 is eligible to receive a Premium Benefit pursuant to this Article, only if Coverage is not Subsidized.

History

• New Section made by final rulemaking at 10 A.A.R. 1962, effective May 4, 2004 (Supp. 04-2). Amended by emergency rulemaking at 10 A.A.R. 4259, effective September 30, 2004 (Supp. 04-3). Amended by final rulemaking at 10 A.A.R. 4346, effective October 5, 2004 (Supp. 04-3). Section amended and Table 1 repealed by final rulemaking at 13 A.A.R. 4581, effective February 2, 2008 (Supp. 07-4). Section expired under A.R.S. § 41-1056(E) at 16 A.A.R. 1765, effective July 14, 2010 (Supp. 10-3). Adopted by final rulemaking at 23 A.A.R. 1414, effective 7/3/2017. Amended by final expedited rulemaking at 27 A.A.R. 479, effective 3/5/2021.

Ariz. Admin. Code § R2-8-203 Payment of Premium Benefit

A. Every month, the ASRS shall provide a Premium Benefit to the Employer on behalf of a retired member, Disabled member, or Contingent Annuitant who maintains Coverage and is eligible to receive a Premium Benefit pursuant to R2-8-202.

B. Notwithstanding subsection (A), if a retired member who is eligible to receive a Premium Benefit pursuant to R2-8-202 elects to maintain Coverage with the Arizona Department of Administration or the ASRS, the ASRS shall reduce the retired member's pension amount by the amount of the retired member's Net Premium for Coverage pursuant to this Article, unless the Net Premium exceeds the pension amount.

C. Notwithstanding subsection (A), if a retired member who is eligible to receive a Premium Benefit pursuant to R2-8-202 elects to maintain Coverage with the ASRS and the Net Premium exceeds the retired member's pension amount, the retired member shall be responsible for remitting the Net Premium to the retired member's insurance company and the ASRS shall:

1. Not reduce the retired member's pension amount; and

Remit payment of the Premium Benefit to the retired member's insurance company.

D. Notwithstanding subsection (A), if a retired member who is eligible to receive a Premium Benefit pursuant to R2-8-202 elects to maintain Coverage with the Arizona Department of Administration and the Net Premium exceeds the retired member's pension amount, the retired member shall be responsible for remitting the Net Premium to the Arizona Department of Administration and the ASRS shall:

1. Not reduce the retired member's pension amount; and

2. Remit payment of the Premium Benefit to the Arizona Department of Administration.

E. If a Disabled member who is eligible to receive a Premium benefit pursuant to R2-8-202 maintains Coverage with the Arizona Department of Administration, the ASRS shall remit the Premium Benefit to the Arizona Department of Administration, unless the Disabled member is participating in the Six-Month Reimbursement Program pursuant to R2-8-206.

F. If a Disabled member who is eligible to receive a Premium Benefit pursuant to R2-8-202 maintains Coverage with the ASRS, the ASRS shall remit the Premium Benefit to the Disabled member's insurance company and the Disabled member shall be responsible for remitting the Net Premium to the Disabled member's insurance company.

G. If a retired member or Disabled member who is eligible to receive a Premium Benefit pursuant to R2-8-202 maintains Coverage with an Employer other than the ASRS or the Arizona Department of Administration, the ASRS shall remit the Premium Benefit to the retired member's or Disabled member's Employer, unless the retired member or Disabled member is participating in the Six-Month Reimbursement Program pursuant to R2-8-206.

H. If a retired member or Disabled member is eligible to receive a Premium Benefit pursuant to R2-8-202, the ASRS shall provide the lesser of the following for any one retired member or Disabled member:

1. The actual cost of the Coverage premium; or

2. The greatest Premium Benefit calculation for which the retired member or Disabled member is eligible pursuant to R2-8-202.

I. If a retired member is eligible to receive a Premium Benefit pursuant to R2-8-202 and the member retires from the ASRS in addition to retiring from another State retirement system or plan described in A.R.S. § 38-921, each month, the ASRS shall remit any Premium Benefit for which the retired member is eligible under this Article to the other State retirement system or plan from which the member retired.

History

• New Section made by final rulemaking at 10 A.A.R. 1962, effective May 4, 2004 (Supp. 04-2). Section expired under A.R.S. § 41-1056(E) at 16 A.A.R. 1765, effective July 14, 2010 (Supp. 10-3). Adopted by final rulemaking at 23 A.A.R. 1414, effective 7/3/2017.

Ariz. Admin. Code § R2-8-204 Premium Benefit Calculation

A. A Single Calculation for a Premium Benefit is based on the retired member's or Disabled member's Coverage election, years of service, and Medicare or non-Medicare status.

B. A Family Calculation for a Premium Benefit is based on the retired member's or Disabled member's Coverage election, years of service, and Medicare or Non-Medicare status, and the Medicare or Non-Medicare status of any dependents for which the retired member or Disabled member has obtained Coverage.

C. A Contingent Annuitant who is eligible to receive an Optional Premium Benefit pursuant to R2-8-207 shall receive an Optional Premium Benefit amount based on:

1. The retired member's years of service and optional retirement benefit election pursuant to A.R.S. § 38-760; and

2. The Contingent Annuitant's Coverage and Medicare or non-Medicare status.

D. Notwithstanding R2-8-203(H), if a Contingent Annuitant is a retired member, the Contingent Annuitant may be entitled to receive more than one Premium Benefit.

History

• New Section made by final rulemaking at 10 A.A.R. 1962, effective May 4, 2004 (Supp. 04-2). Section expired under A.R.S. § 41-1056(E) at 16 A.A.R. 1765, effective July 14, 2010 (Supp. 10-3). Adopted by final rulemaking at 23 A.A.R. 1414, effective 7/3/2017. Amended by final expedited rulemaking at 27 A.A.R. 479, effective 3/5/2021.

Ariz. Admin. Code § R2-8-205 Premium Benefit Documentation

A. Every year, prior to the effective date of Coverage, an Employer shall report to the ASRS all the Coverage plans and premium rates the Employer offers to its retired or Disabled employees.

B. An Employer shall inform the ASRS of any changes to the retired member's, Disabled member's, or Contingent Annuitant's Coverage, including enrollment in Coverage, maintained through the Employer within 30 days of the changes taking effect.

C. Using the Employer's secure ASRS website account, or another ASRS approved method, an Employer shall submit the following health insurance enrollment, change, and/or deletion information pursuant to subsection (B):

1. The retired member's, Disabled member's, or Contingent Annuitant's Social Security number or U.S. Tax Identification number;

2. The retired member's, Disabled member's, or Contingent Annuitant's full name;

3. The retired member's, Disabled member's, or Contingent Annuitant's date of birth;

4. The Coverage in which the retired member, Disabled member, or Contingent Annuitant is enrolling;

5. The type of change that is being made to the Coverage;

6. The following information for each dependent enrolled in, or to be enrolled in, or removed from, Coverage:

a. First and last name;

b. Social Security number or U.S. Tax Identification number;

c. Date of birth; and

d. Medicare number, if applicable.

The old and new premium amounts for Coverage;

8. The effective date of the change, deletion, and/or enrollment;

9. The Employer's name and telephone number;

10. A certification by the Employer representative's dated signature that the information is current and correct.

History

• New Section made by final rulemaking at 10 A.A.R. 1962, effective May 4, 2004 (Supp. 04-2). Section expired under A.R.S. § 41-1056(E) at 16 A.A.R. 1765, effective July 14, 2010 (Supp. 10-3). Adopted by final rulemaking at 23 A.A.R. 1414, effective 7/3/2017. Amended by final expedited rulemaking at 27 A.A.R. 479, effective 3/5/2021. Amended by final rulemaking at 30 A.A.R. 739, effective 5/17/2024.

Ariz. Admin. Code § R2-8-206 Six-Month Reimbursement Program

A. For a retired member or Disabled member who is eligible for a Premium Benefit pursuant to R2-8-202(A)(4) or (B), the ASRS shall remit the Premium Benefit to the retired member or Disabled member pursuant to subsection (B).

B. Pursuant to subsection (A), the ASRS shall remit the Premium Benefit to the retired member or Disabled member every six months, payable in July and January. For purposes of this Section, the Premium Benefit shall be the aggregate amounts of the Premium Benefit the retired member or Disabled member is entitled to receive during the previous six months.

C. In order to receive a Premium Benefit payment pursuant to subsection (B), a retired member or Disabled member shall submit to the ASRS the Reimbursement of Medical and/or Dental Cost (Six-Month Reimbursement Program) form after the last day of the last month for which the retired member or Disabled member is seeking reimbursement.

D. The Reimbursement of Medical and/or Dental Cost (Six-Month Reimbursement Program) form that a retired member or Disabled member submits pursuant to subsection (C) shall include the following information:

1. The retired member's or Disabled member's Social Security number or U.S. Tax Identification number;

2. The retired member's or Disabled member's full name;

3. The retired member's or Disabled member's mailing address and phone number;

4. The retired member's or Disabled member's date of birth;

The retired member's or Disabled member's status with the ASRS;

6. The retired member's or Disabled member's status with the retired member's or Disabled member's Employer;

7. The following Coverage information for the Coverage policy holder:

a. First and last names;

b. Social Security number or U.S. Tax Identification number;

c. Date of birth;

d. Effective date of Coverage;

8. The following information for each dependent enrolled in, or to be enrolled in, Coverage:

a. First and last name;

b. Social Security number or U.S. Tax Identification number;

c. Date of birth;

d. Effective date of Coverage;

9. Six-month reimbursement totals identified by:

a. The month and year the premium is due for Coverage;

b. The total medical plan premium per month;

c. The total dental plan premium per month;

d. The employee's out-of-pocket payroll deduction for a medical premium per month;

e. The employee's out-of-pocket payroll deduction for a dental premium per month;

f. The employee's total out-of-pocket payroll deduction for medical and dental premiums per month;

10. The Employer's name;

11. The Employer's phone number;

12. The Employer's email address;

13. The name of the Employer's representative; and

14. The dated signature of the Employer's representative.

History

• New Section made by final rulemaking at 10 A.A.R. 1962, effective May 4, 2004 (Supp. 04-2). Section expired under A.R.S. § 41-1056(E) at 16 A.A.R. 1765, effective July 14, 2010 (Supp. 10-3). Adopted by final rulemaking at 23 A.A.R. 1414, effective 7/3/2017. Amended by final expedited rulemaking at 27 A.A.R. 479, effective 3/5/2021.

Ariz. Admin. Code § R2-8-207 Optional Premium Benefit

A. A member who retires on or after January 1, 2004, is eligible to elect the Optional Premium Benefit to be effective on the date of the retired member's retirement and may designate a Contingent Annuitant to receive the Optional Premium Benefit upon the death of the retired member if:

1. The retired member elects a retirement option under A.R.S. § 38-760; and

2. The retired member elects to maintain Coverage.

B. A retired member who returns to active membership for 60 consecutive months or more before retiring again, may elect or re-elect the Optional Premium Benefit pursuant to subsection (A).

C. A retired member who does not return to active membership for 60 consecutive months or more before retiring again is not eligible to elect the Optional Premium Benefit pursuant to subsection (A) unless the retired member elected the Optional Premium Benefit to be effective on the date of the retired member's Original Retirement Date.

D. In order to elect, re-elect, or terminate the Optional Premium Benefit pursuant to subsection (A), the retired member shall submit to the ASRS the Optional Premium Benefit Program Election or Termination form containing the following information:

1. The retired member's Social Security number or U.S. Tax Identification number;

2. Whether the retired member is electing, declining, or terminating the Optional Premium Benefit;

3. The following information for the Contingent Annuitant if the retired member is electing or re-electing the Optional Premium Benefit:

a. The Social Security number or U.S. Tax Identification number;

b. The full name; and

c. The date of birth, if not On File; and

4. Certification of understanding by the retired member's dated signature of the following statements:

a. I have a one-time election at the time of retirement for this benefit, and have a retirement date on or after January 1, 2004;

b. I must elect a Joint & Survivor or Period-Certain annuity option;

c. If I elect to participate, my Contingent Annuitant must be either participating or eligible to participate in my retiree health care plan at the time of my death;

d. I must provide proof of birth date for my Contingent Annuitant;

e. The Premium Benefit will be actuarially reduced for the remainder of my benefit and my Contingent Annuitant's benefit as long as the Optional Premium Benefit is elected; and

f. I may rescind the election at any time and be eligible for the unreduced Premium Benefit payable as provided by law.

E. In order to elect or re-elect the Optional Premium Benefit, a member shall submit the Optional Premium Benefit Program Election or Termination form to the ASRS prior to the member's Original Retirement Date.

F. A Contingent Annuitant the retired member designates to receive the Optional Premium Benefit upon the retired member's death is eligible to receive a Premium Benefit if:

1. The retired member designates the Contingent Annuitant as the primary beneficiary on the member's retirement account;

2. The Contingent Annuitant is enrolled in a Coverage plan at the time of the member's death or the Contingent Annuitant enrolls in a Coverage plan within six months of the retired member's death pursuant to A.R.S. § 38-782(A); and

3. The Contingent Annuitant is eligible to receive at least one monthly payment.

G. Upon the death of a retired member who elected the Optional Premium Benefit pursuant to subsection (A), the ASRS shall provide the Optional Premium Benefit on behalf of the retired member's Contingent Annuitant who is eligible to receive the Optional Premium Benefit pursuant to subsection (F).

H. Notwithstanding subsection (G), the amount of the Optional Premium Benefit the ASRS provides on behalf of a Contingent Annuitant shall not exceed the actual amount of the Coverage premium.

I. Unless otherwise indicated by law, the Optional Premium Benefit shall not terminate upon the death of the retired member if a Contingent Annuitant is eligible for the Optional Premium Benefit pursuant to subsection (F).

J. The Optional Premium Benefit shall terminate if the member is no longer receiving a Joint & Survivor or Period-Certain annuity.

History

• New Section made by final rulemaking at 10 A.A.R. 1962, effective May 4, 2004 (Supp. 04-2). Adopted by final rulemaking at 23 A.A.R. 1414, effective 7/3/2017. Amended by final expedited rulemaking at 27 A.A.R. 479, effective 3/5/2021. Amended by final rulemaking at 30 A.A.R. 739, effective 5/17/2024.

Article 3 LONG-TERM DISABILITY

Ariz. Admin. Code § R2-8-301 Definitions

The following definitions apply to this Article unless otherwise specified:

1. "Attending Physician" means a provider:

a. Who is a qualified medical provider or other legally qualified practitioner of a healing art that the claims administrator recognizes or is required by law to recognize;

b. Whose medical training and clinical experience are qualified to treat the member's disabling condition;

c. Whose diagnosis and treatment is consistent with the diagnosis of the disabling condition, according to guidelines established by medical, research, and rehabilitative organizations;

d. Who is licensed to practice in the jurisdiction where care is being given;

e. Who is practicing within the scope of the license; and

f. Who is not related to the member by blood or marriage.

2. "Direct Care" means the member is actively receiving treatment from a provider for the member's disability at least once per calendar year.

1.2. "Estimated Social Security disability income amount" means the same as in R2-8-801(2).

2. 3. "Legal proceeding" means an appeal of an appealable agency decision at the Office of Administrative Hearings pursuant to A.R.S. § 41-1092 et seq. or an appeal of a Social Security determination at the Social Security Administration, or any other review by a formal body, which determines the rights and responsibilities of the member or survivor.

3.4. "LTD" means the Long-Term Disability program described in A.R.S. § 38-797 et seq.

4. "LTD contribution" means the amount of funds the member remits to the ASRS from the member's compensation as payment for the LTD program.

5. "LTD benefit" means the amount of funds the member receives from the ASRS or the ASRS contracted LTD claims administrator, for the period of time a member has an eligible disability as described in A.R.S. § 38-797.07(A)(11).

6. "LTD contribution" means the amount of funds the member remits to the ASRS from the member's compensation as payment for the LTD program.

History

• New Section made by final rulemaking at 23 A.A.R. 2746, effective 11/13/2017. Amended by final rulemaking at 25 A.A.R. 2471, effective 11/3/2019.

Ariz. Admin. Code § R2-8-302 Application for Long-Term Disability Benefit

A. In order to claim an LTD benefit, a disabled member shall submit to the disabled member's Employer all the completed forms prescribed by the ASRS contracted LTD claims administrator within 12 months of the date the disabled member became disabled.

B. Pursuant to A.R.S. § 38-797.07(D), in order to continue receiving an LTD benefit, a disabled member shall submit documentation regarding the disabled member's ongoing disability and occupation as required by the ASRS contracted LTD claims administrator to determine the disabled member's continuing eligibility for an LTD benefit.

C. Pursuant to A.R.S. § 38-797.07(11), in order to submit an application for an LTD benefit, a member must provide objective medical evidence from an Attending Physician.

D. Pursuant to A.R.S. § 38-797.07(7)(b)(i), in order to continue receiving an LTD benefit, the disabled member must be under the Direct Care of a doctor.

History

• New Section made by final rulemaking at 23 A.A.R. 2746, effective 11/13/2017. Amended by final rulemaking at 25 A.A.R. 2471, effective 11/3/2019.

Ariz. Admin. Code § R2-8-303 Long-Term Disability Calculation

A. The ASRS contracted LTD claims administrator shall calculate an LTD benefit for a member using the member's monthly compensation as described in A.R.S. § 38-797(11).

B. For a member whose monthly compensation is $0 as of the date of disability, the ASRS shall pay a monthly benefit of $50 unless the benefit is reduced pursuant to R2-8-807 or required to be reduced pursuant to A.R.S. § 38-797.07(A)(2).

C. The ASRS shall reduce a member's LTD benefit in accordance with A.R.S. § 38-797.07(A).

D. Notwithstanding any other section, a member who became disabled on or after August 27, 2019, shall not receive a benefit under this article that would increase the member's monthly compensation after disability to an amount that exceeds 100% of the member's monthly compensation before disability.

History

• New Section made by final rulemaking at 23 A.A.R. 2746, effective 11/13/2017. Amended by final rulemaking at 25 A.A.R. 2471, effective 11/3/2019. Amended by final rulemaking at 27 A.A.R. 89, effective 3/9/2021.

Ariz. Admin. Code § R2-8-304 Payment of Long-Term Disability Benefit

A. The ASRS contracted LTD claims administrator shall begin providing an LTD benefit to an eligible disabled member no sooner than six months after the date the disabled member became disabled.

B. Notwithstanding subsection (A), the ASRS contracted LTD claims administrator may begin providing an LTD benefit to an eligible disabled member sooner than six months if the disability is related to the member's disability that occurred within six months immediately preceding the disability.

C. The ASRS contracted LTD claims administrator may provide an eligible disabled member's LTD benefit to a third party pursuant to A.R.S. § 38-797.09.

D. Notwithstanding any other section, a member may receive Long-Term disability benefits for no more than 12 months after the member receives a required minimum distribution of the member's retirement benefit pursuant to A.R.S. § 38-775.

History

• New Section made by final rulemaking at 23 A.A.R. 2746, effective 11/13/2017. Amended by final rulemaking at 25 A.A.R. 2471, effective 11/3/2019. Amended by final rulemaking at 28 A.A.R. 1255, effective 7/17/2022.

Ariz. Admin. Code § R2-8-305 Social Security Disability Appeal

A. Upon request by the ASRS contracted LTD claims administrator, a member who claims an LTD benefit pursuant to R2-8-302(A) shall submit a Social Security disability income application as prescribed by the ASRS contracted LTD claims administrator.

B. In order to continue receiving an LTD benefit, a member whose application for Social Security disability income has been denied or terminated must appeal the most recent determination of denial or termination through a hearing before an administrative law judge pursuant to A.R.S. § 38-797.07(A)(10)(a) until the ASRS contracted LTD claims administrator or the Social Security Claims Administrator determines the member is not eligible for a Social Security benefit.

C. Within 10 days after a member receives notice of the status of the member's Social Security disability income application, the member shall notify:

1. The ASRS of the member's application status by submitting a copy of the notice identifying the status of the member's Social Security disability income application to the ASRS, if the member is not receiving an LTD benefit; or

2. The ASRS contracted LTD claims administrator of the member's application status by submitting a copy of the notice identifying the status of the member's Social Security disability income application to the ASRS contracted LTD claims administrator, if the member is not receiving an LTD benefit.

D. A member who disagrees with an LTD determination by the ASRS contracted LTD claims administrator may submit an appeal pursuant to 2 A.A.C. 8, Article 4.

History

• New Section made by final rulemaking at 23 A.A.R. 2746, effective 11/13/2017.

Ariz. Admin. Code § R2-8-306 Approval of Social Security Disability

Upon receipt of a Social Security disability income benefit, a member shall immediately remit to:

1. The ASRS the amount of the Social Security disability income benefit necessary to offset the LTD benefit; or

2. The ASRS contracted LTD claims administrator the amount of the Social Security disability income benefit necessary to offset the LTD benefit.

History

• New Section made by final rulemaking at 23 A.A.R. 2746, effective 11/13/2017.

Article 4 PRACTICE AND PROCEDURE BEFORE THE BOARD

Ariz. Admin. Code § R2-8-401 Definitions

The following definitions apply to this Article, unless otherwise specified:

1. "Appealable agency action" has the same meaning as in A.R.S. § 41-1092.

2. "Board" means, if established, a Committee designated by the Board to take action on appeals as described in A.R.S. § 38-714(E)(1) or, if a Committee is not established, the same as in A.R.S. § 38-711(6).

3. "Final administrative action" has the same meaning as in A.R.S. § 41-1092 and is rendered by the Board.

"Health Plan" means an arrangement under which ASRS engages a Health Plan Vendor for coverage for members and their eligible dependents for routine, preventive, and emergency health-care procedures, pharmaceuticals, dental, vision, or other services and benefits funded through an insurance policy in which the Health Plan Vendor processes and pays claims as an insurer, or a self-funded arrangement in which the Health Plan Vendor processes and pays claims using ASRS funds.

5. "Health Plan Vendor" means an entity that enters into a contract with ASRS to provide an insured Health Plan or to administer, process, and pay claims for a Health Plan self-insured by ASRS.

History

• New Section made by final rulemaking at 11 A.A.R. 444, effective January 4, 2005 (Supp. 05-1). Amended by final rulemaking at 21 A.A.R. 2515, effective 12/5/2015. Amended by final rulemaking at 23 A.A.R. 487, effective 4/8/2017. Amended by final rulemaking at 23 A.A.R. 2749, effective 11/13/2017. Amended by final rulemaking at 28 A.A.R. 223, effective 1/5/2022.

Ariz. Admin. Code § R2-8-402 General Procedures

In computing any time period, parties shall exclude the day from which the designated time period begins to run. Parties shall include the last day of the period unless it falls on a Saturday, Sunday, or legal holiday. When the time period is 10 days or less, parties shall exclude Saturdays, Sundays, and legal holidays.

History

• New Section made by final rulemaking at 11 A.A.R. 444, effective January 4, 2005 (Supp. 05-1).

Ariz. Admin. Code § R2-8-403 Letters of Appeal; Request for a Hearing of an Appealable Agency Action

A. After receipt of an agency decision, a person who is not satisfied with the agency decision, may submit a letter of appeal:

1. To the ASRS's vendor for long-term disability benefits, if the appeal relates to a long-term disability decision; or

2. To the ASRS Member Services Division Assistant Director, or such director's designee, if the appeal relates to an agency decision other than a long-term disability decision or Health Plan Vendor decision.

B. Upon receipt of a letter of appeal, the long-term disability vendor, or the Member Services Division Assistant Director, or such director's designee, shall send a response letter to the person requesting the appeal notifying the person of:

1. The decision the agency is making in response to the letter of appeal; and

2. The person's right to appeal the agency response by submitting a letter of appeal to the ASRS Director or such director's designee.

C. A person who is not satisfied with the agency response pursuant to subsection (B) may submit a letter of appeal to the ASRS Director or such director's designee within 60 days of the date on the agency response letter.

D. Within 30 days of the date the ASRS receives a letter of appeal pursuant to subsection (C), the ASRS director or such director's designee shall send a response letter by certified mail to the person requesting the appeal that includes:

The agency action the ASRS is taking in response to the letter of appeal; and

2. Notice of Appealable Agency Action, as required pursuant to A.R.S. § 41-1092.03 informing the person requesting the appeal, that the person has a right to appeal the agency action by submitting a Request for Hearing pursuant to subsections (E) and (F).

E. For an appealable agency action, a person who is not satisfied with an agency action pursuant to subsection (D) may file a Request for a Hearing, in writing, with the ASRS. The date the Request is filed is established by the ASRS date stamp on the face of the first page of the Request. The Request shall include the following:

1. The name and mailing address of the member, employer, or other person filing the Request;

2. The name and mailing address of the attorney for the person filing the Request, if applicable;

3. A concise statement of the reasons for the appeal.

F. The person requesting a hearing shall file the Request for a Hearing with the ASRS within 30 days after receiving a response letter including a Notice of an Appealable Agency Action, pursuant to subsection (E).

G. Upon receipt of the Request for a Hearing, the ASRS shall notify the Office of Administrative Hearings as required in A.R.S. § 41-1092.03(B).

H. Pursuant to subsection (B):

1. The long-term disability vendor shall send a response letter to the person requesting the appeal within 120 days of the date the long-term disability vendor receives the letter of appeal; and

2. The Member Services Division Assistant Director, or such director's designee, shall send a response letter to the person requesting the appeal within 30 days of the date the ASRS receives the letter of appeal.

I. The Board has delegated to each Health Plan Vendor the authority to:

1. Interpret and apply the terms of the Health Plan Vendor's particular Health Plan;

2. Determine whether a particular benefit is included in the Health Plan and, if included, the amount of payment to be made under the Health Plan; and

Perform a full and fair review of any decision by the Health Plan Vendor regarding benefits included in or payments to be made under the Health Plan if the decision is appealed in accordance with the Health Plan Vendor's specified procedures.

J. An individual who is enrolled in a Health Plan made available by ASRS and who wishes to appeal a decision by the Health Plan Vendor shall follow the appeal procedures specified in the applicable Health Plan description.

History

• New Section made by final rulemaking at 11 A.A.R. 444, effective January 4, 2005 (Supp. 05-1). Amended by final rulemaking at 23 A.A.R. 487, effective 4/8/2017. Amended by final rulemaking at 28 A.A.R. 223, effective 1/5/2022.

Ariz. Admin. Code § R2-8-404 Board Decisions on Hearings before the Office of Administrative Hearings

A recommended decision from the Office of Administrative Hearings that is sent to ASRS at least 30 days before the Board's next regular meeting, shall be reviewed by the Board at that meeting. At the meeting, the Board shall render a decision to accept, reject, or modify the findings of fact, conclusions of law and recommendations in whole or in part. If the Board modifies or rejects a recommended decision, the Board shall state the reasons for the modification or rejection. The Board shall deliver the Board's final decision to the Office of Administrative Hearings within five days after the meeting at which the Board made the final decision.

History

• New Section made by final rulemaking at 11 A.A.R. 444, effective January 4, 2005 (Supp. 05-1). Amended by final expedited rulemaking at 27 A.A.R. 479, effective 3/5/2021.

Ariz. Admin. Code § R2-8-405 Motion for Rehearing Before the Board; Motion for Review of a Final Decision

A. Except as provided in subsection (H), within 30 days after service of the final administrative decision, any aggrieved party in an appealable agency action may file with the Board a Motion for Rehearing Before the Board, in writing, specifying the particular grounds for rehearing before the Board.

B. Except as provided in subsection (H), within 30 days after service of the final administrative decision, any aggrieved party of an appealable agency action may file with the Board a Motion for Review of a Final Decision, in writing, specifying the particular grounds for reviewing the Board's final administrative decision.

B. C. A party may amend a Motion for Rehearing Before the Board or a Motion for Review of a Final Decision at any time before the Board rules on the motion. A party may file a response within 15 days after the motion or the amended motion is filed. The Board may require the filing of written briefs upon the issues raised in the motion or the amended motion, and may provide for oral argument.

C. D. The Board may grant a Motion for Rehearing Before the Board or a Motion for Review of a Final Decision for any of the following causes that materially affects the moving party's rights:

1. Irregularity in the administrative proceedings of the agency or the hearing officer, or any order or abuse of discretion that deprives the moving party of a fair hearing;

2. Misconduct of the Board, the hearing officer, or the prevailing party;

3. Accident or surprise that could not have been prevented by ordinary prudence;

4. Newly discovered material evidence that could not with reasonable diligence have been discovered and produced at the original hearing;

5. Excessive or insufficient penalties;

6. Error in the admission or rejection of evidence or other errors of law occurring at the administrative hearing or during the process of the action; or

7. That the decision, or findings of fact, is not justified by the evidence or is contrary to law.

D. E. The Board may affirm or modify the final administrative decision or grant a rehearing before the Board or review of final administrative decision to all or any of the parties on all or part of the issues for any of the reasons in subsection (C). An order granting a rehearing or review shall specify with particularity the grounds for the order.

E. F. Not later than 10 days after the final administrative decision, the Board may, after giving each party notice and an opportunity to be heard, order a rehearing or review of its final administrative decision for any reason for which it might have granted a rehearing or review on motion of a party. After giving the parties or their counsel notice and an opportunity to be heard on the matter, the Board may grant a motion for rehearing or review for a reason not stated in the motion. In either case, the order granting a rehearing or review shall specify the grounds on which it is granted.

F. G. When a motion for rehearing or review is based upon an affidavit, the affidavit shall be filed with the motion. An opposing party may, within 15 days after filing, file an opposing affidavit. The Board may extend the period for filing an opposing affidavit for not more than 20 days for good cause shown or by written stipulation of the parties. The Board may permit a reply affidavit.

G. H. The Board shall rule on the motion within 15 days after the response to the motion is filed or if a response is not filed, within five days of the expiration of the response period.

H. I. If the Board makes a specific finding that the immediate effectiveness of a particular decision is necessary for the preservation of the public peace, health, and safety and that a rehearing or review of the decision is impracticable, unnecessary, or contrary to the public interest, the decision may be issued as a final decision without an opportunity for a rehearing or review. If a decision is issued as a final decision without an opportunity for rehearing or review, an application for judicial review of the decision may be made within the time limits permitted for applications for judicial review of the Board's final decisions.

History

• New Section made by final rulemaking at 11 A.A.R. 444, effective January 4, 2005 (Supp. 05-1). Amended by final rulemaking at 23 A.A.R. 487, effective 4/8/2017.

Article 5 PURCHASING SERVICE CREDIT

Ariz. Admin. Code § R2-8-501 Definitions

The following definitions apply to this Article unless otherwise specified:

1. "Active duty" means full-time duty in a branch of the United States uniformed service, other than Active Reserve Duty.

"Active reserve duty" means participating in required meetings and annual training in a Reserve or National Guard branch of the United States uniformed service.

3. "Actuarial present value" means an amount in today's dollars of a member's future retirement benefit calculated using appropriate actuarial assumptions and the:

a. Eligible Member's Current Years of Credited Service;

b. Eligible Member's age as of the date the Eligible Member submits to the ASRS a request to purchase service pursuant to this Article;

c. Amount of Service Credit the member wishes to purchase; and

d. Member's current annual compensation.

4. "Authorized representative" means an individual who has been delegated the authority to act on behalf of a Custodian, Trustee, Plan Administrator, or a member, if the member's IRA or 403(b) is not maintained by the member's Employer.

5. "Current years of credited service" means the amount of credited service a member has earned or purchased, and the amount of Service Credit for which an Irrevocable PDA is in effect for which the member has not yet completed payment, but does not include any current requests to purchase Service Credit for which the member has not yet paid.

6. "Custodian" means a financial institution that holds financial assets for guaranteed safekeeping.

7. "Direct rollover" means distribution of Eligible Funds made payable to the ASRS as a contribution for the benefit of an eligible member from a retirement plan listed in A.R.S. § 38-747(H)(2) or (H)(3).

8. "Eligible funds" means payments listed in A.R.S. § 38-747(H)(2) and (H)(3).

9. "Eligible member" means a member who is eligible to purchase service pursuant to A.R.S. §§ 38-742, 38-743, 38-744, or 38745.

10. "Forfeited service" means credited service for which the ASRS has returned retirement contributions to the member under A.R.S. § 38-740.

11. "IRC" means the same as "Internal Revenue Code" in A.R.S. § 38-711(18).

12. "Irrevocable PDA" means an irrevocable "Payroll Deduction Authorization" contract between an Eligible Member, an Employer, and the ASRS that requires the Employer to withhold payments from an Eligible Member's pay for a specified amount and for a specified number of payments, as provided in A.R.S. § 38-747.

13. "Leave of absence service" means an approved leave of absence without pay as specified in A.R.S. § 38-744.

14. "LTD" means the same as in R2-8-301.

15. "Military Call-up service" means a member is called to Active Duty under A.R.S. § 38-745 in a branch of the United States Uniformed Services.

16. "Military service" means Active Duty or Active Reserve Duty under A.R.S. § 38-745 with any branch of the United States Uniformed Services or the Commissioned Corps of the National Oceanic and Atmospheric Administration.

17. "Military service record" means a United States Uniformed Services or National Oceanic and Atmospheric Administration document that provides the following information:

a. The member's full name;

b. The member's Social Security number;

c. Type of discharge the member received; and

d. Active Duty dates, if applicable; or

e. Active Reserve Duty dates, if applicable; and

f. Point history for Active Reserve Duty dates, if applicable.

"Other public service" means previous employment listed in A.R.S. § 38-743(A).

19. "PDA pay-off invoice" means written correspondence from the ASRS to an Eligible Member that specifies the amount necessary to be paid by the Eligible Member to complete an Irrevocable PDA to receive the total credited service specified in the Irrevocable PDA.

20. "Plan administrator" means the person authorized to represent a specific eligible plan as addressed in IRC § 414(g).

21. "Service credit" means Forfeited Service, Leave of Absence Service, Military Service and Military Call-up Service, and Other Public Service that an Eligible Member may purchase.

22. "SP invoice" means a written correspondence from the ASRS informing an Eligible Member of the amount of money required to purchase a specified amount of Service Credit.

23. "Termination pay" means an Employer's payment to the ASRS of an Eligible Member's pay received as a result of terminating employment to purchase Service Credit as specified in A.R.S. § 38-747(B)(2).

24. "Three full calendar months" means the first day of the first full month through the last day of the third consecutive full month.

25. "Transfer employment" means to terminate employment with one Employer with which an Eligible Member has an Irrevocable PDA:

a. After accepting an offer to work for a new Employer;

b. While working as an active member for a different Employer; or

c. Before returning to work with any Employer within 120 days of terminating employment.

"Trustee-to-Trustee transfer" means a transfer of assets to the ASRS as authorized in A.R.S. § 38-747(I), from a retirement program from which, at the time of the transfer, a member is not eligible to receive a distribution.

27. "Uniformed services" means the United States Army, Army Reserve, Army National Guard, Navy, Navy Reserve, Air Force, Air Force Reserve, Air Force National Guard, Marine Corps, Marine Corps Reserve, Coast Guard, Coast Guard Reserve, and the Commissioned Corps of the Public Health Service.

28. "Window credit" means overpayments made on previously purchased Service Credit by members of the ASRS as provided by Laws 1997, Ch. 280, § 21, and Laws 2003, Ch. 164, § 3.

History

• New Section made by final rulemaking at 11 A.A.R. 2640, effective June 30, 2005 (Supp. 05-2). Amended by final rulemaking at 12 A.A.R. 4667, effective December 5, 2006 (Supp. 06-4). Amended by final rulemaking at 18 A.A.R. 3130, effective January 6, 2013 (Supp. 12-4). Amended by final rulemaking at 19 A.A.R. 764, effective June 1, 2013 (Supp. 13-2). Amended by final rulemaking at 21 A.A.R. 2515, effective 12/5/2015. Amended by final rulemaking at 25 A.A.R. 303, effective 3/18/2019. Amended by final rulemaking at 28 A.A.R. 1257, effective 7/17/2022.

Ariz. Admin. Code § R2-8-502 Request to Purchase Service Credit and Notification of Cost

A. An Eligible Member may request to purchase Service Credit electronically. The Eligible Member shall verify at the time of request, the following information for the Eligible Member:

1. Name;

2. Mailing address;

3. Date of birth;

4. Marital status;

5. Gender;

6. Primary email address;

7. Primary phone number; and

8. Which category of Service Credit the Eligible Member is requesting to purchase.

B. An Eligible Member who requests to purchase Service Credit pursuant to subsection (A) shall acknowledge the following statements of understanding:

1. Any person who knowingly makes any false statement or who falsifies or permits to be falsified any record of the retirement plan with an intent to defraud the plan is guilty of a class 6 felony per Arizona Revised Statutes Section 38-793; and

2. This transaction is subject to audit. If any errors or misrepresentations are discovered as a result of an audit, the Eligible Member's total credited service with the ASRS will be adjusted as necessary and if the Eligible Member is retired, the Eligible Member's retirement benefit will also be adjusted. Any overpayment(s) will be refunded. However, if a payment made with a rollover or pre-tax dollars is returned to the Eligible Member, there may be tax consequences as a result of this refund.

C. Upon receipt of the documentation required by this Article from the Eligible Member and if the Eligible Member's request to purchase Service Credit meets the requirements of this Article, the ASRS shall provide the following to the Eligible Member:

1. An SP Invoice stating the cost to purchase the amount of Service Credit the member is eligible to purchase;

2. Instructions for electing method of payment; and

3. The date payment election is due.

D. An Eligible Member who requests to purchase Service Credit pursuant to this section shall elect one or more methods of payment and submit the election to the ASRS by the date payment election is due.

E. An Eligible Member who elects to purchase Service Credit using after-tax payments shall acknowledge the following information:

1. After-tax payments must be from the Eligible Member and remitted to the ASRS by the Eligible Member;

2. After-tax payments cannot be used to purchase political subdivision employment with a United States territory, commonwealth, overseas possession, or insular area; and

3. If the Eligible Member joined the ASRS on or after July 1, 1999, §§ 415(b) and 415(c) of the IRC limit the after-tax money the Eligible Member can use to purchase Service Credit.

History

• New Section made by final rulemaking at 11 A.A.R. 2640, effective June 30, 2005 (Supp. 05-2). Amended by final rulemaking at 12 A.A.R. 4667, effective December 5, 2006 (Supp. 06-4). Amended by final rulemaking at 18 A.A.R. 3130, effective January 6, 2013 (Supp. 12-4). Amended by final rulemaking at 25 A.A.R. 303, effective 3/18/2019. Amended by final expedited rulemaking at 27 A.A.R. 479, effective 3/5/2021.

Ariz. Admin. Code § R2-8-503 Requirements Applicable to All Service Credit Purchases

A. To purchase Service Credit at the amount provided in an SP Invoice, an Eligible Member shall purchase the Service Credit by check or money order, or request an Irrevocable PDA, Direct Rollover, Trustee-to-Trustee Transfer, or Termination Pay as specified in this Article, by the due date specified by the method of payment the Eligible Member elected.

B. An Eligible Member may purchase all of the Service Credit or a portion of the Service Credit. If the Eligible Member wishes to purchase only a portion of the Service Credit, the Eligible Member shall specify:

1. Either the number of years or partial years of Service Credit the Eligible Member wishes to purchase; or

2. The cost for the number of years or partial years of Service Credit the Eligible Member wishes to purchase, not exceeding the years or partial years and cost specified on the SP Invoice.

C. If the eligible member elects to purchase only a portion of the service credit, the cost and amount of service credit the eligible member identifies on the Service Purchase Payment Request form is only an estimate and may be more or less than the actual cost or amount of service credit purchased by the eligible member.

D. The eligible member shall not request to purchase additional service credit based on the SP invoice until the member has completed the purchase of the previously requested portion of service credit or cancel the request as specified in subsection (F).

E. C. The ASRS shall not consider more than one active request at a time from a member to purchase Service Credit in a single category. The categories are:

1. Leave of Absence Service;

2. Military Service;

3. Presidential Call-up service,

4. 3. Forfeited Service; and

5. 4. Other Public Service.

F. D. An Eligible Member may cancel an active request by notifying the ASRS in writing.

G. E. If an Eligible Member is entitled to a Window Credit, the Eligible Member may apply the Window Credit to purchase Service Credit. To apply a Window Credit to a purchase of Service Credit, the Eligible Member shall make a request to the ASRS in writing by the date payment election is due as specified on the SP Invoice and include the following information:

1. The amount the Eligible Member wants to apply, and

2. The Eligible Member's dated signature

3. The date of the member's signature.

H. The amount of service credit an eligible member may purchase and the benefits an eligible member may receive are subject to the limitations prescribed in A.R.S. § 38-747(E) .

I. F . On or before the due date specified on the SP Invoice, an Eligible Member may request an extension of a due date for purchasing Service Credit.

1. If the member notifies the ASRS of an ASRS error, the time is extended 30 days after the date the ASRS sends notification to the eligible member that the ASRS has corrected the error;

2. If an ASRS internal review is made of the member's service credit purchase request, the time is extended 30 days after the date ASRS sends notification to the member that the review is completed;

3. If the member appeals an issue regarding the SP invoice under Article 4 of this Chapter, the time is extended 30 days after the date ASRS sends notification to the member that a decision on the appeal has been made; or

4. If an unforeseeable event occurs that is outside of the member's control, such as an incapacitating illness of the member or death of an immediate family member, and the member notifies the ASRS of the event, the ASRS shall extend the time by up to six months, after a review of the unforeseeable event to determine the length of the extension.

History

• New Section made by final rulemaking at 11 A.A.R. 2640, effective June 30, 2005 (Supp. 05-2). Amended by final rulemaking at 12 A.A.R. 4667, effective December 5, 2006 (Supp. 06-4). Amended by final rulemaking at 18 A.A.R. 3130, effective January 6, 2013 (Supp. 12-4). Amended by final rulemaking at 18 A.A.R. 3130, effective January 6, 2013 (Supp. 12-4). Amended by final rulemaking at 25 A.A.R. 303, effective 3/18/2019.

Ariz. Admin. Code § R2-8-504 Service Credit Calculation for Purchasing Service Credit

A. An Eligible Member who purchases Service Credit shall receive one month of credited service for one or more days of service in a calendar month.

B. Pursuant to A.R.S. 38-739(B), an Eligible Member who purchases Service Credit shall receive a proportionate amount of credited service based on the length of the Eligible Member's service year.

C. Notwithstanding any other provision, an Eligible Member whose membership date is on or after July 20, 2011, cannot purchase more than five years of Service Credit for each of the following based on the length of the Eligible Member's service year:

1. Leave of Absence Service;

2. Military Service; and

3. Other Public Service.

History

• New Section made by final rulemaking at 11 A.A.R. 2640, effective June 30, 2005 (Supp. 05-2). Amended by final rulemaking at 25 A.A.R. 303, effective 3/18/2019.

Ariz. Admin. Code § R2-8-505 Restrictions on Purchasing Overlapping Service Credit

A. The ASRS shall not permit an Eligible Member to purchase Service Credit that, when added to credited service earned in any plan year, results in more than:

One year of credited service in any plan year, or

2. One month of credited service in any one calendar month.

B. A member may not purchase Service Credit for any period of time for which the member is eligible to receive retirement benefits from another public employee retirement system.

C. For purposes of this section, "another public employee retirement system" means any retirement plan providing retirement benefits and maintained by the United States government, a state, territory, commonwealth, overseas possession or insular area of the United State or a political subdivision of a state, territory, commonwealth, overseas possession or insular area of the United States.

History

• New Section made by final rulemaking at 11 A.A.R. 2640, effective June 30, 2005 (Supp. 05-2). Amended by final rulemaking at 25 A.A.R. 303, effective 3/18/2019. Amended by final rulemaking at 28 A.A.R. 1257, effective 7/17/2022.

Ariz. Admin. Code § R2-8-506 Cost Calculation for Purchasing Service Credit

A. For Service Credit for Leave of Absence Service, Military Service, and Other Public Service, the ASRS shall calculate, as of the date of the request to purchase Service Credit:

1. The Actuarial Present Value of the future retirement benefit for the Eligible Member including the Service Credit that the Eligible Member requests to purchase, and

2. The Actuarial Present Value of the future retirement benefit for the Eligible Member without the Service Credit that the Eligible Member requests to purchase.

B. The cost for purchasing the Service Credit that the Eligible Member requests to purchase is the difference between the Actuarial Present Value in subsection (A)(1) and the Actuarial Present Value in subsection (A)(2).

History

• New Section made by final rulemaking at 11 A.A.R. 2640, effective June 30, 2005 (Supp. 05-2). Amended by final rulemaking at 25 A.A.R. 303, effective 3/18/2019.

Ariz. Admin. Code § R2-8-507 Required Documentation and Calculations for Forfeited Service Credit

A. An Eligible Member who requests to purchase Service Credit for Forfeited Service under A.R.S. § 38-742 shall provide the ASRS:

1. The name of an Employer, if known, for which the Eligible Member is requesting to purchase Service Credit for Forfeited Service; and

2. The year and month the Eligible Member believes the ASRS returned retirement contributions.

B. Upon receipt of payment as specified in subsection (D), the ASRS shall apply the Service Credit to the Eligible Member's account based on the most recent Forfeited Service available for purchase.

C. Notwithstanding subsection (B), if an Eligible Member has more than one return of contributions pursuant to A.R.S. § 38-740, the Eligible Member may elect to purchase Forfeited Service for any of the return of contributions and the ASRS shall apply the Service Credit to the Eligible Member's account based on the most recent Forfeited Service available for purchase.

D. The amount the Eligible Member shall pay to purchase Service Credit for previously Forfeited Service is the amount of retirement contributions that the ASRS issued, plus interest on that amount from the date on the return of retirement contributions check to the date of redeposit at the Assumed Actuarial Investment Earnings Rate specified in R2-8-118(A).

History

• New Section made by final rulemaking at 11 A.A.R. 2640, effective June 30, 2005 (Supp. 05-2). Amended by final rulemaking at 12 A.A.R. 4667, effective December 5, 2006 (Supp. 06-4). Amended by final rulemaking at 25 A.A.R. 303, effective 3/18/2019. Amended by final expedited rulemaking at 27 A.A.R. 479, effective 3/5/2021.

Ariz. Admin. Code § R2-8-508 Required Documentation and Calculations for Leave of Absence Service Credit

A. An Eligible Member who requests to purchase Service Credit for Leave of Absence Service under A.R.S. § 38-744 shall provide to the ASRS an Approved Leave of Absence form that includes:

1. An Approved Leave of Absence form that includes:

a.

1. The following information completed by the Eligible Member:

i. a. The start date and end date of the approved leave of absence;

ii. b. The date the Eligible Member returned to work or a statement of why employment was not resumed;

iii. c. The name of the Employer;

iv. d. Whether the Eligible Member participated in another public retirement system during this leave of absence; and

e. If the Eligible Member participated in another public retirement system during the leave of absence, whether the Eligible Member is receiving a benefit or is eligible to receive a benefit, from the other public retirement system; and

2. Acknowledgement of the following statements of understanding:

v. a. The Eligible Member understands that up to one year of Service Credit may be purchased for each approved leave of absence, if the Eligible Member returns to work for the Employer that approved the leave of absence unless employment could not be resumed because of disability or nonavailability of a position;

vi. A statement that the eligible member understands that the ASRS uses the actuarial present value calculation method to determine the cost of the service purchase request;

vii. b. The Eligible Member authorizes the Employer to provide any necessary personal information to ASRS in order to process this request; and

viii. The member's dated signature; and

b. The following information completed by the ASRS employer;

i. The beginning date and ending date of the approved leave of absence;

ii. The date the eligible member returned to work or a statement of why employment was not resumed;

iii. Name of the employer;

iv. The authorized employer representative's name;

v. The authorized employer representative's telephone number and, if applicable, fax number; and

vi. The authorized employer representative's dated signature verifying that the approved leave of absence benefited or was in the best interest of the employer; and

2. A copy of the guidelines referenced in A.R.S. § 38-744, if applicable.

c. The Eligible Member certifies that if the Eligible Member participated in another public retirement system during the approved leave of absence, the Eligible Member is not receiving, and is not eligible to receive, a benefit from the other public retirement system for the time during the approved leave of absence; and

3. The Eligible Member's dated signature.

B. Pursuant to A.R.S. § 38-744, a member who participated in another public retirement system during the leave of absence, and is receiving a benefit or is eligible to receive a benefit from the other public retirement system, is not an Eligible Member for purposes of this section.

C. If the information provided by the Eligible Member pursuant to subsection (A) is correct, the Employer shall validate the information and submit the information to the ASRS through the Employer's secure ASRS account. If the information provided by the Eligible Member pursuant to subsection (A) is incorrect, the Employer shall correct the information and submit the information to the ASRS through the Employer's secure ASRS account.

D. Upon submitting the information specified in subsection (B), the Employer shall acknowledge the following statements of understanding:

1. The Employer has verified all the dates for the approved leave of absence period are correct; and

2. The contact individual has the legal power to bind the Employer in transactions with the ASRS.

B. E. The amount the Eligible Member shall pay to purchase Service Credit for an approved leave of absence is determined as provided in R2-8-506.

History

• New Section made by final rulemaking at 11 A.A.R. 2640, effective June 30, 2005 (Supp. 05-2). Amended by final rulemaking at 12 A.A.R. 4667, effective December 5, 2006 (Supp. 06-4). Amended by final rulemaking at 25 A.A.R. 303, effective 3/18/2019.

Ariz. Admin. Code § R2-8-509 Required Documentation and Calculations for Military Service Credit

A. An Eligible Member who requests to purchase Service Credit for Military Service under A.R.S. § 38-745(A) and (B) shall provide to the ASRS:

1. The items listed in R2-8-507(A)(1) ;

2. 1. A copy of the Eligible Member's Military Service Record within 30 days of the Eligible Member's request to purchase Service Credit; and

3. 2. A Military Service form that contains:

a. The member's full name;

b. a. Whether the Eligible Member is receiving a benefit or is eligible to receive a benefit, from the military.

c. b. The branch of the Uniformed Services the Eligible Member was in;

d. c. Whether the Eligible Member was on Active Duty or Active Reserve Duty;

e. d. The start date and end date of the Eligible Member's Military Service for which the Eligible Member is requesting to purchase Service Credit;

f. e. Acknowledgement that the Eligible Member will submit to the ASRS:

i. Proof of honorable separation for each type of Military Service listed on the form; and

ii. The Eligible Member's Military Service Record that supports all of the service listed on the form;

g. f. Acknowledgement of the following statements of understanding:

i. I understand that any person who knowingly makes any false statement or who falsifies or permits to be falsified any record of the retirement plan with an intent to defraud the plan is guilty of a class 6 felony per Arizona Revised Statutes Section 38-793 ;

ii. I understand this transaction is subject to audit and if any errors or misrepresentations are discovered as a result of this audit, my total credited service with the ASRS will be adjusted as necessary and if I am retired, my retirement benefit will also be adjusted;

iii. i. The Eligible Member understands that the service listed on this form does not include time that the Eligible Member either volunteered or was ordered into Active Duty service as part of a military call-up while employed by an Employer. This service is purchased under Military Call-up Service and requires a Military Call-up form to be completed by the Eligible Member's Employer; and

iv. ii. The Eligible Member understands that any time the Eligible Member has listed on this form for Reserve or National Guard time reflects the months that the Eligible Member attended at least one drill or assembly for each month listed.

B. The amount the Eligible Member pays to purchase Service Credit for Military Service is determined as provided in R2-8-506.

C. The ASRS determines the amount of Service Credit an Eligible Member receives for Active Duty and Active Reserve Duty time by the time listed on the Military Service form, if the service listed is supported by the information contained in the Eligible Member's Military Service Record.

D. If the ASRS has not received complete and correct documents pursuant to this section within 30 days of the request to purchase Service Credit, the ASRS shall cancel the Eligible Member's request to purchase Service Credit.

History

• New Section made by final rulemaking at 11 A.A.R. 2640, effective June 30, 2005 (Supp. 05-2). Amended by final rulemaking at 12 A.A.R. 4667, effective December 5, 2006 (Supp. 06-4). Amended by final rulemaking at 25 A.A.R. 303, effective 3/18/2019.

Ariz. Admin. Code § R2-8-510 Required Documentation and Calculations for Military Call-up Service Credit

A. An Eligible Member who meets the requirements under A.R.S. § 38-745 ()D shall receive up to 60 months of Service Credit, not to exceed 5 years of Service Credit for Military Call-up Service under A.R.S. § 38-745 ( (D) through (K). In order to determine the amount of contributions the Employer owes to purchase Service Credit for Military Call-up Service, the Eligible Member's Employer shall provide to the ASRS a copy of the Eligible Member's Military Service Record and a completed Military Call-up form that includes the following:

1. The Eligible Member's full name;

2. The Eligible Member's Social Security number;

The start date of Military Call-up Service;

4. The end date of Military Call-up Service;

5. Whether the member received paid leave while on Presidential Call-up;

6. 5. The date the Eligible Member returned to work for the Employer;

7. 6. The salary for each pay period in each fiscal year while the Eligible Member was on military call-up, including any salary increases the Eligible Member would have received had the Eligible Member not left work due to military call-up;

8. The ASRS employer's name and address;

9. 7. The name of a contact individual for the Employer, and that individual's business telephone number;

10. 8. The contact individual's dated signature;

11. 9. If applicable, the

a. dates that the Eligible Member was hospitalized and released from the hospital as a result of participating in a military call-up.

b. The date that the member was hospitalized for one year for injuries sustained as a result of participating in a Presidential Call-up; and

10. If applicable, the date the Eligible Member became disabled during or as a result of participating in a military call-up;

11. If applicable, the date of the Eligible Member's death during or as a result of participating in a military call-up; and

12. Acknowledgement of the following statements of understanding:

a. All the dates and payroll information for the Military Call-up Service are correct;

b. The Eligible Member:

i. Was honorably separated from Active Duty and returned to the same Employer within 90 days of either discharge from Active Duty or release from service-related hospitalization; or

ii. Was disabled and unable to return to work; or

iii. Died during or as a result of Active Duty.

c. The Employer must pay both the employee and Employer contributions in a lump sum upon the Eligible Member returning to employment, receipt of a declaration of disability, or receipt of a death certificate. These contributions are based on the salary the Eligible Member would have earned if the Eligible Member had not volunteered or been ordered into Active Duty;

d. The Eligible Member may receive a maximum of 60 months of Service Credit for Military Call-up Service pursuant to A.R.S. § 38-745; and

e. The contact individual has the legal power to bind the Employer in transactions with the ASRS.

12. A copy of the member's death certificate, if applicable.

B. An Employer shall make the request to purchase Service Credit for Military Call-up Service within 30 days after the earlier of the dates listed in A.R.S. § 38-745(E).

C. The ASRS calculates the amount the Employer pays to purchase Military Call-up Service pursuant to A.R.S. § 38-745(G) by multiplying the Eligible Member's salary per pay period at the time Active Duty commences, by the contribution rate in effect for the period of Active Duty. Included in the calculation are any salary increases the Eligible Member would have received if the Eligible Member had not left work to participate in a military call-up.

D. The ASRS shall send the Employer a statement of cost for purchase of the Service Credit for Military Call-up Service based on the calculation in subsection (C). Within 90 days from the date on the ASRS statement of cost, the Employer shall pay to the ASRS the amount on the statement. If the Employer fails to make full payment within 90 days, interest shall accrue on the unpaid balance at the Assumed Actuarial Investment Earnings Rate in effect on the date of the statement of cost as specified in R2-8-118(A) . The ASRS may collect the unpaid balance plus interest pursuant to A.R.S. § 38-735(C).

E. If an Employer remits retirement or long-term disability contributions on behalf of an Eligible Member while the Eligible Member is on military call-up, the Employer shall reverse the contributions after the ASRS receives the information in subsection (A).

F. If an Employer remits retirement contributions on behalf of an Eligible Member while the Eligible Member is on military call-up, and the Eligible Member does not return to the Employer after separation from active Military Service, the ASRS shall apply the retirement contributions to the Eligible Member's credited service.

History

• New Section made by final rulemaking at 11 A.A.R. 2640, effective June 30, 2005 (Supp. 05-2). Amended by final rulemaking at 12 A.A.R. 4667, effective December 5, 2006 (Supp. 06-4). Amended by final rulemaking at 25 A.A.R. 303, effective 3/18/2019.

Ariz. Admin. Code § R2-8-511 Required Documentation and Calculations for Other Public Service Credit

A. An Eligible Member who requests to purchase Service Credit for Other Public Service under A.R.S. § 38-743 shall provide to the ASRS a completed Other Public Service form, signed and dated by the Eligible Member, that includes the following:

1. The member's full name;

2. The member's Social Security number;

3. Other names used by the member during employment with the other public service employer, if applicable;

4. 1. The name and mailing address of the Other Public Service employer;

5. 2. The position the Eligible Member held while working for the Other Public Service employer;

6. 3. The start date and end date of the Eligible Member's employment with the Other Public Service employer;

7. 4. The actual months and years the Eligible Member was employed with the Other Public Service employer;

8. 5. A statement of whether the Eligible Member participated in the Other Public Service employer's retirement plan;

9. 6. If the Eligible Member participated in the Other Public Service employer's retirement plan, the name of the retirement plan, identifying whichever one of the following applies:

a. The approximate date the Eligible Member took a return of retirement contributions;

b. The plan is non-contributory and the Eligible Member is not eligible for benefits from the plan; or

c. That, if not using all of the retirement contributions as a rollover, the Eligible Member will request a return of retirement contributions and forfeit all rights to any benefits from the plan and provide the ASRS with documentation that the Eligible Member has forfeited all rights to benefits from the plan no later than the due date specified on the SP Invoice; and

10. 7. Acknowledgement that

a. Knowingly making a false statement or falsifying or permitting falsification of any record of the ASRS with an intent to defraud ASRS is a Class 6 felony, pursuant to A.R.S. § 38-793 ;

b. The service purchase transaction is subject to audit and if any errors are discovered, the ASRS shall adjust a member's total credited service with the ASRS, or if the member is already retired, adjustments to the member's credited service will affect the member's retirement benefit; and

c. if an audit determines that the Eligible Member is eligible for a benefit from the Other Public Service employer's retirement plan, the Eligible Member is required to take necessary steps to forfeit the benefit, and if the forfeiture is not completed within 90 days of being notified of the audit results, the Service Credit purchase listed on this application will be revoked and any funds paid to purchase the Service Credit will be refunded to the member.

B. The amount the Eligible Member shall pay to purchase Service Credit for Other Public Service is determined as provided in R2-8-506.

C. Notwithstanding R2-8-512, the ASRS shall not accept after-tax monies for the purchase of Service Credit for Other Public Service with a territory, commonwealth, overseas possession or insular area pursuant to A.R.S. § 38-743.

History

• New Section made by final rulemaking at 11 A.A.R. 2640, effective June 30, 2005 (Supp. 05-2). Amended by final rulemaking at 12 A.A.R. 4667, effective December 5, 2006 (Supp. 06-4). Amended by final rulemaking at 25 A.A.R. 303, effective 3/18/2019.

Ariz. Admin. Code § R2-8-512 Purchasing Service Credit by Check, Cashier's Check, or Money Order

A. An Eligible Member may purchase Service Credit by personal check in the Eligible Member's name, cashier's check, or money order remitted by the Eligible Member.

B. By the due date specified by the method of payment the Eligible Member elected, the Eligible Member shall ensure that the ASRS receives a check, cashier's check, or money order made payable to the ASRS in the amount to purchase the requested Service Credit.

C. If an eligible member purchases service credit by check, cashier's check, or money order in conjunction with one or more rollovers, trustee-to-trustee transfers, or termination pay, the member shall make payment within 30 days after the date the ASRS sends written confirmation that the ASRS received the final rollover, trustee-to-trustee transfer, or termination pay payment.

History

• New Section made by final rulemaking at 11 A.A.R. 2640, effective June 30, 2005 (Supp. 05-2). Amended by final rulemaking at 12 A.A.R. 4667, effective December 5, 2006 (Supp. 06-4). Amended by final rulemaking at 25 A.A.R. 303, effective 3/18/2019.

Ariz. Admin. Code § R2-8-513 Purchasing Service Credit by Irrevocable PDA

A. An Eligible Member may purchase Service Credit by Irrevocable PDA.

B. By the due date specified on the SP invoice, the member shall ensure that the ASRS receives the completed Service Purchase Payment Request form with the information specified in R2-8-502(D)(2) .

C. B. If the Eligible Member elects to pay for Service Credit by Irrevocable PDA, the Eligible Member shall elect the terms of the Irrevocable PDA and submit the Irrevocable PDA to the ASRS and the Employer with the following:

1. Acknowledgements:

a. This Irrevocable PDA is binding and irrevocable;

b. This Irrevocable PDA shall remain in effect until the earlier of:

i. The authorized payroll deductions are completed; or

ii. The Eligible Member terminates employment.

c. The ASRS cannot terminate the Irrevocable PDA due to financial hardship;

d. The amount of Irrevocable PDA payments the Eligible Member makes is subject to federal laws;

e. The cost to purchase Service Credit by Irrevocable PDA includes an administrative interest charge at the Assumed Actuarial Investment Earnings Rate in effect at the time of the authorization as specified in R2-8-118(A);

f. Payments specified in this Irrevocable PDA are in addition to the regular contributions required pursuant to A.R.S. §§ 38-736 and 38-797.05;

g. The ASRS shall apply credited service to the Eligible Member's account upon receipt of payments authorized by the Eligible Member under this Irrevocable PDA; and

h. The ASRS shall not transfer, refund, or disburse the administrative interest that the ASRS charges pursuant to subsection (B)(1)(e); and

2. Statements of Understanding:

a. It is the Eligible Member's responsibility to ensure the Eligible Member's Employer properly deducts payments and submits contributions as provided by the terms of the Irrevocable PDA;

b. Payments specified by the terms of this Irrevocable PDA shall be made directly to the ASRS from the Eligible Member's Employer and the Eligible Member does not have the option of receiving such payments directly from the Employer;

c. The Eligible Member's Employer shall make payments pursuant to this Irrevocable PDA after other mandatory deductions are made;

d. The Eligible Member's Employer cannot accept an election to change this Irrevocable PDA;

e. The Eligible Member has up to 14 days to request the ASRS calculate the remaining balance of this Irrevocable PDA after the earlier of:

i. Terminating employment;

ii. Terminating LTD without returning to work with an Employer; or

iii. The effective ASRS retirement date;

f. The Eligible Member must complete a purchase of the remaining balance on this Irrevocable PDA by the due date specified on the PDA Pay-off Invoice;

g. It is the Eligible Member's responsibility to notify the ASRS of any changes in the Eligible Member's employment that may affect the status of this Irrevocable PDA;

h. If the Eligible Member terminates employment and returns to work with an Employer within 120 days of terminating employment, this Irrevocable PDA must continue with the new Employer pursuant to R2-8-513.01; and

i. If the Eligible member terminates employment and does not return to work with an Employer within 120 days of terminating employment, the ASRS shall terminate this Irrevocable PDA pursuant to R2-8-513.01.

C. By submitting the Irrevocable PDA to the ASRS, the Irrevocable PDA is deemed to be signed by the Eligible Member.

D. At the time the Eligible Member elects the Irrevocable PDA, the Eligible Member may elect to use Termination Pay towards the balance of the Irrevocable PDA if the Eligible Member terminates employment. If the Eligible Member elects to use Termination Pay, the Eligible Member shall submit the Irrevocable PDA to the ASRS with the following information:

1. A statement that the Eligible Member:

a. Understands and agrees that the Eligible Member must continue working at least Three Full Calendar Months after the date of submission of the form before Termination Pay may be used on a pre-tax basis;

b. Understands that if the Termination Pay exceeds the balance owed on the Irrevocable PDA, the overage will be returned to the Employer to be distributed to the Eligible Member;

c. Elects to irrevocably agree to have termination pay that may be payable to the member upon termination of employment sent to the ASRS on a pre-tax basis and used toward any remaining balance of the Irrevocable Payroll Deduction Authorization if all scheduled payroll deductions have not been completed upon termination of service; and

c. Understands that the election to use Termination Pay is binding and irrevocable;

d. The Eligible Member's Termination Pay must be received and processed before the ASRS will accept any other form of payment;

e. The Eligible Member's Employer is required to make payment directly to the ASRS after mandatory deductions are made, and the Eligible Member does not have the option of receiving the funds directly from the Employer;

f. It is the Eligible Member's responsibility to ensure that the Eligible Member's Employer properly deducts Termination Pay;

g. The amount of Termination Pay the Eligible Member elects is irrevocable pursuant to § 414(h)(2) of the IRC;

h. If the Eligible Member terminates employment and immediately retires, the Eligible Member's retirement processing may be delayed; and

2. Whether the Eligible Member is electing either all Termination Pay or a specified amount of Termination Pay to be applied to the balance of the Irrevocable PDA.

E. The ASRS shall:

1. Charge interest on the unpaid balance at the Assumed Actuarial Investment Earnings Rate in effect at the time the Eligible Member submitted the request to purchase service as specified in R2-8-118(A);

2. Limit the payroll deduction time period to a maximum of 520 payments; and

3. Require a minimum payment of $10.00 per payroll period, or payment in an amount to purchase at least .001 years of Service Credit per payroll period, whichever is greater.

F. The Employer shall implement the payroll deduction on the first pay period after receiving the Irrevocable PDA.

G. If a deduction is not made under an Irrevocable PDA within six months after the Eligible Member submits the authorization, the authorization lapses and the Eligible Member may make another request, which is recalculated based on the new request date unless the failure to begin deductions is due to an ASRS error.

H. A period of leave of absence, LT D, or military call-up shall not cancel the Irrevocable PDA. The Employer shall resume deductions immediately upon the Eligible Member's return to that Employer. The period during which the Eligible Member is on leave of absence, on LT D, or leaves work because of a military call-up is not included in the payment time limitation under subsection (D)(2). If the Eligible Member does not return to active working status, whether due to termination of employment or retirement, the Eligible Member may elect to purchase the balance of unpaid service under the Irrevocable PDA at the time of termination or retirement as specified in this Section.

I. Deductions made pursuant to an Irrevocable PDA continue until the:

1. Irrevocable PDA is completed;

2. Eligible Member retires, whether or not the Eligible Member continues employment as allowed in A.R.S. §§ 38-766.01 and 38-764(I);

3. Eligible Member terminates all ASRS employment without transferring employment; or

4. Date of the Eligible Member's death.

J. If an Eligible Member retires or terminates employment from all Employers without transferring employment as stated in R2-8-513.01 before all deductions are made as authorized by the Irrevocable PDA, the ASRS shall cancel the Eligible Member's Irrevocable PDA unless the Eligible Member notifies the ASRS of the Eligible Member's intent to purchase the remaining amount within 14 days after the earlier of either termination or retirement .

K. When the Eligible Member notifies the ASRS of retirement or termination from all ASRS employment and requests to pay off the Irrevocable PDA, the ASRS shall send the Eligible Member a PDA Pay-off Invoice through the Eligible Member's secure ASRS account. The ASRS shall calculate the amount owed by the Eligible Member.

L. By the date payment election is due, the Eligible Member shall ensure that the ASRS receives the information specified in R2-8-502(C).

M. The Eligible Member may purchase the remaining Service Credit by one or more of the following methods by the due date specified on the PDA Pay-off Invoice:

By any method specified in R2-8-512;

2. By making a request to the ASRS for a rollover or transfer under R2-8-514 and completing the rollover or transfer by the due date specified on the PDA Pay-off Invoice; or

3. By Termination Pay under R2-8-519, if the Eligible Member authorized this option at the time the Eligible Member signed the Irrevocable PDA.

History

• New Section made by final rulemaking at 11 A.A.R. 2640, effective June 30, 2005 (Supp. 05-2). Amended by final rulemaking at 12 A.A.R. 4667, effective December 5, 2006 (Supp. 06-4). Amended by final rulemaking at 18 A.A.R. 3130, effective January 6, 2013 (Supp. 12-4). Amended by final rulemaking at 25 A.A.R. 303, effective 3/18/2019.

Ariz. Admin. Code § R2-8-513.01 Irrevocable PDA and Transfer of Employment to a Different Employer

A. If an Eligible Member Transfers Employment, the Eligible Member's new Employer shall continue to make deductions pursuant to an Irrevocable PDA.

B. If an Eligible Member terminates employment without having accepted an offer to work with an Employer, the ASRS shall terminate an Irrevocable PDA.

C. Notwithstanding subsection (B), if a retirement contribution is due from a new Employer within 120 days from the Eligible Member's termination date with the previous Employer, the ASRS shall determine that the Eligible Member Transferred Employment, unless the Eligible Member notified the ASRS of the termination of employment.

D. If an Eligible Member who has elected Termination Pay pursuant to R2-8-513(D) Transfers Employment, the ASRS shall not accept any Termination Pay that the ASRS receives from the Eligible Member's previous Employer.

History

• New Section made by final rulemaking at 12 A.A.R. 4667, effective December 5, 2006 (Supp. 06-4). Amended by final rulemaking at 25 A.A.R. 303, effective 3/18/2019.

Ariz. Admin. Code § R2-8-513.02 Termination Date

For the purpose of an Irrevocable PDA, the date an Eligible Member is considered terminated from an Employer is:

1. For an Eligible Member terminating employment, the Eligible Member's last pay period end date with that Employer;

2. For an Eligible Member on military call-up who does not return to the same Employer:

a. 90 days from the date of separation fromlmilitary call-up;

b. 90 days from the date released from the hospital, if injured while on military call-up; or

c. The date the Eligible Member has been hospitalized for two years for injuries sustained as a result of participating in a military call-up.

d. The date of the member's death as a result of participating in a Presidential Call-up;

3. For an Eligible Member on leave of absence without pay who does not return to the same Employer, the date the Employer required the Eligible Member to return to work;

4. For an Eligible Member who is unable to work because of a disability, the later of:

a. The date the Eligible Member's request for long-term disability benefits are denied;

b. The date the Eligible Member no longer has leave with pay available; or

c. For an Eligible Member on long-term disability who does not return to the same Employer or Transfer Employment, the date long-term disability benefits are terminated.

History

• New Section made by final rulemaking at 12 A.A.R. 4667, effective December 5, 2006 (Supp. 06-4). Amended by final rulemaking at 25 A.A.R. 303, effective 3/18/2019.

Ariz. Admin. Code § R2-8-514 Purchasing Service Credit by Direct Rollover or Trustee-to-Trustee Transfer

A. An Eligible Member may purchase Service Credit by Direct Rollover or Trustee-to-Trustee Transfer pursuant to this Article.

B. By the due date specified by the method of payment the Eligible Member elected, the Eligible Member shall ensure that the ASRS receives the payment for the service purchase and a completed Direct Rollover/ Transfer Certification to Purchase Service Credit form.

C. Upon receipt of the completed Service Purchase Payment Request form, the ASRS shall provide a Direct Rollover/Transfer Certification to Purchase Service Credit form, if the ASRS has not already provided the member with the form.

D. The member shall ensure that the ASRS receives the Direct Rollover/Transfer Certification to Purchase Service Credit form completed by the member and the plan making the distribution within 90 days after the issue date of the SP Invoice.

C. An Eligible Member who chooses to purchase Service Credit shall provide the following to the ASRS:

1. The name of the financial institution or plan;

2. Whether the Eligible Member is choosing to rollover/transfer the entire balance of their account and if not, the amount of the rollover/transfer;

3. Acknowledgement of the following information:

a. After-tax funds are only acceptable from 401(a) and 403(b) plans and must be listed separately from the portion that is pretax on the payment as after-tax amounts. This information must be provided to the ASRS with the payment.

b. The only fund types that the ASRS accepts are:

i. 401(a);

ii. 401(k) pre-tax only;

iii. 403(b);

iv. Governmental 457 pre-tax only;

v. 403(a) pre-tax only;

vi. 408 Traditional IRA pre-tax only;

vii. 408(k) SEP IRA pre-tax only;

viii. 408(p) Simple IRA pre-tax only and only if the Eligible Member participated for at least 2 years in this plan;

c. The ASRS shall not accept the following fund types:

i. Roth funds;

ii. Funds already distributed to the Eligible Member from a retirement plan listed in subsection (3)(b);

iii. Inherited IRA;

iv. Coverdale Education Savings Account funds;

v. Hardship distributions;

vi. Funds not includable in gross income;

vii. Funds required under § 401(a)(9) of the IRC because the Eligible Member have attained age 701/2;

viii. One of a series of substantially equal periodic payments made at least annually for the Eligible Member's life;

ix. One of a series of substantially equal periodic payments made for 10 years or more;

x. After-tax contributions from any plan other than a 401(a) or 403(b) qualified plan;

d. The funds must be sent as a Direct Rollover from a plan listed in subsection (3)(b) and issued to the ASRS for the benefit of the Eligible Member. If the payment is issued to anyone other than the ASRS, including the Eligible Member, then within 60 days of the plan issuing the payment, the Eligible Member must place the payment into a plan specified in subsection (3)(b) to be reissued directly to the ASRS.

e. It is the Eligible Member's responsibility to contact the administrator of the plan from which the Direct Rollover will be made and have it initiated. The Eligible Member must also ensure all rollovers are completed by the due date. If the ASRS does not receive payment by the due date, the invoice will expire and the payment will be returned to the Eligible Member.

f. If the ASRS accepts a rollover and later determines that it was not eligible, the ASRS will distribute the invalid payment directly to the Eligible Member. Any taxes, penalties, and interest that the IRS, any taxing authority, or financial institution may assess against the Eligible Member due to an invalid payment are solely the Eligible Member's responsibility.

g. The plan from which the Eligible Member is rolling over funds must be solely in the Eligible Member's name. The Eligible Member may be a spousal beneficiary of a deceased person or an alternate payee on the plan from which the Eligible Member is rolling over funds.

E. D. An Eligible Member who chooses to purchase Service Credit pursuant to this section shall submit a Direct Rollover/Transfer Certification to Purchase Service Credit form that includes:

1. The Eligible Member's full name;

2. The last 4 digits of the Eligible Member's Social Security number;

3. Member's mailing address;

4. Member's daytime telephone number;

5. The amount of each rollover or transfer, if applicable;

6. The account number of each plan, if applicable;

7. 3. The Eligible Member's signature certifying that the Eligible Member understands the requirements, limitations, and entitlements for the rollover/transfer that is being used to purchase Service Credit, and has read and understands the Direct Rollover/Transfer Certification to Purchase Service Credit form and any accompanying instructions and information ;

8. The date the member signs the form;

9. 4. The Authorized Representative's name and title;

10. The authorized representative's address;

11. 5. The Authorized Representative's telephone number; and

12. 6. Certification by the Authorized Representative's dated signature that:

a. The plan is either:

i. A qualified pension, profit sharing, or 401(k) plan described in IRC § 401(a), or a qualified annuity plan described in IRC § 403(a);

ii. A deferred compensation plan described in IRC § 457(b) maintained by a state of the United States, a political subdivision of a state of the United States, or an agency or instrumentality of a state of the United States;

iii. An annuity contract described in IRC § 403(b); or

iv. An IRA described in A.R.S. § 38-747(H)(3);

b. The rollover/transfer specified on the form from which the pre-tax funds are being rolled over or transferred is intended to satisfy the requirements of the applicable section of the IRC;

c. The Authorized Representative is not aware of any plan provision or any other reason that would cause the plan/IRA not to satisfy the applicable section of the IRC; and

d. The funds will be sent to the ASRS as a direct plan rollover, IRA rollover, or a Trustee-to-Trustee Transfer.

13. The date and signature of the authorized representative.

F. The ASRS shall provide the member with written notification regarding the eligibility of the rollover.

G. E. The Eligible Member shall contact the Plan Administrator to have the funds distributed and transferred to the ASRS. Unless the ASRS receives a check for the correct amount from the plan and all documents required by this Article by the due date specified by the method of payment the Eligible Member elected, the ASRS shall cancel the request to purchase Service Credit.

H. At the written request of the member, the ASRS shall provide an extension of 60 days in which the check may be received by the ASRS from the plan at the written request of the member, if:

1. The member has followed the procedure in this Article for requesting to purchase service credit,

2. The member has responded to the ASRS correspondence within the time-frame set forth in this Article,

3. The eligible plan has not provided to the ASRS the check to pay for the requested service credit purchase within 90 days of the date of the SP invoice, and

4. The member makes the written request for extension before expiration of the 90 days.

I. F . The Eligible Member shall ensure that the ASRS receives a check from the plan, made payable to the ASRS, for an amount that does not exceed the amount specified on the SP Invoice.

J. G . If the payment from the eligible plan exceeds the amount specified on the SP Invoice, the ASRS shall return the entire payment to the Eligible Member.

History

• New Section made by final rulemaking at 11 A.A.R. 2640, effective June 30, 2005 (Supp. 05-2). Amended by final rulemaking at 12 A.A.R. 4667, effective December 5, 2006 (Supp. 06-4). Amended by final rulemaking at 25 A.A.R. 303, effective 3/18/2019.

Ariz. Admin. Code § R2-8-515 [Repealed]

History

• New Section made by final rulemaking at 11 A.A.R. 2640, effective June 30, 2005 (Supp. 05-2). Amended by final rulemaking at 12 A.A.R. 4667, effective December 5, 2006 (Supp. 06-4). Repealed by final rulemaking at 25 A.A.R. 303, effective 3/18/2019.

Ariz. Admin. Code § R2-8-516 Expired

History

• New Section made by final rulemaking at 11 A.A.R. 2640, effective June 30, 2005 (Supp. 05-2). Amended by final rulemaking at 12 A.A.R. 4667, effective December 5, 2006 (Supp. 06-4). New Section made by final rulemaking at 11 A.A.R. 2640, effective June 30, 2005 (Supp. 05-2). Amended by final rulemaking at 12 A.A.R. 4667, effective December 5, 2006 (Supp. 06-4). Section expired under A.R.S. § 41-1056(J) at 22 A.A.R. 3195, effective October 11, 2016 (Supp. 16-3).

Ariz. Admin. Code § R2-8-517 Expired

History

• New Section made by final rulemaking at 11 A.A.R. 2640, effective June 30, 2005 (Supp. 05-2). Amended by final rulemaking at 12 A.A.R. 4667, effective December 5, 2006 (Supp. 06-4). New Section made by final rulemaking at 11 A.A.R. 2640, effective June 30, 2005 (Supp. 05-2). Amended by final rulemaking at 12 A.A.R. 4667, effective December 5, 2006 (Supp. 06-4). Section expired under A.R.S. § 41- 1056(J) at 22 A.A.R. 3195, effective October 11, 2016 (Supp. 16-3).

Ariz. Admin. Code § R2-8-518 Repealed

History

• New Section made by final rulemaking at 11 A.A.R. 2640, effective June 30, 2005 (Supp. 05-2). Amended by final rulemaking at 12 A.A.R. 4667, effective December 5, 2006 (Supp. 06-4). Repealed by final rulemaking at 18 A.A.R. 3130, effective January 6, 2013 (Supp. 12-4).

Ariz. Admin. Code § R2-8-519 Purchasing Service Credit by Termination Pay

A. To purchase Service Credit using Termination Pay, an Eligible Member shall elect to use Termination Pay by the date payment election is due.

B. Upon receipt of the documentation required by this Article from the eligible member and if the eligible member's request to purchase service credit meets the requirements of this Article, the ASRS shall provide a:

1. SP invoice stating the cost to purchase the requested amount of service credit and the date the payment is due, and

2. Service Purchase Payment Request form as described in R2-8-502(D)(2) .

B. An Eligible Member who elects to use Termination Pay pursuant to this section, shall provide the ASRS with the Eligible Member's anticipated termination date which cannot be more than six months from the date the ASRS issues the SP Invoice and must be at least Three Full Calendar Months after the date the Eligible Member elects and submits Termination Pay as a method of payment.

C. By the due date specified on the SP invoice, the member shall ensure that the ASRS receives the completed Service Purchase Payment Request form.

D. C. An Eligible Member who elects to use Termination Pay pursuant to this section, shall provide the ASRS with a Termination Pay Authorization for the Purchase of Service Credit form with the following information:

1. Member's full name,

2. Member's Social Security number,

3. Member's daytime telephone number,

4. The Request ID number listed on the SP invoice,

5. 1. The name of the Employer that will be submitting the Termination Pay to the ASRS;

6. 2. Whether the Eligible Member elects to use all Termination Pay or a specific amount of Termination Pay;

7. 3. Signature of the Eligible Member, certifying that the Eligible Member understands that:

a. The Eligible Member is required to continue working at least Three Full Calendar Months after the date the Eligible Member submits the Termination Pay Authorization for the Purchase of Service Credit form before Termination Pay may be used on a pre-tax basis;

b. If the Eligible Member terminates employment more than six months after the date on the SP Invoice, the Eligible Member may purchase the Service Credit at a newly calculated rate and possibly at a higher cost;

c. The terms elected in the Termination Pay Authorization for the Purchase of Service Credit form are binding and irrevocable;

d. The Eligible Member's Employer is required to make payment directly to the ASRS after mandatory deductions are made, and the Eligible Member does not have the option of receiving the funds directly from the Employer;

e. The Eligible Member's Termination Pay must be received and processed before the ASRS will accept any other form of payment;

f. If the member elects to purchase with termination pay only a portion of the service credit that the member is entitled to purchase, the member may be eligible to use other forms of payment to purchase additional service credit. However, using other forms of payment to purchase additional service credit does not alter, amend, or revoke the terms of the Termination Pay Authorization for the Purchase of Service Credit form;

g. f. It is the Eligible Member's responsibility to ensure that the Eligible Member's Employer properly deducts Termination Pay, as provided in the Termination Pay Authorization for the Purchase of Service Credit form; and

h. g. The amount of Termination Pay the Eligible Member elects is irrevocable pursuant to § 414(h)(2) of the IRC;

h. If the Termination Pay exceeds the balance due on the SP Invoice, the ASRS will return the difference to the Eligible Member's Employer to be distributed to the Eligible Member;

i. If the Eligible Member terminates employment and immediately retires, the Eligible Member's retirement processing may be delayed; and

j. The ASRS will send a notification to the Eligible Member's Employer two weeks prior to the Eligible Member's termination date, as indicated on the Termination Pay Authorization form, to notify the Employer that the Eligible Member's Termination Pay must be sent directly to the ASRS.

E. In addition to the other time limitations in this Section, to apply termination pay to a service purchase the eligible member shall complete and sign the Termination Pay Authorization for the Purchase of Service Credit form, and the member shall ensure that the ASRS receives the Termination Pay Authorization for the Purchase of Service Credit form at least three full calendar months before the member retires or terminates employment.

F. D. The ASRS shall not apply Termination Pay to an SP Invoice covered by an Irrevocable PDA in effect at the time of termination, unless the Eligible Member elected the Termination Pay pursuant to R2-8-513(D) at the time the member authorized the Irrevocable PDA.

G. E. If an Eligible Member elects to use Termination Pay to purchase Service Credit, the ASRS shall not apply any other form of payment to the Service Credit purchase until the ASRS receives the Termination Pay.

F. Notwithstanding any other section, if an Eligible Member dies prior to terminating employment, the ASRS shall not accept Termination Pay.

G. If an Eligible Member Transfers Employment, the ASRS shall not accept Termination Pay from the Eligible Member's previous Employer.

History

• New Section made by final rulemaking at 11 A.A.R. 2640, effective June 30, 2005 (Supp. 05-2). Amended by final rulemaking at 12 A.A.R. 4667, effective December 5, 2006 (Supp. 06-4). Amended by final rulemaking at 25 A.A.R. 303, effective 3/18/2019.

Ariz. Admin. Code § R2-8-520 Termination of Employment and Request Return of Retirement Contributions or Death of Member While Purchasing Service Credit by an Irrevocable PDA

A. If an Eligible Member terminates employment without transferring employment as specified in R2-8-513.01 while purchasing Service Credit by an Irrevocable PDA and requests return of retirement contributions pursuant to A.R.S. § 38-740, the ASRS shall return any principal payments made for the purchase of Service Credit including interest earned on those principal payments at the interest rate used to determine return of contributions upon termination of membership by separation from service by other than retirement or death as specified in R2-8-118(A).

B. If an Eligible Member dies while purchasing Service Credit, the ASRS shall credit the Eligible Member's account with:

1. The Service Credit for which the ASRS received payment pursuant to a PDA before the Eligible Member's death;

2. The principal payments made by the Eligible Member; and

2. 3. Interest earned on payment through the date of distribution at the Assumed Actuarial Investment Earnings Rate specified in R2-8-118(A) .

3. All service purchase payments.

C. If an Eligible Member dies while purchasing Service Credit, the ASRS shall not permit the survivor or an estate to purchase the remaining balance.

D. The ASRS shall not transfer, disburse, or refund the administrative interest the ASRS charged as part of an Irrevocable PDA as specified in R2-8-513.

E. The ASRS shall not credit a member's account with the administrative interest the ASRS charged as part of an Irrevocable PDA as specified in R2-8-513.

History

• New Section made by final rulemaking at 11 A.A.R. 2640, effective June 30, 2005 (Supp. 05-2). Amended by final rulemaking at 12 A.A.R. 4667, effective December 5, 2006 (Supp. 06-4). Amended by final rulemaking at 25 A.A.R. 303, effective 3/18/2019.

Ariz. Admin. Code § R2-8-521 Adjustment of Errors

A. If the ASRS determines an error has been made in the information provided by the member or in the calculations made by the ASRS, the ASRS shall make an adjustment to the member's account and return ineligible payments, if any.

B. If the ASRS determines that a member is receiving or is eligible to receive retirement benefits from another public employee retirement system that makes the member ineligible to purchase service credit for the same period, the ASRS shall revoke that purchase of service credit, and return any payments made, less any interest payments made, if applicable.

C. B. The ASRS shall notify the member in writing of any adjustments.

History

• New Section made by final rulemaking at 11 A.A.R. 2640, effective June 30, 2005 (Supp. 05-2). Amended by final rulemaking at 25 A.A.R. 303, effective 3/18/2019.

Article 6 PUBLIC PARTICIPATION IN RULEMAKING

Ariz. Admin. Code § R2-8-601 Definitions

The following definitions apply to this Article unless otherwise specified:

1. "ASRS" has the same meaning as in A.R.S. § 38-711 .

2. "Day" means a calendar day, and excludes the:

a. Day of the act or event from which a designated period of time begins to run; and

b. Last day of the period if a Saturday, Sunday, or official state holiday.

3. 1. "Rulemaking record" means a file the ASRS maintains as specified in A.R.S. § 41-1029.

4. 2. "Oral proceeding" means a public gathering the ASRS holds for the purpose of receiving comment and answering questions about a proposed rule as specified in A.R.S. § 41-1023.

5. 3. "Presiding officer" means an individual selected by the ASRS Director to oversee oral proceedings.

6. 4. "Substantive policy statement" has means the same meaning as in A.R.S. § 41-1001 41-1001(22).

History

• New Section made by final rulemaking at 12 A.A.R. 964, effective March 7, 2006 (Supp. 06-1). Amended by final rulemaking at 21 A.A.R. 2515, effective 12/5/2015.

Ariz. Admin. Code § R2-8-602 Reviewing Agency Rulemaking Record and Directory of Substantive Policy Statements

Except on a state holiday, a person may review a rulemaking record or the directory of substantive policy statements at the Phoenix office of the ASRS, Monday through Friday, from 8:00 a.m. until 5:00 p.m.

History

• New Section made by final rulemaking at 12 A.A.R. 964, effective March 7, 2006 (Supp. 06-1). Amended by final rulemaking at 22 A.A.R. 3323, effective 1/1/2017.

Ariz. Admin. Code § R2-8-603 Petition for Rulemaking

A. A person submitting a petition to the ASRS to make or amend a rule under A.R.S. § 41-1033 shall include the following in the petition:

1. The name and current address of the person submitting the petition;

2. An identification of the rule to be made or amended;

3. The suggested language of the rule;

4. The reason why a new rule should be made or a current rule should be amended with supporting information, including:

a. An identification of the persons who would be affected by the rule and how the persons would be affected; and

b. If applicable, statistical data with references to attached exhibits;

5. The signature of the person submitting the petition; and

6. The date the person signs the petition.

B. The ASRS shall send a written notice of the ASRS's decision regarding the Petition for Rulemaking to the person within 60 days of receipt of the petition.

History

• New Section made by final rulemaking at 12 A.A.R. 964, effective March 7, 2006 (Supp. 06-1). Amended by final rulemaking at 22 A.A.R. 3323, effective 1/1/2017.

Ariz. Admin. Code § R2-8-604 Review of a Rule, Agency Practice, or Substantive Policy Statement

A. A person submitting a petition to the ASRS under A.R.S. § 41-1033 requesting that the ASRS review an agency practice or substantive policy statement that the person alleges constitutes a rule shall include the following in the petition:

1. The name and current address of the person submitting the petition,

2. The reason the person alleges that the agency practice or substantive policy statement constitutes a rule,

3. The signature of the person submitting the petition, and

4. The date the person signs the petition.

B. The person who submits a petition under subsection (A) shall attach a copy of the substantive policy statement or a description of the agency practice to the petition.

C. The ASRS shall send a written notice of the ASRS's decision regarding the petition to the person within 60 days of receipt of the petition.

History

• New Section made by final rulemaking at 12 A.A.R. 964, effective March 7, 2006 (Supp. 06-1). Amended by final rulemaking at 22 A.A.R. 3323, effective 1/1/2017.

Ariz. Admin. Code § R2-8-605 Objection to Rule Based Upon Economic, Small Business and Consumer Impact

A. A person submitting an objection to a rule based upon the economic, small business and consumer impact under A.R.S. § 41-1056.01 shall include the following in the objection:

1. The name and current address of the person submitting the objection;

Identification of the rule;

Either evidence that the actual economic, small business and consumer impact:

a. Significantly exceeded the impact estimated in the economic, small business and consumer impact statement submitted during the making of the rule with supporting information attached as exhibits; or

b. Was not estimated in the economic, small business and consumer impact statement submitted during the making of the rule and that actual impact imposes a significant burden on persons subject to the rule with supporting information attached as exhibits; or

c. Reflects that the ASRS did not select the alternative that imposes the least burden and costs to persons regulated by the rule, including paperwork and other compliance costs, necessary to achieve the underlying regulatory objective.

4. The signature of the person submitting the objection; and

5. The date the person signs the objection.

B. The ASRS shall respond to the objection as specified in A.R.S. § 41-1056.01(C).

History

• New Section made by final rulemaking at 12 A.A.R. 964, effective March 7, 2006 (Supp. 06-1). Amended by final rulemaking at 22 A.A.R. 3323, effective 1/1/2017.

Ariz. Admin. Code § R2-8-606 Oral Proceedings

A. A person requesting an oral proceeding under A.R.S. § 41-1023(C) shall submit a written request to the ASRS that includes:

1. The name and current address of the person making the request;

2. If applicable, the name of the public or private organization, partnership, corporation or association, or the name of the governmental entity the person represents; and

3. Reference to the proposed rule including, if known, the date and issue of the Arizona Administrative Register in which the Notice of Proposed Rulemaking was published.

B. The ASRS shall record an oral proceeding by either electronic or stenographic means and any CDs, cassette tapes, transcripts, lists, speaker slips, and written comments received shall become part of the official record.

C. A presiding officer shall perform the following acts on behalf of the ASRS when conducting an oral proceeding as prescribed under A.R.S. § 41-1023:

1. Provide a method for a person who attends the oral proceeding to voluntarily note the person's attendance;

2. Provide a Request to Present Oral Comment form that includes space for:

a. The name of the person submitting the Request to Present Oral Comment form,

b. The entity the person represents, if applicable, and

c. The rule on which the person wishes to comment or about which the person has a question;

d. The approximate length of time the individual wishes to speak;

3. Open the proceeding by identifying the rules to be considered, the location, date, time, purpose of the proceeding, and the agenda;

4. Explain the background and general content of the proposed rulemaking;

5. Provide for public comment as specified in A.R.S. § 41-1023(D); and

6. Close the oral proceeding by announcing the location where written public comments are to be sent and specifying the close of record date and time.

D. A presiding officer may limit comments to a reasonable time period, as determined by the presiding officer. Oral comments may be limited to prevent undue repetition.

History

• New Section made by final rulemaking at 12 A.A.R. 964, effective March 7, 2006 (Supp. 06-1). Amended by final rulemaking at 22 A.A.R. 3323, effective 1/1/2017.

Ariz. Admin. Code § R2-8-607 Petition for Delayed Effective Date

A. A person who wishes to delay the effective date of a rule under A.R.S. § 41-1032 shall file a petition with the ASRS prior to the proposed rule's close of record date. The petition shall contain the:

1. Name and current address of the person submitting the petition;

Identification of the proposed rule;

3. Need for the delay, specifying the undue hardship or other adverse impact that may result if the request for a delayed effective date is not granted;

Reason why the public interest will not be harmed by the delayed effective date;

5. Signature of the person submitting the petition; and

Date the person signs the petition.

B. The ASRS shall send a written notice of the ASRS's decision to the person within 30 days of receipt of the Petition for b Delayed Effective Date.

History

• New Section made by final rulemaking at 12 A.A.R. 964, effective March 7, 2006 (Supp. 06-1). Amended by final rulemaking at 22 A.A.R. 3323, effective 1/1/2017.

Article 7 CONTRIBUTIONS NOT WITHHELD

Ariz. Admin. Code § R2-8-701 Definitions

The following definitions apply to this Article unless otherwise specified:

1. "218 agreement" means a written agreement between the state, political subdivision, or political subdivision entity and the Social Security Administration, under the provisions of § 218 of the Social Security Act, to provide Social Security and Medicare or Medicare-only coverage to employees of the state, political subdivision, or political subdivision entity.

2. "Documentation" means a pay stub, completed W-2 form, completed Verification of Contributions Not Withheld form, Employer letter or spreadsheet, completed State Personnel Action Request Form, Social Security Earnings Report, employment contract, payroll record, timesheet, or other Employer-provided form that includes:

a. Whether the employee was covered under the Employer's 218 Agreement prior to July 24, 2014,

b. The number of hours the member worked or was Engaged to Work for the Employer per pay period, and

c. The amount and type of compensation earned by the member within each pay period.

3. "Eligible service" means employment with an Employer:

a. That is no more than 15 years before the date the ASRS receives written credible evidence that less than the correct amount of contributions were paid into the ASRS or the ASRS otherwise determines that less than the correct amount of contributions were made as specified in A.R.S. § 38-738(C); and

b. In which the member was Engaged to Work for an Employer.

4. "Engaged to Work" means the same as in R2-8-1001.

History

• New Section made by final rulemaking at 12 A.A.R. 4793, effective December 5, 2006 (Supp. 06-4). Amended by final rulemaking at 21 A.A.R. 2515, effective 12/5/2015. Amended by final rulemaking at 25 A.A.R. 303, effective 3/18/2019. Amended by final expedited rulemaking at 28 A.A.R. 1367, effective 5/18/2022.

Ariz. Admin. Code § R2-8-702 General Information

A. Verified eligible service that occurred more than 15 years before the date ASRS receives the information identified in R2-8-704(A)(1)

B. A. The Employer shall pay the Employer's portion of the contributions the ASRS determines is owed under R2-8-706 whether or not the member pays the member's portion of the contributions.

1. The member has withdrawn contributions as specified in R2-8-115 ; or

2. The member pays the member's portion of the contributions.

C. B. The person who initiates the claim that contributions were not withheld for Eligible Service has the burden to prove a contribution error was made.

D. C. The ASRS shall not waive payment of contributions or interest owed under this Article.

E. D. If a member is not able to establish eligibility for purchasing service credit pursuant to this Article, the member may be eligible to purchase service pursuant to A.R.S. § 38-743 and Article 5 of this Chapter.

History

• New Section made by final rulemaking at 12 A.A.R. 4793, effective December 5, 2006 (Supp. 06-4). Amended by final rulemaking at 25 A.A.R. 303, effective 3/18/2019.

Ariz. Admin. Code § R2-8-703 Employer's Discovery of Error

If an Employer determines that any amount of contributions have not been withheld for a member for a period of Eligible Service, the Employer shall notify the ASRS by submitting through the Employer's secure ASRS account a Verification of Contributions Not Withheld form with the following information:

1. The member's full name;

2. The member's Social Security number;

3. The range of dates that any contribution was not withheld;

4. The member's position title during the date range listed in subsection (3);

5. The amount and type of compensation the member was entitled to receive, and the number of hours the member worked for the Employer per pay period for each fiscal year;

6. The member's hire date;

7. Whether the member was Engaged to Work for the Employer;

8. Whether the position was covered under the Employer's 218 Agreement for periods prior to July 24, 2014; and

9. The dated signature of the Employer's authorized agent certifying:

a. All the dates and salary information is correct;

b. The person submitting this form has the legal power to enter into binding transactions with the ASRS;

c. Acknowledgement the Employer will receive an invoice for the contributions owed for Eligible Service only, as well as the accumulated interest on the contributions that were not withheld for both the member and Employer contributions; and

d. Acknowledgement the member will receive an invoice for their contributions owed.

History

• New Section made by final rulemaking at 12 A.A.R. 4793, effective December 5, 2006 (Supp. 06-4). Amended by final rulemaking at 25 A.A.R. 303, effective 3/18/2019.

Ariz. Admin. Code § R2-8-704 Member's Discovery of Error

A. If a member believes that an Employer has not withheld contributions for the member for a period of Eligible Service, the member shall:

1. Notify the member's Employer that the Employer has not withheld contributions correctly by contacting the Employer directly; or

2. Submit to the ASRS a Contributions Not Withheld Request form through the member's secure ASRS account with the following:

a. The name of the Employer that should have remitted contributions;

b. The range of dates that any contribution was not withheld;

c. The member's position title during the date range listed in subsection (b);

d. Whether the member was Engaged to Work for the Employer; and

e. Dated signature of the member certifying the member understands:

i. The ASRS will be providing the member's Social Security number to the Employer for verification; and

ii. If the member's Employer cannot verify this request, it is the member's responsibility to provide Documentation of Eligible Service.

B. If the information provided by the eligible member pursuant to subsection (A) is correct, the Employer shall validate the information and submit the information to the ASRS through the Employer's secure ASRS account. If the information provided by the eligible member pursuant to subsection (A) is incorrect, the Employer shall either correct the information and submit the corrected information to the ASRS through the Employer's secure ASRS account, along with the information identified in R2-8-703 or cancel the request by notifying the member through ASRS secure messaging the reason the request was canceled.

C. If the Employer refuses to fill out the Verification of Contributions Not Withheld form, or if the member disputes the information the Employer completes on the form, the member shall provide the ASRS with the Documentation the member believes supports the allegation that contributions should have been withheld.

History

• New Section made by final rulemaking at 12 A.A.R. 4793, effective December 5, 2006 (Supp. 06-4). Amended by final rulemaking at 22 A.A.R. 3326, effective 1/1/2017. Amended by final rulemaking at 25 A.A.R. 303, effective 3/18/2019. Amended by final expedited rulemaking at 28 A.A.R. 1367, effective 5/18/2022.

Ariz. Admin. Code § R2-8-705 ASRS' Discovery of Error

If the ASRS determines, as specified in A.R.S. § 38-738(B)(7), that all contributions have not been withheld for a member for a period of Eligible Service, the ASRS shall notify the Employer in writing and shall request the Employer submit through the Employer's secure ASRS account a Verification of Contributions Not Withheld form pursuant to R2-8-703.

1. The months, years and hours per week worked;

2. The compensation earned by the member each fiscal year for the time periods worked; and

3. The member's position title at the time contributions should have been withheld.

History

• New Section made by final rulemaking at 12 A.A.R. 4793, effective December 5, 2006 (Supp. 06-4). Amended by final rulemaking at 25 A.A.R. 303, effective 3/18/2019.

Ariz. Admin. Code § R2-8-706 Determination of Contributions Not Withheld

A. Upon receipt of the information listed in R2-8-703, R2-8-704, or R2-8-705, the ASRS shall review the information to determine whether or not member contributions should have been withheld by the Employer, the length of time those contributions should have been withheld, and the amount of contributions that should have been withheld.

B. Except for a member who met the requirements to be an active member while simultaneously contributing to another retirement plan listed in subsection (B)(2), for purposes of this Article, the ASRS shall determine that contributions should not have been withheld for the period of service in question if:

1. An Employer remits an accurate ACR amount pursuant to R2-8-116; or

2. The employee participates in:

a. Another Arizona retirement plan listed in A.R.S. Title 38, Chapter 5, Articles 3, 4, or 6; or

b. In an optional retirement plan listed in A.R.S. Title 15, Chapter 12, Article 3 or A.R.S. Title 15, Chapter 13, Article 2.

C. Except for returning to work under A.R.S. § 38-766.01, the presence of a contract between a member and the Employer does not alter the contribution requirements of A.R.S. §§ 38-736 and 38-737.

D. If there is any discrepancy between the Documentation provided by the Employer and the Documentation provided by the member, a document used in the usual course of business prepared at the time in question is controlling.

E. The ASRS shall provide to each, Employer and the member, an invoice with the following:

1. The amount of Eligible Service for which contributions were not withheld,

2. The dollar amount of the contributions to be paid to the ASRS by the Employer,

3. The interest on the Employer contributions and member contributions to be paid to the ASRS by the Employer pursuant to A.R.S. § 38-738,

4. The amount of the delinquent interest late charge to be paid to the ASRS by the Employer pursuant to A.R.S. § 38-735, and

5. The dollar amount of contributions to be paid to the ASRS by the member.

F. The ASRS shall send the member an invoice according to subsection (E) after the Employer has remitted the full amount due to be paid by the Employer.

History

• New Section made by final rulemaking at 12 A.A.R. 4793, effective December 5, 2006 (Supp. 06-4). Amended by final rulemaking at 22 A.A.R. 3326, effective 1/1/2017. Amended by final rulemaking at 25 A.A.R. 303, effective 3/18/2019. Amended by final expedited rulemaking at 28 A.A.R. 1367, effective 5/18/2022.

Ariz. Admin. Code § R2-8-707 Submission of Payment

A. Within 90 days from the date on the statement invoice identified in R2-8-706(E), the Employer shall pay to the ASRS the amount due to be paid by the Employer. An Employer who makes payment under A.R.S. § 38-738(B)(3) is not liable for additional interest that may accrue as a result of a member's failure to remit payment required by A.R.S. § 38-738(B)(1). If the ASRS does not receive full payment of the Employer's amount due within 90 days after the ASRS notifies the Employer of the amount due, the full amount due will accrue interest as provided in A.R.S. § 38-738. The ASRS may collect the unpaid balance plus interest pursuant to A.R.S. § 38-735(C).

B. The member shall make payment to the ASRS pursuant to A.R.S. § 38-738 by the due date specified on the member's invoice identified in R2-8-706(E).

C. If the ASRS does not receive full payment of the member's amount due by the due date specified on the member's invoice identified in R2-8-706(E), the full amount due will accrue interest, as provided in A.R.S. § 38-738.

D. A member does not receive service credit or credit for salary until both the Employer and member portions of the contributions and all interest has been paid pursuant to A.R.S. § 38-738.

History

• New Section made by final rulemaking at 12 A.A.R. 4793, effective December 5, 2006 (Supp. 06-4). Amended by final rulemaking at 25 A.A.R. 303, effective 3/18/2019. Amended by final expedited rulemaking at 28 A.A.R. 1367, effective 5/18/2022.

Ariz. Admin. Code § R2-8-708 Expired

History

• New Section made by final rulemaking at 12 A.A.R. 4793, effective December 5, 2006 (Supp. 06-4). Section expired under A.R.S. § 41-105 6(J) at 22 A.A.R. 2982, effective September 15, 2016 (Supp. 16-3).

Ariz. Admin. Code § R2-8-709 [Repealed]

History

• New Section made by final rulemaking at 12 A.A.R. 4793, effective December 5, 2006 (Supp. 06-4). Repealed by final rulemaking at 25 A.A.R. 303, effective 3/18/2019.

Article 8 RECOVERY OF OVERPAYMENTS

Ariz. Admin. Code § R2-8-801 Definitions

For purposes of this article, the following definitions apply, unless specified otherwise:

1. "DRO" means the same as in R2-8-120 .

2.

1. "Estimated Social Security disability income amount" and "Revised Social Security disability income amount" mean the amount of funds the ASRS is entitled to collect pursuant to R2-8-802.

3. 2. "LTD" means long-term disability program as described in A.R.S. § 38-797 et seq.

4. 3. "LTD benefit" means the same as in R2-8-301.

5. 4. "Overpayment" means:

a. Any funds the ASRS distributes in excess of the amount to which the recipient is legally entitled; and

b. Any estimated social security disability income amount or revised social security disability income amount the ASRS is entitled to collect pursuant to A.R.S. § 38-765.

History

• New Section made by final rulemaking at 23 A.A.R. 2750, effective 11/13/2017. Amended by final rulemaking at 28 A.A.R. 1746, effective 9/4/2022.

Ariz. Admin. Code § R2-8-802 Estimated Social Security Disability Income Amount and Revised Social Security Disability Income Amount

A. The ASRS contracted LTD claims administrator shall determine a member's estimated Social Security disability income amount as follows:

1. Prior to the death, retirement, or forfeiture of a member, the estimated Social Security disability income amount shall be equal to the member's full monthly LTD benefit reduced by $50 per month pursuant to A.R.S. § 38-797.07(A)(9); and

2. Upon the member's death, retirement, or forfeiture, the estimated Social Security disability income amount shall be equal to the total amount of the member's LTD benefit, reduced by $50 per month pursuant to A.R.S. § 38-797.07(A)(9).

B. A member or survivor who disputes the estimated Social Security disability income amount based on the conclusions of a legal proceeding may request a revised Social Security disability income amount by submitting supporting documentation from the legal proceeding to the ASRS contracted LTD claims administrator within 30 days of the date of conclusion of the legal proceeding.

C. Pursuant to subsection (B), the ASRS or the ASRS contracted LTD claims administrator shall determine whether the estimated Social Security disability income amount needs to be revised based on the conclusions of the legal proceeding.

D. If the ASRS or the ASRS contracted LTD claims administrator determines the estimated Social Security disability income amount was inaccurate, the ASRS or the ASRS contracted LTD claims administrator shall calculate a revised Social Security disability income amount based on the supporting documentation provided by the member or survivor pursuant to subsection (B).

E. Pursuant to subsection (B), if the revised Social Security disability amount is less than the amount of the estimated Social Security disability benefit, the ASRS or the ASRS contracted LTD claims administrator shall:

1. Refund a portion of the amount of the estimated Social Security disability benefit that the ASRS retained upon forfeiture of the member in order to offset the difference between the estimated Social Security disability income amount and the revised Social Security disability income amount, or

2. Adjust the member's retirement benefits or the survivor's benefits to offset the difference between the estimated Social Security disability income amount and the revised Social Security disability income amount.

F. If a member or survivor is not satisfied with the determination on the request for a revised Social Security disability income amount, the member or survivor may appeal the determination pursuant to 2 A.A.C. 8, Article 4.

History

• New Section made by final rulemaking at 23 A.A.R. 2750, effective 11/13/2017.

Ariz. Admin. Code § R2-8-803 Reimbursement of Overpayments

A. Upon the ASRS discovering that it has made an overpayment to a an Employer, member, survivor, or alternate payee, the ASRS shall send a letter to notify the necessary person that an overpayment was provided and the person shall reimburse the ASRS in the amount of the overpayment.

B. A person, other than Employer, who reimburses the ASRS for an overpayment shall do so by remitting a check or money order, made payable to the ASRS, by the due date specified in the letter providing notice of the overpayment.

C. An Employer that reimburses the ASRS for an overpayment shall do so by remitting payment through the Employer's secure ASRS account, or by check or money order made payable to the ASRS, by the due date specified in the letter providing notice of the overpayment.

C. D. If the ASRS is unable to collect the amount of an overpayment by reducing future payments to Employers, members, survivors, or alternate payees as provided in this Article, the ASRS shall allow the appropriate person to reimburse the ASRS for the amount of the overpayment by making payments over the course of as many months as the number of months in which an overpayment was made by the ASRS, not to exceed 36 months.

D. E. A person may request to reimburse the amount of the overpayment to the ASRS sooner than provided in this Article.

F. If an Employer, member, survivor, or alternate payee does not repay the amount of an overpayment pursuant to this Article, the ASRS may reduce a Health Insurance Premium Benefit that is paid pursuant to Article 2.

History

• New Section made by final rulemaking at 23 A.A.R. 2750, effective 11/13/2017. Amended by final rulemaking at 28 A.A.R. 1261, effective 7/17/2022.

Ariz. Admin. Code § R2-8-804 Collection of Overpayments from Forfeiture

A. Unless a member cancels a forfeiture request by submitting written notice to the ASRS within 30 days of the request to forfeit, the ASRS shall reduce a member's refund amount in order to offset the member's overpayment amount pursuant to subsection (B).

B. The ASRS shall reduce the member's refund amount by the amount of any overpayment and the ASRS shall:

1. Pursue collection of any remaining overpayment amount pursuant to this Article; and

2. Distribute the remaining refund amount to the member pursuant to R2-8-115.

History

• New Section made by final rulemaking at 23 A.A.R. 2750, effective 11/13/2017.

Ariz. Admin. Code § R2-8-805 Collection of Overpayments from Retirement Benefit

A. Notwithstanding A.R.S. § 38-768, the ASRS may reduce a person's benefit pursuant to this section.

B. Upon retirement, the ASRS shall reduce the amount of a member's retirement benefit by the amount of any overpayments that have not been reimbursed to the ASRS, pursuant to R2-8-803 as follows:

1. If the member elects to receive a lump sum or partial lump sum benefit, the amount of the lump sum or partial lump sum shall be reduced by the amount of the overpayment to no less than $5.00 and the ASRS shall pursue overpayment collections for any remaining overpayment amount pursuant to this Article;

2. If the member elects to receive retirement benefits as a monthly annuity and the amount of the overpayment is equal to or less than the amount of the member's first annuity disbursement minus $5.00, the ASRS shall reduce the amount of the first annuity disbursement by the amount of any overpayment to no less than $5.00;

3. If the member elects to receive retirement benefits as a monthly annuity and the amount of the overpayment exceeds the amount of the member's first annuity disbursement plus $5.00, the ASRS shall reduce the amount of the first annuity disbursement by the amount of the overpayment to no less than $5.00 and pursue collection pursuant to subsection (B).

C. The ASRS shall reduce a member's or alternate payee's monthly annuity as follows in order to offset any overpayments which have not been reimbursed or collected pursuant to this Article:

1. The ASRS shall reduce the member's monthly annuity by up to 10% for 36 months, if the amount of the overpayment can be collected by the ASRS within that time.

2. If the amount of the overpayment cannot be collected pursuant to subsection (B)(1), the ASRS will notify the member that the member must make payment arrangements within 60 days of the date on the notice. If the member does not make payment arrangements within 60 days of the date on the notice, the ASRS shall actuarially reduce the amount of the member's monthly annuity.

D. Notwithstanding subsection (B), the ASRS shall not reduce a member's or alternate payee's monthly annuity by an estimated Social Security disability income amount while the member is pursuing a Social Security disability income determination pursuant to R2-8-305, if the member submits documentation to the ASRS every six months informing the ASRS of the status of the member's Social Security disability income request until a determination is made regarding the amount of Social Security disability income.

History

• New Section made by final rulemaking at 23 A.A.R. 2750, effective 11/13/2017.

Ariz. Admin. Code § R2-8-806 Collection of Overpayments from Survivor Benefit

A. Notwithstanding A.R.S. § 38-768, the ASRS may reduce a person's benefit pursuant to this section.

B. If a member, survivor, or alternate payee does not repay the amount of an overpayment pursuant to this Article, the ASRS shall reduce the necessary person's amount of benefits pursuant to subsection (C).

C. The ASRS shall collect the amount of any remaining overpayment by reducing the necessary person's monthly annuity over the same number of months in which the overpayment was made, up to 3 months for each month an overpayment was made by the ASRS.

D. If the ASRS is unable to collect the amount of any overpayment pursuant to subsection (C), the ASRS shall pursue collection of any remaining overpayment amount pursuant to this Article.

E. Notwithstanding subsection (C), the ASRS shall not reduce a survivor's monthly annuity by an estimated Social Security disability income amount while the survivor is pursuing a Social Security disability income determination on behalf of the member pursuant to R2-8-305, if the survivor submits documentation to the ASRS every six months informing the ASRS of the status of the member's Social Security disability income request until a determination is made regarding the amount of Social Security disability income to which the member was entitled.

History

• New Section made by final rulemaking at 23 A.A.R. 2750, effective 11/13/2017.

Ariz. Admin. Code § R2-8-807 Collection of Overpayments from LTD Benefit

Upon disability of the member, the ASRS shall reduce the amount of the disabled member's LTD benefit by the amount of any overpayment the member received from the ASRS and has not reimbursed pursuant to this section.

History

• New Section made by final rulemaking at 23 A.A.R. 2750, effective 11/13/2017. Amended by final rulemaking at 25 A.A.R. 2471, effective 11/3/2019.

Ariz. Admin. Code § R2-8-808 Collection of Overpayments by the Attorney General

If an Employer, member, survivor, or alternate payee does not reimburse the ASRS for an overpayment pursuant to R2-8-803, the ASRS may submit the overpayment amount for collection by the Arizona Attorney General's Office.

History

• New Section made by final rulemaking at 23 A.A.R. 2743, effective 11/13/2017. Amended by final rulemaking at 28 A.A.R. 1261, effective 7/17/2022.

Ariz. Admin. Code § R2-8-809 Collection of Overpayments by the Arizona Department of Revenue

If an Employer, member, survivor, or alternate payee does not reimburse the ASRS for an overpayment pursuant to R2-8-803, the ASRS may submit the overpayment amount for collection by the Arizona Department of Revenue.

History

• New Section made by final rulemaking at 23 A.A.R. 2750, effective 11/13/2017. Amended by final rulemaking at 28 A.A.R. 1261, effective 7/17/2022.

Ariz. Admin. Code § R2-8-810 Collection of Overpayments by Garnishment or Levy

Pursuant to A.R.S. § 38-723, the ASRS may collect the amount of any overpayment that has not been reimbursed or collected pursuant to this article by garnishing wages and/or placing a levy on the appropriate person's bank account.

History

• New Section made by final rulemaking at 23 A.A.R. 2750, effective 11/13/2017.

Article 9 COMPENSATION

Ariz. Admin. Code § R2-8-901 Definitions

"Services rendered" means the duties which a member performs for an Employer as required by the member's employment with the Employer.

History

• New Section made by final rulemaking at 23 A.A.R. 2750, effective 1/1/2018. Section expired under A.R.S. § 41-1056(J) at 24 A.A.R. 1872, effective June 12, 2018 (Supp. 18-2). Adopted by final rulemaking at 27 A.A.R. 91, effective 3/9/2021.

Ariz. Admin. Code § R2-8-902 Remitting Contributions

Pursuant to A.R.S. §§ 38-736, 38-737, and 38-797.05, an Employer shall remit contributions to the ASRS through the Employer's secure ASRS account for any payment the Employer provides to the member that is eligible to be included as compensation under this section.

History

• New Section made by final rulemaking at 23 A.A.R. 2746, effective 1/1/2018. Section expired under A.R.S. § 41-1056(J) at 24 A.A.R. 1872, effective June 12, 2018 (Supp. 18-2). Adopted by final rulemaking at 27 A.A.R. 91, effective 3/9/2021.

Ariz. Admin. Code § R2-8-903 Accrual of Credited Service

A. A member shall accrue service credits pursuant A.R.S. § 38-739 for each month in which the Employer's pay period ends and for which contributions have been remitted to the ASRS, except for pay the member receives from the Employer for services rendered in a prior pay period for which contributions were remitted pursuant to R2-8-902.

B. Regardless of whether the member meets membership requirements with more than one Employer, a member may not earn more than one month of service credit in a calendar month and not more than one year of service credit during a fiscal year.

History

• New Section made by final rulemaking at 23 A.A.R. 2750, effective 1/1/2018. Section expired under A.R.S. § 41-1056(J) at 24 A.A.R. 1872, effective June 12, 2018 (Supp. 18-2). Adopted by final rulemaking at 27 A.A.R. 91, effective 3/9/2021.

Ariz. Admin. Code § R2-8-904 Compensation from An Additional Employer

A. For purposes of remitting contributions pursuant to R2-8-902, compensation includes pay the member receives from an additional Employer if:

1. The member meets membership pursuant to A.R.S. § 38-711 with at least one Employer;

2. The member was employed with the additional Employer and did not meet membership with the additional Employer pursuant to A.R.S. § 38-711 between January 1, 2005 through December 31, 2009;

3. The member resumed or continued employment with the additional Employer and did not meet membership with the additional Employer prior to January 1, 2012; and

4. The member does not leave employment with an Employer or the additional Employer in an unpaid status for more than 30 consecutive days during the member's service year.

B. For purposes of calculating average monthly compensation according to A.R.S. § 38-711, compensation includes the pay identified in subsection (A).

C. Notwithstanding any other subsection, for a member whose membership began after December 31, 2009, compensation includes pay the member receives from an additional Employer if the member meets membership pursuant to A.R.S. § 38-711 with the additional Employer.

History

• New Section made by final rulemaking at 23 A.A.R. 2750, effective 1/1/2018. Section expired under A.R.S. § 41-1056(J) at 24 A.A.R. 1872, effective June 12, 2018 (Supp. 18-2). Adopted by final rulemaking at 27 A.A.R. 91, effective 3/9/2021.

Ariz. Admin. Code § R2-8-905 Expired

History

• New Section made by final rulemaking at 23 A.A.R. 2750, effective 1/1/2018. Section expired under A.R.S. § 41-105 6(J) at 24 A.A.R. 1872, effective June 12, 2018 (Supp. 18-2).

Article 10 MEMBERSHIP

Ariz. Admin. Code § R2-8-1001 Definitions

The following definitions apply to this Article unless otherwise specified:

1. "218 Agreement" means the same as in R2-8-701.

2. "218 Resolution" means written authorization for a potential Employer to provide Social Security and Medicare or Medicare-only coverage to employees under the provisions of § 218 of the Social Security Act.

"Acceptable Documentation" means the same as in R2-8-115.

4. "Designated Employer Administrator" means an individual designated by the Employer and who has authorized access to the Employer's secure ASRS account in order to fulfill the Employer's responsibilities.

5. "Engaged To Work" means the earlier of:

a. The date the employee begins rendering services for the Employer and the Employer intends the employee to work for at least 20 hours a week for at least 20 weeks in a fiscal year or;

b. The week an employee renders services to an Employer for at least 20 hours a week for at least 20 weeks in a fiscal year.

6. "Leasing An Employee From A Third Party" means the same as "Leased from a third party" in R2-8-116.

7. "State Social Security Administrator" means the Arizona Department of Administration staff designated to approve 218 Agreements and 218 Resolutions.

"Week" means 12:00 a.m. on Sunday through 11:59 p.m. on the following Saturday.

History

• Adopted by final rulemaking at 24 A.A.R. 3407, effective 2/4/2019. Amended by final rulemaking at 30 A.A.R. 742, effective 5/17/2024.

Ariz. Admin. Code § R2-8-1002 Employee Membership

A. For purposes of active member eligibility, an employee of an Employer becomes a member of the ASRS pursuant to A.R.S. § 38-711(23) when the employee is Engaged To Work for the Employer.

B. If the Employer does not provide an accurate date for which an employee was Engaged To Work pursuant to subsection (A), the ASRS shall determine that an employee's membership effective date will be the member's hire date, if provided by the Employer and within 30 days of the first pay period end date after the hire date, for which the Employer was required to submit contributions.

C. If the Employer does not provide a hire date pursuant to subsection (B), the effective date is the first pay period end date of contributions received for that member.

D. Unless a member terminates employment or retires from the ASRS, for purposes of determining active member eligibility, a member will continue to be an active member for the remainder of a fiscal year in which the employee met the requirements to be an active member in the ASRS with that Employer pursuant to A.R.S. § 38-711.

E. Within 30 days of employment, an employee who is eligible for ASRS membership pursuant to A.R.S. § 38-711(23) shall create a secure ASRS account and submit to the ASRS through the employee's secure ASRS account the following information:

1. The Employee's full name;

2. The Employee's Social Security number;

3. The Employee's date of birth;

4. The Employee's gender;

5. The Employee's marital status;

6. The Employee's primary phone number;

7. The Employee's personal email address;

8. The Employee's current mailing address; and

9. The Employee's designated beneficiary.

F. Within 30 days of a change in the member's name, the member shall submit to the ASRS through the member's secure ASRS account a Change of Name form that contains:

1. The member's full name that is on file with the ASRS;

2. The member's Social Security number;

3. The member's current mailing address;

4. The member's date of birth;

5. The member's personal email address;

6. The member's primary phone number;

7. The member's gender;

8. The member's marital status;

9. The member's retired, active, inactive, or LTD status with the ASRS;

10. The member's new full name;

11. The type of legal document establishing the member's new name;

12. A copy of the legal document establishing the member's new name; and

13. The member's dated signature.

G. Within 30 days of a change in the member's contact information, the member shall notify the ASRS of the change.

H. If an employee of an Employer meets the requirements of A.R.S. § 38-727(A)(8), the employee may elect to not participate in the ASRS.

I. Within 30 days after employment, an Employer whose employee is 65 years of age or older as of the date of employment and who has elected not to participate in the ASRS pursuant to subsection (H), shall submit to the ASRS through the Employer's secure ASRS account a 65+ Membership Waiver form that contains:

1. The employee's full name;

2. The employee's Social Security number;

3. The employee's current mailing address;

4. The employee's date of birth;

5. The employee's dated signature acknowledging the following statements:

a. The employee is electing to waive any rights to ASRS membership and the employee will not be eligible for any retirement, disability, or health insurance benefits offered by the ASRS;

b. The employee is not a member of the ASRS as of the date of employment; and

c. The employee understands that this election is irrevocable for the remainder of the employee's employment with that Employer and the time the employee works under this election is not eligible for purchase in the ASRS;

6. The Employer's name;

7. The date employee's employment began; and

8. The name and dated signature of the Employer's representative.

J. A corrected and completed 65+ Membership Waiver form must be resubmitted to the ASRS pursuant to subsection (I) within 14 days of the date the ASRS notifies the employee that the 65+ Membership Waiver form is incorrect or incomplete.

History

• Adopted by final rulemaking at 24 A.A.R. 3407, effective 2/4/2019.

Ariz. Admin. Code § R2-8-1003 Charter School Employer Membership

A. Pursuant to A.R.S. § 15-187(C), a charter school in Arizona is considered a political subdivision that is eligible to participate in the ASRS if the charter school is sponsored by:

1. A state university;

2. A community college district;

3. A group of community college districts;

4. The state board of education; or

5. The state board for charter schools.

B. In order to participate as an Employer in the ASRS, a charter school shall notify the ASRS in writing of the charter school's intent to join the ASRS and provide:

1. A copy of the current and active Charter Contract, including any amendments, which is approved by the entity sponsoring the charter school pursuant to subsection (A);

2. Documentation showing the name and location of all schools authorized by the Charter Contract identified in subsection (B)(1); and

Documentation showing the charter school board's approval to pursue ASRS membership and complete ASRS requirements for membership.

C. Upon receipt of the information contained in subsection (B), the ASRS shall determine if the charter school is eligible to participate in the ASRS. If the charter school is not eligible to participate in the ASRS, the ASRS shall send the charter school a notice of ineligibility. If the charter school is eligible to participate, the ASRS shall provide the charter school a Potential New Employer Letter.

D. In order to participate as an Employer in the ASRS, an eligible charter school shall submit to the ASRS by the due date listed on the Potential New Employer Letter:

1. The following original documents:

1.a. The current retirement plan or a statement signed by the designated authorized agent for the charter school acknowledging there is no current retirement plan.

2.b. Two ASRS Agreements showing:

a.i. The legal name and current mailing address of the charter school as sponsored pursuant to subsection (A);

b.ii. What amount of prior service the charter school shall purchase for employees pursuant to R2-8-1006;

c.iii. The approximate number of employees that will become members upon the effective date of the ASRS Agreement;

d.iv. The name, title, email address, and telephone number of the designated authorized agent for the charter school;

e.v. The designated authorized agent is authorized and directed to conduct all negotiations, conclude all arrangements, and sign all documents necessary to administer the supplemental ASRS retirement plan pursuant to A.R.S. Title 38, Chapter 5, Articles 2 and 2.1; and

f.vi. The ASRS Agreement is binding and irrevocable;

g.vii. The effective date of the ASRS Agreement;

h.viii. The charter school agrees to be bound by the provisions of A.R.S. Title 38, Chapter 5, Article 2 and Article 2.1 unless otherwise indicated by law; and

i.ix. The dated signature of the designated authorized agent for the charter school.

3.c. Two ASRS Resolutions showing:

a.i. The legal name of the charter school as sponsored pursuant to subsection (A);

b.ii. The charter school is adopting a supplemental ASRS retirement plan pursuant to A.R.S. § 38-729;

c.iii. The charter school agrees to be bound by the provisions of A.R.S. Title 38, Chapter 5, Article 2 and Article 2.1 unless otherwise indicated by law;

d.iv. The designated authorized agent for the charter school;

e.v. The designated authorized agent is authorized and directed to conduct all negotiations, conclude all arrangements, and sign all documents necessary to administer the supplemental ASRS retirement plan pursuant to A.R.S. Title 38, Chapter 5, Articles 2 and 2.1; and

f.vi. The dated and notarized signature of the designated authorized agent.

2. The following copies if the eligible charter school has elected coverage pursuant to a 218 Agreement:

4.a. A 218 Agreement. If the charter school is electing coverage pursuant to a 218 Agreement, the 218 Agreement must be completed and approved by the Social Security Administration prior to joining the ASRS.

5.b. A 218 Resolution. The 218 Resolutions must be completed and approved by the Social Security Administration prior to joining the ASRS.

E. Upon receipt of Acceptable Documentation identified in subsection (D), the ASRS may approve the charter school's request for membership pursuant to A.R.S. § 38-729. If the request to join the ASRS is approved, the ASRS Director shall sign the ASRS Agreements before the ASRS shall send one of each of the original documents identified in subsection (D) to the charter school.

F. Any charter school that is established under the charter contract of a participating charter school shall participate in the ASRS.

G. Upon joining the ASRS, a charter school has a one-time opportunity to identify and exclude current employees from ASRS membership based on a classification of those employees that is established by the charter school consistent with federal law and that is not designed to, and does not result in, the cost of providing the benefits to the charter school's employees being greater than the cost of providing benefits to the employees of Employers as determined by the ASRS.

H. A charter school that elects to identify and exclude a classification of employees according to subsection (G) shall provide the ASRS with all information the ASRS requests in order for the ASRS to determine the cost of providing the benefits to the charter school's employees is not greater than the cost of providing benefits to the employees of Employers as determined by the ASRS.

I. Notwithstanding subsection (G), all other current and future employees of the charter school who meet membership eligibility requirements are required to participate in the ASRS as of the effective date of the charter school joining the ASRS according to A.R.S. §§ 38-711 et seq.

History

• Adopted by final rulemaking at 24 A.A.R. 3407, effective 2/4/2019. Amended by final rulemaking at 30 A.A.R. 742, effective 5/17/2024.

Ariz. Admin. Code § R2-8-1004 Other Political Subdivision and Political Subdivision Entity Employer Membership

A. A political subdivision or political subdivision entity, other than a charter school, may be eligible to participate in the ASRS pursuant to A.R.S. §§ 38-711 and 38-729 if it notifies the ASRS in writing of the political subdivision's or political subdivision entity's intent to join the ASRS and provides to the ASRS:

1. A copy of the current legal authority establishing the political subdivision or political subdivision entity;

2. Documentation showing the name and location of the political subdivision or political subdivision entity; and

3. Documentation showing the political subdivision or political subdivision entity has taken the necessary legal action to be eligible to participate pursuant to A.R.S. § 38-729.

B. Upon receipt of the information contained in subsection (C), the ASRS shall determine if the political subdivision or political subdivision entity is eligible to participate in the ASRS. If the political subdivision or political subdivision entity is not eligible to participate in the ASRS, the ASRS shall send the political subdivision or political subdivision entity a notice of ineligibility. If the political subdivision or political subdivision entity is eligible to participate, the ASRS shall provide the political subdivision or political subdivision entity a Potential New Employer Letter.

C. In order to participate as an Employer in the ASRS, an eligible political subdivision or political subdivision entity shall submit to the ASRS by the due date listed on the Potential New Employer Letter:

1. The following original documents:

1.a. The current retirement plan or a statement signed by the designated authorized agent for the political subdivision or political subdivision entity acknowledging there is no current retirement plan.

2.b. Two ASRS Agreements showing:

a.i. The legal name and current mailing address of the political subdivision or political subdivision entity;

b.ii. What amount of prior service the political subdivision or political subdivision entity shall purchase for employees pursuant to R2-8-1006;

c.iii. The approximate number of employees that will become members upon the effective date of the ASRS Agreement;

d.iv. The name, title, email address, and telephone number of the designated authorized agent for the political subdivision or political subdivision entity;

e.v. The designated authorized agent is authorized and directed to conduct all negotiations, conclude all arrangements, and sign all documents necessary to administer the supplemental ASRS retirement plan pursuant to A.R.S. Title 38, Chapter 5, Articles 2 and 2.1; and

f.vi. The ASRS Agreement is binding and irrevocable;

g.vii. The effective date of the ASRS Agreement;

h.viii. The political subdivision or political subdivision entity agrees to be bound by the provisions of A.R.S. Title 38, Chapter 5, Article 2 and Article 2.1 unless otherwise indicated by law; and

i.ix. The dated signature of the designated authorized agent for the political subdivision or political subdivision entity.

3.c. Two ASRS Resolutions showing:

a.i. The legal name of the political subdivision or political subdivision entity;

b.ii. The political subdivision or political subdivision entity is adopting a supplemental ASRS retirement plan pursuant to A.R.S. § 38-729;

c.iii. The political subdivision or political subdivision entity agrees to be bound by the provisions of A.R.S. Title 38, Chapter 5, Article 2 and Article 2.1 unless otherwise indicated by law;

d.iv. The designated authorized agent for the political subdivision or political subdivision entity;

e.v. The designated authorized agent is authorized and directed to conduct all negotiations, conclude all arrangements, and sign all documents necessary to administer the supplemental ASRS retirement plan pursuant to A.R.S. Title 38, Chapter 5, Articles 2 and 2.1; and

f.vi. The dated and notarized signature of the designated authorized agent.

2. The following copies if the eligible political subdivision or political subdivision entity has elected coverage pursuant to a 218 Agreement:

4.a. A 218 Agreement. If the political subdivision or political subdivision entity is electing coverage pursuant to a 218 Agreement, the 218 Agreement must be completed and approved by the Social Security Administration prior to joining the ASRS.

5.b. A 218 Resolution. The 218 Resolutions must be completed and approved by the Social Security Administration prior to joining the ASRS.

D. Upon receipt of Acceptable Documentation identified in subsection (B), the ASRS may approve the political subdivision's or political subdivision entity's request for membership pursuant to A.R.S. § 38-729. If the request to join the ASRS is approved, the ASRS Director shall sign the ASRS Agreements before the ASRS shall send one of each of the original documents identified in subsection (B) to the political subdivision or political subdivision entity.

E. Upon joining the ASRS, a political subdivision or political subdivision entity has a one-time opportunity to identify and exclude current employees from ASRS membership based on a classification of those employees that is established by the political subdivision or political subdivision entity consistent with federal law and that is not designed to, and does not result in, the cost of providing the benefits to the political subdivision's or political subdivision entity's employees being greater than the cost of providing benefits to the employees of Employers as determined by the ASRS.

F. A political subdivision or political subdivision entity that elects to identify and exclude a classification of employees according to subsection (E) shall provide the ASRS with all information the ASRS requests in order for the ASRS to determine the cost of providing the benefits to the political subdivision's or political subdivision entity's employees is not greater than the cost of providing benefits to the employees of Employers as determined by the ASRS.

G. Notwithstanding subsection (E), all other current and future employees of the political subdivision or political subdivision entity who meet membership eligibility requirements are required to participate in the ASRS as of the effective date of the political subdivision or political subdivision entity joining the ASRS according to A.R.S. §§ 38-711 et seq.

History

• Adopted by final rulemaking at 24 A.A.R. 3407, effective 2/4/2019. Amended by final rulemaking at 30 A.A.R. 742, effective 5/17/2024.

Ariz. Admin. Code § R2-8-1005 Employer Reporting

A. An Employer shall submit contribution information and contribution payments pursuant to A.R.S. § 38-735, through the Employer's secure ASRS account.

B. Within 14 days of receiving the information contained in subsection R2-8-1002(E)(1) through (E)(3), the Employer shall:

1. Verify the information the employee provided;

2. Confirm the employee meets membership requirements pursuant to A.R.S. § 38-711; and

3. Submit the verified information to the ASRS through the Employer's secure ASRS account.

C. For an Employer whose employee elects to participate in an Optional Retirement Plan in lieu of the ASRS pursuant to A.R.S. § 15-1628, within 30 days of electing to participate in an Optional Retirement Plan, the Employer shall submit to the ASRS through the Employer's secure ASRS account the:

1. Employee's full name;

2. Employee's Social Security number;

3. Date of the employee's employment; and

4. Date of the employee's Optional Retirement Plan election.

D. For an Employer who has submitted information pursuant to subsection (C), within 30 days of that employee terminating employment with that Employer, the Employer shall notify the ASRS through the Employer's secure ASRS account of the employee's termination date.

E. Within 14 days before the effective date of joining the ASRS, an Employer shall submit an initial online authorization and designation form in writing to the ASRS with the following information:

1. The Employer's name;

2. The following information for the person authorized by the Employer to approve the Employer's Designated Employer Administrator:

a. The person's full name;

b. The person's title;

c. The person's phone number;

d. The person's email address;

e. The person's dated signature affirming that person has the authority to approve the Employer's Designated Employer Administrator;

3. The full name of the individual the Employer is designating as the Employer's Designated Employer Administrator;

4. The title of the individual the Employer is designating as the Employer's Designated Employer Administrator;

5. The phone number of the individual the Employer is designating as the Employer's Designated Employer Administrator;

6. The email address of the individual the Employer is designating as the Employer's Designated Employer Administrator;

7. The dated signature of the individual the Employer is designating as the Employer's Designated Employer Administrator.

F. An Employer's Designated Employer Administrator shall establish a new Employer's Designated Employer Administrator as needed through the Employer's secure ASRS account.

G. Within 30 days of an Employer no longer having an Employer's Designated Employer Administrator, the Employer shall submit in writing an initial online authorization and designation form pursuant to subsection (E).

H. Within 30 days of change in the Employer's address, the Employer shall notify the ASRS of the change through the Employer's secure ASRS account.

I. Within 10 days of any change in the name or ownership of the Employer, the Employer shall provide written notice of the change to the ASRS through the Employer's secure ASRS account by providing the Employer's previous account information and the changes to that information.

J. Within 30 days of any change in the character of an Employer's organizational structure, the Employer shall send to the ASRS through the Employer's secure ASRS account, written notice of the previous organizational structure and the effective changes to the Employer's organizational structure.

K. Within 30 days of Leasing An Employee From A Third Party, an Employer shall submit the following information:

1. The employee's full name;

2. The number of hours per week the employee works for the Employer;

3. The title of the employee's position;

4. A copy of the agreement showing the Employer Leasing An Employee From A Third Party; and

5. Whether the employee is retired from the ASRS.

History

• Adopted by final rulemaking at 24 A.A.R. 3407, effective 2/4/2019.

Ariz. Admin. Code § R2-8-1006 Prior Service Purchase Cost for New Employers

A. Pursuant to A.R.S. § 38-729, upon the effective date of joining the ASRS, an Employer may elect to purchase service credit for a period of employment prior to the effective date of joining the ASRS for employees Engaged To Work for the Employer on the effective date of joining the ASRS who are members of the ASRS as of the effective date of joining the ASRS.

B. The ASRS may provide to a potential Employer an estimated cost to purchase service credit pursuant to this Section. In order for the ASRS to estimate the cost to purchase service pursuant to this Section, a potential Employer shall provide the following information to the ASRS for each employee of the potential Employer who is Engaged To Work for the potential Employer and for whom the potential Employer intends to purchase service credit pursuant to this Section:

The employee's full name;

2. The employee's date of birth;

3. The employee's Social Security number;

4. The employee's current salary; and

5. The date the employee began employment with the potential Employer.

C. An Employer who elects to purchase service credit pursuant to this Section shall submit the following information for each member for which the Employer is purchasing service credit:

1. Member's full name;

2. Member's date of birth;

3. Member's Social Security number;

4. Member's date of employment;

5. Documentation showing the Member is Engaged To Work for the Employer as of the effective date of joining the ASRS;

6. Member's current salary as of the effective date of joining the ASRS; and

7. The number of years the Employer is electing to purchase for the member pursuant to this Section or the dollar amount the Employer is electing to pay to purchase service for the member pursuant to this Section.

D. The cost to purchase service credit pursuant to this Section shall be determined using an actuarial present value calculation.

E. An Employer who elects to purchase service credit pursuant to this Section shall submit payment for the full cost of the service purchase to the ASRS within 90 days of the date of notification by the ASRS.

F. If an Employer who elects to purchase service credit pursuant to this Section does not submit payment for the full cost of the service purchase within 90 days of the date of notification, the Employer is not eligible to purchase service credit pursuant to this Section.

G. An employer may not purchase service credit pursuant to this Section for a time period for which the employee is eligible to receive retirement benefits from another public employee retirement system.

H. For purposes of this Section, "another public employee retirement system" means the same as in R2-8-505.

History

• Adopted by final rulemaking at 24 A.A.R. 3407, effective 2/4/2019. Amended by final rulemaking at 28 A.A.R. 1257, effective 7/17/2022.

Article 11 TRANSFER OF SERVICE CREDIT

Ariz. Admin. Code § R2-8-1101 Definitions

The following definitions apply to this Article unless otherwise specified:

1. "Actuarial present value" means an amount in today's dollars of a member's future retirement benefit calculated using appropriate actuarial assumptions and the:

a. Member's Current Years of Credited Service;

b. Member's age as of the date the Member submits to the ASRS a request to transfer service credit pursuant to this Article; and

c. Member's most recent annual compensation.

2. "Current years of credited service" means:

a. For Transfer In Service, the amount of credited service a member has earned or purchased, and the amount of service credit for which an Irrevocable PDA is in effect for which the member has not yet completed payment, but does not include any current requests to purchase service credit for which the member has not yet paid; and

b. For transferring service credit to the Other Retirement Plan, the amount of credited service a member has earned or purchased, but does not include service credit for which the member has not yet paid.

3. "Irrevocable PDA" means the same as in R2-8-501.

4. "Funded Actuarial Present Value" means the Actuarial Present Value reduced to the extent funded on market value basis as of the most recent actuarial evaluation of the ASRS.

5. "Member's accumulated contribution account balance" means the sum of all the member's retirement contributions and any principal payments made for:

a. The purchase of service credit;

b. Contributions not withheld; and

c. Previous transfers of service credit.

6. "Other retirement plan" means the state retirement plans specified in A.R.S. § 38-921, other than the ASRS, or a retirement plan of a charter city as specified in A.R.S. § 38-730.

7. "Other Retirement Plan's cost" means the amount determined by the ASRS pursuant to R2-8-1102(D).

8. "Other public service" means the same as in R2-8-501.

9. "Transfer in service" means credited service with the Other Retirement Plan that a member is eligible to transfer to the ASRS pursuant to A.R.S. §§ 38-730 and 38-921.

History

• Adopted by final rulemaking at 25 A.A.R. 303, effective 3/18/2019.

Ariz. Admin. Code § R2-8-1102 Required Documentation and Calculations for Transfer In Service Credit

A. A member who is eligible to Transfer In Service credit, may request to transfer service credit by providing a Transfer In form to the ASRS with the following:

1. The name of the Other Retirement Plan;

2. The date the member either terminated employment with an employer of the Other Retirement Plan or ceased to participate in the Other Retirement Plan;

3. The date the member began employment with the employer through which the member was participating in the Other Retirement Plan;

4. The number of years the member participated in the Other Retirement Plan;

5. Acknowledgement the member agrees that:

a. Knowingly making a false statement or falsifying or permitting falsification of any record of the ASRS with an intent to defraud ASRS is a Class 6 felony, pursuant to A.R.S. § 38-793; and

b. The Transfer In Service credit transaction is subject to audit and if any errors are discovered, the ASRS shall adjust a member's account, or if the member is already retired, adjustments to the member's account may affect the member's retirement benefit.

B. Upon receipt of the information specified in subsection (A), the ASRS shall submit the information to the Other Retirement Plan and request:

1. The Other Retirement Plan's Funded Actuarial Present Value pursuant to A.R.S. §§ 38-730 and 38-922;

2. The Member's Accumulated Contribution Account Balance in the Other Retirement Plan;

3. The amount of service credit the member has accumulated in the Other Retirement Plan; and

4. The start date and end date for the member's participation in the Other Retirement Plan.

C. Upon receipt of the information specified in subsection (B), the ASRS shall calculate the Actuarial Present Value as specified in R2-8-506 necessary to transfer full service credit to the ASRS.

D. The ASRS shall calculate the Other Retirement Plan's Cost as follows:

1. If the ASRS Actuarial Present Value is greater than the Other Retirement Plan's Funded Actuarial Present Value, then the Other Retirement Plan's Cost is the greater of:

a. The Other Retirement Plan's Funded Actuarial Present Value; or

b. The Member's Accumulated Contribution Account Balance in the Other Retirement Plan;

2. If the ASRS Actuarial Present Value is less than or equal to the Other Retirement Plan's Funded Actuarial Present Value, then the Other Retirement Plan's Cost is the greater of:

a. The ASRS Actuarial Present Value; or

b. The Member's Accumulated Contribution Account Balance in the Other Retirement Plan.

E. The ASRS shall compare the Other Retirement Plan's Cost to the ASRS Actuarial Present Value calculated pursuant to subsection (C) and:

1. If the Other Retirement Plan's Cost is less than the ASRS Actuarial Present Value, then the member may elect to transfer service credit to the ASRS and:

a. Pay the difference between the Other Retirement Plan's Cost and the ASRS Actuarial Present Value; or

b. Accept a proportionately reduced amount of service credit;

2. If the Other Retirement Plan's Cost is greater than or equal to the ASRS Actuarial Present Value, then the member may elect to transfer the service to the ASRS pursuant to subsection (F).

F. Upon completion of the comparison specified in subsections (D) and (E), the ASRS shall send the member a transfer in invoice notifying the member of the member's options to complete the transfer of service credit through the member's secure ASRS account.

G. The member may elect to complete a transfer of service credit pursuant to this section by submitting the member's election by the election due date specified on the transfer in invoice.

H. Upon receipt of the member's election to complete a transfer of service credit, the ASRS shall send the transfer in invoice to the Other Retirement Plan and the Other Retirement Plan shall make payment to the ASRS by submitting a check made payable to the ASRS for the Other Retirement Plan's Cost specified on the transfer in invoice by the payment due date specified on the transfer in invoice.

I. If a member elects to pay the total difference between the ASRS Actuarial Present Value and the Other Retirement Plan's Cost pursuant to R2-8-1102(E), the member shall elect the method of payment by the payment due date specified on the transfer in invoice.

J. A member may elect to pay the total difference between the ASRS Actuarial Present Value and the Other Retirement Plan's Cost pursuant to R2-8-1102(E) by any one or more methods specified in R2-8-512, R2-8-513, R2-8-514, or R2-8-519.

K. For a member who elects to accept a proportionately reduced amount of service pursuant to subsection (E)(1)(b), the ASRS shall calculate the proportionately reduced amount of service credit based on the member's service credits in the Other Retirement Plan multiplied by the ratio of the Other Retirement Plan's Cost to the ASRS Actuarial Present Value.

L. The member shall submit payment to transfer service credit pursuant to this section by the payment due date specified on the transfer in invoice.

M. If the member does not submit payment for the total difference in the calculations pursuant to R2-8-1102(E) by the payment due date specified on the transfer in invoice, the member may be eligible to purchase the remaining service credit as Other Public Service, and the member is not eligible to purchase the remaining service credit based on the cost specified in the transfer in invoice.

History

• Adopted by final rulemaking at 25 A.A.R. 303, effective 3/18/2019.

Ariz. Admin. Code § R2-8-1103 Transferring Service to Other Retirement Plans

A. Upon receipt of a request to transfer a member's service credit from the ASRS to the Other Retirement Plan, the ASRS shall calculate:

The ASRS Funded Actuarial Present Value pursuant to A.R.S. §§ 38-730 and 38-922; and

2. The Member's Accumulated Contribution Account Balance in the ASRS.

B. Upon completing the calculations specified in subsection (A), the ASRS shall submit the calculations and member information to the Other Retirement Plan with a due date for the Other Retirement Plan to submit a fund request to the ASRS pursuant to subsection (C).

C. If a member elects to transfer service credit to the Other Retirement Plan, the member shall ensure that the Other Retirement Plan submits a fund request on the Other Retirement Plan's letterhead by the due date specified in subsection (B) to the ASRS with the following information:

1. The member's full name;

2. The last four digits of the member's Social Security number;

3. The name of the Other Retirement Plan; and

4. The Actuarial Present Value necessary to transfer full service credit to the Other Retirement Plan.

D. Upon receipt of the information specified in subsection (C), the ASRS shall compare the calculations specified in subsection (A) to the Other Retirement Plan's Actuarial Present Value specified in subsection (C) and transfer funds as follows:

1. If the Other Retirement Plan's Actuarial Present Value specified in subsection (C) is greater than the ASRS Funded Actuarial Present Value specified in subsection (A), then the ASRS shall transfer the greater of:

a. The ASRS Funded Actuarial Present Value specified in subsection (A); or

b. The Member's Accumulated Contribution Account Balance in the ASRS.

2. If the Other Retirement Plan's Actuarial Present Value specified in subsection (C) is less than or equal to the ASRS Funded Actuarial Present Value, then the ASRS shall transfer the greater of:

a. The Other Retirement Plan's Actuarial Present Value specified in subsection (C); or

b. The Member's Accumulated Contribution Account Balance in the ASRS.

E. Transferring service credit to the Other Retirement Plan pursuant to this Section constitutes a withdrawal from ASRS membership and results in a forfeiture of all other benefits under ASRS.

F. Notwithstanding subsection (E), pursuant to A.R.S. § 38-750, a transferred employee who continues an Irrevocable PDA after transferring service credit to the Other Retirement Plan may be eligible to:

1. Transfer service credit associated with the remaining balance of the Irrevocable PDA for which the transferred employee paid for the purchase of service credit plus interest at the Assumed Actuarial Investment Earnings Rate pursuant to A.R.S. § 38-922, not including any administrative interest charge the transferred employee paid pursuant to an Irrevocable PDA; or

2. Receive a return of contributions plus interest as specified in R2-8-118(A), column 3, pursuant to A.R.S. § 38-740.

G. If the ASRS has a DRO on file for a member, the ASRS shall not transfer a member's service credit from the ASRS to the Other Retirement Plan unless the DRO indicates whether the member may transfer all ASRS service credit to the Other Retirement Plan.

H. Notwithstanding subsection (G), if the ASRS has a DRO on file for a member that does not indicate whether the member may transfer all ASRS service credit to the Other Retirement Plan, the ASRS shall not transfer a member's service credit from the ASRS to the

History

• Adopted by final rulemaking at 25 A.A.R. 303, effective 3/18/2019. Amended by final rulemaking at 28 A.A.R. 1746, effective 9/4/2022.

Chapter 9 GOVERNING COMMITTEE FOR DEFERRED COMPENSATION PLANS

Article 1 [REPEALED]

Ariz. Admin. Code § R2-9-101 [Repealed]

History

• Former Rule 1; Former Section R2-9-01 repealed, new Section R2-9-01 adopted effective May 7, 1980 (Supp. 80-3). Former Section R2-9-01 renumbered as Section R2-9-101 (Supp. 82-1). Section repealed; new Section made by final rulemaking at 10 A.A.R. 3265, effective September 24, 2004 (Supp. 04-3). Repealed by final rulemaking at 25 A.A.R. 883, effective 6/2/2019.

Ariz. Admin. Code § R2-9-102 Repealed

History

• Former Rule 2; Former Section R2-9-02 repealed, new Section R2-9-02 adopted effective May 7, 1980 (Supp. 80-3). Former Section R2-9-02 renumbered as Section R2-9-102 (Supp. 82-1). Section repealed by final rulemaking at 10 A.A.R. 3265, effective September 24, 2004 (Supp. 04-3).

Chapter 10 DEPARTMENT OF ADMINISTRATION - RISK MANAGEMENT DIVISION

Article 1 COVERAGE AND CLAIMS PROCEDURE

Ariz. Admin. Code § R2-10-101 Definitions

The following definitions apply in this Chapter unless the context otherwise requires:

"Agency" means a state department, board, or commission.

2. "Agency loss prevention committee" means a panel of individuals established by the head of an agency to develop and oversee the agency's loss prevention program.

3. "Agency loss prevention coordinator" means an individual chosen by the head of an agency to implement the agency's loss prevention program and who is the agency's liaison with Risk Management.

4. "Attorney General's Office" means the Liability Management Section of the Attorney General's Office assigned to defend claims covered by A.R.S. § 41-621.

5. "Client" means an individual in custodial care of a provider through contract or court order with a state agency through programs listed in A.R.S. § 41-621(B).

6. "Confined space" has the meaning of 29 CFR 1910.146(b) Occupational Safety and Health Standards for General Industry, The Industrial Commission of Arizona, Division of Occupational Safety and Health, February 1, 1998, which is incorporated by reference in this rule. This incorporation by reference does not include any later amendments or editions. Copies of the incorporation by reference are available for inspection at the Industrial Commission of Arizona, 800 West Washington, Phoenix, Arizona and in the Office of the Secretary of State, Public Service Department, 1700 West Washington, Phoenix, Arizona.

"Contaminant" means a substance that is radioactive, infectious, carcinogenic, toxic, irritant, corrosive, sensitizer or an agent that damages the lungs, skin, eyes, mucous membranes, and other body organs.

8. "Data Breach" means any theft, loss, or unauthorized acquisition, unauthorized access to, or unauthorized disclosure of nonpublic data or information or hardware containing nonpublic data or information, in the insured's care, custody, or control, that does or may compromise the privacy, security, confidentiality, or integrity of such data or information.

8.9. "Deductible" means the amount of a loss that the agency will pay before Risk Management is obligated to pay anything.

9.10. "Department" means the Department of Administration, an agency of the State of Arizona.

10.11. "Emergency" means an immediate health threat.

11.12. "Environment" means navigable waters, surface waters, groundwater, drinking water supply, land surface or subsurface strata, and ambient air, within or bordering on this state.

12.13. "Environmental Contractor" means a company hired by the state to conduct environmental site investigations and remediation work.

13.14. "Environmental property claim" means a demand or payment resulting from chemical or biological damage to the environment.

14.15. "Ergonomics" means a science of the relationship between human capability and the work environment, which the Department uses to design a job, task, equipment, or tool to conform comfortably within the limits of human capability.

15.16. "Feasibility study" means a remediation plan based upon a site investigation to clean up a contaminated site by an environmental contractor.

16.17. "Geophysical survey" means a radar, magnetic, electric, gravity, thermal, or seismic survey.

17.18. "Groundwater" means water beneath the ground in sediments or permeable bedrock.

18.19. "Hazardous substance or waste" means hazardous waste as defined in A.R.S. § 49-921(5).

19.20. "Health threat" means evidence that exposure to a specific type and concentration of contaminant is harmful to human health. This evidence shall be based on at least 1 study conducted by the National Institute of Occupational Safety and Health or the Environmental Protection Agency in accordance with established scientific principles.

20.21. "Incident" means an event involving an agency employee, facility, or equipment that results in an occupational injury or illness, personal injury, or loss of or damage to state property, or an event involving the public that exposes the state to a liability loss.

21.22. "Loss prevention" means any action or plan intended to reduce the frequency and severity of property, liability, or workers' compensation losses.

22.23. "Occurrence" means an accident, incident or a series of accidents or incidents arising out of a single event or originating cause and includes all resultant or concomitant insured losses.

23.24. "Passenger van" means any motor vehicle designed, modified, or otherwise capable of being configured to carry not less than 8 passengers and no more than 15 passengers.

24.25. "Personal protective equipment" means any clothing, material, device, or equipment worn to protect a person from exposure to, or contact with, any harmful material or force.

25.26. "Provider" means an individual or entity authorized to provide services to state clients as outlined in A.R.S. § 41-621(B) that is not contractually required to indemnify and hold the state harmless.

26.27. "Remedial action" or "remediation" means the process of cleaning up a hazardous substance or waste site by an environmental contractor.

27.28. "Risk Manager" means the Administrator for the State Risk Management Program.

28.29. "Risk Management" or "RM" means the State Risk Management Program.

30. "Security Incident" means an event that creates a reasonable suspicion that nonpublic data or information, or hardware containing nonpublic data or information, in the insured's care, custody, or control, may have been compromised, or that measures put in place to protect such data or information may have failed.

31. "Security System Breach" means any unauthorized access to, unauthorized use or misuse of, damage, deletion, or modification to, or denial of authorized access to, a computer system within the care, custody, or control of the insured, by cyber-attacks, through any electronic means, including malware, viruses, worms, and Trojan horses, spyware and adware, zero-day attacks, hacker attacks, and denial of service attacks.

29.32. "Self-insurance" means state -provided loss protection for an agency, employee, or other person or entity who is insured through RM funds.

30.33. "Site assessment" means the process of completing and assessing a site investigation and a feasibility study.

31.34. "Site investigation" means a detailed examination by an environmental contractor of an area of a building or ground suspected of being contaminated with a hazardous substance or waste.

History

• Adopted effective July 27, 1983 (Supp. 83-4). Former Section R2-10-101 repealed, new Section R2-10-101 adopted effective June 12, 1989 (Supp. 89-2). Amended effective December 18, 1992 (Supp. 92-4). Amended effective January 12, 1995 (Supp. 95-1). Amended effective September 15, 1997 (Supp. 97-3). Amended by final rulemaking at 6 A.A.R. 1717, effective April 20, 2000 (Supp. 00-2). Amended by final rulemaking at 23 A.A.R. 3239, effective 1/8/2018. Amended by final rulemaking at 30 A.A.R. 1941, effective 7/6/2024.

Ariz. Admin. Code § R2-10-102 Reporting Procedures

A. Any agency, provider, or other person or entity insured pursuant to A.R.S. § 41-621 shall report a property loss, liability claim, or incident that may give rise to a claim under A.R.S. § 41-621 to RM as follows:

1. A physical injury within 1 day of the incident orally, in writing, or by electronic means.

2. Property damage expected to exceed $10,000 within 1 day of the incident orally, in writing, or by electronic means.

3. Property loss expected to exceed $10,000 within 1 day of the incident orally, in writing, or by electronic means.

4. Except for the Board of Regents and State Universities, a data breach, security system breach or security incident orally or in writing to the ADOA Chief Information Officer within 72 hours of the incident or when the agency should have reasonably known of the incident. For the Board of Regents and State Universities, a data breach, security system breach or security incident orally or in writing to the ADOA Risk Manager within 72 hours of the incident or when the agency should have reasonably known of the incident.

4.5. All other claims or incidents within 10 days of the incident in writing or by electronic means.

B. Any agency, officer, employee, or other person or entity insured pursuant to A.R.S. § 41-621, who receives a claim, notice, summons, complaint or other process by any claimant or representative shall immediately forward the claim to RM. This applies to all claims for injuries or damages whether the reporting party believes there to be a factual basis for the claim, but excludes contract lawsuits or other matters not covered under A.R.S. § 41-621.

C. Anyone who is insured pursuant to A.R.S. § 41-621 shall cooperate in accordance with A.R.S. § 41-621(N) with RM and the Attorney General's office or other counsel appointed by the Attorney General to represent the insured, including providing all information and materials requested to investigate and resolve a claim.

D. An agency shall submit a report of a loss on the following RM forms:

1. A loss involving a state-owned vehicle or a state driver on the "Automobile Loss Report". Information required includes: the agency involved, facts of the incident, the vehicles involved, description of injuries to individuals, names of witnesses, and the police agency that investigated the incident.

2. A loss involving private property damage, or injury to a member of the public as a result of alleged acts or omissions of a state officer, employee, or other person insured pursuant to A.R.S. § 41-621, other than a loss arising out of use of a motor vehicle, on a "General Liability Report". Information including the agency and employees involved, facts of the incident, name of the claimant, and description of the claimant's injuries, witnesses to the incident, and the name of the police agency that investigated the incident.

3. A loss to state property, whether personal property (other than motor vehicles) or real property, on the "Property Loss Report". Information includes the agency and employees involved, facts of the incident, description of the damaged property, the party responsible for the loss, names of witnesses, and the police agency investigating the loss.

4. A loss to employee-owned property covered under A.R.S. § 41-621(A)(4) on the "Property Loss Report''. Information necessary to document the loss and calculate the actual dollar value of the claim is required. In addition, the employee shall submit a copy of any written agreement between the employee and the employing state agency authorizing the use of the employee-owned property on the job, and a copy of the Personal Property Inventory form (PROPINV) maintained by the employing state agency.

History

• Adopted effective July 27, 1983 (Supp. 83-4). Amended effective June 12, 1989 (Supp. 89-2). Amended effective December 18, 1992 (Supp. 92-4). Amended effective January 12, 1995 (Supp. 95-1). Amended by final rulemaking at 6 A.A.R. 1717, effective April 20, 2000 (Supp. 00-2). Amended by final rulemaking at 30 A.A.R. 1941, effective 7/6/2024.

Ariz. Admin. Code § R2-10-103 Liability Claim Procedures

A. RM shall investigate all reported liability claims to determine coverage. RM shall notify the appropriate insurance carrier, if applicable, and evaluate the merits of self-insured claims and coordinate defense and settlements under A.R.S. § 41-621.

B. State employees shall direct all contacts concerning any liability claim against the state, its agencies, officers, agents, or employees by a third party to RM, the Attorney General's office, or an independent contractor representing either of those offices.

C. Unless authorized by law, an agency, officer, or employee shall obtain prior approval from the Risk Manager or Attorney General's office before disclosing oral discussions, written reports of claims, or lawsuits to anyone other than state-authorized personnel. Prior permission for each discussion or report is necessary to comply with this subsection.

History

• Adopted effective July 27, 1983 (Supp. 83-4). Amended effective June 12, 1989 (Supp. 89-2). Amended effective December 18, 1992 (Supp. 92-4). Amended effective January 12, 1995 (Supp. 95-1). Amended by final rulemaking at 6 A.A.R. 1717, effective April 20, 2000 (Supp. 00-2). Amended by final rulemaking at 30 A.A.R. 1941, effective 7/6/2024.

Ariz. Admin. Code § R2-10-104 Self-insured Property Claim Procedures

A. RM shall not cover a property loss covered under the terms of the state's self-insurance program for state agencies if the loss is not reported to RM as required by R2-10-102(A), or is reported later than 90 days following discovery of the incident. RM shall cover a property loss only if there is proper documentation as to the cause and dollar amount of the loss. RM shall only cover those claims with documentation submitted to RM within 1 year of the date of discovery. If a loss to a building or structure requires more than one year to repair or replace, the Risk Manager may grant an extension of time to document the amount of the loss. An agency shall submit a request for an extension in writing to the Risk Manager no later than 11 months from the date of loss. The request shall contain clear justification for the delay, and a projected date of completion.

B. RM shall investigate all reported property claims to determine coverage (and notify the appropriate excess insurance carrier if applicable) and coordinate settlements under A.R.S. § 41-621.

C. RM or, upon request, the agency involved, shall obtain competitive bids for the necessary repairs or replacement. RM shall authorize and approve all repair or replacement.

D. RM shall review and approve consulting services, when required of a architect or engineer who are advising the state on the repair, replacement, or construction of state buildings that have been partially or totally damaged and that are to be paid for by RM funds.

History

• Adopted effective July 27, 1983 (Supp. 83-4). Amended effective June 12 1989 (Supp.89-1). Amended effective December 18, 1992 (Supp. 92-4). Amended effective January 12, 1995 (Supp. 95-1). Amended by final rulemaking at 6 A.A.R. 1717, effective April 20, 2000 (Supp. 00-2).

Ariz. Admin. Code § R2-10-105 Employment Discrimination Claim Procedures

A. Upon receipt of a notice of discrimination charge, the agency or employee shall:

Within 7 days, send a copy of the charge to RM and the Attorney General's office.

2. Contact the Attorney General's office for any required legal assistance during the administrative process.

3. Provide to RM a completed copy of any response, prior to filing. RM shall review the information contained in the response and assist in resolution during administrative process.

B. The agency shall provide a copy of a decision or Right to Sue Letter to RM within 7 days.

History

• Adopted effective July 27, 1983 (Supp. 83-4). Amended effective June 12, 1989 (Supp. 89-2). Former Section R2-10-105 renumbered to Sections R2-10-106 and R2-10-107, new Section R2-10-105 renumbered from R2-10-106 and amended effective December 18, 1992 (Supp. 92-4). Amended effective January 12, 1995 (Supp. 95-1). Amended by final rulemaking at 6 A.A.R. 1717, effective April 20, 2000 (Supp. 00-2).

Ariz. Admin. Code § R2-10-106 State-owned Property Coverage and Limitations

A. The Department provides property loss coverage for state-owned buildings on a replacement-cost basis for items actually replaced or repaired. Property loss coverage for state-owned personal property is replacement cost less depreciation. For agencies with a total appropriated and non-appropriated budget of less than $1 million, property claims will be subject to a $100 per occurrence deductible. A property deductible of $2,500 per occurrence shall apply to all other agencies.

a. Subrogation collections shall reimburse the fund from which a deductible was paid up to the amount of the deductible and on a primary basis.

b. No deductible shall apply to property loss coverage afforded in accordance with A.R.S. § 41-621(B).

B. RM shall not include the cost of labor in property loss reimbursement if state employee labor cost for repair or replacement is allocated from appropriated funds. RM shall determine whether to use state employees or contractors for repair work based upon availability.

C. Property loss coverage includes all state-owned property except: roads, bridges, tunnels, dams, dikes, and retaining walls.

D. Property loss coverage includes coverage for necessary business interruption losses resulting from an insured direct physical loss or damage to property that is self-insured pursuant to A.R.S. § 41-621.

History

• Adopted effective June 12, 1989 (Supp. 89-2). Former Section R2-10-106 renumbered to R2-10-105, new Section R2-10-106 renumbered from R2-10-105(A) and (B) and amended effective December 18, 1992 (Supp. 92-4). Amended effective January 12, 1995 (Supp. 95-1). Amended by final rulemaking at 6 A.A.R. 1717, effective April 20, 2000 (Supp. 00-2). Amended by final rulemaking at 23 A.A.R. 3239, effective 1/8/2018. Amended by final rulemaking at 30 A.A.R. 1941, effective 7/6/2024.

Ariz. Admin. Code § R2-10-107 Liability Coverage and Limitations

A. The following coverage and limitations apply in this Chapter:

1. The Department provides liability coverage within the limitations of A.R.S. § 41-621 for a state officer or employee while driving a state-owned or other vehicle in the course and scope of employment.

a. Coverage shall be on a primary basis for a state-owned, leased, or rented vehicle and on an excess basis for any other vehicle.

b. The state shall not provide coverage for damage or loss of a personal vehicle.

2. a state officer or employee operates a state-owned vehicle within the course and scope of employment if driving:

a. On authorized state business,

b. To and from work,

c. To and from lunch on a working day,

d. To and from meals while on out-of-town travel.

3. a state officer or employee does not operate a personal vehicle within the course and scope of employment when driving:

a. To and from work,

b. To and from lunch in the area of employment and not on authorized state business,

c. On other than state-authorized business.

B. A volunteer acting at the direction of a state official, within the course and scope of state-authorized activities, is covered under A.R.S. § 41-621.

C. A claim alleging a civil rights violation is covered through RM, unless otherwise excluded, except there is no coverage for payment of that portion of a settlement or judgment for position status adjustments.

D. The state shall cover a state officer, employee, or other person self-insured pursuant to A.R.S. § 41-621, for liability on an excess basis while using such insured's personal aircraft within the course and scope of employment with the state subject to the following conditions:

1. a state officer, employee, or other person self-insured pursuant to A.R.S. § 41-621 shall carry a minimum of $1,000,000 in aircraft liability coverage.

2. Any state officer, employee pilot, or other pilot self-insured pursuant to A.R.S. § 41-621, must obtain approval prior to flying on state business. To obtain this approval, such insured pilot shall complete an RM pilot application form that requests the pilot's name, airman's certificate number, driver's license number, aircraft description, rating, and flying hours, and submit it to RM for review with a certificate of insurance evidencing the required limits of coverage on a personal aircraft. To maintain RM approval, such insured pilot shall submit an updated pilot application form and certificate of insurance annually.

3. RM shall send a letter to the pilot self-insured pursuant to A.R.S. § 41-621 approving or rejecting an application to fly a personal aircraft on state business. The approval letter shall be presented to the appropriate department head and a copy sent to the agency's loss prevention coordinator.

4. Every pilot self-insured pursuant to A.R.S. § 41-621 shall maintain a current FAA pilot certification.

5. Every pilot self-insured pursuant to A.R.S. § 41-621 shall meet the pilot warranties in the aircraft insurance policy owned by the state.

6. Every pilot self-insured pursuant to A.R.S. § 41-621 shall hold all licenses, certificates, endorsements, and other qualifications, including proficiency checks and recent experience, required by the FAA or other federal, state, or local statutes and rules to act as pilot-in-command or as a required crew member for the aircraft being flown. The pilot-incommand shall meet current requirements for carrying passengers.

7. Course and scope of employment with the state does not include:

a. Personal use of an aircraft;

b. An aircraft for hire, reward or commercial use;

c. Agricultural operations;

d. Carrying external loads;

e. Performing aerial acrobatics.

8. No pilot self-insured pursuant to A.R.S. § 41-621 shall carry more passengers on an aircraft than the number defined in the aircraft insurance policy purchased by RM.

9. The Department shall not cover damage or loss of the agent, officer, or employee-owned aircraft.

10. The requirements in this Section apply to a non-state employee pilot flying on behalf of an agent, officer, or employee on authorized state business.

All aircraft used for state business shall comply with all statutes and rules of the FAA and other federal, state, and local jurisdictions for flight.

History

• Renumbered from R2-10-105(C) through (J) and amended effective December 18, 1992 (Supp. 92-4). Amended effective January 12, 1995 (Supp. 95-1). Section corrected to reflect amendment on file with the Office of the Secretary of State effective January 12, 1995 (Supp. 97-1). Amended by final rulemaking at 6 A.A.R. 1717, effective April 20, 2000 (Supp. 00-2). Amended by final rulemaking at 23 A.A.R. 3239, effective 1/8/2018. Amended by final rulemaking at 30 A.A.R. 1941, effective 7/6/2024.

Ariz. Admin. Code § R2-10-108 Deductibles and Waivers

A. Agency Claim Settlement or Judgment More Than $150,000.

1. The Department shall charge each agency a deductible of not more than $10,000 on each claim settlement or judgment approved for payment of more than $150,000.

2. RM shall waive the deductible if the agency provides a response to RM containing an agency action plan to be taken to eliminate or limit similar future risk to the state, and

a. The agency action plan is submitted to RM within 60 days of the agency's notification of claim approval or payment. The agency action plan shall include the following;

i. Findings outlining the cause or causes of the claim;

ii. Actions that will be implemented to prevent recurrence of similar losses or claims;

iii. Development of action items and time lines for completion; and

iv. Appointment of an agency contact to act as a liaison for all matters relating to the plan.

b. RM approves the agency action plan as reasonable and effective; and

c. The agency implements the plan within 30 days of RM approval, and provides periodic status reports as outlined in the approved Agency Action Plan.

3. If the agency fails to comply with all the conditions outlined in subsection (A)(2), RM shall charge a deductible of $10,000 on the subject judgment or claim payment as well as each subsequent claim resulting from that cause or exposure until the agency fully complies with subsection (A)(2).

B. RM may waive any deductible to any agency for just cause. Just cause may exist when the application of a deductible is not warranted due to the circumstances of the claim, or is in the best interest of the state

C. If a dispute arises between RM and the agency pertaining to this Section, one or more meetings shall be held at progressively upward, incremental Department of Administration management levels until the agency and RM reach a solution.

History

• Adopted effective September 15, 1997 (Supp. 97-3). Amended by final rulemaking at 6 A.A.R. 1717, effective April 20, 2000 (Supp. 00-2). Amended by final rulemaking at 12 A.A.R. 4384, effective January 6, 2007 (Supp. 06-4). Amended by final rulemaking at 23 A.A.R. 3239, effective 1/8/2018.

Ariz. Admin. Code § R2-10-109 Computation of Time

In computing any period of time prescribed or allowed in this Chapter, the day from which the designated period begins to run shall not be included. The last day of the period shall be included unless it is a Saturday, Sunday or legal state holiday. When the period of time is less than 7 days, intermediate Saturdays, Sundays, and legal state holidays shall be excluded in the computation.

History

• New Section adopted by final rulemaking at 6 A.A.R. 1717, effective April 20, 2000 (Supp. 00-2).

Ariz. Admin. Code § R2-10-110 Cyber Breach Coverage and Limitations

A. To meet the requirement of A.R.S. § 41-621(A), the Arizona Department of Administration shall provide insurance for all the following:

1. Investigation, response and crisis management for data breaches, security system breaches or security incidents.

2. Data restoration.

3. Business interruption and extra expense.

Network security liability.

Privacy liability.

6. Regulatory defense and associated fines and penalties if not prohibited by law.

7. Media content liability.

8. Payment Card Industry Data Security Standards defense and associated fines and penalties if not prohibited by law.

9. Investigation of a security incident.

10. Other exposures where insurance may be required to protect this state and its departments, agencies, boards and commissions to the extent it is determined necessary and in the best interest of the state.

B. The Director of the Department of Administration shall determine which agencies will be afforded coverage or limited coverage as prescribed in A.R.S. § 41-621(A). The Director may consider any of the following circumstances in denying or limiting coverage to selected agencies, boards, commissions and any such other insured;

1. An agency, board, or commission specifically requests exclusion from coverage. If the Director of the Department of Administration grants such an exclusion from coverage, then this exclusion shall include an exclusion from any self-insurance provided by ADOA Risk Management and any excess insurance that ADOA Risk Management may have purchased.

2. Securing coverage for a specific agency, board, or commission will prejudice the Department's ability to secure coverage for other state agencies, boards and commissions.

C. Notwithstanding R2-10-106, a deductible shall be applied for each occurrence covered by the Department as provided for in A.R.S. § 41-621(F). For agencies with a total appropriated and non-appropriated budget of less than $2 million, a per occurrence deductible of 5% of the total appropriated and non-appropriated budget shall apply. A deductible of $100,000 per occurrence shall apply to all other agencies. If the Director determines that an agency, board, or commission has one or more of the following circumstances, the deductible as calculated in this section shall be double:

1. For failure to timely report as prescribed in R2-10-102 (A)(4),

2. For failure to produce timely underwriting information when requested by the Department,

3. For failure to act timely on a known security issue,

4. For failure to cooperate with the Arizona Department of Administration information technology security team,

5. For failure to seek Risk Management approval to indemnify or limit a contractor's liability for losses as prescribed in R2-10-301(B), or

For any other action or non-action that prejudiced the Department in securing insurance, increased insurance costs, limited insurance coverage, or exposed the state to increased exposure as provided for in A.R.S. § 41-621(F).

History

• New Section made by final rulemaking at 30 A.A.R. 1941, effective 7/6/2024.

Article 2 LOSS PREVENTION

Ariz. Admin. Code § R2-10-201 Submission of Building Plans

If an agency anticipates the cost to construct, alter, or repair a state-owned or leased building to exceed $100,000, the agency shall submit building plans to RM prior to a pre-planning conference with an architect to allow Rm to offer recommendations for loss prevention measures.

History

• Adopted effective July 27, 1983 (Supp. 83-4). Amended effective June 12, 1989 (Supp. 89-1). Amended effective December 18, 1992 (Supp. 92-4). Amended effective January 12, 1995 (Supp. 95-1). Amended by final rulemaking at 6 A.A.R. 1717, effective April 20, 2000 (Supp. 00-2). Amended by final rulemaking at 23 A.A.R. 3239, effective 1/8/2018.

Ariz. Admin. Code § R2-10-202 Purchase of Specialized Hazard Control Equipment

A. An agency shall notify the RM Loss Prevention Manager prior to starting the procurement process for any specialized safety or security equipment or system exceeding $50,000 RM shall assist each agency to determine whether the equipment or system will adequately perform its specialized function and is in compliance with applicable codes.

B. RM shall submit any comments or recommendations regarding specialized safety or security equipment or system to the agency within 10 days from the date RM receives notification of a planned procurement.

History

• Adopted effective July 27, 1983 (Supp. 83-4). Amended effective June 12, 1989 (Supp. 89-2). Amended effective December 18, 1992 (Supp. 92-4). Amended effective January 12, 1995 (Supp. 95-1). Amended by final rulemaking at 6 A.A.R. 1717, effective April 20, 2000 (Supp. 00-2). Amended by final rulemaking at 23 A.A.R. 3239, effective 1/8/2018.

Ariz. Admin. Code § R2-10-203 Hazard Reporting

Any agency, officer, agent, or employee shall advise a supervisor, loss prevention coordinator, or loss prevention committee chairperson of any suspected or potential hazards that may require inspection, investigation, or requires action to correct. A supervisor shall report an identified hazard that cannot be corrected to the agency head. The agency head shall notify RM of any hazard that cannot be corrected by the agency or that requires further evaluation and assessment before corrective action can be taken.

History

• Adopted effective July 27, 1983 (Supp. 83-4). Amended effective June 12, 1989 (Supp. 89-2). Amended effective December 18, 1992 (Supp. 92-4). Amended effective January 12, 1995 (Supp. 95-1). Amended by final rulemaking at 6 A.A.R. 1717, effective April 20, 2000 (Supp. 00-2).

Ariz. Admin. Code § R2-10-204 RM Loss Prevention Consultative Services

A. The Risk Manager shall schedule, evaluate, and assess each state agency's loss prevention programs and facilities to identify program deficiencies or hazardous conditions that might lead to loss. Following an evaluation or assessment, RM shall submit a written report to the agency head and loss prevention coordinator, with recommendations to eliminate or control physical hazards or correct unsafe practices and procedures.

B. An agency shall respond in writing to RM recommendations detailing the agency's corrective action plan within 60 days. The agency shall review the recommendations to determine cost feasibility and integration into agency plans. The agency shall notify RM of the corrective action it intends to take. An agency shall report in writing every 30 days until the agency completes corrective action or Risk Management determines the agency has taken all reasonable corrective action.

C. Subsection (B) does not apply to an RM recommendation in response to an agency request for a hazard assessment.

History

• Adopted effective July 27, 1983 (Supp. 83-4). Amended effective June 12, 1989 (Supp. 89-2). Amended effective December 18, 1992 (Supp. 92-4). Amended effective January 12, 1995 (Supp. 95-1). Amended by final rulemaking at 6 A.A.R. 1717, effective April 20, 2000 (Supp. 00-2).

Ariz. Admin. Code § R2-10-205 Development and Implementation of Agency Loss Prevention Programs

A. An agency head shall develop and implement an agency loss prevention program that integrates loss prevention and safety policy into all agency activities. The agency shall incorporate into the loss prevention program the requirements of this Section, applicable state and federal standards, state worker and property protection measures, and programs, practices, and procedures to protect the state from third-party liability claims.

B. An agency head, in coordination with RM, shall develop and implement policies, practices, and procedures to reduce the frequency and severity of a future incident if:

1. The agency has or may have a loss; and

2. Federal or state rules, or National Consensus Standards have not been developed, or do not apply to protect the state from such losses.

C. RM shall publish criteria and program information as guidance for an agency to use in its loss prevention program and shall interpret and explain state, federal, and National Consensus Standards.

History

• Adopted effective Aug. 12, 1985 (Supp. 85-4). Amended effective June 12, 1989 (Supp. 89-2). Section repealed, new Section adopted effective December 18, 1992 (Supp. 92-4). Amended effective January 12, 1995 (Supp. 95-1). Amended by final rulemaking at 6 A.A.R. 1717, effective April 20, 2000 (Supp. 00-2).

Ariz. Admin. Code § R2-10-206 Agency Loss Prevention Program Management

A. An agency shall issue a policy letter to all agency employees that expresses the agency commitment to prevent or control losses. The letter shall solicit the support of agency personnel to the goals and objectives of loss prevention. The agency shall include the letter in the agency loss prevention program document, which shall be available for review by all agency personnel.

B. An agency head shall appoint a qualified management level or professional employee as loss prevention coordinator. The loss prevention coordinator shall conduct and coordinate the agency's loss prevention program. The loss prevention coordinator shall be an ex-officio member of the agency's loss prevention committee and report to the agency head on matters pertaining to administration of the loss prevention program and safety within the agency. The loss prevention coordinator interprets and applies policies and procedures, chairs and coordinates the agency safety committee, reviews agency loss claims, and makes recommendations to prevent future losses. The loss prevention coordinator shall provide technical information to employees and agency management concerning Arizona Department of Safety and Health (ADOSH) and Arizona Department of Environmental Quality (ADEQ) requirements as well as RM policies, procedures, and the rules in this Chapter.

C. Each agency head shall establish an agency loss prevention committee to develop, implement and monitor the agency's loss prevention program. The agency shall appoint to the committee management level personnel representing each major division within the agency. An agency with multi-level organizational structures shall ensure that committee membership is representative of the functional and geographical divisions of the agency.

History

• Adopted effective December 18, 1992 (Supp. 92-4). Amended effective January 12, 1995 (Supp. 95-1). Amended by final rulemaking at 6 A.A.R. 1717, effective April 20, 2000 (Supp. 00-2).

Ariz. Admin. Code § R2-10-207 Agency Loss Prevention Program Elements

Each agency loss prevention committee or individuals designated by the agency head shall develop, implement, and monitor the following loss prevention program elements of an occupational health and safety program (as applicable to their agency):

1. The agency loss prevention policy statement;

2. 1. New employee and continuo programs that include:

a. Safety and loss prevention education regarding property protection, liability exposure, and workplace safety;

b. Agency-specific safety training regarding emergency plans, actions, and first-aid; and

c. Job-specific safety training to employees performing tasks where:

i. Frequent or severe accidents have occurred; or

ii. There is a potential for frequent or severe accidents.

3. 2. Documentation and recordkeeping of employee training;

4. 3. An emergency plan for each agency location that establishes procedures to follow in the event of serious injury, fire, or other emergency that can be reasonably foreseen at the specific agency location. The emergency plan shall:

a. Designate an employee responsible for formulating, implementing, testing, and maintaining the emergency plan;

b. Contain procedures for notification of emergency response personnel and safe evacuation of personnel from the location, including an evacuation diagram that shall be visibly posted throughout each location;

c. Contain procedures for obtaining first-aid, medical treatment, and emergency transportation in the event of serious injury; and

d. Require that the plan be periodically tested and evaluated and identified deficiencies corrected;

5. 4. Procedures for scheduled safety inspections of buildings, grounds, equipment, and machinery. An agency shall document the 4 results of each inspection and forward notice of any deficiencies to the loss prevention coordinator for corrective action. The agency loss prevention committee or coordinator shall follow-up on inspection recommendations to ensure action is taken to remedy a noted deficiency. The agency loss prevention committee or coordinator shall bring an uncorrected deficiency to the attention of the agency head;

6. 5. Procedures for accident and incident investigations:

a. An agency shall develop procedures for reporting an accident or incident involving personnel, property, automobile, liability, industrial injury, environmental damage, and a mishap or near miss to the agency's loss prevention coordinator or loss prevention committee. The loss prevention coordinator and loss prevention committee shall review the accident and incident reports and identify the corrective action necessary to prevent recurrence;

b. Procedures for reporting, investigating, and recording maintenance of a work-related accident or incident shall include:

i. Timely and accurate reporting of each work-related accident or incident;

ii. Investigation of each accident or incident to gather pertinent information, determine cause, and recommend a solution to prevent recurrence of a similar accident or incident;

iii. Compiling, analyzing, and evaluating all data derived from the investigation to determine the frequency, severity, and location of an accident or incident and communicating the information to appropriate agency personnel; and

iv. Maintaining records of employee injury under A.A.C R20-5-629;

7. 6. A maintenance program for state-owed vehicles, equipment, and grounds under the control of that agency that includes:

a. A preventive maintenance program with a written schedule of routine inspection, adjustment, cleaning, lubrication, and testing of equipment including boilers and machinery, fire protection, security and emergency equipment, and motor vehicles;

b. Safety procedures such as "lock-out-tagout" and "buddy procedures" for jobs subject to a serious accident such as those involving working in a confined space operating dangerous equipment and machinery, and working on electrical equipment; and

c. Personal protective equipment for a specific job or area including training on proper fit, use, care, maintenance, inspection, cleaning, and storage;

8. 7. A fire protection program that complies with the Arizona State Fire Code, located in AA.C. Title 4, Chapter 36. This program shall incorporate best practices and standards that protect state of Arizona employees, the general public, and resources entrusted to the agency.

9. 8. Systems and procedures to protect the personal security of each employee and prevent loss of or damage to state property, including:

a. Security escorts, exterior lighting, identification badges, and electronic access systems;

b. Labeling systems, inventory control procedures, property removal procedures, and key control systems; and

c. Building and ground security systems, alarms systems, electronic surveillance, perimeter fencing, and security patrol services.

10. 9. A land, facility, equipment, or process environmental protection program that includes:

a. Procedures to ensure compliance with all applicable local, state and federal environmental laws;

b. Identification of equipment, processes, and practices that may cause water pollution, air pollution, or land and property contamination;

c. Procedures to prevent or control emissions and discharges in excess of local, state, and federal laws and rules; and

d. Procedures to investigate, report, and remediate any discharge or contamination in excess of local, state, or federal laws and rules;

11. 10. An industrial hygiene program that encompasses an existing or potential health hazard within an agency, or that agency personnel may be exposed to during the course of work. The program shall include a documented survey of agency facilities and work practices to identify areas of concern such as noise, air contamination, ergonomic factors, lighting and confined spaces. The program shall include procedures to notify employees of health hazards, medical monitoring when applicable, and personal protective equipment requirements including training, fit testing, and care. The industrial hygiene program shall include the following program elements as applicable:

a. Hazard communication;

b. Laboratory safety (Chemical Hygiene Plan);

c. Hearing conservation;

d. Confined space entry;

e. Handling and disposing of hazardous waste;

f. Back protection;

g. Ergonomics;

h. Asbestos management;

i. Building air quality;

j. Chemical exposure assessment;

k. Personal protective equipment;

l. Respiratory protection;

m. Bloodborne pathogen protection; and

n. Tuberculosis protection;

12. 11. Motor vehicle safety program. For the purpose of this Section, an authorized driver is an employee whose job position description questionnaire or similar document requires the use of a vehicle; an employee who operates a state vehicle; or an employee who operates a leased, rented or personal vehicle where the state provides 100% of that vehicle lease, rental or operational costs.

a. Standards: Each agency shall develop standards to ensure that an authorized driver who drives on state business is capable of operating a motor vehicle in a safe manner At a minimum, the program shall include the following standards:

i. An authorized driver shall use and ensure use of seat belts by all occupants, as required by law

ii. An authorized driver shall possess a valid driver's license of the appropriate class with any required endorsements.

iii. An authorized driver who operates a personally owned vehicle on state business shall maintain the statutorily required liability insurance.

b. Defensive driver training: The agency shall develop and implement programs and procedures to ensure that authorized drivers attend defensive driver training no later than three months from initial hire date or appointment to a position requiring the operation of a motor vehicle. All other authorized drivers who have not attended defensive driver training within the 36 months prior to August 5, 2007 shall attend defensive driver training within 12 months of this date. Defensive driver training and defensive driver refresher training shall cover, at a minimum the following topics:

i. Defensive driving techniques,

ii. Traffic and vehicle regulations,

iii. Driver and passenger restraints,

iv. Inclement weather and night-vision driving hazards,

v. Dealing with emergencies

vi. Alcohol and drug use hazards and laws,

vii. Vehicle insurance and financial responsibility, and

viii. Motor Vehicle Record (MVR) Check.

RM may provide Defensive Driver/Van Safety training assistance or coordination upon request of the agency or the agency may elect to develop and implement agency-specific training.

c. Defensive driver refresher training: The agency shall have a designated responsible party to ensure that authorized drivers attend defensive driver refresher training at a minimum every four years.

d. c. Records: The agency shall ensure records are maintained regarding training under subsections (b), (c) and (e) that reflect topics, date of training, instructor name and qualifications of instructor, length of training, location of training, participant's name, and job title.

e. d. Passenger van and specialty vehicle training: In addition to subsection (b), the agency shall include a training element for drivers of passenger or cargo vans that are designed, modified, or could otherwise be configured for an occupancy of nine to 15 persons (including the driver). The training component for vans shall include: classroom instruction, behind-the-wheel instruction (on the road, on a closed course or using a driving simulator) and a certificate or card of completion. For a motorized specialty vehicle or specialty mobile equipment, the agency shall ensure that instruction is conducted before initial operation of the vehicle or equipment. The instruction shall be based on nationally recognized industry standards and training time lines or manufacturer's operator instructions. For the purpose of this subsection, a motorized "specialty vehicle" or "specialty mobile equipment" means a conveyance designed for the transport of people or cargo that is not licensed or intended for use on public roadways.

f. Vehicle maintenance and inspections: The agency shall develop and implement a preventive maintenance and inspection element for vehicles. At a minimum, the agency shall ensure that maintenance and inspection staff use preventive maintenance schedules and repair records. Vehicle inspections shall comply with all state and federal inspection standards for the vehicles being inspected. The agency shall ensure that all state-owned motor vehicles utilized for state business are inspected and maintained in a safe operating condition.

g. e. Vehicle incident review: An agency shall ensure that the motor fleet safety program includes a vehicle incident review element. A Vehicle Incident Review Committee shall conduct a review of each incident that involves collision or damage to determine the cause and preventability of the incident, and recommend any corrective action to prevent recurrence. If the committee determines the incident was preventable, the driver shall attend defensive driver refresher training within three months of committee determination. Based on the circumstances, the agency head may direct additional corrective action. An authorized driver involved in any motor vehicle collision on state business shall promptly notify the authorized driver's immediate supervisor.

h. f. Driving record review: An agency shall develop and implement procedures for the review of an authorized driver's record maintained by the Motor Vehicle Division (MVD) of the Arizona Department of Transportation (ADOT). The agency shall establish a schedule for reviewing driving records based on agency-specific exposures and RM claims history data. The agency shall ensure that the driving record of each authorized driver is reviewed at least annually. The review shall cover the most recent 39-month period. For driving record reviews, each authorized driver shall, upon request, provide name, driver license number, expiration date and date of birth. A copy of a driving record release form is available upon request from RM. An authorized driver shall promptly notify the authorized driver's immediate supervisor of any license suspension, revocation, or restriction placed on the driver's license or privilege to drive a motor vehicle. If the license of an authorized driver is suspended or revoked, authorization to drive on state business is suspended on the date of driver's license suspension or revocation and remains suspended until the date of driver's license reinstatement. If a review of a driving record reveals one or more convictions totaling six or more points for the 39-month period, the appropriate agency management shall be notified. The driver shall attend defensive driver training or similar action designed to improve the person's driving skills. For the purpose of this Section, RM considers similar action to be successful completion of the MVD Traffic Survival School within 12 months of the record review.

i. g. Driving record review guidelines and criteria: Agencies may develop criteria that meet or exceed the requirements of this Section relating to accumulated MVD points or driving behavior. At a minimum, the following criteria are to be followed when evaluating a 39-month driving record and recommending agency action:

i. 5 or fewer points = Acceptable record: Continue annual driving record and driver insurance status checks.

ii. 6 to 7 points = Conditional record: Conduct driving record and driver insurance status checks at least twice a year. Driver attends defensive driver training or similar action designed to improve driving skill.

iii. 8 or more points = High-risk record: Request that the agency head limit driving on state business. If an agency head allows the authorized driver to drive on state business, the agency head shall provide to the driver, in writing, the limitations and the duration of the authorization to drive. An agency head shall not circumvent an order or action of the Motor Vehicle Division or any court.

13. 12. A safety and security standard for a construction site where state employees work, that includes:

a. Site-specific safety rules and procedures for the type of risks expected to be encountered on the site;

b. Routine inspection of construction sites to ensure compliance with local, state, and federal safety laws and rules;

c. Training of each employee in safe practices and procedures;

d. Availability of first-aid, medical, and emergency equipment and services at the construction site, including arrangements for emergency transportation;

e. Procedures to prevent theft, vandalism, and other losses at the construction site; and

f. Periodic testing and evaluation of the plan and correction of identified deficiencies.

History

• Adopted effective December 18, 1992 (Supp. 92-4). Amended effective January 12, 1995 (Supp. 95-1). Amended by final rulemaking at 6 A.A.R. 1717, effective April 20, 2000 (Supp. 00-2). Amended by final rulemaking at 13 A.A.R. 2043, effective August 4, 2007 (Supp. 07-2). Amended by final rulemaking at 23 A.A.R. 3239, effective 1/8/2018.

Article 3 INSURANCE: PURCHASE AND CONTRACTS

Ariz. Admin. Code § R2-10-301 Insurance: Purchase and Contracts

A. An agency seeking to purchase property, liability, or workers' compensation insurance shall request RM's approval in writing at least 90 days before the desired effective date of coverage. RM shall not reimburse an agency for the purchase of property, liability, or workers' compensation insurance that has not been approved by RM.

B. An agency shall submit a written request for approval to RM before the agency does one or more of the following:

1. Names or agrees to name any person or entity as an additional insured under the state's self-insurance or any other insurance obtained by or with RM's approval;

2. Provides or agrees to provide a Certificate of Insurance;

3. Agrees to indemnify,s hold harmless, or limit the liability of any party to a contract, lease, or other written agreement; or

4. Waives or agrees to waive the state's or the agency's right to subrogate with regard to any party to a contract, lease, or other written agreement.

C. The written request prescribed in subsection (B) shall be signed by the agency director and include all of the following:

1. The circumstances of the request;

2. Whether the party to the contract, lease, or written agreement is a sole source for the state;

3. The level or additional risk of loss to the state resulting from the requested action;

4. Whether the requested action helps the agency accomplish the agency's mission; and

5. An explanation of why the action to be approved is in the best interest of the state.

D. If a contract requires the state to be named as an additional insured, the contracting agency shall ensure that the name of the contracting agency and the state are included on the applicable additional insured endorsement (s).

History

• Adopted effective July 27, 1983 (Supp. 83-4). Amended effective June 12, 1989 (Supp. 89-2). Amended effective December 18, 1992 (Supp. 92-4). Amended effective January 12, 1995 (Supp. 95-1). Amended by final rulemaking at 11 A.A.R. 5453, effective February 4, 2006 (Supp. 05-4). Amended by final rulemaking at 30 A.A.R. 1941, effective 7/6/2024.

Ariz. Admin. Code § R2-10-302 Repealed

History

• Adopted effective July 27, 1983 (Supp. 83-4). Amended effective June 12, 1989 (Supp. 89-2). Repealed effective December 18, 1992 (Supp. 92-4).

Ariz. Admin. Code § R2-10-303 Repealed

History

• Adopted effective July 27, 1983 (Supp. 83-4). Former Section R2-10-303 repealed, new Section R2-10-303 adopted effective June 12, 1989 (Supp. 89-2). Repealed effective December 18, 1992 (Supp. 92-4).

Ariz. Admin. Code § R2-10-304 Repealed

History

• Adopted effective July 27, 1983 (Supp. 83-4). Amended effective June 12, 1989 (Supp. 89-4). Repealed effective December 18, 1992 (Supp. 92-4).

Article 4 PROVIDER INDEMNITY PROGRAM (PIP)

Ariz. Admin. Code § R2-10-401 Coverages and Limitations

A. The Department of Administration shall purchase insurance or self-insure the parties and programs as set forth in A.R.S. § 41-621(B) for losses caused by an occurrence or wrongful act which is the result of either the actions of a state client or an individual provider within the course and scope of activities as a state client or individual provider.

B. Coverages which shall apply under this program are as follows:

1. Liability coverage for providers and clients for damages resulting from acts and omissions within the course and scope of activities as a provider or client is provided pursuant to A.R.S. § 41-621(B). The amount that the Department will pay on behalf of an insured provider or client is limited as described in R2-10-401(C).

2. Coverage is provided on a replacement-cost-less-depreciation basis for the loss of or damage to real or personal property owned by a provider as a result of the actions of a client.

C. Limits of Liability Coverage:

1. The maximum amount of liability coverage that will be paid on behalf of an insured provider or client is $1,000,000 per claim, including related claims, and $2,000,000 in the aggregate for all claims first made against that provider or client during a single fiscal year of the State, July 1 through June 30, regardless of the number of:

a. Claims made; or

b. Persons making such claims or on whose behalf such claims are made; or

c. Causes of action asserted.

2. If more than one provider or client in a custodial-care facility or home is a PIP insured, the liability of all providers and clients combined in such home or facility shall be subject to a single per-claim limit.

3. For purposes of R2-10-401(C), a claim is "made" on the date that it was sent to the insured provider or client or, if a lawsuit, the date that the lawsuit was filed against the insured provider or client.

4. As used in R2-10-401(C), "related claims" means all claims based upon, arising from, or resulting from the same or related acts, omissions, facts, circumstances or events or the same or related series of acts, omissions, facts, circumstances or events, regardless of when such acts, omissions, facts, circumstances or events occur.

5. If two or more related claims are made against an insured provider or client in different state fiscal years, all such related claims shall be deemed to have been made when the first such related claim was made.

6. The payment of defense costs will not affect the per-claim or annual aggregate limit. However, once the annual aggregate limit has been paid, whether based upon settlement or a judgment, there will be no duty to defend that insured against any other claim to which that particular annual aggregate limit would apply.

C. D. The following are excluded from the Provider Indemnity Program coverage:

1. Mysterious disappearance of property;

2. Intentional, unlawful or illegal acts except claims pursuant to A.R.S. § 12-661 ;

3.2. Automobile physical damage resulting from permissive use by a client;

4.3. Benefits covered under any workers' compensation, unemployment compensation, or disability benefits law; and

5.4. All claims, injuries, and damages that A.R.S. § 41-621 excludes from coverage, including, without limitation, injury or damage that is expected or intended from the standpoint of the insured, including any such expected or intended injury or damage resulting from physical abuse, sexual abuse or sexual molestation.

History

• Adopted effective June 12, 1989 (Supp. 89-2). Amended effective December 18, 1992 (Supp. 92-4). Amended effective January 12, 1995 (Supp. 95-1). Amended by final rulemaking at 30 A.A.R. 1941, effective 7/6/2024.

Ariz. Admin. Code § R2-10-402 Repealed

History

• Adopted effective June 12, 1989 (Supp. 89-2). Repealed effective December 18, 1992 (Supp. 92-4).

Ariz. Admin. Code § R2-10-403 Repealed

History

• Adopted effective June 12, 1989 (Supp. 89-2). Repealed effective December 18, 1992 (Supp. 92-4).

Ariz. Admin. Code § R2-10-404 Repealed

History

• Adopted effective June 12, 1989 (Supp. 89-2). Repealed effective December 18, 1992 (Supp. 92-4).

Ariz. Admin. Code § R2-10-405 Repealed

History

• Adopted effective June 12, 1989 (Supp. 89-2). Repealed effective December 18, 1992 (Supp. 92-4).

Ariz. Admin. Code § R2-10-406 Repealed

History

• Adopted effective June 12, 1989 (Supp. 89-2). Repealed effective December 18, 1992 (Supp. 92-4).

Article 5 ENVIRONMENTAL LOSSES

Ariz. Admin. Code § R2-10-501 Investigation, Feasibility Study, and Remediation of the Release of Hazardous Substances

A. RM will provide funding for a site investigation, feasibility study, and remediation of any hazardous materials, operations, or wastes which have resulted in or may result in environmental damage and/or a health threat associated with property and/or facilities owned or operated by the state or at which such operations are conducted or materials/wastes are located.

B. RM will provide funding to determine the horizontal and vertical extent of the hazardous substance/waste discovered during the site investigation. This will include:

1. Sample collection and analysis of laboratory results from:

a. Soil boring samples

b. Trenching samples

c. Bedrock core samples

d. Groundwater monitoring well samples

e. Structural facilities

Geophysical surveys

3. If a feasibility study indicates remediation is necessary, RM will provide funding to the agency for an environmental remediation contractor as explained in R2-10-502.

C. RM shall not pay for site investigations and feasibility studies for agencies planning to obtain property by any means including lease, purchase, and gift, where there may be potential damage to the air, water, or soil.

History

• Adopted effective January 12, 1995 (Supp. 95-1).

Ariz. Admin. Code § R2-10-502 Expired

History

• Adopted effective January 12, 1995 (Supp. 95-1). Section expired under A.R.S. § 41-1056(J) at 28 A.A.R. 2061, effective 8/2/2022.

Ariz. Admin. Code § R2-10-503 Site Maintenance

RM shall, if the agency so requests, provide funding for site maintenance of closed hazardous substance/waste sites where remediation has been complete as required by the Arizona Department of Environmental Quality (ADEQ) or the Environmental Protection Agency (EPA).

History

• Adopted effective January 12, 1995 (Supp. 95-1).

Ariz. Admin. Code § R2-10-504 Expired

History

• Adopted effective January 12, 1995 (Supp. 95-1). Section expired under A.R.S. § 41- 1056(J) at 23 A.A.R. 448, effective January 11, 2017 (Supp. 17-1).

Article 6 COMPUTATION OF INTEREST ON APPEALED JUDGEMENTS

Ariz. Admin. Code § R2-10-601 Computation Procedures

A. Interest payable on judgments against the state that are appealed shall be computed by averaging the investment yields on three-month and six-month Treasury Bills as reported in the Federal Reserve's H 15 statistical release of selected interest rates for the period of time the case is on appeal.

B. Averages are calculated for each individual month of the appeal period and then averaged for the total months of the appeal period, excluding those months in which the case was on appeal for less than 15 days.

History

• Adopted effective January 12, 1995 (Supp. 95-1).

Chapter 11 DEPARTMENT OF ADMINISTRATION - PUBLIC BUILDINGS MAINTENANCE

Article 1 GENERAL

Ariz. Admin. Code § R2-11-101 Definitions

The following definitions apply in this Chapter:

1. "Agency" has the meaning in A.R.S. § 41-1001.

2. "Department" means the Department of Administration.

3. "Director" means the Director of the Department of Administration or the Director's designated agent.

4. "Person" has the meaning in A.R.S. § 1-215 but includes an agency, unless the agency is listed in A.R.S. § 41-791(B)(3).

5. "State building" means a building under the jurisdiction of the Director.

6. "State property" means all real property and buildings under the jurisdiction of the Department, as prescribed by A.R.S. § 41-791.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3).

Ariz. Admin. Code § R2-11-102 Alcoholic Beverages

A person shall not possess or consume alcoholic beverages on state property.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3).

Ariz. Admin. Code § R2-11-103 Altering Buildings or Grounds

A person shall not alter, remodel, or redecorate state property without prior approval from the Director.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3).

Ariz. Admin. Code § R2-11-104 Animals

A person shall not bring an animal, other than an animal guide or service animal, onto state property without prior approval from the Director.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3).

Ariz. Admin. Code § R2-11-105 Bicycles, Rollerblades, Rollerskates, and Skateboards

A person shall not use or operate bicycles, rollerblades, rollerskates, or skateboards on state property, unless that person is an on-duty police officer on bicycle patrol or a state employee using a bicycle for transportation to and from work.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3).

Ariz. Admin. Code § R2-11-106 Electrical or Plumbing Systems

A person shall not install or modify an electrical or plumbing system on state property, or any part of such a system, without prior approval from the Director.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3).

Ariz. Admin. Code § R2-11-107 Heating or Cooling Equipment

A person shall not tamper with or adjust heating or cooling equipment or controls on state property without prior approval from the Director.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3).

Ariz. Admin. Code § R2-11-108 Noise

A person shall not create loud noises on state property that interfere with the work of an employee or daily business of an agency.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3).

Ariz. Admin. Code § R2-11-109 Plants

A person shall not pick, cut, or remove flowers, shrubs, trees, or other plants or parts of plants from state property without prior approval from the Director.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3).

Ariz. Admin. Code § R2-11-110 Roofs

A person shall not be on the roof of a state building without prior approval from the Director.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3).

Ariz. Admin. Code § R2-11-111 Signs

A person shall not install a sign of any type on state property without prior approval from the Director.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3).

Ariz. Admin. Code § R2-11-112 Smoking

A person shall not smoke in a state building unless the person is in a designated smoking area or exempt under A.R.S. § 36-601.02(B).

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3).

Ariz. Admin. Code § R2-11-113 Waste

A. A person shall not leave garbage, litter, trash, human or animal waste, or any other kind of waste on state property unless the waste is deposited in a container the Department maintains for that kind of waste.

B. A person shall not deposit waste collected from a private residence or commercial business on state property.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3).

Ariz. Admin. Code § R2-11-114 Windows

A person shall not open windows in air-conditioned state buildings without prior approval from the Director.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3).

Article 2 TRAFFIC AND PARKING

Ariz. Admin. Code § R2-11-201 Definitions

The following definitions apply in this Article:

1. "Citation" means a document, issued by the Department's Capitol Police under A.R.S. § 41-796, that contains a notice to appear.

2. "Decal" means a graphic designed label, placard, sticker, or tag that, when properly displayed, authorizes preferential parking privileges in state parking lots for the driver of a vehicle.

3. "Designate" means to identify with signs or markings.

4. "Employee" means any person elected, appointed, or employed by the state, either on a part-time or full-time basis, whether paid by payroll or under contract or serving as a volunteer.

5. "Loading zone" means an area that is painted yellow, designating a place for business pickups and deliveries.

6. "No-parking zone" means an area that is painted red, designating a place where parking is not permitted.

7. "Parking" means stopping or placing a vehicle in an area, regardless of whether the vehicle is attended or unattended.

8. "Parking space" means an area that the Department outlines with painted white lines, designating a place for parking a vehicle.

9. "Reserved parking space" means any parking space designated for a special purpose or a special class, such as physically disabled persons, travel reduction program participants, or visitors.

10. "Safety zone" means an area or space that is both:

a. Officially set apart within a roadway for the exclusive use of pedestrians; and

b. Protected, marked, or indicated by adequate signs as to be plainly visible at all times.

11. "Vehicle" has the meaning in A.R.S. § 28-101 and includes a "motor vehicle," a term also defined in A.R.S. § 28-101.

12. "Visitor" means any person other than an employee.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3).

Ariz. Admin. Code § R2-11-202 General Provisions

A. The state is not responsible for the care and protection of any vehicle or its contents at any time the vehicle is operated or parked on state property.

B. The person to whom a parking permit is issued is responsible for all parking violations involving the person's vehicle.

C. If parking lot or area reservation hours are altered, the Department shall post notices at the parking lot or area, and the changes are effective immediately.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3).

Ariz. Admin. Code § R2-11-203 Parking Prohibitions

A. A person shall not park a vehicle in a:

Bicycle rack or area;

2. Loading zone, unless the person is making a pickup or delivery and the person's vehicle has commercial license plates or is state owned. Loading zone parking is permitted during the time the person is actually engaged in loading or unloading;

3. Location that is not designated as a parking space;

No parking zone;

5. Reserved parking space without authorization, unless the person is a visitor using parking reserved for visitors; or

6. Safety zone.

B. A person shall not obstruct any of the following with a vehicle:

1. Building entrance,

2. Driveway,

3. Fire lane,

4. Loading dock, or

5. Properly parked vehicle.

C. A person shall not drive or park a vehicle:

1. On a pedestrian path or sidewalk; or

2. In any area on state property closed by barricades, chain, tape, rope, traffic cones, or other traffic-control devices.

D. A person shall not park outside of the area designated by painted white lines when using a parking space.

E. In an emergency the Department may impose parking limitations or prohibitions required by the particular circumstances.

F. For special events the Department may impose parking limitations or prohibitions based on all of the following factors:

1. Previous experience with similar events, and

2. Risk data.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3).

Ariz. Admin. Code § R2-11-204 Parking Decals

A. Unless a person is a visitor using parking reserved for visitors, the person shall properly display a reserved parking space decal in the manner prescribed in this Section to be authorized to park in a reserved parking space.

B. To park in a parking space reserved for the physically disabled, a person shall obtain a removable windshield placard or special plates, bearing the international symbol of access, from the Department of Transportation, Motor Vehicle Division, and display the placard or plates as prescribed by rules of the Department of Transportation.

C. A person with a decal for any other kind of reserved parking space shall display the decal from the rearview mirror, attach the decal to the left side of the windshield, or display the decal on the left side of the dashboard. The person shall ensure that the decal is visible through the windshield so it can be read by someone standing outside the vehicle.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3).

Ariz. Admin. Code § R2-11-205 Operation of Vehicles on State Property

A. On state property the Department shall enforce all state laws governing the operation of vehicles.

B. A person driving or parking a vehicle on state property shall obey posted traffic and parking signs.

C. The Department's Capitol Police shall enforce a maximum speed limit of 5 miles per hour in all state parking lots under the Department's jurisdiction.

D. Any person who has been in an accident involving a moving vehicle on state property shall immediately report the accident to the Department's Capitol Police.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3).

Ariz. Admin. Code § R2-11-206 Expired

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3). Section expired under A.R.S. § 41-1056(J) at 24 A.A.R. 2563, effective June 13, 2017 (Supp. 18-3).

Ariz. Admin. Code § R2-11-207 Expired

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3). Section expired under A.R.S. § 41-1056(J) at 24 A.A.R. 2563, effective June 13, 2017 (Supp. 18-3).

Ariz. Admin. Code § R2-11-208 Expired

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3). Section expired under A.R.S . § 41-1056(J) at 24 A.A.R. 2563, effective June 13, 2017 (Supp. 18-3).

Ariz. Admin. Code § R2-11-209 Removal of Vehicles from State Property

The Department shall remove any vehicle on state property parked in a barricaded area, abandoned, or parked in a manner that constitutes a hazard or impediment to vehicular or pedestrian traffic or to the movement and operation of emergency equipment. The registered owner of the vehicle shall pay for all costs of removal.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3).

Article 3 SOLICITATION AND SPECIAL EVENT

Ariz. Admin. Code § R2-11-301 Definitions

The following definitions apply in this Article:

1. "Department" means the Arizona Department of Administration.

2. "Director" means the Director of the Arizona Department of Administration or the Director's designee.

1 3. "Solicitation" means any activity for the promotion, sale, advocacy or transfer of product or products, service or services, membership or memberships, or cause or causes. In addition, distribution or posting of advertisements, circulars, flyers, handbills, leaflets, posters, or other printed information for these purposes is solicitation.

2 4. "Solicitation material" means advertising, circulars, flyers, handbills, leaflets, posters, or other printed information.

3 5. "Solicitor" means a person conducting a solicitation activity.

6. "Special Event" or "Event" means an assembly, gathering, ceremony, press conference, demonstration, display, festival, parade, or rally conducted by a person excluding a ceremony, gathering, or press conference that is conducted by a person authorized by the head of a state agency using the agency's own office space.

7. "Sponsor" means the person holding an event.

4 8. "Work site" means any location within a state building where public employees or officers conduct the daily business of an agency including building lobby areas, cafeterias, break rooms, and areas outside of any main entrance.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3). Amended by final rulemaking at 25 A.A.R. 2211, effective 10/13/2019.

Ariz. Admin. Code § R2-11-302 Unauthorized Solicitation or Event Prohibited

A person shall not conduct a solicitation on state property or use state buildings or grounds for an event without express written permission from the Director.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3). Amended by final rulemaking at 25 A.A.R. 2211, effective 10/13/2019.

Ariz. Admin. Code § R2-11-303 Application

A. Any person who would like to conduct a solicitation or hold an event on state property may apply for a permit by filing, in person or by mail, a Department-approved application form with the Office of Special Events.

B. The completed application form shall be submitted at least 15 business days before the desired date of the solicitation or event. A completed application form is one that is legible and contains, at a minimum, all of the following information:

1. The name, address, and telephone number of the solicitor or sponsor;

2. The proposed date of the solicitation or event and the approximate starting and concluding times;

3. The specific, proposed location for the solicitation or event;

4. A general description of the solicitation or event, including equipment and facilities to be used;

5. Approximate number of persons expected to be in attendance.

6. The name, address, and telephone number of the person responsible for clean-up of the area after the activity, if different from the person in subsection (B)(1);

7. Copies of all solicitation materials to be used. All materials must provide accurate information;

8. The name, address, and telephone number of any chief monitor who will be designated to direct the solicitation or event;

9. A Certificate of Insurance as required by the Department's Risk Management Division; and

10. Any use of devices that create amplified noise must be included in the permit request.

C. The Director may accept a completed application form submitted less than 15 days before a press conference if the Director determines that enforcing the 15-day requirement would nullify the need for the press conference. In this situation, R2-11-304 does not apply.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3). Amended by final rulemaking at 25 A.A.R. 2211, effective 10/13/2019.

Ariz. Admin. Code § R2-11-304 Processing Procedure

A. Within three days of receiving an application, the Department shall notify the applicant that the application is either complete or incomplete. If the application is incomplete, the notice shall specify what information is missing.

B. An applicant with an incomplete application shall supply the missing information within five days after the date of the notice. If the applicant fails to do so, the Department may deny the permit.

C. Upon receipt of all missing information within five days, as specified in subsection (B), the Department shall notify the applicant that the application is complete.

D. The Department shall not process an application for a permit until the applicant has fully complied with R2-11-303.

E. The Director shall render a permit decision no later than three days after receipt of a complete application. The date of receipt is the postmark date of the notice advising the applicant that the application is complete.

F. For the purpose of A.R.S. § 41-1073, the Department establishes the following permit time-frames:

1. Administrative completeness review time-frame: three days.

Substantive review time-frame: three days.

3. Overall time-frame: six days.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3).

Ariz. Admin. Code § R2-11-305 Permit Issuance; Denial

A. Before issuing a permit, the Director shall review the application.

B. After consideration of the factors in subsection (C), the Director may issue a permit to an applicant who has complied with the application requirements in R2-11-303.

C. The Director may deny a permit for one or more of the following reasons:

1. The solicitation or event interferes with the work of an employee or daily business of an agency;

2. The solicitation or event conflicts with the time, place, manner, or duration of other events or solicitations for which permits have been issued or are pending;

3. The solicitation or event creates a risk of injury or illness to persons or risk of danger to property; or

4. The applicant, solicitation, or event fails to comply with the requirements of this Article.

D. A permit shall not be issued earlier than one year before the solicitation.

E. If the Director denies a permit, the Department shall send the applicant a written notice explaining:

1. The reason for denial, with citations to supporting statutes or rules,

The applicant's right to seek a hearing to challenge the denial,

3. The applicant's right to request an informal settlement conference under A.R.S. § 41-1092.06, and

4. The time periods for appealing the denial.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3). Amended by final rulemaking at 25 A.A.R. 2211, effective 10/13/2019.

Ariz. Admin. Code § R2-11-306 Bulletin Boards

A. The Director shall designate at least one bulletin board for solicitation or event material in each state building.

B. A person conducting a solicitation or event shall post solicitation or event material only on bulletin boards designated under subsection (A).

C. All posted material must go through the application process and receive approval of the Office of Special Events prior to posting on bulletin boards.

C D. The Department has the authority to remove solicitation or event material that is outdated or improperly posted.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3). Amended by final rulemaking at 25 A.A.R. 2211, effective 10/13/2019.

Ariz. Admin. Code § R2-11-307 State Resources

A person shall not use state materials, supplies, or equipment or other resources, such as payroll stuffing or interoffice mail, to conduct a solicitation.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3).

Ariz. Admin. Code § R2-11-308 Work Sites

Except for posting solicitation material on a bulletin board designated under R2-11-306, a person shall not conduct a solicitation at a work site.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3).

Ariz. Admin. Code § R2-11-309 Exemptions

A.This Article does not apply to the following state programs:

1. The State Deferred Compensation Program,

2. The State Employees Charitable Campaign,

3. The U.S. Savings Bond Drive,

4. The United Blood Services Blood Drive,

5. The Capitol Rideshare Commuter Club,

The Capitol Rideshare Clean Air Campaign,

7. Human Resources Professional Development programs,

7 8. The Employee Wellness Program,

8 9. The employee recognition programs of each agency subject to these rules, and 10. Programs as determined by the Director related to professional development or training only when sponsored or requested by the agency head.

B. An employee association composed principally of employees of state government agencies may apply under this Article for a permit to conduct a solicitation at a work site

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3). Amended by final rulemaking at 10 A.A.R. 5184, effective December 7, 2004 under A.R.S. § 41-1052(E) (Supp. 04-4). Amended by final rulemaking at 25 A.A.R. 2211, effective 10/13/2019.

Ariz. Admin. Code § R2-11-310 Suspension or Revocation

A. The Director may suspend or revoke a permit for failure to comply with this Article or other applicable laws.

B. Before the Director suspends or revokes a permit, the Department shall send the solicitor or sponsor written notice, explaining:

1. The reason for suspension or revocation, with citations to supporting statutes or rules,

2. The solicitor or sponsor's right to a hearing before suspension or revocation and

3. The time and place of the hearing concerning the suspension or revocation.

C. If the Director finds that public health, safety, or welfare imperatively requires emergency action, and incorporates a finding to that effect in the order, the Director may summarily suspend the permit pending proceedings for revocation or other action, based on circumstances of the emergency.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3). Amended by final rulemaking at 25 A.A.R. 2211, effective 10/13/2019.

Ariz. Admin. Code § R2-11-311 Review of Denial or Summary Suspension

A. Under A.R.S. Title 41, Chapter 6, Article 10, an applicant, solicitor, or sponsor may obtain a hearing on a denial or summary suspension.

B. An applicant appealing a denial shall file a notice of appeal with the Department within 30 days after receiving the notice prescribed in R2-11-305(E).

C. If the Director summarily suspends a permit under R2-11-310(C), the Department shall promptly prepare and serve a notice of hearing under A.R.S. § 41-1092.05.

D. The Department shall notify the Office of Administrative Hearings, which shall schedule and conduct the hearing.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3). Amended by final rulemaking at 25 A.A.R. 2211, effective 10/13/2019.

Ariz. Admin. Code § R2-11-312 Risk Management

A. The Director may take one or more of the following actions to the extent it is necessary and in the best interests of the state:

1. Impose conditions on the conduct of the event in the permit;

2. Require the applicant to post a deposit against damage and clean-up expense;

3. Require the applicant to carry liability insurance and provide the certificate of insurance; and

4. Require the applicant to provide medical, sanitary, and security services.

B. The Director shall consider all of the following criteria to determine whether one or more of the actions in subsection (A) is necessary and in the best interests of the state:

1. Previous experience with similar events;

2. Deposits required for similar events in Arizona;

3. Risk data; and

4. Medical, sanitary, and security services required for similar events in Arizona and the cost of those services.

C. The Department shall not provide insurance or guarantee against damage to equipment or personal property of any person using state buildings or grounds.

D. If the Director requires msance for a solicitation or event, the solicitor or sponsor shall list the state of Arizona and the Department as additional insured entities.

E. The sponsor is liable to the state for any injury done to its property and for any expense arising out of the sponsor's use of state buildings or grounds.

History

• New section made by final rulemaking at 25 A.A.R. 2211, effective 10/13/2019.

Article 4 SEVERABILITY

Ariz. Admin. Code § R2-11-401 Validity Of Rules

If a rule or portion of a rule contained in this Chapter is held unconstitutional or invalid, the holding does not affect the validity of the remaining rules.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3). Renumbered from R2-11-501 by final rulemaking at 25 A.A.R. 2211, effective 10/13/2019.

Ariz. Admin. Code § R2-11-402 [Repealed]

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3). Repealed by final rulemaking at 25 A.A.R. 2211, effective 10/13/2019.

Ariz. Admin. Code § R2-11-403 [Repealed]

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3). Repealed by final rulemaking at 25 A.A.R. 2211, effective 10/13/2019.

Ariz. Admin. Code § R2-11-404 [Repealed]

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3). Repealed by final rulemaking at 25 A.A.R. 2211, effective 10/13/2019.

Ariz. Admin. Code § R2-11-405 [Repealed]

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3). Repealed by final rulemaking at 25 A.A.R. 2211, effective 10/13/2019.

Ariz. Admin. Code § R2-11-406 [Repealed]

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3). Repealed by final rulemaking at 25 A.A.R. 2211, effective 10/13/2019.

Ariz. Admin. Code § R2-11-407 [Repealed]

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3). Repealed by final rulemaking at 25 A.A.R. 2211, effective 10/13/2019.

Ariz. Admin. Code § R2-11-408 [Repealed]

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3). Repealed by final rulemaking at 25 A.A.R. 2211, effective 10/13/2019.

Ariz. Admin. Code § R2-11-409 [Repealed]

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3). Repealed by final rulemaking at 25 A.A.R. 2211, effective 10/13/2019.

Article 5 GOVERNMENTAL MALL DEVELOPMENT

Ariz. Admin. Code § R2-11-501 Review of Denial or Summary Suspension

A. Under A.R.S. Title 41, Chapter 6, Article 10, an applicant, may obtain a hearing on a denial or summary suspension.

B. An applicant appealing a denial shall file a notice of appeal with the Department within 30 days after receiving the notice of denial.

C. If the Director summarily suspends a development project, the Department shall promptly prepare and serve a notice of hearing under Arizona Administrative Code Title 2, Chapter 19.

D. The Department shall notify the Office of Administrative Hearings, which shall schedule and conduct the hearing.

History

• New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3). Renumbered to R2-11-401 by final rulemaking at 25 A.A.R. 2211, effective 10/13/2019. New Section made by emergency rulemaking under A.R.S. § 41-1026 at 9 A.A.R. 3046, effective June 18, 2003 for a period of 180 days (Supp. 03-2). Emergency Section repealed and replaced by new Section under A.R.S. § 41-1026(E) made by final rulemaking at 9 A.A.R. 3781, effective August 8, 2003 (Supp. 03-3). Amended by final rulemaking at 26 A.A.R. 679, effective 6/5/2020.

Chapter 12 OFFICE OF THE SECRETARY OF STATE

Article 1 REPEALED

Ariz. Admin. Code § R2-12-101 Repealed

History

• Adopted as an emergency effective January 9, 1979, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 79-1). Adopted effective March 8, 1979 (Supp. 79-2). Repealed effective November 4, 1998 (Supp. 98-4).

Ariz. Admin. Code § R2-12-102 Repealed

History

• Adopted as an emergency effective January 9, 1979, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 79-1). Adopted effective March 8, 1979 (Supp. 79-2). Repealed effective November 4, 1998 (Supp. 98-4).

Ariz. Admin. Code § R2-12-103 Repealed

History

• Adopted as an emergency effective January 9, 1979, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 79-1). Adopted effective March 8, 1979 (Supp. 79-2). Repealed effective November 4, 1998 (Supp. 98-4).

Ariz. Admin. Code § R2-12-104 Repealed

History

• Adopted as an emergency effective January 9, 1979, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 79-1). Adopted effective March 8, 1979 (Supp. 79-2). Repealed effective November 4, 1998 (Supp. 98-4).

Ariz. Admin. Code § R2-12-105 Repealed

History

• Adopted as an emergency effective January 9, 1979, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 79-1). Adopted effective March 8, 1979 (Supp. 79-2). Repealed effective November 4, 1998 (Supp. 98-4).

Ariz. Admin. Code § R2-12-106 Repealed

History

• Adopted as an emergency effective January 9, 1979, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 79-1). Adopted effective March 8, 1979 (Supp. 79-2). Repealed effective November 4, 1998 (Supp. 98-4).

Ariz. Admin. Code § R2-12-107 Repealed

History

• Adopted as an emergency effective January 9, 1979, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 79-1). Adopted effective March 8, 1979 (Supp. 79-2). Repealed effective November 4, 1998 (Supp. 98-4).

Ariz. Admin. Code § R2-12-108 Repealed

History

• Adopted as an emergency effective January 9, 1979, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 79-1). Adopted effective March 8, 1979 (Supp. 79-2). Repealed effective November 4, 1998 (Supp. 98-4).

Ariz. Admin. Code § R2-12-109 Repealed

History

• Adopted as an emergency effective January 9, 1979, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 79-1). Adopted effective March 8, 1979 (Supp. 79-2). Repealed effective November 4, 1998 (Supp. 98-4).

Ariz. Admin. Code § R2-12-110 Repealed

History

• Adopted as an emergency effective January 9, 1979, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 79-1). Adopted effective March 8, 1979 (Supp. 79-2). Amended effective June 17, 1985 (Supp. 85-3). Repealed effective November 4, 1998 (Supp. 98-4).

Article 2 REPEALED

Ariz. Admin. Code § R2-12-201 Repealed

History

• Adopted as an emergency effective March 2, 1983 pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 83-2). Adopted as a permanent rule without change effective June 2, 1983 (Supp. 83-3). Repealed effective November 4, 1998 (Supp. 98-4).

Ariz. Admin. Code § R2-12-202 Repealed

History

• Adopted as an emergency effective March 2, 1983 pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 83-2). Adopted as a permanent rule without change effective June 2, 1983 (Supp. 83-3). Repealed effective November 4, 1998 (Supp. 98-4).

Ariz. Admin. Code § R2-12-203 Repealed

History

• Adopted as an emergency effective March 2, 1983 pursuant to A.R.S. § 41-1003, valid for only 90 days. Amended as an emergency effective March 22, 1983 pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 83-2). Correction to Supp. 83-2, amended as an emergency effective March 22, 1983, should have read "in the county where the examiner registers the voter". Section R2-12-202 adopted as a permanent rule without change as amended effective June 2, 1983 (Supp. 83-3). Repealed effective November 4, 1998 (Supp. 98-4).

Ariz. Admin. Code § R2-12-204 Repealed

History

• Adopted as an emergency effective March 2, 1983 pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 83-2). Adopted as a permanent rule without change effective June 2, 1983 (Supp. 83-3). Repealed effective November 4, 1998 (Supp. 98-4).

Ariz. Admin. Code § R2-12-205 Repealed

History

• Adopted as an emergency effective March 2, 1983 pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 83-2). Adopted as a permanent rule without change effective June 2, 1983 (Supp. 83-3). Repealed effective November 4, 1998 (Supp. 98-4).

Article 3 REGISTRATION OF TELEMARKETING SELLERS

Ariz. Admin. Code § R2-12-301 Repealed

History

• Adopted as an emergency effective September 12, 1989, pursuant to A.R.S. § 41-1026 valid for only 90 days (Supp. 89-3). Adopted without change as a permanent rule effective January 9, 1990 (Supp. 90-1). Repealed effective November 4, 1998 (Supp. 98-4).
• The following Section was inadvertently removed from the Arizona Administrative Code (Supp. 98-4). The Section should not have been removed and is therefore reinstated, with no lapse in effectiveness (Supp. 99-3).

Ariz. Admin. Code § R2-12-302 Fees

A. The annual registration fee for full-year registration shall be $500.00. The annual registration fee for an initial registration statement filed between August 1 and June 30 of a registration year shall be according to a sliding scale with a minimum fee of $250.00 as follows:

$500 - July (full-year registration)

$475 - August

$450 - September

$425 - October

$400 - November

$375 - December

$350 - January

$325 - February

$300 - March

$275 - April

$250 - May and June

B. The fee for filing A.R.S. § 44-1272 Supplemental Statements, including Quarterly Statements of changes in solicitors, shall be $25.00 per filing.

History

• Adopted as an emergency effective September 12, 1989, pursuant to A.R.S. § 41-1026 valid for only 90 days (Supp. 89-3). Adopted without change as a permanent rule effective January 9, 1990 (Supp. 90-1). Repealed effective November 4, 1998 (Supp. 98-4). Section reinstated after having been inadvertently removed (Supp. 99-3).

Ariz. Admin. Code § R2-12-303 Repealed

History

• Adopted as an emergency effective September 12, 1989, pursuant to A.R.S. § 41-1026 valid for only 90 days (Supp. 89-3). Adopted without change as a permanent rule effective January 9, 1990 (Supp. 90-1). Repealed effective November 4, 1998 (Supp. 98-4).

Article 4 NO TRESPASS PUBLIC NOTICE LIST

Ariz. Admin. Code § R2-12-401 Repealed

History

• Adopted as an emergency effective September 5, 1989, pursuant to A.R.S. § 41-1026 valid for only 90 days (Supp. 89-3). Adopted without change as a permanent rule effective January 9, 1990 (Supp. 90-1). Repealed effective November 4, 1998 (Supp. 98-4).

Ariz. Admin. Code § R2-12-402 Recording Private Property Rights - Fees

A. The following recording fees are established under A.R.S. § 23-1326.

1. Employer's Private Property Rights: annual recording fee, $20.

2. Employer's Private Property Rights per address and legal description of the property to which the employer has control: annual fee, per location, $4.

B. An employer who records property rights under A.R.S. § 23-1326 with the Secretary of State shall do so on a form prescribed by the Office.

C. If more than one property is listed, a supplemental form shall be used to list the additional properties.

D. The form and fees, and if applicable, supplemental form shall be accompanied by the Employer's Private Property Rights documents and filed with the Secretary of State 8:00 a.m. to 5:00 p.m., Monday through Friday except state holidays or state furlough days.

E. Checks or money orders shall be made payable to: Secretary of State.

F. The form and fees and supporting documents may be mailed or hand-delivered.

1. Mailing address: Secretary of State, Business Services, 1700 W. Washington St., Fl. 7, Phoenix, AZ 85007-2808.

2. In person:

a. Phoenix - State Capitol Executive Tower, 1700 W. Washington St., First Floor, Room 103; or

b. Tucson - Arizona State Complex Building, 400 W. Congress, Second Floor, Room 252.

History

• New Section made by exempt rulemaking at 17 A.A.R. 1637, effective August 15, 2011 (Supp. 11-3).
• The following Article was adopted under an exemption from the Arizona Administrative Procedure Act (A.R.S. Title 41, Chapter 6) pursuant to A.R.S. § 41-132. Exemption from A.R.S. Title 41, Chapter 6 means that these rules were not published as proposed rules, the general public was not allowed a comment period, and the rules were not approved by the Attorney General.

Article 5 ELECTRONIC SIGNATURES

Ariz. Admin. Code § R2-12-501 Definitions

A. "Acceptable Certification Authorities" means authorities that meet the requirements of R2-12-504.

B. "Approved List of Certification Authorities" means the list of Certification Authorities approved by the Secretary of State to issue certificates for electronically signed transactions involving public entities in Arizona.

C. "Asymmetric crypto-system" means an electronically processed algorithm, or series of algorithms, which uses two different keys with the following characteristics:

1. One key encrypts a given message;

2. One key decrypts a given message; and

3. The keys have the property that it is infeasible to discover one key from merely knowing the other key.

D. "CARAT Guidelines" means the CARAT Guidelines - Guidelines for Constructing Policies Governing the Use of Identity-Based Public Key Certificates drafted by the Certification Authority Rating and Trust (CARAT) Task Force of the National Automated Clearing House Association (NACHA), Version 1 Draft, September 21, 1998, excluding later amendments or additions, incorporated by reference and on file with the Secretary of State.

E. "Certificate" means an electronic document attached to a public key by a trusted certification authority, which provides proof that the public key belongs to a legitimate subscriber and has not been compromised.

F. "Certification Authority" means a person or entity that issues a certificate.

G. "Electronically signed communication" means an electronic message that has been processed in such a manner that the message is tied to the individual who signed the message.

H. "GITA" means the Government Information Technology Agency, as established by A.R.S. § 41-3501.

I. "Key pair" means a private key and its corresponding public key in an asymmetric crypto-system. The key pair is unique in that the public key can verify a digital signature that the private key creates.

J. "Message" means an electronic representation of information intended to serve as a written communication with a public entity.

K. "Person" means a human being or any organization capable of signing a document, either legally or as a matter of fact.

L. "Policy Authority" means, as defined by CARAT Guidelines, some authoritative party that formulates the guidelines defining the process of electronic signature use.

M. "Private key" means the key of a key pair used to create a digital signature.

N. "Public key" means the key of a key pair used to verify a digital signature.

O. "Public entity" means any budget unit, as defined in A.R.S. § 41-3501.

P. "S.A.S. 70" means the standards set in the American Institute of Certified Public Accounts (AICPA) Statement on Auditing Standards No. 70. Should current S.A.S. 70 standards (or any succeeding version) be superceded, the Secretary of State, in consultation with GITA and the State Treasurer, shall establish a deadline for all affected parties to comply with the replacing standard. This deadline shall be no later than two years from the date of issuance of the new S.A.S. standards. GITA will also provide a "roadmap" of how the revised standard fits the current Type 1 and Type 2 S.A.S. 70 designations used elsewhere in these rules.

Q. "Subscriber" means a person who:

1. Is the subject listed in a certificate,

2. Accepts the certificate, and

3. Holds a private key which corresponds to a public key listed in that certificate.

History

• Adopted by exempt rulemaking at 5 A.A.R. 742, effective February 19, 1999 (Supp. 99-1).

Ariz. Admin. Code § R2-12-502 Identification of Acceptable Technologies for Electronic Signatures

A. The Secretary of State shall accept, and approve for use, technologies for electronic signature, in consultation with the Policy Authority and GITA, provided the technologies meet the standards set forth in the GITA standards for Electronic Signatures, as specified in A.R.S. § 41-3504.

B. Provisions for Adding New Technologies

1. Any individual or company can petition the Secretary of State to review the technology, by providing a written request for review including a full explanation of a proposed technology that meets the requirements established under subsection (A) and meets the requirements of the Policy Authority as identified in R2-12-503.

2. The Secretary of State has 180 days from the date of the request to review the petition and either accept or reject it.

a. If the petitioner's proposed technology meets the requirements established under subsection (A) and meets the requirements of the Policy Authority, then GITA shall work with the Policy Authority to incorporate the new technology into electronic signature use by public agencies in Arizona.

b. If the proposed technology is rejected, the petitioner can appeal the decision through the Administrative Procedure Act, A.R.S. § 41-1092.08(H).

History

• Adopted by exempt rulemaking at 5 A.A.R. 742, effective February 19, 1999 (Supp. 99-1).

Ariz. Admin. Code § R2-12-503 Policy Authority

A. The office of the Secretary of State shall serve as the Policy Authority as defined within the CARAT Guidelines. These guidelines provide a prudent operational model that may be applied to new technologies as they are approved.

B. Decisions made by the Policy Authority under R2-12-501, R2-12-502, and R2-12-504 may be appealed pursuant to the Administrative Procedure Act, A.R.S. § 41-1092.08(H).

History

• Adopted by exempt rulemaking at 5 A.A.R. 742, effective February 19, 1999 (Supp. 99-1).

Ariz. Admin. Code § R2-12-504 Certification Authority Approval Application, Suspension, Revocation

A. Acceptable Certification Authorities

1. The Secretary of State shall maintain an "Approved List of Certification Authorities" authorized to issue certificates for electronically signed communication with public entities in Arizona.

2. Public entities shall only accept certificates from Certification Authorities that appear on the "Approved List of Certification Authorities" and are authorized to issue certificates by the Secretary of State.

B. Registration of Certification Authorities

1. The Secretary of State shall place Certification Authorities on the "Approved List of Certification Authorities" after the Certification Authority provides the Secretary of State with a copy of an unqualified performance audit performed in accordance with standards set in S.A.S. 70 to ensure that the Certification Authorities practices and policies are consistent with the requirements in this Article and any requirements of the Policy Authority.

a. Certification Authorities that have been in operation for one year or less shall undergo a S.A.S. 70 type 1 audit - A report of Policies and Procedures placed in operation, receiving an unqualified opinion.

b. Certification Authorities that have been in operation for longer than one year shall undergo a S.A.S. 70 type 2 audit - A Report of Policies and Procedures placed in operation and test of operating effectiveness, receiving an unqualified opinion.

c. To remain on the "Approved List of Certification Authorities", a Certification Authority must provide proof of compliance every two years after initially being placed on the list and meet any requirements of the Policy Authority in effect at that time.

2. In lieu of completing the auditing requirement in subsection (B)(1), Certification Authorities may be placed on the "Approved List of Certification Authorities" upon providing the Secretary of State with proof acceptable to the Secretary of State that the Certification Authority meets the Policy Authority's criteria for acceptance of a Foreign License (non-Arizona license).

a. Certification Authorities shall be removed from the "Approved List of Acceptable Certification Authorities" unless they provide current proof of accreditation to the Secretary of State at least once per year no later than December 31 of each year.

b. If the Secretary of State is informed a Certification Authority has had its accreditation revoked, the Certification Authority shall be removed from the "Approved List of Certification Authorities" immediately.

History

• Adopted by exempt rulemaking at 5 A.A.R. 742, effective February 19, 1999 (Supp. 99-1).

Article 6 ELECTRONIC VOTER REGISTRATION

Ariz. Admin. Code § R2-12-601 Definitions

In addition to the definitions provided in A.R.S. §§ 16-101, 16-111, 16-140, and 16-153, unless the context provides otherwise, the following definitions apply to this Article:

1. "Destination county recorder" means the county recorder to which the registrant's voter registration application is delivered.

2. "Electronic signature" is defined in A.R.S. § 41-132.

3. "Electronic voter registration form" means the capture and acknowledgment of statements on behalf of the registrant during the electronic voter registration process. Its contents are substantively the information prescribed by A.R.S. § 16-152.

4. "Electronic voter registration process" means the sequence of events between a registrant and a transmitter beginning with identification of the registrant up to and including submitting the registration information.

5. "Electronic voter registration, statement, or other document" means all data entered into a registration, statement, or other document that is electronically prepared and transmitted to a county recorder.

6. "Identification register" means the index of information containing registrant information maintained by a transmitter.

7. "Registrant" means a person attempting to register to vote.

8. "Transmitter" means an agency who is part of the chain of transmission of an electronic voter registration, statement, or other document from a registrant to a destination county recorder even though the agency did not receive the transmitted registration, statement, or other document directly from the registrant.

9. "Wet signature" means a physically generated signature of a person that can be compared to other physically generated signatures of the person for verification of authenticity.

History

• New Section made by final rulemaking at 8 A.A.R. 1905, effective March 29, 2002 (Supp. 02-1).

Ariz. Admin. Code § R2-12-602 Retention of Electronic Voter Registration Forms

A. For each electronic voter registration transmitted to the Secretary of State, the Secretary of State shall keep the documents listed in A.R.S. § 16-152(B) until the next General Election or the date a county recorder confirms the registration is received, whichever is later.

B. For each electronic voter registration transmitted to a county recorder, the county recorder shall keep the documents listed in A.R.S. § 16-152(A) as specified by A.R.S. § 16-162.

History

• New Section made by final rulemaking at 8 A.A.R. 1905, effective March 29, 2002 (Supp. 02-1).

Ariz. Admin. Code § R2-12-603 Electronic Signatures for Electronic Voter Registration Forms

A. To accept the terms of the electronic voter registration process, a registrant shall electronically sign the electronic voter registration form. If a registrant uses an electronic signature, the registrant shall:

1. Declare, under penalty of perjury, that the electronic voter registration form is true, correct, and complete to the best of the registrant's knowledge; and

2. Signify to the transmitter during the electronic voter registration process to release the electronic voter registration form to the destination county recorder.

B. An electronic signature for use on an electronic voter registration form shall be a separate acknowledgement statement authorizing the transmitter to transmit the information to the destination county recorder.

C. A registrant may use an electronic signature on an electronic voter registration form if the following conditions are true:

The registrant is active in the transmitter's identification register.

2. The registrant is uniquely identified by name, physical address, and date of birth in the transmitter's identification register.

3. A digitized image of the registrant's wet signature exists with the transmitter for the purpose of transmitting with the electronic voter registration form to the destination county recorder.

D. If a registrant does not electronically sign the registrant's electronic voter registration form, the registrant may complete the voter registration process on paper.

History

• New Section made by final rulemaking at 8 A.A.R. 1905, effective March 29, 2002 (Supp. 02-1).

Ariz. Admin. Code § R2-12-604 Acceptable Transmitters of Electronic Voter Registration Forms

A. Only the following government agencies may be transmitters:

1. The Department of Transportation,

2. The county recorders, and

3. The Secretary of State.

B. Each transmitter shall enter into an agreement with the Secretary of State to transmit electronic voter registration information before transmitting electronic voter registration information.

History

• New Section made by final rulemaking at 8 A.A.R. 1905, effective March 29, 2002 (Supp. 02-1).

Ariz. Admin. Code § R2-12-605 Transfer of Electronic Voter Registration Information

A. The Secretary of State, or its duly authorized third party, shall receive an electronic voter registration information from an accepted transmitter and deliver it to a destination county recorder.

B. A county recorder may:

1. Receive electronic voter registration information updates through the Secretary of State;

2. Receive paper renditions of the electronic voter registration information on a registration form prescribed by the Secretary of State;

3. Receive digitized images of the electronic voter registration information in a registration form prescribed by the Secretary of State.

C. Information collected to update a registrant's voter registration information may be transmitted electronically if the following conditions are true:

1. A registrant provides information to a transmitter for updating the registrant's name or address in the identification register pursuant to A.R.S. § 16-112(B)(4).

2. The information specified in subsection (C)(1) is received from a transmitter specified in R2-12-604(A).

3. The information specified in subsection (C)(1) is transmitted in an electronic voter registration format via an electronic manner accepted by the Secretary of State.

4. The information specified in subsection (C)(1) uniquely identifies an elector of a county recorder's voter registration roll by name and date of birth.

D. Information collected for the intent of initial registration to the voter registration rolls may be transmitted electronically if:

1. The information meets the criteria of subsection (C);

The information contains a digitized image of a registrant's wet signature; and

3. The information has been electronically signed by a registrant to authorize the transmitter to release the electronic voter registration form.

E. Voter registration information shall be kept confidential pursuant to A.R.S. § 16-153.

F. Driver's license information shall be kept confidential pursuant to A.R.S. § 16-112.

History

• New Section made by final rulemaking at 8 A.A.R. 1905, effective March 29, 2002 (Supp. 02-1).

Article 7 BALLOT MEASURE PUBLICITY PAMPHLET ARGUMENT FEES

Ariz. Admin. Code § R2-12-701 Ballot Measure Publicity Pamphlet Argument

The following fees have been established by the Office of the Secretary of State, for the purpose of offsetting the cost of printing "pro" and "con" arguments in the ballot measure publicity pamphlet as required by A.R.S. § 19-124(D):

1. Argument filed on paper only - $100.00.

2. Argument filed on paper and electronic format (computer disk) - $75.00.

History

• New Section adopted by final rulemaking at 6 A.A.R. 1076, effective March 3, 2000 (Supp. 00-1).

Article 8 PROFESSIONAL EMPLOYER ORGANIZATIONS

Ariz. Admin. Code § R2-12-801 Definitions

Unless the context otherwise requires, the definitions of terms contained in A.R.S. § 23-561 are applicable in this Article. Additionally, the following definitions apply in this Article, unless otherwise specified in these rules:

1. "Application" means such forms, materials, fees, and information required to enable the Secretary of State to ascertain if an applicant meets the requirements of registration.

2. "Common Control" means having charge of those activities that are inherent in operating a PEO or PEO group.

3. "Controlling Person" means any organization or person that possesses, directly or indirectly, through financial ownership or otherwise, the power to direct, or cause the direction of, the management or policies of the PEO.

4. "PEO" means professional employer organization.

5. "Parent PEO" means an organization or person that holds common control over two or more PEOs and is the designated entity under which a group registration is filed.

6. "Professional Employer Group" means two or more professional employer organizations that are under common control of a parent PEO and that operate under a group registration issued under A.R.S. § 23-566.

History

• New Section made by final rulemaking at 13 A.A.R. 4501, effective January 29, 2008 (Supp. 07-4).

Ariz. Admin. Code § R2-12-802 Registration

A. Each applicant shall apply to the Secretary of State in writing upon forms available from the Secretary of State. Each completed application shall contain the required documentation identified in each type of registration pursuant to A.R.S. §§ 23-563, 23-564, 23-565, 23-566 and 23-567 and each application shall be verified by oath or affidavit by the applicant, and shall be accompanied by the fees required by these rules.

B. A certificate shall be issued to an applicant who submits a complete application if the Secretary of State determines that the applicant meets the requirements of registration.

C. A written notice of denial of registration shall be provided to an applicant who submits a complete application if the Secretary of State determines that the applicant does not meet the requirements of registration.

D. A written notice shall be provided to an applicant who submits an incomplete application. This notice shall advise the applicant that the application is incomplete and that the application is denied, unless the applicant corrects the deficiencies within 30 days or such greater time as specifically provided in the notice of deficiency and otherwise meets all requirements for registration as determined by the Secretary of State.

E. An applicant shall respond within 30 days to all requests of the Secretary of State for further information regarding an application. Failure to provide the requested information within 30 days or such greater time as specifically provided in the Secretary of State's request shall be grounds for the denial of an application.

F. An applicant who is required to deposit a bond, an irrevocable letter of credit or securities in a depository, to fulfill the requirements of A.R.S. § 23-569(A)(2) shall submit the bond, an irrevocable letter of credit or securities with the Secretary of State's office.

G. Upon receiving a bond, an irrevocable letter of credit or securities the Secretary of State's office shall deposit the asset with the State of Arizona Treasurer's Office who shall confirm the transaction by issuing documentation identifying the date and type of deposit.

History

• New Section made by final rulemaking at 13 A.A.R. 4501, effective January 29, 2008 (Supp. 07-4).

Ariz. Admin. Code § R2-12-803 Limited Registration

An applicant for limited registration must provide with its application:

1. A copy of the statutory and regulatory PEO requirements of another state in which the PEO applicant is registered and which govern that PEO's out-of-state registration. The governing statutory and regulatory requirements from the other state must be substantially similar to the PEO requirements of Arizona as determined by the Arizona Secretary of State.

A certificate or documentation issued by that state's licensing agency showing that the applicant's registration is current and valid and discloses whether the applicant has been subject to any disciplinary actions in that state.

3. A statement signed by a controlling person of the PEO declaring that the PEO meets the requirements of limited registration as provided in A.R.S § 23-567(A)(1) through (4).

History

• New Section made by final rulemaking at 13 A.A.R. 4501, effective January 29, 2008 (Supp. 07-4).

Ariz. Admin. Code § R2-12-804 Late Registration

If renewal registration is not received by the Secretary of State within 120 days after the applicant's completed fiscal year, the applicant shall pay the established registration renewal fee.

History

• New Section made by final rulemaking at 13 A.A.R. 4501, effective January 29, 2008 (Supp. 07-4).

Ariz. Admin. Code § R2-12-805 Registration Fees

A. A PEO registering with the Secretary of State shall pay the following fees:

1. If applying for initial registration:

a. The initial registration fee shall be $1,000; and

b. The renewal registration fee shall be $1,000.

2. If applying for group registration:

a. The initial group registration fee shall be $1,000 for the parent employer organization and $500 for each member of the group; and

b. The group registration renewal fee shall be $1,000 for the parent organization and $500 for each member of the group.

3. If applying for limited registration:

a. The initial limited registration fee shall be $1,000; and

b. The limited registration renewal fee shall be $1,000.

B. All fees are nonrefundable.

History

• New Section made by final rulemaking at 13 A.A.R. 4501, effective January 29, 2008 (Supp. 07-4).

Ariz. Admin. Code § R2-12-806 Complaints

A. Any person may file a complaint with the Office of the Secretary of State regarding a PEO. The Secretary of State shall receive any complaints and shall investigate and determine whether action is necessary involving allegations of any misconduct as provided in A.R.S. § 23-575 and these rules.

1. A complaint must be in writing;

2. The complainant shall be clearly identified. If an entity files a complaint an individual shall be identified in the complaint that will serve as a contact person while the investigation of the complaint is conducted;

3. The name of the PEO who has allegedly committed the misconduct must be clearly identified;

4. The nature of the misconduct and the circumstances surrounding the alleged misconduct shall be clearly identified; and

5. Documentation, if any, supporting the allegations shall accompany the complaint.

B. Upon receipt of the complaint the Secretary of State shall mail a copy of the complaint to the PEO in question and request a written response.

C. If a PEO fails to respond within 30 days to a request for information during an investigation the Secretary of State may take action pursuant to A.R.S. § 23-575(E).

History

• New Section made by final rulemaking at 13 A.A.R. 4501, effective January 29, 2008 (Supp. 07-4).

Ariz. Admin. Code § R2-12-807 Investigations

A. The Secretary of State or its representative may request information, perform an investigation, audit, or review documents necessary to determine whether a PEO has violated any provision of A.R.S. §§ 23-563 through 23-569 or 23-575 or these rules.

B. Information gathered pursuant to an investigation is confidential and not open to public inspection pursuant to A.R.S. § 23-563(C).

C. The disciplinary record of a PEO is a matter of public record as allowed by law.

History

• New Section made by final rulemaking at 13 A.A.R. 4501, effective January 29, 2008 (Supp. 07-4).

Ariz. Admin. Code § R2-12-808 Administrative Hearings

If the Secretary of State denies an application for registration, or restricts, revokes or refuses to renew a registration, or if the Secretary of State places a registrant on probation, upon notification, the registrant may appeal the decision of the Secretary of State pursuant to the procedure provided in A.R.S. Title 41, Chapter 6, Article 10.

History

• New Section made by final rulemaking at 13 A.A.R. 4501, effective January 29, 2008 (Supp. 07-4).

Ariz. Admin. Code § R2-12-809 Restriction, Revocation or Probation of Registration

A. If a PEO fails to comply with any of the requirements of registration the Secretary of State may restrict, revoke or place the PEO on probation until such time as the PEO comes into compliance with the registration requirements.

B. If the PEO fails to cure any deficiency within 150 days of the registration renewal date, the Secretary of State may revoke the registration of an applicant.

C. If a PEO fails to comply with any of the duties and responsibilities identified in R2-12-811 the Secretary of State may take action pursuant to A.R.S. § 23-575(E) and (F) until such time as the PEO comes into compliance.

D. Upon restriction of a registration, the holder of the restricted registration shall:

1. Immediately cease soliciting clients for PEO services.

2. Notify each client of the PEO of the PEO's restriction within five days after the effective date of the restriction.

E. Upon revocation of a registration, the holder of the revoked registration shall:

1. Cease all PEO operations immediately.

2. Notify each client of the PEO of the PEO's revocation within two days after the effective date of revocation.

F. Upon the completion of a period of registration restriction or the reinstatement of a registration that was revoked the PEO shall be placed on probation for one year.

History

• New Section made by final rulemaking at 13 A.A.R. 4501, effective January 29, 2008 (Supp. 07-4).

Ariz. Admin. Code § R2-12-810 Requirements for Reinstatement of a Restricted, Revoked or Probationary Registration After the Specified Term of Discipline

A. Unless otherwise specified in a disciplinary order imposing revocation, the disciplined registrant may, after two years from the date of the disciplinary order, petition for the reinstatement of its registration.

B. Unless otherwise specified in a disciplinary order a PEO whose registration has been restricted or put on probation the disciplined registrant shall, at the end of the restriction, or probation, petition for the release from the conditions of restriction or probation.

C. Unless otherwise provided by a disciplinary order, an applicant who applies for reinstatement of a registration after the specified term of restriction or revocation of the registration shall:

1. Submit an application for registration complete with all supporting documents as is required when making an initial application for registration demonstrating the applicant meets all current qualifications for registration and compliance with requirements and conditions of registration reinstatement;

2. Submit a Petition for Release from the imposed disciplinary order that documents that all conditions of reinstatement and requirements for re-registration have been fulfilled;

3. Pay the established registration renewal fee;

4. Provide documentation to the Secretary of State to clearly demonstrate the applicant is statutorily qualified to be reinstated to engage in offering PEO services; and

5. Pay all monies due.

History

• New Section made by final rulemaking at 13 A.A.R. 4501, effective January 29, 2008 (Supp. 07-4).

Ariz. Admin. Code § R2-12-811 Duties and Responsibilities

A. An applicant or registered PEO shall notify the Secretary of State in writing within 30 days of any conviction, judgment, guilty plea or no contest plea of the applicant or any of the applicant's controlling persons for any violation listed in A.R.S. § 23-575.

B. An applicant or registered PEO shall notify the Secretary of State in writing within 30 days of any final action by a state or federal regulatory agency for violations related to the operation of a PEO.

C. An applicant or registered PEO shall notify the Secretary of State in writing within 30 days of any determination by any court of competent jurisdiction, including federal courts, located in any state, that the applicant or any of the applicant's controlling persons were found, or pled guilty to fraud related to the operation of a PEO.

D. An applicant or registered PEO shall respond to any requests for information and comply with any investigations that are initiated by the Secretary of State.

E. An applicant or registered PEO shall notify the Secretary of State in writing within 10 days of the PEO's failure to stay current with obligations that relate to payroll, payroll-related taxes, workers' compensation insurance premiums for covered employees and employee benefits.

History

• New Section made by final rulemaking at 13 A.A.R. 4501, effective January 29, 2008 (Supp. 07-4).

Article 10 CAMPAIGN CONTRIBUTIONS AND EXPENSES; STANDING POLITICAL COMMITTEES SECTION

Ariz. Admin. Code § R2-12-1001 Filing Fees

A. A fee of $250.00 shall accompany the filing of a Statement of Organization that declares the status of a Standing Political Committee. Regardless of the date of filing of a Statement of Organization, the annual registration of all Standing Political Committees shall expire midnight on December 31.

B. A fee of $250.00 shall be submitted to the Secretary of State for the annual renewal of a Standing Political Committee's status. Annual renewal fees are due and payable on or before January 1.

C. All fees shall be made payable to the Office of the Secretary of State. Fees paid to the Secretary of State for Standing Political Committee status are non-returnable and non-transferable.

History

• New Section adopted by final rulemaking at 6 A.A.R. 3567, effective August 23, 2000 (Supp. 00-3).

Article 11 NOTARY PUBLIC BONDS AND FEES

Ariz. Admin. Code § R2-12-1101 Definitions

The following definitions shall apply in this Article unless the context otherwise requires:

"Acknowledgment" means the same as defined in A.R.S. § 41-311(1).

"Bond" means a surety bond to the state, with sureties approved by the clerk of the superior court in the county in which the individual is being commissioned as a notary public.

"Copy certification" means the same as defined in A.R.S. § 41-311(3).

"Credible person" means a person used to identify a signer when the signer does not have other satisfactory evidence of identity as specified in A.R.S. § 41-311(11).

"Jurat" means the same as defined in A.R.S. § 41-311(6).

"Oath" or "affirmation" means the same as defined in A.R.S. § 41-311(10).

"Satisfactory evidence of identity" means the same as defined in A.R.S. § 41-311(11).

History

• New Section adopted by emergency rulemaking at 6 A.A.R. 2956, effective July 18, 2000 (Supp. 00-3). Emergency rulemaking renewed at 7 A.A.R. 672, effective January 13, 2001 (Supp. 01-1). Section made by final rulemaking at 7 A.A.R. 2141, effective May 1, 2001 (Supp. 01-2).

Ariz. Admin. Code § R2-12-1102 Notary Public Fees

A. Pursuant to A.R.S. § 38-412, a notary public shall keep posted at all times in a conspicuous location, the fee schedule listed under subsection (E)(1) through (3).

B. Upon reviewing the fees schedule under subsection (E)(1) through (3), a notary shall select a standard fee, from "no charge" up to the maximum $10 fee for a notarial act. A notary public shall be consistent when charging fees and post the fee schedule in a conspicuous location.

C. When posting fees under subsection (A) and (B), notaries shall use the template in Exhibit 1. Notary Public Services.

D. Before performing any notarial act, the notary public shall inform the requestor of the service fee if one will be charged.

E. A Notary public may charge the following fee:

1. For an acknowledgment or jurat, "no charge" up to $10 per notary public signature;

2. For jurats, $2 per signature;

3. 2. For a copy certification, "no charge" up to $10 per page certified;

4. 3. For an oath or affirmation, "no charge" up to $10 per notarial act.

History

• New Section adopted by emergency rulemaking at 6 A.A.R. 2956, effective July 18, 2000 (Supp. 00-3). Emergency rulemaking renewed at 7 A.A.R. 672, effective January 13, 2001 (Supp. 01-1). Section made by final rulemaking at 7 A.A.R. 2141, effective May 1, 2001 (Supp. 01-2). Amended by final rulemaking at 24 A.A.R. 137, effective 3/5/2018.

Ariz. Admin. Code § R2-12-1103 Notary Public Bonds

A. Notaries public shall purchase a bond in the amount of $5,000 before being commissioned as a notary public. The original bond shall be filed with the clerk of the superior court in the applicant's county of residence. A copy of the bond shall be filed with the applicant's application form submitted to the Secretary of State's Office.

B. The bond shall contain, on its face, the oath of office for the notary public as specified in A.R.S. § 38-233(B). This oath shall be as specified in A.R.S. § 38-231. The notary shall endorse the oath on the face of the bond, immediately below the oath, by signing the notary's name under which the person has applied to be commissioned as a notary and exactly as the name appears on the notary application form filed with the Secretary of State's Office.

History

• New Section adopted by emergency rulemaking at 6 A.A.R. 2956, effective July 18, 2000 (Supp. 00-3). Emergency rulemaking renewed at 7 A.A.R. 672, effective January 13, 2001 (Supp. 01-1). Section made by final rulemaking at 7 A.A.R. 2141, effective May 1, 2001 (Supp. 01-2).

Article 12 ELECTRONIC NOTARY

Ariz. Admin. Code § R2-12-1201 Definitions

The following definitions shall apply to this Article unless context otherwise requires:

"Apostille" means a certificate that authenticates the seals and signatures of officials on public documents issued by public authorities for use in foreign countries that are members of the 1961 Hague Convention Treaty.

2. "Certificate Authority" means an entity that issues digital certificates for use in performing electronic notarizations.

3. "Commission" means the same as defined in A.R.S. § - 41-251(2).

4. "Electronic" means the same as defined in A.R.S. § - 41-251(3).

"Electronic notarization" or "electronic notarial act" means a notarial act performed with respect to an electronic record in accordance with this Article while the signer is in the physical presence of the notary public.

6. "Electronic notary public" means a notary public authorized to perform electronic notarial acts.

7. "Electronic record" means information that is created, generated, sent, communicated, received or stored by electronic means.

8. "Electronic seal" means an electronic image that contains information attached to or logically associated with an electronic record and that contains the words "notary public", the name of the county in which the notary public is commissioned, the notary public's name as it appears on the notarial commission, the commission number and the expiration date of the notarial commission.

9. "Electronic signature" means the same as defined A.R.S. § 41-251(4).

10. "Non-repudiation" means the signer of an electronic document shall not deny their electronic signature without factual basis.

11. "Notarial act" means the same as defined in A.R.S. § 41-251(6).

12. "Notary public" or "notary" means the same as defined in A.R.S. § 41-251(8).

13. "Person" means the same as defined in A.R.S. § - 41-251(10).

"Qualified Certificate Authority" means a trusted entity that issues digital certificates in compliance with the requirements of R2-12-1204.

15. "Tamper-evident technology" means a set of applications, programs, hardware, software, or other technologies designed to enable a notary public to perform notarial acts with respect to electronic records and to display evidence of any changes made to an electronic record.

History

• New Section made by final rulemaking at 9 A.A.R. 2085, effective August 1, 2003 (Supp. 03-2). R2-12-1201 renumbered to R2-12-1202 by final rulemaking at 26 A.A.R. 106, effective 12/30/2019. Amended by final rulemaking at 28 A.A.R. 719, effective 3/24/2022.

Ariz. Admin. Code § R2-12-1202 Authority to Perform Electronic Notarization

A notary public of this state may perform electronic notarizations during the term of the notary public's commission if:

1. The notary public has received written authorization from the Secretary of State to perform either:

a. Full name and any former names used by the applicant; Electronic notarizations under this Article; or

b. Physical address and telephone number; Remote online notarizations; and

c. Mailing address and telephone number;

d. Business address, telephone number, fax number and email address, if applicable;

e. County of residence;

f. Gender;

g. Date of birth;

h. The previous commission number of the applicant if previously an electronic notary or notary public appointed under A.R.S. § 41-312 in Arizona, if applicable;

i. Responses to questions regarding the applicant's background on the following subjects:

i. Whether the applicant has been convicted of a felony or an undesignated offense in this or any other jurisdiction and whether the applicant has been restored to civil rights.

ii. Whether the applicant has been convicted of a lesser offense involving moral turpitude or of a nature that is incompatible with the duties of a notary public in this or any other jurisdiction such as a finding that the applicant engaged in conduct that would violate A.R.S. § 41-313 if adjudicated in Arizona, or that the applicant engaged in conduct that constituted misconduct in public office or demonstrated dishonesty or a lack of veracity.

iii. Whether the applicant has ever had a professional license revoked, suspended, restricted, or denied for misconduct, dishonesty, or any cause that relates to the duties or responsibilities of a notary public such as a finding that the applicant engaged in conduct that would violate A.R.S. § 41-313 if adjudicated in Arizona, or that the applicant engaged in conduct that demonstrated dishonesty or a lack of veracity.

iv. Whether the applicant has had a notary commission revoked, suspended, restricted, or denied in this state or any other jurisdiction.

v. Statement that applicant is 18 years of age or older.

vi. Statement of being an Arizona resident.

vii. Whether the applicant holds or has held a notary commission in another state or jurisdiction and the commission number and jurisdiction, if applicable.

2. The Secretary of State has not terminated or revoked such authorization.

3. Each applicant shall register with the Secretary of State in a manner prescribed by the Secretary of State the applicant's possession of an approved electronic notary token within 90 days of submitting the application.

History

• New Section made by final rulemaking at 9 A.A.R. 2085, effective August 1, 2003 (Supp. 03-2). R2-12-1202 renumbered from R2-12-1201 by final rulemaking at 26 A.A.R. 106, effective 12/30/2019.

Ariz. Admin. Code § R2-12-1203 Registration

A. To receive authorization from the Secretary of State to perform electronic notarizations a notary public must submit an application in a format prescribed by the Secretary of State that provides the following information about the applicant:

1. The applicant's full legal name and the name under which the applicant is commissioned as a notary public (if different);

2. The applicant's email address;

3. A description of the technologies or devices that the applicant intends to use to perform electronic notarizations;

4. The name, address, and website URL of any vendors or other persons that will directly supply to the applicant the technologies that the applicant intends to use;

5. A statement certifying that the applicant has obtained a digital certificate from a qualified certificate authority to be used by the applicant in performing electronic notarizations; and

6. A statement certifying that the technologies described in the application comply with the requirements of this Article.

B. The application must be submitted to the Secretary of State as provided by information posted on the Secretary of State's website at https://azsos.gov/.

C. If, during the term of a notary public's commission, the notary public intends to use the technologies of another vendor or person than those identified under subsection (A)(3) and (4), then an additional application or amendment identifying such other vendors or other persons must be submitted to the Secretary of State as provided in this section.

D. If the technology identified in the application under subsection (A) conforms to the standards adopted under this Article and the applicant satisfies the requirements of this section, the Secretary of State shall approve the use of the technology and issue to the notary public written authorization to perform electronic notarizations.

E. The Secretary of State may reject the application, or terminate or revoke a prior authorization given under this section, for the following reasons:

1. The applicant's failure to comply with A.R.S. §§ 41-251 through 41-333 or this Article;

2. Any information required under subsection (A) is missing, inaccurate, or incomplete; or

3. The technology identified in the application does not conform to the standards adopted under this Article.

F. The Secretary of State shall notify the notary public of approval or rejection of the application within forty-five (45) days after receipt. If the application is rejected, the Secretary of State shall state the reasons for the rejection.

G. Rejection of an application, or termination or revocation of a prior authorization to perform electronic notarizations may be appealed pursuant to A.R.S. §§ 41-1092.03 and 41-1092.06.

H. The term of the commission for electronic notarization shall be the same as the term of the notary's existing notary commission.

I. The renewal of the commission of a notary public who has previously received authorization to perform electronic notarizations does not constitute renewal of such authorization to perform electronic notarizations. Applicant shall submit another application as provided under subsection (A) and must receive authorization from the Secretary of State in order to continue to perform electronic notarizations.

J. Nothing herein shall be construed to prohibit a notary public from receiving, installing, or using hardware and/or software updates to the technologies that the notary public identified under subsection (A) if the hardware and/or software update does not result in technologies that are materially different from the technologies that the notary public identified previously.

History

• New Section made by final rulemaking at 9 A.A.R. 2085, effective August 1, 2003 (Supp. 03-2). R2-12-1203 renumbered from R2-12-1202 by final rulemaking at 26 A.A.R. 106, effective 12/30/2019. Amended by final rulemaking at 28 A.A.R. 719, effective 3/24/2022.

Ariz. Admin. Code § R2-12-1204 Tamper Evident Technology

A. A notary public shall select one or more tamper-evident technologies to perform electronic notarizations. The tamper-evident technology shall consist of a digital certificate complying with the X.509 standard adopted by the International Telecommunication Union or a similar industry-standard technology.

B. In performance of an electronic notarization, a notary public shall attach or logically associate the notary public's electronic signature and electronic seal to an electronic record that is the subject of a notarial act by use of the digital certificate.

C. A notary public may not perform an electronic notarization if the digital certificate:

1. Has expired;

2. Has been revoked or terminated by the issuing or registering authority;

Is invalid; or

4. Is incapable of authentication.

D. Renewal of the notary's digital certificate is separate from the registration process with the Secretary of State and shall be obtained from a qualified certificate authority capable of supplying certificates that comply with this section. Renewal of the certificate with the certificate authority is the responsibility of the notary.

E. Journals are not deemed received until the Secretary of State accepts the journals as complete. The electronic notary shall not be subject to a penalty for delay outside the control of the electronic notary in delivering the journal to the Secretary of State.

History

• New Section made by final rulemaking at 9 A.A.R. 2085, effective August 1, 2003 (Supp. 03-2). R2-12-1204 renumbered from R2-12-1203 by final rulemaking at 26 A.A.R. 106, effective 12/30/2019.

Ariz. Admin. Code § R2-12-1205 Electronic Seal Requirements

A. A notary public shall use the same unique electronic seal for all electronic notarizations performed during an applicable commission period.

B. An electronic seal shall substantially conform to the following design: a rectangular or circular seal with the notary public's name as it appears on the commission, the great seal of the State of Arizona, the words "Notary Public," "State of Arizona," and "My commission expires on (date)," the name of the county in which the notary public is commissioned, and the commission number.

C. When affixed to an electronic record, an electronic seal shall be clear, legible, and photographically reproducible. An electronic seal is not required to be within a minimum or maximum size when photographically reproduced on an electronic record.

D. An electronic notary token shall contain:

1. The commission number of the electronic notary;

2. The full name of the electronic notary, as commissioned as an electronic notary;

3. The expiration date of the notary's commission;

4. A link to the commission record of the electronic notary on the Secretary of State's official web site; and

5. Any applicable information relative to A.R.S. § 41-132 .

E. A notary service electronic certificate shall contain:

1. The commission number of the electronic notary authorizing the notary service electronic certificate;

2. The identification of the authorizing electronic notary's electronic notary token;

3. The full name of the individual, as presented to the electronic notary;

4. A link to the authorizing commission record of the electronic notary on the Secretary of State's official web site; and

5. Any applicable information relative to A.R.S. § 41-132 .

F. An electronic notary may possess only one electronic notary token.

History

• New Section made by final rulemaking at 9 A.A.R. 2085, effective August 1, 2003 (Supp. 03-2). R2-12-1205 renumbered from R2-12-1204 by final rulemaking at 26 A.A.R. 106, effective 12/30/2019.

Ariz. Admin. Code § R2-12-1206 Security of Electronic Signatures and Electronic Seals

A. A notary public's electronic signature and electronic seal shall remain within the exclusive control of the notary public, including control by means of use of a password or other secure method of authentication. A notary public shall not disclose any access information used to affix the notary public's electronic signature or electronic seal to electronic records, except:

1. When requested by the Secretary of State or a law enforcement officer;

2. When required by court order or subpoena; or

3. Pursuant to an agreement to facilitate electronic notarizations with a vendor or other technology provider identified in an application submitted under this Article.

B. A notary public may not allow any other individual to use his or her electronic signature or electronic seal to perform a notarial act.

C. Upon resignation, revocation, or expiration of the notary public's commission, the notary public's electronic seal (including any coding, disk, digital certificate, card, software, or password that enables the notary public to attach or logically associate the electronic seal to an electronic record) shall be destroyed or disabled to prohibit its use by any other person.

1. Incorporating the electronic notary token elements into the document;

2. Either directly incorporating the time and date of notarization or incorporating the time and date of notarization using a process of an approved time stamp provider;

3. Affixing the notary's electronic signature.

D. A notary public shall immediately notify an appropriate law enforcement agency and the Secretary of State on actual knowledge of the theft or vandalism of the notary public's electronic signature, electronic seal, or digital certificate. A notary public shall immediately notify the Secretary of State on actual knowledge of the unauthorized use by another person of the notary public's electronic signature, electronic seal, or digital certificate.

1. Presence of a date and time stamp from an approved time stamp token provider;

2. Affixing the notary's electronic signature.

History

• New Section made by final rulemaking at 9 A.A.R. 2085, effective August 1, 2003 (Supp. 03-2). R2-12-1206 renumbered from R2-12-1205 by final rulemaking at 26 A.A.R. 106, effective 12/30/2019.

Ariz. Admin. Code § R2-12-1207 Journal

An electronic notary public shall keep a journal of all electronic notarial acts in bound paper form with the same form as required in A.R.S. § 41-319 and shall be under the sole control of the electronic notary public.

History

• New Section made by final rulemaking at 9 A.A.R. 2085, effective August 1, 2003 (Supp. 03-2). R2-12-1207 renumbered from R2-12-1206 by final rulemaking at 26 A.A.R. 106, effective 12/30/2019.

Ariz. Admin. Code § R2-12-1208 Requirements for Authenticating the Notarial Act

Electronic notarial acts need to fulfill certain basic requirements to ensure non-repudiation and the capability of being authenticated by the Secretary of State for purposes of issuing Apostilles and Certificates of Authentication. They are as follows:

1. The fact of the notarial act, including the notary's identity, signature, and commission status, must be verifiable by the Secretary of State, and

2. The notarized electronic document will be rendered ineligible for authentication by the Secretary of State if it is improperly modified after the time of notarization, including any unauthorized alterations to the document content, the electronic notarial certificate, the notary public's electronic signature, and/or the notary public's official electronic seal.

3. Fee for a jurat shall be not more than $25.

4. Fee for authorizing a notary service electronic certificate to a person shall be not more than $50. This does not include any vendor fees or charges to the person for reception of the notary service electronic certificate.

5. Fee for any other notarial act shall be not more than $25.

History

• New Section made by final rulemaking at 9 A.A.R. 2085, effective August 1, 2003 (Supp. 03-2). R2-12-1208 renumbered from R2-12-1207 by final rulemaking at 26 A.A.R. 106, effective 12/30/2019.

Ariz. Admin. Code § R2-12-1209 [Repealed]

History

• New Section made by final rulemaking at 9 A.A.R. 2085, effective August 1, 2003 (Supp. 03-2). Repealed by final rulemaking at 26 A.A.R. 106, effective 12/30/2019.

Article 13 REMOTE ONLINE NOTARIZATION

Ariz. Admin. Code § R2-12-1301 Definitions

The following definitions shall apply to this Article unless context otherwise requires:

"Commission" means the same as defined in A.R.S. § - 41-251(2).

2. "Communication technology" means the same as defined in A.R.S. § - 263(I)(1).

3. "Credential analysis" means a process or service that meets the standards established under R2-12-1305 through which a third person affirms the validity of an identification credential through review of public or private data sources.

4. "Dynamic knowledge-based authentication assessment" means an identity assessment of an individual that is based on a set of questions formulated from public or private data sources for which the individual has not provided a prior answer.

5. "Electronic" means the same as defined in A.R.S. § - 41-251(3).

"Electronic notarization" or "electronic notarial acts" means a notarial act performed with respect to an electronic record in accordance with Article 12.

7. "Electronic record" means information that is created, generated, sent, communicated, received or stored by electronic means.

8. "Electronic seal" means an electronic image that contains information attached to or logically associated with an electronic record and that contains the words "notary public", the name of the county in which the notary public is commissioned, the notary public's name as it appears on the notarial commission, the commission number and the expiration date of the notarial commission.

9. "Identification credential" means an identification card or document that constitutes "satisfactory evidence of identity" as defined in A.R.S. § - 41-255.

10. "Identity proofing" means a process or service that meets the standards established under R2-12-1305 through which a third person affirms the identity of a remotely located individual by a review of personal information from public or private data sources.

11. "Multi-factor authentication" means a security system that requires more than one method of authentication from independent categories of credentials to verify the user's identity for a login or other transaction.

12. "Notarial act" means the same as defined in A.R.S. § 41-251(6).

13. "Person" means the same as defined in A.R.S. § - 41-251(10).

"Personal knowledge" means the same as defined in A.R.S. § 41-255(A).

15. "Remotely located individual" means the same as defined in A.R.S. § 41-263(I)(5).

16. "Remote online notarization" or "remote online notarial act" means a notarial act performed by means of communication technology.

17. "Remote presentation" means transmission to a notary public through communication technology of an image of a remotely located individual's identification credential that is of sufficient quality to enable the notary public to reasonably identify the remotely located individual and to perform credential analysis.

History

• Adopted by final rulemaking at 26 A.A.R. 537, effective 3/19/2020. Amended by final rulemaking at 28 A.A.R. 719, effective 3/24/2022.

Ariz. Admin. Code § R2-12-1302 Authority to Perform Remote Online Notarization

A. A notary public of this state may perform remote online notarizations during the term of the notary public's commission if:

1. 'The notary public has received written authorization from the Secretary of State to perform remote online notarizations under this Article; and

2. The Secretary of State has not terminated or revoked such authorization.

B. A notary public who is authorized to perform remote online notarizations under subsection (A) may also perform electronic notarizations under Article 12.

History

• Adopted by final rulemaking at 26 A.A.R. 537, effective 3/19/2020.

Ariz. Admin. Code § R2-12-1303 Use of Electronic Notarization

In performing a remote online notarization, a notary public must comply with the requirements for electronic notarization as provided in Article 12.

History

• Adopted by final rulemaking at 26 A.A.R. 537, effective 3/19/2020.

Ariz. Admin. Code § R2-12-1304 Registration

A. To receive authorization from the Secretary of State to perform remote online notarizations a notary public must submit an application in a format prescribed by the Secretary of State that provides the following information about the applicant:

1. The applicant's full legal name and the name under which the applicant is commissioned as a notary public (if different);

2. The applicant's email address;

3. A description of the technologies or devices that the applicant intends to use to perform remote online notarizations;

4. The name, address, and website URL of any vendors or other persons that will directly supply to the applicant the technologies that the applicant intends to use;

5. A statement certifying that the technologies described in the application comply with the requirements of this Article; and

6. A disclosure of any professional license or commission revocations or other professional disciplinary actions taken under the laws of any state against the applicant.

B. The application must be submitted to the Secretary of State as provided by information posted on the Secretary of State's website at https://azsos.gov/.

C. If, during the term of a notary public's commission, the notary public intends to use the technologies of another vendor or person than those identified under subsection (A)(3) and (4), then an additional application or amendment identifying such other vendors or other persons must be submitted to the Secretary of State as provided in this section.

D. If the technology identified in the application under subsection (A) conforms to the standards adopted under this Article and the applicant satisfies the requirements of this section, the Secretary of State shall approve the use of the technology and issue to the notary public written authorization to perform electronic notarizations.

E. The Secretary of State may reject the application, or terminate or revoke a prior authorization given under this section, for the following reasons:

1. The applicant's failure to comply with A.R.S. §§ 41-251 through 41-333 or this Article;

2. Any information required under subsection (A) is missing, inaccurate, or incomplete; or

3. The technology identified in the application does not conform to the standards adopted under this Article.

F. The Secretary of State shall notify the notary public of approval or rejection of the application within (45) days after receipt. If the application is rejected, the Secretary of State shall state the reasons for the rejection.

G. Rejection of an application, or termination or revocation of a prior authorization to perform electronic notarizations may be appealed pursuant to A.R.S. §§ 41-1092.03 and 41-1092.06.

H. The term of the commission to perform remote online notarization shall be the same as the term of the notary's existing notary commission.

I. The renewal of the commission of a notary public who has previously received authorization to perform remote online notarizations does not constitute renewal of such authorization. Applicant shall submit another application as provided under subsection (A) and must receive authorization from the Secretary of State in order to continue to perform remote online notarizations.

J. Nothing herein shall be construed to prohibit a notary public from receiving, installing, or using hardware and/or software updates to the technologies that the notary public identified under subsection (A) if the hardware and/or software update does not result in technologies that are materially different from the technologies that the notary public identified previously.

History

• Adopted by final rulemaking at 26 A.A.R. 537, effective 3/19/2020. Amended by final rulemaking at 28 A.A.R. 719, effective 3/24/2022.

Ariz. Admin. Code § R2-12-1305 Standards for Identity Verification

A. If a notary public does not have satisfactory evidence of the identity of a remotely located individual under subsection (D), the notary public must reasonably verify the individual's identity through a multi-factor authentication procedure as provided in this section and in subsections (B) and (C). The procedure must analyze the individual's identification credential that is the subject of remote presentation against trusted third-person data sources, bind the individual's identity to the individual following successful dynamic knowledge-based authentication assessment, and permit the notary public to visually compare the identification credential and the individual. Credential analysis and identity proofing must be performed by a reputable third party who has provided evidence to the notary public of the ability to satisfy the requirements of this Article.

B. Credential analysis must use public or private data sources to confirm the validity of the identification credential that is the subject of remote presentation by a remotely located individual and shall, at a minimum:

1. Use automated software processes to aid the notary public in verifying the identity of each remotely located individual;

2. Require the identification credential to pass an authenticity test, consistent with sound commercial practices, that uses appropriate technologies to confirm the integrity of visual, physical, or cryptographic security features and to confirm that the identification credential is not fraudulent or inappropriately modified;

3. Use information held or published by the issuing source or an authoritative source, as available and consistent with sound commercial practices, to confirm the validity of personal details and identification credential details; and

4. Enable the notary public to visually compare for consistency the information and photograph on the identification credential and the remotely located individual as viewed by the notary public in real time through communication technology.

C. Identity proofing must be performed by means of a dynamic knowledge-based authentication assessment. The assessment is successful if it meets the following requirements:

1. The remotely located individual must answer a quiz consisting of a minimum of five questions related to the individual's personal history or identity formulated from public or private data sources;

2. Each question must have a minimum of five possible answer choices;

3. At least 80% of the questions must be answered correctly;

4. All questions must be answered within two minutes;

5. If the remotely located individual fails the first attempt, the individual may retake the quiz one time within 24 hours;

6. During a retake of the quiz, a minimum of 40% of the prior questions must be replaced;

7. If the remotely located individual fails the second attempt, the individual is not allowed to retry with the same online notary public within 24 hours of the second failed attempt; and

8. The notary public must not be able to see or record the questions or answers.

D. A notary public has satisfactory evidence of the identity of a remotely located individual if:

1. The notary public has personal knowledge of the identity of the individual; or

2. The individual is identified by oath or affirmation of a credible witness in accordance with the following requirements:

a. To be a credible witness, the witness must have personal knowledge of the remotely located individual.

b. The notary public must have personal knowledge of the credible witness or verify the identity of the credible witness by multi-factor authentication in accordance with subsections (A), (B) and (C).

c. A credible witness may be outside the physical presence of the notary public or remotely located individual if the notary public, credible witness, and remotely located individual can communicate by using communication technology.

History

• Adopted by final rulemaking at 26 A.A.R. 537, effective 3/19/2020.

Ariz. Admin. Code § R2-12-1306 Standards for Communication Technology

A. Communication technology must provide for synchronous audio-video feeds of sufficient video resolution and audio clarity to enable the notary public and remotely located individual to see and speak with each other. The process must provide a means for the notary public reasonably to confirm that an electronic record before the notary public is the same record in which the remotely located individual made a statement or on which the remotely located individual executed a signature.

B. Communication technology must provide reasonable security measures to prevent unauthorized access to:

1. The live transmission of the audio-visual feeds;

2. The methods used to perform identify verification; and

3. The electronic record that is the subject of the remote online notarization.

C. If a remotely located individual must exit the workflow prior to completion of the identity verification process, the individual must restart the identity verification process from the beginning.

History

• Adopted by final rulemaking at 26 A.A.R. 537, effective 3/19/2020.

Ariz. Admin. Code § R2-12-1307 Certificate of Notarial Act for Remote Online Notarization

A. A form of notarial certificate for a remote online notarization satisfies the requirement of A.R.S. § 41-376(F) 41-263(D) if it is in the form provided by applicable law and contains a statement substantially as follows: "This remote online notarization involved the use of communication technology."

B. A short form of acknowledgment prescribed in A.R.S. § 41-265 or other form of notarial certificate required by law satisfies the requirement of A.R.S. § 41-263(D) if it is in substantially one of the following forms for the purposes indicated:

For an acknowledgment in an individual capacity :

State of Arizona

County of _____________________

The foregoing instrument was acknowledged before me by means of communication technology on (date) by (name(s) of indi-vidual(s)).

(Signature of notary public)

Notary Public

(Electronic seal)

(My commission expires: ________________)

For an acknowledgment in a representative capacity :

State of Arizona

County of _____________________

The foregoing instrument was acknowledged before me by means of communication technology on (date) by (name(s) of indi-vidual(s)) as (type of authority, such as officer or trustee) of (name of party on behalf of whom the instrument was executed). (Signature of notary public)

Notary Public

(Electronic seal)

(My commission expires: ________________)

For a verification on oath or affirmation :

State of Arizona

County of _____________________

Signed and sworn to (or affirmed) before me by means of communication technology on (date) by (name(s) of individual(s) making statement).

(Signature of notary public)

Notary Public

(Electronic seal)

(My commission expires: ________________)

Certificate of acknowledgement for a corporation :

State of Arizona

County of _____________________

The foregoing instrument was acknowledged before me by means of communication technology this (date) by (name of officer or agent, title of officer or agent) of (name of corporation acknowledging), a (state or place of incorporation) corporation, on behalf of the corporation.

(Signature of notary public)

Notary Public

(Electronic seal)

(My commission expires: ________________)

Certificate of acknowledgement for a partnership :

State of Arizona

County of _____________________

The foregoing instrument was acknowledged before me by means of communication technology this (date) by (name of acknowledging partner or agent), partner (or agent) on behalf of (name of partnership), a partnership.

(Signature of notary public)

Notary Public

(Electronic seal)

(My commission expires: ________________)

Certificate of acknowledgement for an individual acting as principal by an attorney in fact :

State of Arizona

County of _____________________

The foregoing instrument was acknowledged before me by means of communication technology this (date) by (name of attorney in fact) as attorney in fact on behalf of (name of principal).

(Signature of notary public)

Notary Public

(Electronic seal)

(My commission expires: ________________)

Certificate of acknowledgement by any public officer, trustee, or personal representative :

State of Arizona

County of _____________________

The foregoing instrument was acknowledged before me by means of communication technology this (date) by (name and title of position).

(Signature of notary public)

Notary Public

(Electronic seal)

(My commission expires: ________________)

History

• Adopted by final rulemaking at 26 A.A.R. 537, effective 3/19/2020. Amended by final rulemaking at 28 A.A.R. 719, effective 3/24/2022.

Ariz. Admin. Code § R2-12-1308 Record Retention and Depositories

A. A notary public must retain the electronic journal required and any audio-visual recording of the performance of each remote online notarial act in a computer or other electronic storage device that protects the journal and recording against unauthorized access by password or cryptographic process. The recording must be created in an industry-standard, audiovisual file format and must not include images of any electronic record that was the subject of the remote online notarization.

B. An electronic journal must be retained for at least five years after the last remote online notarial act chronicled in the journal. An audio-visual recording must be retained for at least five years after the recording is made.

C. A notary public must take reasonable steps to ensure that a backup of the electronic journal and audio-visual recording exists and is secure from unauthorized use.

D. On the death or adjudication of incompetency of a current or former notary public, the notary public's personal representative or guardian or any other person knowingly in possession of an electronic journal or audio-visual recording must:

1. Comply with the retention requirements of this section;

2. Transmit the journal and recording to one or more depositories under subsection (E); or

3. Transmit the journal and recording in an industry-standard readable data storage device to the Secretary of State at: Secretary of State, Attn: Notary Department, 1700 W. Washington Street, Floor 7, Phoenix, AZ 85007-2808.

E. A notary public, guardian, conservator, or agent of a notary public, or a personal representative of a deceased notary public may, by written contract, engage a third person to act as a depository to provide the storage required by this section. A third person under contract under this section shall be deemed a depository. The contract must:

1. Enable the notary public, guardian, conservator, or agent of the notary public, or the personal representative of the deceased notary public to comply with the retention requirements of this section even if the contract is terminated; or

2. Provide that the information will be transferred to the notary public, guardian, conservator, or agent of the notary public, or the personal representative of the deceased notary public if the contract is terminated.

History

• Adopted by final rulemaking at 26 A.A.R. 537, effective 3/19/2020. Amended by final rulemaking at 28 A.A.R. 719, effective 3/24/2022.

Ariz. Admin. Code § R2-12-1309 Electronic Record of Remote Online Notarizations

A. A notary public shall record each remote online notarial act performed by the notary public in chronological order in one or more journals maintained in a permanent, tamper-evident electronic format that complies with this Article. A notary public may not record a remote online notarial act in a paper journal required by section A.R.S. § 41-319. Each journal entry shall include:

1. The date and time of the notarial act;

2. A description of the record, if any, and type of notarial act;

3. The full name and address of each individual for whom the remote online notarial act is performed;

4. If the identity of the individual is based on personal knowledge, a statement to that effect;

5. If the identity of the individual is based on credential analysis and identity proofing, a brief description of the results of the identity verification process and the identification credential presented, including the date of issuance and expiration of the identification credential but not its serial or identification number;

6. If the identity of the individual is based on an oath or affirmation of a credible witness, the information required by subsections (3), (4) and (5) of this section with respect to the credible witness;

7. A fee, if any, charged by the notary public.

B. An electronic journal kept by the notary public and the audio and visual recording are subject to A.R.S. § 41-319 relating to public records.

History

• Adopted by final rulemaking at 28 A.A.R. 719, effective 3/24/2022.

Chapter 13 State Board of Investment

Article 1 GENERAL PROVISIONS

Ariz. Admin. Code § R2-13-101 Definitions

In this Article, unless otherwise specified, the following terms mean:

1. "General Accounting Office" means the General Accounting Office of the Department of Administration.

2. "General Fund" means the General Fund of the State as defined in A.R.S. § 35-141.

3. "Servicing Bank" means the bank awarded the servicing bank contract pursuant to A.R.S. § 35-315(C).

4. "Servicing Bank Contract" means the contract awarded pursuant to A.R.S. § 35-315.

History

• Adopted effective July 12, 1996 (Supp. 96-3). R2-13-101(3) reflects corrected A.R.S. citation (Supp. 06-1). R2-13-101(1) revised at request of the Board, Office File No. M11-215, filed June 7, 2011 (Supp. 11-2).

Ariz. Admin. Code § R2-13-102 Servicing Bank Charges Account

A. As authorized by A.R.S. § 35-315(B), General Fund interest earnings shall be deposited monthly into a General Fund account known as the "Servicing Bank Charges Account" to the extent necessary to pay for current servicing charges.

B. Claims for servicing bank charges shall be paid from the Servicing Bank Charges Account. After each payment the General Accounting Office shall transfer any remaining interest earnings in the Servicing Bank Charges Account into the General Fund.

History

• Adopted effective July 12, 1996 (Supp. 96-3). R2-13-102(A) reflects corrected A.R.S. citation (Supp. 06-1). R2-13-102(B) revised at request of the Board, Office File No. M11-215, filed June 7, 2011 (Supp. 11-2).

Ariz. Admin. Code § R2-13-103 Information Required to be Submitted with Servicing Bank's Monthly Statement

This Servicing Bank shall deliver to the state treasurer its monthly account analysis statement for services rendered in the preceding month which shall include the number and type of transactions performed, amount and time duration of deposits, and any other information required under the servicing bank contract.

History

• Adopted effective July 12, 1996 (Supp. 96-3).

Article 2 AZ529, ARIZONA'S EDUCATION SAVINGS PLAN

Ariz. Admin. Code § R2-13-201 Definitions

A. "Account year" means the period beginning on October 1 and ending on September 30 of each year.

B. "A.R.S." means Arizona Revised Statutes.

C. "Board" means the Arizona State Board of Investment.

C. D. "Cash" means currency, bills and coin in circulation, or converting a negotiable instrument to cash by endorsing and presenting to a financial institution for deposit. An automatic transfer, cashier's check, certified check, money order, payroll deposit, traveler's check, personal check, and wire transfer will be treated as cash. Deposits will also be accepted by credit card.

D.E. "Code" means the Internal Revenue Service Code of 1986, as amended, or the corresponding provision of any future United States Internal Revenue law.

E. "Commission" means the Commission for Postsecondary Education as defined in A.R.S. § 15-1871 .

F. "Committee" means the Family College Savings Program Oversight Committee as defined in A.R.S. § 15-1871 .

G. F. "Distributee" means the designated beneficiary or the account owner who receives or is treated as receiving a distribution from an account. If a distribution is made directly to the designated beneficiary or to an eligible educational institution for the benefit of the designated beneficiary, the designated beneficiary is the distributee. In all other circumstances, the account owner is the distributee.

H. G. "Eligible educational institution" means an institution of higher education that qualifies under § 529 of the Code as an eligible educational institution.

H. "Financial institution" means a financial institution as defined in A.R.S. § 15-1871(6).

I. "Negotiable instrument" means negotiable instrument as defined in A.R.S. § 47-3104.

J. "Qualified Tuition Program" means a qualified tuition program as defined in § 529 of the Code.

K. "Treasurer" means the Office of the Arizona State Treasurer.

History

• Amended by exempt rulemaking at 27 A.A.R. 1650, effective 9/28/2021.

Ariz. Admin. Code § R2-13-202 Cash Contributions; Fees

A. Contributions to accounts in all qualified tuition programs shall be made only in cash as defined in R2-13-201.

A. B. Application fee. The application fee is $10. Application fees shall be forwarded to the Treasurer at the end of the month in which the account is opened. A financial institution may waive the application fee but will nevertheless be responsible for tendering to the Treasurer $10 for each new account opened; said tender to be made at the end of the month in which the account is opened. The Treasurer shall review the application fee every 24 months and recommend to the Board whether the application fee should be adjusted.

C. Reasonable fees and charges. Reasonable fees and charges may be levied against a qualified tuition program pursuant to an agreement for services between a financial institution and the Board. Fees shall be forwarded to the Treasurer at the end of each month.

B. Administrative fee. For each account opened, the financial institution shall pay to the Commission a one-time fee of $3 at the end of the month in which the account was opened. The Committee shall review the administrative fee every 24 months and recommend to the Commission whether the administrative fee should be adjusted. The financial institution shall not charge the account owner the administrative fee.

C. Marketing fee. The financial institution shall pay to the Com- mission an annual marketing fee. The marketing fee shall be paid at the beginning of each calendar year as a $200 flat fee. If a financial institution begins participating in the Arizona Family College Savings Program after the beginning of a calendar year, the financial institution shall pay a pro-rated marketing fee based upon the month in which it begins participation in the Program regardless of the day in the month. The Committee shall review the marketing fee every 12 months and recommend to the Commission whether the marketing fee should be adjusted. The Commission may review the marketing fee prior to the committee's required 12- month review. The financial institution shall not charge the account owner the marketing fee.

History

• Amended by exempt rulemaking at 27 A.A.R. 1650, effective 9/28/2021.

Ariz. Admin. Code § R2-13-203 Changing Designated Beneficiary

An account owner may change the designated beneficiary so long as the new designated beneficiary is a member of the family, as defined in § 529 of the Code, A.R.S. § 15-1871(8) or both, of the previously named designated beneficiary. The account owner must certify and provide to the financial institution the name, address, social security number, and relationship of the new designated beneficiary to the previously named designated beneficiary on a form prescribed by the financial institution and approved by the Treasurer. The change shall be effective upon the financial institution's receipt of such certification.

History

• Amended and renumbered from R2-13-204 by exempt rulemaking at 27 A.A.R. 1650, effective 9/28/2021.

Ariz. Admin. Code § R2-13-204 Account Balance Limitations

A. For each designated beneficiary, the balance in all qualified tuition programs, as defined in § 529 of the Code, shall not exceed the lesser of:

1. The product (rounded down to the nearest multiple of $1000) of 7 and the average one year's undergraduate tuition, fees, room and board at the ten independent four year eligible educational institutions as measured and last published by the College Board's Independent College 500 Index that have the largest total direct charges. For purposes of this subsection, "total direct charges" means the charges determined for each eligible educational institution by multiplying the eligible educational institution's undergraduate enrollment by the reported tuition, fees, room and board for an on-campus student at the eligible educational institution; or

2. The cost in current dollars of qualified higher education expenses the account owner reasonably anticipates the designated beneficiary will incur.

B. No person shall make any contribution to a qualified tuition program during an account year that would cause the sum of the account balances in all qualified tuition programs of the designated beneficiary as of the first day of the account year plus contributions made during the account year less withdrawals during the account year to or from any such account to exceed the maximum allowable balance set forth in subsection (A). Any excess contributions with respect to a designated beneficiary shall be promptly withdrawn as a non-qualified withdrawal or transferred to another account in accordance with A.R.S. § 15-1875(E) or A.R.S. § 15-1875(F).

C. No financial institution shall accept for deposit in any account a contribution if the contribution would cause the sum of the values (as of the beginning of an account year) of all qualified tuition programs of the designated beneficiary that are man- aged by the financial institution and contributions to such accounts less withdrawals from such accounts during the account year to exceed the maximum allowable balance set forth in subsection (A).

D. Each year, the Board shall review the amounts set forth in subsection (A).

E. Persons making a contribution to an account shall certify that as to the account's designated beneficiary, and to the best of the contributor's knowledge, the contribution shall not cause the balances in all qualified tuition programs to exceed the account balance limitations described in subsection (A).

F. If the Treasurer determines that contributions have been made to program accounts in violation of subsection (B) or (C), the Treasurer shall notify the Board, the designated beneficiary and the account owners of all accounts of such designated beneficiary. The account owners shall have 60 days after receipt of such notice to reduce the balances of the qualified tuition programs through distributions and/or changes in beneficiaries to a level less than or equal to the maximum account balance described in subsection (A). If the balances are not appropriately reduced, the Treasurer will disqualify such accounts in reverse order of their date of opening until the sum of the balances in the accounts does not exceed the maximum allowable balance set forth in subsection (A). This subsection shall not apply to any contribution made at a time when such contributions did not cause the account balance limits to be exceeded.

History

• Amended and renumbered from R2-13-205 by exempt rulemaking at 27 A.A.R. 1650, effective 9/28/2021.

Ariz. Admin. Code § R2-13-205 Withdrawals; Uses of Withdrawn Funds

A. An account owner may withdraw funds from an account at any time. The designated beneficiary of an account shall not have any authority to withdraw funds from an account unless the account is structured to give the designated beneficiary such right of withdrawal upon matriculation or upon incurring qualified higher education expenses as defined in A.R.S. § 15-1871(12) and § 529 of the Code.

B. Neither the Board nor the Treasurer are responsible for tracking how withdrawn funds are used. It is the responsibility of the account owner to ensure that withdrawn funds are used for qualified higher education expenses as defined in A.R.S. § 15-1871(12) and § 529 of the Code, and to substantiate any exemption from tax or penalty.

B. Withdrawals.

1. Qualified Withdrawals.

a. The financial institution is provided with a copy of a n invoice from the eligible educational institution, and the distribution is made directly to the eligible educational institution; or

b. The financial institution is provided with a copy of an invoice from the eligible educational institution, and the distribution is made in the form of a check payable to both the designated beneficiary and the eligible educational institution; or

c. Within 30 days following the withdrawal, substantiation that the withdrawal was actually expended for qualified higher education expenses is submitted to the financial institution.

2. Withdrawal Based on Death, Disability, or Scholarship. A penalty-free withdrawal may be made as a result of the designated beneficiary's death, disability, or scholarship, if written substantiation thereof is provided. Such written substantiation must come from a party other than the designated beneficiary or the account owner. In the case of a scholarship, the withdrawal may not exceed the amount of the scholarship.

3. Non-Qualified or Unsubstantiated Withdrawals.

a. If the withdrawal has not been declared, by the party making the withdrawal, to be non-qualified, the amount of any penalty shall be remitted to the Com- mission with the financial institution's first monthly report following the date that the withdrawal is determined to be non-qualified. If the withdrawal has been declared to be non-qualified, the amount of said withholding may be remitted to the Commission with the financial institution's required monthly report.

b. If the withdrawal has not been declared, by the party making the withdrawal, to be non-qualified, the financial institution shall report any such withholding, in writing, to the Commission with the financial institution's first monthly report following the date that the withdrawal is determined to be non-qualified. The report shall include identification of the account owner, beneficiary, date of withdrawal, amount of withdrawal, and a brief description as to why the financial institution believes the withdrawal to be non-qualified. If the withdrawal has been declared to be non-qualified, the report may be submitted to the Commission with the financial institution's required monthly report. The financial institution shall notify the account owner and beneficiary, in writing, of any withholding.

c. If a qualified withdrawal is made from an account in any calendar year, within 60 days after the end of such year and within 60 days after the end of the following year, any designated beneficiary or account owner who received a partial or total refund from the eligible educational institution attended by the designated beneficiary or the eligible educational institution that the designated beneficiary had expected to attend shall provide to the financial institution a signed statement identifying the amount of any refunds received. In addition, the designated beneficiary or account owner shall provide an explanation as to what portion, if any, of the refund is allocable to a qualified withdrawal. If all or a portion of a refund is allocable to a qualified withdrawal, the designated beneficiary (or the account owner) may provide the financial institution with substantiation of qualified higher education expenses for which the refund was used or substantiation that the refund was made by reason of scholarship, or the death, or disability of the designated beneficiary. To the extent that a refund allocable to a qualified withdrawal was not used to pay qualified higher education expenses or made on account of death, disability, or scholarship of the designated beneficiary, it shall be considered a non-qualified withdrawal subject to the penalty described in R7-3-506(B)(3) . The financial institution shall withdraw the penalty from the account from which the original qualified withdrawal was made, if sufficient funds are available in the account, or attempt to collect the penalty by billing the designated beneficiary or account owner for the penalty, if sufficient funds are not available in the account.

4. Substantiation Procedures.

5. Distributions Made after December 31, 2001.

C. The account owner may dispute any withholding made by a financial institution under subsection (B) by submitting writ- ten notice, to the Commission, within 30 days from the date of such withholding. The Commission shall make a written determination regarding the dispute within 30 days of the receipt of its notice from the account owner. If the account owner dis- agrees with the Commission's determination, the matter shall be adjudicated in accordance with A.R.S. § 41-1092 et seq.

History

• Amended and renumbered from R2-13-205 by exempt rulemaking at 27 A.A.R. 1650, effective 9/28/2021.

Ariz. Admin. Code § R2-13-206 Oversight of Financial Institutions

A. Disclaimer of state liability. Unless otherwise expressly agreed upon by the Treasurer in writing, every document pertaining to the AZ529, Arizona's Education Savings Plan shall clearly indicate that "The account is not insured by the state of Arizona and neither the principal deposited nor the investment return is guaranteed by the state of Arizona." A rubber stamp may be used to imprint this language on deposit slips, account statements, payroll stubs, or other documents pertaining to the AZ529, Arizona's Education Savings Plan. This language may also be hand-written or typed or provided by any other method to facilitate compliance.

B. No Investment Direction. A financial institution shall not permit an account owner to move funds, once deposited, that in any way would result in investment direction of the funds or earnings on the funds except to the extent permissible under § 529 of the Code and any applicable regulations and guidance.

C. Reporting Requirements.

1. At least quarterly, every financial institution shall provide each account owner with a statement. The statement shall list a beginning balance, all activity during the quarter, including any interest paid or dividends earned, and an ending balance. Additionally, the statement for the fourth quarter shall include the following information: an annual beginning balance, an annual total of the interest earned or dividends paid, a year-end balance, and any distributions paid.

2. Within the time-frames established by the Code, financial institutions, at the request of the Treasurer, shall provide Form 1099Q to all distributees.

A copy of the statement described in (C)(1) and (2) shall be sent to the Treasurer. Additionally, each financial institution shall provide the Treasurer with the information required by A.R.S. § 15-1874(H).

D. Access to books and records. No contractor shall have access to the books and records of a financial institution or Program Manager unless the Treasurer or its designee first approves, with or without modification, such request for access.

E. Non-renewal. The Board's failure to renew a contract with a financial institution shall not be construed as "good cause" as referred to in A.R.S. § 15-1874(I).

F. Marketing programs.

1. Any financial institution or group of financial institutions that wishes to engage in its own marketing program for the AZ529, Arizona's Education Savings Plan may do so provided that any proposed marketing program is first submitted to the Treasurer for review. If, within 60 days, the Treasurer does not notify the financial institution or group of financial institutions, in writing, that the proposed marketing program is rejected or requires modifications, the proposed marketing program shall be deemed approved.

2. Any financial institution or group of financial institutions that chooses to engage in its own marketing program may petition the Treasurer for a credit against future marketing fees.

History

• Amended and renumbered from R2-13-206 by exempt rulemaking at 27 A.A.R. 1650, effective 9/28/2021.

Ariz. Admin. Code § R2-13-207 IRS Regulations, Rulings, Notices, and Other Guidance

A. If (i) the Internal Revenue Service issues on or after February 27, 2002, any regulation, ruling, notice or other precedential guidance on procedures or activities that a qualified tuition program may adopt or undertake without jeopardizing its exemption under § 529 of the Code, (ii) such guidance is less restrictive than any rule contained in Title 2, Chapter 13, Article 2, and (iii) the more restrictive rule was not mandated by A.R.S. §§ 15-1871 to 15-1877, then the more restrictive rule shall be deemed liberalized to the maximum extent possible without violating A.R.S. §§ 15-1871 through 15-1877 or any requirements for a program to qualify as a qualified tuition program under § 529 of the Code.

B. If (i) the Internal Revenue Service issues on or after February 27, 2002, any regulation, ruling, notice or other precedential guidance on procedures or activities that a qualified tuition program shall or shall not adopt or undertake to avoid jeopardizing its exemption under § 529 of the Code and (ii) the rules contained in Title 2, Chapter 13, Article 2 or the statutes contained in A.R.S. §§ 15-1871 to 15-1877 do not include such requirement or prohibition, then these rules shall be deemed amended to the maximum extent possible without violating A.R.S. §§ 15-1871 through 15-1877 to adopt such requirement or prohibition.

History

• Renumbered from R2-13-207 by exempt rulemaking at 27 A.A.R. 1650, effective 9/28/2021.

Ariz. Admin. Code § R2-13-208 Renumbered

History

• Renumbered to R2-13-207 by exempt rulemaking at 27 A.A.R. 1650, effective 9/28/2021.

Chapter 14 OFFICE OF THE ARIZONA STATE TREASURER - STATEWIDE COLLATERAL POOL

Article 1 STATEWIDE COLLATERAL POOL

Ariz. Admin. Code § R2-14-101 Definitions

A.The definitions in A.R.S. § 35-1201 apply to this Chapter.

B.Additionally, in this Chapter:

1. "Collateral pool" means the method of securing repayment of uninsured balances of public deposits made with an eligible depository through the pledge of eligible investments specified under A.R.S. § 35-323.

2. "CUSIP" means Committee on Uniform Security Identification Procedures and refers to a nine character alphanumeric code that uniquely identifies a financial security.

3. "EST" means Eastern Standard Time.

4. "FDIC" means the Federal Deposit Insurance Corporation.

"Treasurer" means the Office of the Arizona State Treasurer.

6. "Uninsured" means public monies deposited with an eligible depository that exceed the amount insured by an instrumentality of the United States.

History

• Adopted by final rulemaking at 21 A.A.R. 233, effective 4/4/2015.

Ariz. Admin. Code § R2-14-102 Participation Mandatory

A.Public depositors.

1. Except as provided under A.R.S. § 35-1204(B), all public depositors shall place deposits of uninsured public monies with an eligible depository.

2. A public depositor that decides to exercise the exemption provided under A.R.S. § 35-1204(B) shall provide written notice of the decision to the Administrator.

B.Eligible depositories. Except as provided in subsections (B)(1) and (2), an eligible depository that accepts or retains public monies shall pledge required collateral to the collateral pool.

1. An eligible depository that accepts and retains only insured public monies is not required to pledge collateral to the collateral pool. However, the eligible depository shall provide a notarized statement to the Administrator that lists:

a. Each public depositor for which the eligible depository is retaining public monies,

b. The deposit balance for each public depositor, and

c. The total insurance available for each public depositor.

2. An eligible depository that accepts and retains all public monies in the trust department of the eligible depository and secures the public monies under 12 U.S.C. Section 92 a is not required to pledge collateral to the collateral pool.

C.An eligible depository doing business in Arizona that does not accept or retain public monies shall attest to this fact on a notarized statement that is available from the Administrator.

History

• Adopted by final rulemaking at 21 A.A.R. 233, effective 4/4/2015.

Ariz. Admin. Code § R2-14-103 Collateral Required

A.An eligible depository that intends to accept and retain uninsured public monies shall execute a Collateral Security Agreement with the Treasurer, using a form that is available on the web site of the Treasurer. In the agreement, the eligible depository shall pledge for the benefit of the Treasurer eligible collateral having a market value of at least 102 percent of the retained amount of uninsured public monies.

B.An eligible depository shall deposit all eligible collateral, including a letter of credit that satisfies the requirements at A.R.S. §§ 35-312(A)(4) and 35-323(G)(4), with a qualified escrow agent that will hold the required collateral in trust for the use and benefit of the Treasurer on behalf of the collateral pool.

C.An eligible depository that does not have a preferred qualified escrow agent may ask the Administrator for permission to use the Treasurer's existing custodial contracts as a qualified escrow agent.

D.An eligible depository that has pledged required collateral to a housing authority in an amount and manner required by the United States Department of Housing and Urban Development is not required to pledge additional collateral to the collateral pool. However, the eligible depository shall include the HUD-related public monies in the reports required under R2-14-105 .

E. If an eligible depository uses a security as eligible collateral, the eligible depository shall:

1. At the time the security is deposited with a qualified escrow agent, forward to the Administrator the par and market value of the security, identified by the security's CUSIP, and the source of the valuation. The Administrator shall, from time to time, test the market value of the security using an independent source; and

2. If the security matures or is called for redemption, the cash proceeds will be retained by the qualified escrow agent until substitute collateral is pledged to replace the matured or called security.

History

• Adopted by final rulemaking at 21 A.A.R. 233, effective 4/4/2015.

Ariz. Admin. Code § R2-14-104 Increasing, Releasing, and Substituting Eligible Collateral

A.If a public depositor anticipates making a late-day (5:00 p.m. EST or later) increase in the amount of public monies deposited with an eligible depository, the public depositor shall notify the Administrator. The Administrator shall notify the eligible depository of the anticipated deposit and if needed, require that additional eligible collateral be pledged.

B.If an eligible depository determines that the amount of eligible collateral deposited with a qualified escrow agent exceeds the amount required under R2-14-103(A), the eligible depository may request that the Administrator release the excess collateral or if the collateral is a letter of credit, consent to a reduction in the face amount of credit. The Administrator shall approve the request as soon as the Administrator determines that the amount of collateral held by the qualified escrow agent exceeds the amount required.

C.Except as provided in A.R.S. § 35-1208(C), an eligible depository may make substitutions of pledged eligible collateral if the amount of required collateral is maintained.

History

• Adopted by final rulemaking at 21 A.A.R. 233, effective 4/4/2015.

Ariz. Admin. Code § R2-14-105 Reports Required

A.Contact information. An eligible depository shall provide the Administrator, using a form available on the Treasurer's web site, with the following:

1. Information the Administrator needs to contact the individual responsible for ensuring that the eligible depository complies with A.R.S. Title 35, Chapter 10, and this Chapter;

2. Information the Administrator needs to contact each public depositor including:

a. Name and physical address of the public depositor; and

b. Telephone and fax numbers and e-mail address of the individual who is to receive monthly statements from the Administrator; and

Updated information promptly after any of the information provided under subsection (A)(1) or (2) changes.

B.Daily report. An eligible depository shall provide the Administrator, using a form or format available on the Treasurer's web site or another form or format approved by the Administrator, a summary report no later than 12:30 p.m. EST every business day. The report, which shall be transmitted electronically, shall contain the following information:

1. Name of eligible depository making the report,

2. Date of report,

3. Demand-deposit ledger balance,

4. Interest-bearing ledger balance,

5. Amount of deposits covered by the FDIC,

6. Amount of uninsured deposits,

7. Amount of required collateral,

8. CUSIPs of the collateral pledged to collateral pool,

9. Market value of collateral pledged to collateral pool,

10. Original par value of collateral pledged to collateral pool,

11. Number of demand-deposit accounts of public monies, and

12. Number of interest-bearing accounts of public monies.

C.Monthly report. On or before the eighth day of each month, an eligible depository shall provide the Administrator, using a form or format available on the Treasurer's web site or another form or format approved by the Administrator, a report that contains the following information regarding each public depositor:

1. Name of public depositor,

2. Taxpayer identification of the public depositor,

3. Name and number of the public depositor's account,

4. Amount of demand deposit held for the public depositor,

5. Amount of interest-bearing deposit held for the public depositor,

6. Amount of total deposits held for the public depositor,

7. Amount of the public depositor's deposits covered by the FDIC, and

8. Amount of required collateral to protect the public depositor's deposits.

D.Detailed daily report. When the Administrator determines that additional information is needed to ensure that all public monies are protected, an eligible depository shall provide the information required under subsections (B) and (C) sorted first by public depositor and second by taxpayer identification number.

E.Additional reports. If requested by the Administrator, an eligible depositor that is a bank or savings institution shall submit to the Administrator a copy of the quarterly Report of Condition and Income filed with the Federal Financial Institutions Examination Council's Central Data Repository, as required under 12 U.S.C. § 324 (state member banks), 12 U.S.C. § 1817 (state non-member banks), 12 U.S.C. § 161 (national banks), and 12 U.S.C. § 1464 (savings institutions). An eligible depository that is a credit union shall submit to the Administrator a copy of the quarterly Call Report filed with the National Credit Union Administration, as required under 12 U.S.C. 1756.

History

• Adopted by final rulemaking at 21 A.A.R. 233, effective 4/4/2015.

Ariz. Admin. Code § R2-14-106 Use of Reports

A.If the Administrator determines after reviewing either the daily report or detailed daily report that an eligible depository has pledged insufficient collateral to the collateral pool, the Administrator shall immediately contact the eligible depository and require that additional collateral be pledged.

B.An eligible depository that is contacted under subsection (A) shall send a report to the Administrator identifying the additional collateral pledged by CUSIP, par value, and market value.

C.If an eligible depository fails to pledge additional collateral as required under subsection (A) or provide the report required under subsection (B) by 3:00 p.m. EST of the day contacted by the Administrator, the Administrator shall take one or more of the following actions:

1. Provide written notice to the eligible depository of intent to assess a daily civil penalty of:

a. $250 for failure to comply with subsection (A), and

b. $100 for failure to comply with subsection (B);

2. Provide electronic notice of the noncompliance to the:

a. Superintendent of the Department of Financial Institutions, and

b. Public depositors that have deposits with the eligible depository, and

3. Post notice of the noncompliance on the Treasurer's web site.

D.The Administrator shall forward an electronic copy of the monthly report to each public depositor within five days after receiving the report. Before the end of the month, each public depositor shall review the monthly report and inform the Administrator of any discrepancy between the information in the monthly report and the account statement provided directly to the public depositor by the eligible depository. If the public depositor fails to inform the Administrator of a discrepancy before the end of the month, the Administrator shall deem the monthly report to be correct.

History

• Adopted by final rulemaking at 21 A.A.R. 233, effective 4/4/2015.

Ariz. Admin. Code § R2-14-107 Fee Assessment

A.Under A.R.S. § 35-1212, the collateral pool is required to be self-supporting. The Administrator is authorized to assess fair and equitable fees from eligible depositories.

B.Annual assessment. The Administrator shall annually assess an eligible depository required under R2-14-102(B) to pledge eligible collateral to the collateral pool an amount that reflects the eligible depository's daily average portion of uninsured public monies on deposit.

1. The Administrator shall determine the total amount to be assessed based on expenses incurred to administer and enforce the collateral pool during a calendar year.

2. The Administrator shall inform each eligible depository of the depository's assessed amount by January 15 of each year.

3. An eligible depository shall pay the assessed amount by February 15 of each year.

4. If an eligible depository enters or leaves the collateral pool during a calendar year, the Administrator shall make or refund a partial assessment.

C.Additional assessment. When an eligible depository fails to comply fully with A.R.S. Title 35, Chapter 10 or this Chapter, the Administrator incurs extra expenses to administer and enforce the collateral pool. When this happens, the Administrator shall assess an additional fee from the non-complying eligible depository equal to the amount of extra expense incurred by the Administrator.

History

• Adopted by final rulemaking at 21 A.A.R. 233, effective 4/4/2015.

Ariz. Admin. Code § R2-14-108 Payment of Losses

A.The Administrator shall find that an eligible depository is in default if the eligible depository:

1. Fails to return to a public depositor public monies including earned interest in accordance with the terms of the depository agreement;

2. Is subject to a court order or formal action by a supervisory authority that has the effect of restraining the eligible depository from making payments of deposit liabilities; or

3. Has had a receiver appointed by a supervisory authority.

B.If the Administrator determines that an eligible depository is in default or insolvent, the Administrator shall provide notice of the default or insolvency to all public depositors that have deposited public monies with the defaulting or insolvent eligible depository.

C.If the Administrator determines that an eligible depository is in default or insolvent, the Administrator shall revoke authorization for the eligible depository to make substitutions of eligible collateral.

D.If the Administrator determines that an eligible depository is in default or insolvent, the Administrator, in cooperation with the Arizona Department of Financial Institutions and the receiver appointed for the eligible depository, if any, shall:

1. If the receiver has found a new eligible depository that agrees to accept the public monies deposited with the defaulting or insolvent eligible depository:

a. Transfer the required collateral from the defaulting or insolvent eligible depository to the new eligible depository, and

b. Provide notice of the transfer to the public depositors; or

2. If a new eligible depository is not found, take possession of the required collateral and do one or both of the following:

a. Liquidate the required collateral in an orderly fashion and distribute the proceeds on a pro-rata basis to the public depositors; or

b. Upon request from a public depositor and if it is possible to segregate and divide the required collateral, provide a pro-rata share of the segregated and divided collateral to the public depositor making the request.

3. If the Administrator determines that the default of an eligible depository is not due to the insolvency or receivership of the eligible depository, any transfer, distribution, or liquidation of required collateral under subsections (D)(1) or (D)(2) by the Administrator will allow the eligible depository to reduce account balances correspondingly for public fund deposits subject to the transfer, distribution, or liquidation.

History

• Adopted by final rulemaking at 21 A.A.R. 233, effective 4/4/2015.

Ariz. Admin. Code § R2-14-109 Civil Penalty for Noncompliance; Hearing

A.The Administrator may assess a civil penalty in the amount specified under A.R.S. § 35-1211 against an eligible depository for failing to:

1. Maintain required collateral, or

2. File a report required under R2-14-105.

B.If the Administrator determines that an eligible depository has failed to maintain required collateral or file a required report, the Administrator shall serve written notice by certified mail to the eligible depository of intent to assess a civil penalty. The Administrator shall ensure that the notice provides the information required under A.R.S. § 41-1092.03(A).

C.An eligible depository that receives notice under subsection (B) may make a written request for a hearing. The eligible depository shall make the request for hearing within 30 days after receipt of the notice under subsection (B).

D.At least 20 days before a scheduled hearing, an eligible depository may make a written request for an informal settlement conference.

E.The Administrator shall ensure that hearings are conducted using the procedures in A.R.S. Title 41, Chapter 6, Article 10 and rules of the Office of Administrative Hearings.

History

• Adopted by final rulemaking at 21 A.A.R. 233, effective 4/4/2015.

Chapter 15 Department of Administration - General Services Division

Article 2 FLEET MANAGEMENT

Ariz. Admin. Code § R2-15-201 Expired

History

• Adopted effective July 27, 1983 (Supp. 83-4). Section repealed, new Section adopted effective February 7, 1990 (Supp. 90-1). Transferred from R2-1-201 (Supp. 91-3). Amended by final rulemaking at 6 A.A.R. 4265, effective October 20, 2000 (Supp. 00-4). Section expired under A.R.S. § 41-1052(M) at 28 A.A.R. 3851, effective 12/6/2022.

Ariz. Admin. Code § R2-15-202 Expired

History

• Adopted effective July 27, 1983 (Supp. 83-4). Repealed effective February 7, 1990 (Supp. 90-1). Transferred from R2-1-202 (Supp. 91-3). New Section adopted by final rulemaking at 6 A.A.R. 4265, effective October 20, 2000 (Supp. 00-4). Amended by final rulemaking at 18 A.A.R. 1261, effective July 6, 2012 (Supp. 12-2). Section expired under A.R.S. § 41-1052(M) at 28 A.A.R. 3851, effective 12/6/2022.

Ariz. Admin. Code § R2-15-203 Expired

History

• Adopted effective July 27, 1983 (Supp. 83-4). Section repealed, new Section adopted effective February 7, 1990 (Supp. 90-1). Transferred from R2-1-203 (Supp. 91-3). Amended by final rulemaking at 6 A.A.R. 4265, effective October 20, 2000 (Supp. 00-4). Section expired under A.R.S. § 41-1052(M) at 28 A.A.R. 3851, effective 12/6/2022.

Ariz. Admin. Code § R2-15-204 Expired

History

• Adopted effective July 27, 1983 (Supp. 83-4). Section repealed, new Section adopted effective February 7, 1990 (Supp. 90-1). Transferred from R2-1-204 and paragraph labeling corrected (Supp. 91-3). Section repealed by final rulemaking at 6 A.A.R. 4265, effective October 20, 2000 (Supp. 00-4). Section expired under A.R.S. § 41-1052(M) at 28 A.A.R. 3851, effective 12/6/2022.

Ariz. Admin. Code § R2-15-205 Expired

History

• Adopted effective July 27, 1983 (Supp. 83-4). Section repealed, new Section adopted effective February 7, 1990 (Supp. 90-1). Transferred from R2-1-205 (Supp. 91-3). Amended by final rulemaking at 6 A.A.R. 4265, effective October 20, 2000 (Supp. 00-4). Section expired under A.R.S. § 41-1052(M) at 28 A.A.R. 3851, effective 12/6/2022.

Ariz. Admin. Code § R2-15-206 Expired

History

• Adopted effective July 27, 1983 (Supp. 83-4). Editorial correction, subsection (B), paragraph (3) (Supp. 84-2). Section repealed, new Section adopted effective February 7, 1990 (Supp. 90-1). Transferred from R2-1-206 (Supp. 91-3). Amended by final rulemaking at 6 A.A.R. 4265, effective October 20, 2000 (Supp. 00-4). Section expired under A.R.S. § 41-1052(M) at 28 A.A.R. 3851, effective 12/6/2022.

Ariz. Admin. Code § R2-15-207 Expired

History

• Adopted effective July 27, 1983 (Supp. 83-4). Section repealed, new Section adopted effective February 7, 1990 (Supp. 90-1). Transferred from R2-1-207 (Supp. 91-3). Amended by final rulemaking at 6 A.A.R. 4265, effective October 20, 2000 (Supp. 00-4). Section expired under A.R.S. § 41-1052(M) at 28 A.A.R. 3851, effective 12/6/2022.

Ariz. Admin. Code § R2-15-208 Expired

History

• Adopted effective July 27, 1983 (Supp. 83-4). Repealed effective February 7, 1990 (Supp. 90-1). Transferred from R2-1-208 (Supp. 91-3). Section expired under A.R.S. § 41-1052(M) at 28 A.A.R. 3851, effective 12/6/2022.

Ariz. Admin. Code § R2-15-209 Expired

History

• Adopted effective July 27, 1983 (Supp. 83-4). Section repealed, new Section adopted effective February 7, 1990 (Supp. 90-1). Transferred from R2-1-209 (Supp. 91-3). Section repealed by final rulemaking at 6 A.A.R. 4265, effective October 20, 2000 (Supp. 00-4). Section expired under A.R.S. § 41-1052(M) at 28 A.A.R. 3851, effective 12/6/2022.

Article 3 MATERIALS MANAGEMENT

Ariz. Admin. Code § R2-15-301 Definitions

In this Article, unless the context otherwise states:

"Capital asset" has the same meaning as "nonexpendable materials" in A.R.S. § 41-2601.

"Department" means the Department of Administration.

"Direct transfer" means the transfer of surplus or excess materials by the Surplus Property Management Office from one state governmental unit to another without physically moving the property to the Surplus Property Management Office.

"Director" means the director of the Department of Administration.

"Established markets" means those places where materials are regularly bought and sold at prices set by open competition.

"Fair market value" means the price at which sales have been consummated for materials of like type, quality, and quantity in a particular market at the time of acquisition.

"General Accounting Administrator" means the person holding the position as Administrator of the General Accounting Office, Financial Services Division of the Department of Administration.

"Posted prices" means the sale price determined by the Surplus Property Administrator to be fair market value.

"State governmental unit" means any department, commission, council, board, bureau, committee, institution, agency, government corporation or other establishment or official of the executive branch or corporation commission of this state. A.R.S. § 41-2503.

"State plan of operation" means the agreement for acquiring federal surplus property between the state and the United States General Services Administration.

"Surplus Property Administrator" means the person holding the position as Administrator of the Surplus Property Management Office, Management Services Division of the Department of Administration.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Transferred from R2-7-801 (Supp. 91-3). Amended effective April 2, 1993 (Supp. 93-2). Amended by final rulemaking at 10 A.A.R. 3267, effective September 24, 2004 (Supp. 04-3).

Ariz. Admin. Code § R2-15-302 Repealed

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Transferred from R2-7-802 (Supp. 91-3). Section repealed by final rulemaking at 10 A.A.R. 3267, effective September 24, 2004 (Supp. 04-3).

Ariz. Admin. Code § R2-15-303 Disposition

A. The Surplus Property Administrator shall act on behalf of the state in all matters pertaining to the disposition of excess and surplus materials.

B. Except as specifically authorized for the Department of Public Safety under A.R.S. § 41-1713(B)(7), the Arizona Exposition and State Fair Board under A.R.S. § 3-1007(A)(1), Arizona Correctional Industries under A.R.S. §§ 41-1623(E) and 41-1624(B), and the Department of Mines and Mineral Resources under A.R.S. § 27-105(6), a state governmental unit shall not transfer, sell, trade-in, condemn, or otherwise dispose of materials owned by the state without written authorization from the Surplus Property Administrator.

C. Each state governmental unit shall notify the Surplus Property Administrator of all excess and surplus materials on forms provided by the Surplus Property Administrator. The Surplus Property Administrator shall determine the fair market value of excess and surplus materials.

D. The Surplus Property Administrator shall facilitate the transfer of excess or surplus materials to or between state agencies, political subdivisions, and eligible nonprofit institutions. The transfer document for state materials shall indicate that the recipient agrees not to transfer title or dispose of the materials within a six-month period, except for motor vehicles, which have a 12-month restriction, without prior approval of the Surplus Property Administrator.

E. Disposition of surplus materials.

1. The Surplus Property Administrator shall offer surplus materials through competitive sealed bids, public auction, online sales, established markets, or posted prices. If unusual circumstances render the above methods impractical, the Surplus Property Administrator may employ other disposition methods, including appraisal or barter, provided the Surplus Property Administrator makes a written determination that the procedure is advantageous to the state. The following methods of payment for surplus materials are accepted by the Surplus Property Administrator: a United States Postal Money Order, certified check, cashier's check, and cash. Other methods of payment may be approved by the Surplus Property Administrator if the Surplus Property Administrator determines the method to be in the best interest of the state.

2. Competitive sealed bidding. The Surplus Property Administrator shall ensure that:

a. Sale notices are publicly available from the Surplus Property Office at least five days before the date set for opening bids;

b. Each sale notice lists materials offered for sale, location of materials, and availability of materials for inspection, terms and conditions of sale, and instructions to bidders, including the place, date, and time set for the bid opening;

c. Bids are opened publicly;

d. Awards are made in accordance with the provisions of the sale notice; and

e. Awards are made to the highest responsive and responsible bidder, provided that the price offered by the highest responsive and responsible bidder is acceptable to the Surplus Property Administrator. If the Surplus Property Administrator determines that a bid is not advantageous to the state, the Surplus Property Administrator may reject the bid in whole or in part, resolicit bids a bid, or negotiate the sale, provided that the negotiated sale price is higher than the highest responsive and responsible bidder's price.

3. The Surplus Property Administrator shall advertise a pubic [public] auction at least three times before the auction date; and ensure that all terms and conditions of any sale are available to the public at least 24 hours before the auction or, in the case of online sales, within the sales notice.

4. The Surplus Property Administrator shall determine whether surplus materials may be disposed of by trade-in to a vendor for credit on an acquisition. In making this determination, the Surplus Property Administrator shall consider the urgency of need by other state governmental units and whether the trade-in value is expected to exceed the value realized through the sale of the materials.

5. An employee of the owning or disposing state governmental unit shall not directly or indirectly purchase or agree with another person to purchase surplus materials if that employee is, or has been, directly or indirectly involved in the purchase, disposal, maintenance, or preparation for sale of the surplus materials.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Transferred from R2-7-803 (Supp. 91-3). Amended effective April 2, 1993 (Supp. 93-2). Amended by final rulemaking at 10 A.A.R. 3267, effective September 24, 2004 (Supp. 04-3).

Ariz. Admin. Code § R2-15-304 Materials Inventory Report and Submission of Contracts

A. Each state governmental unit, at the end of each fiscal year, shall prepare and submit to the General Accounting Administrator an inventory report of all materials warehoused or otherwise held by the unit, verified by a physical count and certified by the unit's highest-ranking officer, which lists all of the following:

1. Nonexpendable materials (capital assets), capitalized in accordance with the state of Arizona Accounting Manual;

2. Nonexpendable materials (capital assets) held under capital leases and similar financial arrangements;

3. Nonexpendable materials (capital assets) that have been, or will be, leased or rented for more than 90 days; and

4. Other materials warehoused or otherwise held by the units that are subject to the stewardship requirements of the state of Arizona Accounting Manual.

B. The state governmental unit shall include and identify separately in the inventory report all real property, buildings, and other improvements to real property.

C. The state governmental unit shall submit a copy of any signed capital leases and similar financial arrangements to the General Accounting Administrator within 30 days of execution.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Transferred from R2-7-804 (Supp. 91-3). Amended effective April 2, 1993 (Supp. 93-2). Amended by final rulemaking at 10 A.A.R. 3267, effective September 24, 2004 (Supp. 04-3).

Ariz. Admin. Code § R2-15-305 Lost, Stolen, or Destroyed Nonexpendable Materials (Capital Assets)

A. A state governmental unit shall immediately report theft of nonexpendable materials to the appropriate law enforcement agency.

B. Within 10 days after discovery, a state governmental unit shall report lost, stolen, or destroyed nonexpendable materials to the General Accounting Administrator. Based upon results of an investigation, the General Accounting Administrator may authorize the unit, in writing, to delete the missing nonexpendable materials from any internal inventory report and the AFIS Fixed Asset Subsystem (FAS). If materials are deleted from the inventory and subsequently located, the unit shall again list the materials in any internal inventory report and on the FAS.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Transferred from R2-7-805 (Supp. 91-3). Amended effective April 2, 1993 (Supp. 93-2). Amended by final rulemaking at 10 A.A.R. 3267, effective September 24, 2004 (Supp. 04-3).

Ariz. Admin. Code § R2-15-306 Federal Surplus Materials Program

The Surplus Property Administrator shall:

1. Prepare and file a state plan of operation with the United States General Services Administration.

2. Act on behalf of the state with any federal agencies or other surplus property agencies regarding federal surplus materials.

3. Distribute federal surplus materials to eligible entities.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Transferred from R2-7-806 (Supp. 91-3). Amended effective April 2, 1993 (Supp. 93-2). Amended by final rulemaking at 10 A.A.R. 3267, effective September 24, 2004 (Supp. 04-3).

Ariz. Admin. Code § R2-15-307 Authority for Transfer of Materials

A. The Surplus Property Administrator shall determine whether an entity is eligible to acquire federal or state surplus materials. Eligibility for federal surplus materials is determined in accordance with federal law. The determination of whether an entity is eligible for state surplus materials is based on whether the entity:

1. Is eligible to receive federal surplus materials, or

2. Is a federal income tax exempt non-profit entity that is a health or educational organization as defined in federal law that has at least one full-time salaried employee and demonstrates a public benefit for receiving state surplus materials.

B. A state governmental unit shall not acquire federal or state surplus materials without the approval of the Surplus Property Administrator.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Transferred from R2-7-807 (Supp. 91-3). Amended effective April 2, 1993 (Supp. 93-2). Amended by final rulemaking at 10 A.A.R. 3267, effective September 24, 2004 (Supp. 04-3).

Ariz. Admin. Code § R2-15-308 Fees and Charges

A. The Surplus Property Administrator shall determine and assess proper service and handling fees, with the approval of the Director for the acquisition, receipt, warehousing, rehabilitation, delivery, distribution, or transfer of state surplus materials. The Surplus Property Administrator shall ensure that fees are fair and equitable, based on the cost of services performed, and consistent with the continuous maintenance support requirements of the Surplus Property Management Office.

1. The Surplus Property Administrator shall approve or deny any direct transfer of state surplus materials between state governmental units. The Surplus Property Office shall not assess a service and handling fee if a direct transfer between state governmental units can be accomplished without the use of personnel, equipment, or facilities, of the Surplus Property Management Office.

2. For all other direct transfers of state surplus materials, the Surplus Property Administrator shall assess a service and handling fee. The receiving entity shall pay a transfer fee of 10% of the fair market value of the materials. The minimum fee is $20.00 and the maximum fee is $300.00.

B. Fees on other transfers or sales are determined according to R2-15-310 .

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Transferred from R2-7-808 (Supp. 91-3). Amended effective April 2, 1993 (Supp. 93-2). Amended by final rulemaking at 10 A.A.R. 3267, effective September 24, 2004 (Supp. 04-3).

Ariz. Admin. Code § R2-15-309 Surplus Materials Revolving Funds

A. The Surplus Property Administrator may, after a determination that a portion of the monies in the state surplus materials revolving fund is uncommitted for a period of three months, authorize the State Treasurer to deposit that portion of the monies in a government-insured depository institution offering a rate of return with maturity of 13 months or less from the date of purchase. All interest earned shall be credited to the revolving fund.

B. The federal surplus materials revolving fund shall be maintained in accordance with the state plan of operation.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Transferred from R2-7-809 (Supp. 91-3). Amended by final rulemaking at 10 A.A.R. 3267, effective September 24, 2004 (Supp. 04-3).

Ariz. Admin. Code § R2-15-310 Allocation of Proceeds from Sale or Disposal of Excess or Surplus Materials

A. Except as provided in other law, subsection (B), or subsection (C), the Surplus Property Administrator shall ensure that proceeds from the disposition of excess or surplus materials are retained by the Surplus Property Office.

B. Except the Department of Public Safety, under A.R.S. § 41-1713(B)(6), the Surplus Property Office shall not reimburse a state government unit for transfer or sale of materials if the unit originally purchased the materials with General Fund monies.

C. The Surplus Property Administrator shall reimburse proceeds from the disposition of materials originally purchased with special fund monies, such as revolving, dedicated, or federal funds, less the Surplus Property Office's fee, for the material's transfer or sale, according to the following schedule. The Surplus Property Administrator shall:

1. For direct transfer of state excess or surplus materials, collect the fee required in R2-15-308(A) and reimburse the balance of the sale proceeds to the transferring agency; or

2. For non-direct transfer or sale of state excess or surplus materials:

a. Reimburse nothing if the sale proceeds for an item are less than or equal to $50.00; or

b. Reimburse at a rate of not less than 70% of the sale proceeds for an item that sells for a price greater than $50.00; and

3. Reimburse sale proceeds after the sale is completed.

History

• Adopted as an emergency effective January 1, 1985, pursuant to A.R.S. § 41-1003, valid for only 90 days (Supp. 84-6). Emergency expired. Permanent rule adopted effective April 3, 1985 (Supp. 85-2). Transferred from R2-7-810 (Supp. 91-3). Amended effective April 2, 1993 (Supp. 93-2). Amended by final rulemaking at 10 A.A.R. 3267, effective September 24, 2004 (Supp. 04-3).

Chapter 16 Office of the Ombudsman - Citizens' Aide

Article 1 GENERAL PROVISIONS

Ariz. Admin. Code § R2-16-101 Definitions

In addition to the definitions provided in A.R.S. § 41-1371, the following apply in this Chapter:

1. "Complainant" means a person who files a complaint with the Office.

2. "Confidential information" means oral or written information, including a record, for which restricted access is required by federal or Arizona law. Confidential information also includes identifying personal information a complainant or witness requests not be disclosed.

3. "Document" means a paper or electronic: record, memorandum, form, book, letter, file, drawing, map, or plat.

4. "Misconduct" means any act or omission by an employee that constitutes a material or substantial breach of the employee's duties or obligations or that adversely affects a material or substantial interest of the employer.

5. "Office" means the Office of the Ombudsman-Citizens' Aide.

6. "Ombudsman-citizens' aide" means the person appointed to the position of ombudsman-citizens' aide under the provisions of A.R.S. § 41-1373.

7. "Photograph" means a paper or electronic photographic representation, photographic file, motion picture, video tape, microfilm, or microphotograph.

History

• Adopted under an exemption from the Administrative Procedure Act pursuant to Laws 1995, Ch. 281, Section 5; effective October 30, 1996 (Supp. 96-4). Amended by final rulemaking at 12 A.A.R. 1372, effective June 4, 2006 (Supp. 06-2).

Article 2 HANDLING CONFIDENTIAL MATERIAL

Ariz. Admin. Code § R2-16-201 Protecting the Identity of a Complainant or Witness

The Office shall not release to an agency, the public, or anyone else, information that reveals the identity of a complainant or witness without permission from the complainant or witness.

History

• Adopted under an exemption from the Administrative Procedure Act pursuant to Laws 1995, Ch. 281, Section 5; effective October 30, 1996 (Supp. 96-4). Amended by final rulemaking at 12 A.A.R. 1372, effective June 4, 2006 (Supp. 06-2).

Ariz. Admin. Code § R2-16-202 Expired

History

• Adopted under an exemption from the Administrative Procedure Act pursuant to Laws 1995, Ch. 281, Section 5; effective October 30, 1996 (Supp. 96-4). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 1834, effective February 28, 2002 (Supp. 02-1).

Ariz. Admin. Code § R2-16-203 Requirement to Close Case before Violating Confidentiality

The Office shall stop an investigation and close a case if it cannot proceed further without releasing identifying information about a complainant who requested confidentiality. Before stopping the investigation and closing the case for this reason, the Office shall ask the complainant for permission to release identifying information.

History

• Adopted under an exemption from the Administrative Procedure Act pursuant to Laws 1995, Ch. 281, Section 5; effective October 30, 1996 (Supp. 96-4). Amended by final rulemaking at 12 A.A.R. 1372, effective June 4, 2006 (Supp. 06-2).

Ariz. Admin. Code § R2-16-204 Expired

History

• Adopted under an exemption from the Administrative Procedure Act pursuant to Laws 1995, Ch. 281, Section 5; effective October 30, 1996 (Supp. 96-4). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 1834, effective February 28, 2002 (Supp. 02-1).

Ariz. Admin. Code § R2-16-205 Protecting Confidential Agency Information

The Office shall give confidential information received from an agency the same degree of protection as provided by the agency. The Office shall not release confidential agency information to the complainant, or any other person, without the agency's prior authorization, unless ordered by a court or other lawful authority.

History

• Adopted under an exemption from the Administrative Procedure Act pursuant to Laws 1995, Ch. 281, Section 5; effective October 30, 1996 (Supp. 96-4). Amended by final rulemaking at 12 A.A.R. 1372, effective June 4, 2006 (Supp. 06-2).

Ariz. Admin. Code § R2-16-206 Expired

History

• Adopted under an exemption from the Administrative Procedure Act pursuant to Laws 1995, Ch. 281, Section 5; effective October 30, 1996 (Supp. 96-4). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 1834, effective February 28, 2002 (Supp. 02-1).

Ariz. Admin. Code § R2-16-207 Expired

History

• Adopted under an exemption from the Administrative Procedure Act pursuant to Laws 1995, Ch. 281, Section 5; effective October 30, 1996 (Supp. 96-4). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 1834, effective February 28, 2002 (Supp. 02-1).

Ariz. Admin. Code § R2-16-208 Returning a Confidential Document to a Complainant

When requested, the Office shall return a confidential document received from a complainant to the complainant. The Office shall not release a confidential document to anyone other than the complainant unless the complainant provides written authorization for release of the document to a third party or the Office determines that the document was not lawfully in the possession of the complainant.

History

• Adopted effective October 30, 1996 (Supp. 96-4). Amended by final rulemaking at 12 A.A.R. 1372, effective June 4, 2006 (Supp. 06-2).

Ariz. Admin. Code § R2-16-209 Prohibition against Discussing Open Complaint Investigations

The Office shall not discuss an open complaint investigation with the general public or the media.

History

• Adopted under an exemption from the Administrative Procedure Act pursuant to Laws 1995, Ch. 281, Section 5; effective October 30, 1996 (Supp. 96-4). Amended by final rulemaking at 12 A.A.R. 1372, effective June 4, 2006 (Supp. 06-2).

Ariz. Admin. Code § R2-16-210 Summaries of Closed Cases

The Office shall make available to the public a summary of a closed case if the Office determines that the summary will assist in the management of a state government program, respond to an inquiry about the performance of a state program, or inform the public about the activity and performance of the Office. The Office shall ensure that the summary does not disclose identifying information about a complainant or witness whose identity is protected, confidential investigator notes, or confidential information received from an agency.

History

• Adopted under an exemption from the Administrative Procedure Act pursuant to Laws 1995, Ch. 281, Section 5; effective October 30, 1996 (Supp. 96-4). Amended by final rulemaking at 12 A.A.R. 1372, effective June 4, 2006 (Supp. 06-2).

Article 3 RECEIVING AND PROCESSING COMPLAINTS

Ariz. Admin. Code § R2-16-301 Exhausting Reasonable Alternatives within the Agency

A. The Office shall make inquiry of the complainant and the agency to determine whether a complainant has exhausted all reasonable alternatives to resolve a complaint within an agency before initiating an investigation.

B. If the complainant has not made a reasonable effort to resolve the complaint within the agency, the Office shall refer the complainant to the appropriate person or office within the agency and provide the complainant information about available steps to resolve the complaint.

C. The Office shall defer action in a matter that is being litigated in the courts or is the subject of a current formal administrative procedure unless the ombudsman-citizens' aide determines that immediate action is necessary to protect the public health, safety, or welfare.

History

• Adopted under an exemption from the Administrative Procedure Act pursuant to Laws 1995, Ch. 281, Section 5; effective October 30, 1996 (Supp. 96-4). Amended by final rulemaking at 12 A.A.R. 1372, effective June 4, 2006 (Supp. 06-2).

Ariz. Admin. Code § R2-16-302 Inmate Complaints

In accordance with A.R.S. § 41-1377, the Office shall refuse to investigate a complaint filed by a person in the custody of the Department of Corrections, filed by another person on behalf of an inmate, or concerning a rule or substantive policy statement about inmates.

History

• Adopted under an exemption from the Administrative Procedure Act pursuant to Laws 1995, Ch. 281, Section 5; effective October 30, 1996 (Supp. 96-4). Amended by final rulemaking at 12 A.A.R. 1372, effective June 4, 2006 (Supp. 06-2).

Ariz. Admin. Code § R2-16-303 Resolution without Investigation

If a complaint can be resolved quickly by mutual agreement, the Office shall attempt to resolve the complaint informally, without resorting to an investigation.

History

• Adopted under an exemption from the Administrative Procedure Act pursuant to Laws 1995, Ch. 281, Section 5; effective October 30, 1996 (Supp. 96-4). Amended by final rulemaking at 12 A.A.R. 1372, effective June 4, 2006 (Supp. 06-2).

Ariz. Admin. Code § R2-16-304 Anonymous Complaints

The Office shall not investigate an anonymous complaint. If the Office receives facts from an anonymous source that are compelling and can be reasonably independently verified, the Office may investigate the matter if it is within the scope of A.R.S. § 41-1377.

History

• Adopted under an exemption from the Administrative Procedure Act pursuant to Laws 1995, Ch. 281, Section 5; effective October 30, 1996 (Supp. 96-4). Amended by final rulemaking at 12 A.A.R. 1372, effective June 4, 2006 (Supp. 06-2).

Ariz. Admin. Code § R2-16-305 Filing Complaints

A. A complaint against an agency shall be filed with the Office in person or by the U.S. Postal Service, telephone, electronic facsimile, or electronic mail.

B. A complaint that alleges misconduct by a state employee shall be in writing, signed by the complainant, and filed with the Office in person or by the U. S. Postal Service or electronic facsimile.

History

• Adopted under an exemption from the Administrative Procedure Act pursuant to Laws 1995, Ch. 281, Section 5; effective October 30, 1996 (Supp. 96-4). Amended by final rulemaking at 12 A.A.R. 1372, effective June 4, 2006 (Supp. 06-2).

Article 4 CONDUCTING INVESTIGATIONS

Ariz. Admin. Code § R2-16-401 Notice

When it will not compromise the effectiveness of an investigation, the Office shall exercise the right of access under A.R.S. § 41-1378 by giving the agency at least 10 days notice before conducting interviews, examining necessary records, or requiring the production of information. An agency may request an extension to this period for a compelling reason. The ombudsman-citizens' aide shall grant a request for extension unless the ombudsman-citizens' aide believes a delay will cause significant harm or damage.

History

• Adopted under an exemption from the Administrative Procedure Act pursuant to Laws 1995, Ch. 281, Section 5; effective October 30, 1996 (Supp. 96-4). Amended by final rulemaking at 12 A.A.R. 1372, effective June 4, 2006 (Supp. 06-2).

Ariz. Admin. Code § R2-16-402 Expired

History

• Adopted under an exemption from the Administrative Procedure Act pursuant to Laws 1995, Ch. 281, Section 5; effective October 30, 1996 (Supp. 96-4). Section expired under A.R.S. § 41-1056(E) at 8 A.A.R. 1834, effective February 28, 2002 (Supp. 02-1).

Ariz. Admin. Code § R2-16-403 Closing Cases

The Office may close a case for any of the following reasons:

1. Discontinued. The ombudsman-citizens' aide determines that an investigation should be terminated before the investigation is completed because:

a. Disclosure of the complainant's identity is necessary to enable full investigation and the complainant refuses to allow the disclosure;

b. Information or a record is requested from the complainant and the complainant fails to produce the information or record within the time specified by the Office;

c. The complainant withdraws the complaint;

d. The complaint relates to a matter that has become the subject of an administrative or judicial proceeding;

e. The Office forwards the complaint to an appropriate prosecutor because it involves possible criminal activity; or

f. The ombudsman-citizens' aide determines there is other good cause not to proceed with an investigation;

2. Closed - not substantiated. Following an investigation, the ombudsman-citizens' aide makes a finding that the allegations in the complaint are not substantiated;

3. Closed - complaint resolved (before preliminary report). Following an investigation, the ombudsman-citizens' aide determines that the complaint has merit, either wholly or in part, and, before a preliminary report is issued, the agency agrees to provide a remedy that is acceptable to the agency and the ombudsman-citizens' aide;

4. Closed - complaint resolved (after preliminary report). Following an investigation, the ombudsman - citizens' aide determines that the complaint has merit, either wholly or in part, and, after a preliminary report is issued, the agency agrees to provide a remedy that is acceptable to the ombudsman-citizens' aide;

5. Closed - complaint unresolved. Following an investigation, the ombudsman - citizens' aide determines that the complaint has merit, either wholly or in part, and the agency does not accept the recommendations of the ombudsman - citizens' aide; or

6. Other. Any other reason the Office determines requires that a complaint be closed.

History

• Adopted under an exemption from the Administrative Procedure Act pursuant to Laws 1995, Ch. 281, Section 5; effective October 30, 1996 (Supp. 96-4). Amended by final rulemaking at 12 A.A.R. 1372, effective June 4, 2006 (Supp. 06-2).

Ariz. Admin. Code § R2-16-404 Findings

The Office shall make one of the following findings in an investigative report:

Substantiated. The investigation establishes that the administrative act did occur and the complainant's criticism of the administrative act is valid.

2. Partially substantiated.

a. In a complaint having multiple allegations, the investigation establishes that at least one allegation is substantiated and at least one allegation is not substantiated or indeterminate; or

b. The investigation establishes there is shared fault between the complainant and agency.

3. Not substantiated. The investigation establishes that:

a. The administrative act did not occur; or

b. The administrative act occurred, but the complainant's criticism of the administrative act is not valid.

4. Indeterminate. The investigation does not provide sufficient evidence for the Office to determine conclusively:

a. Whether the administrative act occurred; or

b. If the administrative act occurred, whether the complainant's criticism of the administrative act is valid.

History

• Adopted under an exemption from the Administrative Procedure Act pursuant to Laws 1995, Ch. 281, Section 5; effective October 30, 1996 (Supp. 96-4). Amended by final rulemaking at 12 A.A.R. 1372, effective June 4, 2006 (Supp. 06-2).

Ariz. Admin. Code § R2-16-405 Recommendations

A. In accordance with A.R.S. §§ 41-1376 and 41-1379, the Office shall recommend a resolution to a complaint when a completed investigation results in a finding of "substantiated" or "partially substantiated."

B. The Office shall not recommend that a specific employee disciplinary action be imposed.

History

• Adopted under an exemption from the Administrative Procedure Act pursuant to Laws 1995, Ch. 281, Section 5; effective October 30, 1996 (Supp. 96-4). Amended by final rulemaking at 12 A.A.R. 1372, effective June 4, 2006 (Supp. 06-2).

Article 5 INCORPORATING AGENCY RESPONSES INTO REPORTS AND RECOMMENDATIONS

Ariz. Admin. Code § R2-16-501 Preliminary Report

A. Before issuing an opinion or recommendation, the Office shall consult with the agency and send a confidential preliminary report to the agency.

B. In accordance with A.R.S. § 41-1379, the Office or agency may share a preliminary report with other state officials only if it is necessary to resolve the complaint, but shall not publicly disclose the contents of the preliminary report.

C. An agency may seek modification of an opinion or recommendation presented in the preliminary report by including a request for modification in a written response submitted within 15 working days of receiving the preliminary report.

D. An agency may request, for a compelling reason, an extension to the time in which to respond. The Office shall grant an agency's request for extension, unless the ombudsman-citizens' aide believes an extension will cause significant harm or damage.

E. The Office shall consider an agency's request for modification of an opinion or recommendation before it prepares the final report and shall notify the agency of the acceptance or rejection of the request within 15 working days of receiving the request.

F. If an agency does not request modification, the preliminary report becomes the final report 15 working days after the agency receives the preliminary report.

History

• Adopted under an exemption from the Administrative Procedure Act pursuant to Laws 1995, Ch. 281, Section 5; effective October 30, 1996 (Supp. 96-4). Amended by final rulemaking at 12 A.A.R. 1372, effective June 4, 2006 (Supp. 06-2).

Ariz. Admin. Code § R2-16-502 Final Report

A. After the Office receives an agency's response, if any, to a preliminary report and makes accepted modifications to the preliminary report, or if no timely response is filed, the Office shall send the final report to the chief executive officer of the agency.

B. If the Office requests that an agency respond to a final report, the agency shall respond to the Office, in writing, within 20 working days after receiving the final report. The agency shall include in the response the agency's decision to accept or reject a recommendation. If the agency accepts a recommendation, the agency shall specify a date by which the recommendation will be implemented.

C. If the ombudsman-citizens' aide determines that an early response to a final report is necessary to protect the public health, safety, or welfare, the Office shall require an agency to respond on a date sooner than 20 working days. Additionally, the ombudsman - citizens' aide may extend a response period for good cause at the request of an agency.

History

• Adopted under an exemption from the Administrative Procedure Act pursuant to Laws 1995, Ch. 281, Section 5; effective October 30, 1996 (Supp. 96-4). Amended by final rulemaking at 12 A.A.R. 1372, effective June 4, 2006 (Supp. 06-2).

Ariz. Admin. Code § R2-16-503 Advising the Complainant

A. The Office shall provide a final response to a complainant. If requested by the complainant, the Office shall provide the final response in writing.

B. Before releasing a final report to any person not authorized to receive confidential information, the Office shall purge the final report of any confidential information.

History

• Adopted under an exemption from the Administrative Procedure Act pursuant to Laws 1995, Ch. 281, Section 5; effective October 30, 1996 (Supp. 96-4). Amended by final rulemaking at 12 A.A.R. 1372, effective June 4, 2006 (Supp. 06-2).

Chapter 17 Water Quality Appeals Board

Article 1 APPEALS

Ariz. Admin. Code § R2-17-101 Scope of Article; General Considerations

A. These rules of procedure and the statutes and administrative rules governing administrative hearing procedures under Title 41, Chapter 6, Article 10, A.R.S. §§ 41-1092.03 through 41-1092.12 and A.A.C. R2-19-101 through A.A.C. R2-19-122 govern all appeals to the Water Quality Appeals Board taken under A.R.S. § 49-323. In case of a conflict, this Article governs when the Board directly conducts an administrative hearing whereas the procedures under Title 41, Chapter 6, Article 10 govern when the Board uses the services of the Office of Administrative Hearings, except that in all appeal hearings A.R.S. § 49-324(C) prescribes the standard of review.

B. Where a procedure is not established by law, this Article, or an order of the Board, the Board may refer to the Arizona Rules of Civil Procedure for guidance, but the Arizona Rules of Civil Procedure are not binding on the Board or the parties unless the Board issues an order to that effect.

History

• Adopted effective January 8, 1998 (Supp. 98-1). Amended by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Ariz. Admin. Code § R2-17-102 Definitions

The definitions in A.R.S. 41-1092 apply to this Article. In addition, the terms in this Article have the following meanings:

1. "Appellant" means the person who files a notice of appeal with the Department of Environmental Quality under A.R.S. § 49323.

2. "Board" means the Water Quality Appeals Board appointed by the Governor according to A.R.S. § 49-322, but includes an individual Board member or administrative law judge acting on behalf of the Board according to a lawful delegation of authority.

3. "Clerk" means the person designated as Clerk of the Board.

4. "Ex parte communication" means an oral or written communication, not on the public record, made without sufficient prior notice to permit all parties to participate in the communication.

5. 4. "Party" means the appellant, the Department of Environmental Quality, all persons named by the appellant as interested persons as provided in R2-17-107(B)(2), and any interested person the Board has permitted to intervene in the appeal as a matter of right.

6. 5. "Record" has the meaning found in A.R.S. § 12-904(B) and includes records of proceedings before the Office of Administrative Hearings when the Board uses those services.

History

• Adopted effective January 8, 1998 (Supp. 98-1). Amended by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Ariz. Admin. Code § R2-17-103 Commencement of an Appeal; Copies; Informal Settlement Conference

A. To commence an appeal, the appellant shall file a notice of appeal with the Department of Environmental Quality. The Department of Environmental Quality shall deliver or mail a copy of the notice of appeal to the Clerk of the Water Quality Appeals Board. The appellant shall file the notice of appeal within 30 days after receiving the notice of appealable agency action. The date of filing is the date the Department of Environmental Quality receives the notice of appeal.

B. The Clerk shall make available to all persons copies of this Article. The Clerk shall charge a reasonable fee for the cost of copies.

C. If an informal settlement conference is requested by the appellant under A.R.S. § 41-1092.06, the Department of Environmental Quality shall notify the Board in writing of the request and the outcome of the conference.

History

• Adopted effective January 8, 1998 (Supp. 98-1). Amended by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Ariz. Admin. Code § R2-17-104 Docket; Case Number; Information on Documents

A. The Clerk shall maintain a docket of all appeals and assign each appeal a case number. For each appeal, the Clerk shall enter all of the following information on the docket:

1. The case number;

2. The case name;

3. The filing date of the notice of appeal;

4. The receipt date of any answer;

5. The receipt date of any disclosures;

6. The receipt date of prehearing motions, responses, and replies;

7. The dates of the evidentiary hearing;

8. The dates of orders by the Board and the Board's decision;

9. The receipt date of any motion for rehearing or review;

10. The Board's decision on any motion for rehearing or review and the date of the decision; and

11. The Board's final decision and the date of the final decision.

B. A party shall place the case number and the name, address, telephone number and email address of the party or party's attorney on all pleadings, motions, or other documents filed with the Board.

History

• Adopted effective January 8, 1998 (Supp. 98-1). Amended by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Ariz. Admin. Code § R2-17-105 Filing and Service of Pleadings, Motions, or Other Documents

A. Within the time limits for filing, a party shall file the original and 1 copy of all pleadings, motions, or other documents with the Clerk and serve a copy on each party and the administrative law judge, if the Board has delegated hearing powers and duties to the Office of Administrative Hearings.

B. A party shall serve documents other than subpoenas by personal service or by regular mail. A party is considered served at the time of personal service of the document or upon deposit of the document in the United States mail, postage prepaid, in a sealed envelope, addressed to the party being served, at the party's last address of record with the Department of Environmental Quality or the Board. If there is a discrepancy between the records of these agencies, the party serving the document shall use the last address of record with the Board. Each party shall inform the Board of any change of address within 5 days of the change.

C. A party shall demonstrate proof of service by filing with the Clerk a written statement, signed by the party, indicating that service was made in person or by mail. The statement shall be attached to the pleading, motion, or other document being filed.

D. After receiving the Notice of Appeal or an Answer of a party, or when the Board finds that the interest of justice so requires, the Board may order any party to publish an appropriate notice in a newspaper of general circulation in the community or communities that may be adversely affected if the appellant is granted the relief requested in the appellant's Notice of Appeal. The party shall publish the notice in the manner prescribed by the Arizona Rules of Civil Procedure, unless the Board determines that another method of publication is more appropriate.

History

• Adopted effective January 8, 1998 (Supp. 98-1).

Ariz. Admin. Code § R2-17-106 Contents of a Notice of Appeal

A. The notice of appeal shall contain the following statements:

1. "The appellant files this notice of appeal with the Department of Environmental Quality according to A.R.S. § 49-323."

2. "Under A.A.C. R2-17-107, if you, a Respondent in this case, have an interest in the final decision that may result from this Notice of Appeal, you are required to file an Answer to this Notice of Appeal within 20 days from the date of service of this Notice of Appeal on you."

B. The notice of appeal shall contain the following information:

1. The name, address, email and telephone number of the appellant and, if the appellant is represented by an attorney, the name, address, telephone number, email and Arizona Bar number of the appellant's attorney;

2. The names, mailing addresses, email, and telephone numbers of all of the following interested parties:

a. The permittee or registrant, if the permittee or registrant is not the appellant;

b. All persons who filed a notice of appearance in the action before the Department of Environmental Quality that the appellant is appealing; and

c. The Department of Environmental Quality.

3. The specific action of the Department of Environmental Quality involving the grant, denial, modification, or revocation of an individual permit issued under A.R.S. Title 49, Chapter 2, the issuance, denial, or revocation of a determination pursuant to A.R.S. § 49-241(B) or (C), or the establishment of numeric values and data gap issues for pesticides under A.R.S. §§ 49-303 and 49-304;

4. The date of the action by the Department of Environmental Quality;

5. The date the notice of action by the Department of Environmental Quality was received by the appellant;

6. The relief requested by the appellant and a concise statement of the reasons for the appeal;

7. The date of the notice of appeal;

8. The signature of the appellant or the appellant's attorney;

9. A verification that the appellant has served or caused to be served, a copy of the notice of appeal on the Department of Environmental Quality and all parties named by the appellant.

History

• Adopted effective January 8, 1998 (Supp. 98-1). Amended and renumbered from R2-17-107 by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Ariz. Admin. Code § R2-17-107 Time for Filing an Answer to a Notice of Appeal

The Department of Environmental Quality and all parties named by the appellant shall file an answer to appellant's notice of appeal within 20 days from service of the notice of appeal on that party.

History

• Adopted effective January 8, 1998 (Supp. 98-1). Renumbered from R2-17-108 by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Ariz. Admin. Code § R2-17-108 Contents of an Answer to a Notice of Appeal

The answer of each respondent shall contain the following information:

1. The name, address, email and telephone number of the respondent preparing the answer and, if the respondent is represented by an attorney, the name, address, telephone number, email and Arizona Bar number of the respondent's attorney;

2. A response to the appellant's allegations relating to the action taken by the Department of Environmental Quality involving the grant, denial, modification, or revocation of an individual permit issued under A.R.S. Title 49, Chapter 2, the issuance, denial, or revocation of a determination pursuant to A.R.S. § 49-241(B) or (C), or the establishment of numeric values and data gap issues for pesticides under A.R.S. §§ 49-303 and 49-304;

3. The relief requested by the respondent;

4. The date of the answer;

5. The signature of the respondent or the respondent's attorney;

6. A verification that the respondent has served or caused to be served a copy of the answer on all other parties.

History

• Adopted effective January 8, 1998 (Supp. 98-1). Renumbered from R2-17-109 by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Ariz. Admin. Code § R2-17-109 Prehearing Disclosure

A. Within the times set forth in subsection (B), each party shall disclose in writing to every other party:

1. The factual basis of the appeal or response;

2. The legal theory upon which the appeal or response is based, including citations of pertinent legal authorities;

3. The names, addresses, email and telephone numbers of all witnesses the party expects to call at the hearing, with a description of the substance of each witness' expected testimony;

4. If a party is a corporation, the name of the state of incorporation. If the party is not an Arizona corporation, the party shall state whether it is qualified to do business in the state by the Arizona Corporation Commission;

5. If the party is a partnership, the name, address, email and telephone number of each partner;

6. The names, mailing addresses, email and telephone numbers of all of the following interested persons:

a. The permittee or registrant, if the permittee or registrant is not the appellant;

b. All persons who filed a notice of appearance in the action before the Department of Environmental Quality that the appellant is appealing;

c. The mayor of any city or town or the chair of the board of supervisors of any county that may be affected if the appellant is granted the relief requested;

7. The name and address of each person whom the party expects to call as an expert witness at the hearing, the subject matter on which the expert is expected to testify, the substance of the facts and opinions to which the expert is expected to testify, a summary of the grounds for each opinion, the qualifications of the witness and the name and address of the custodian of copies of any reports prepared by the expert;

8. A list of documents which indicates the location, custodian, and a general description of any tangible evidence or relevant documents that the party plans to use during the hearing. Unless good cause is stated for not doing so, a copy of each document listed shall be served with the disclosure. If production is not made, the party shall indicate the name and address of the custodian of the document. A party who produces documents for inspection shall produce them as they are kept in the usual course of business.

B. The parties shall make the initial disclosure required by subsection (A) at least 15 days prior to the date set for hearing, unless the parties otherwise agree, or the Board shortens or extends the time for good cause. If feasible, counsel shall meet to exchange disclosures; otherwise, the parties shall serve the disclosures as prescribed in R2-17-105 . At the same time the parties shall file with the Clerk the disclosures and 1 copy of each document listed.

C. The duties described in subsections (A) and (B) are continuing duties, and each party shall make additional or amended disclosures whenever new or different information is discovered or revealed. A party shall serve additional or amended disclosures seasonably, but in no event later than 3 days before the hearing, except by leave of the Board.

D. A party shall include in its disclosure, information and data in the possession, custody, and control of the parties as well as that which can be ascertained, learned, or acquired by reason- able inquiry and investigation.

E. Each party shall make the disclosure in writing under oath and sign the disclosure.

F. When information is withheld from disclosure or discovery on a claim that it is privileged or subject to protection as trial preparation materials, the party making the claim shall do so expressly and shall support the claim with a description of the nature of the documents, communications, or things not produced or disclosed that is sufficient to enable other parties to contest the claim.

History

• Adopted effective January 8, 1998 (Supp. 98-1). Amended and renumbered from R2-17-110 by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Ariz. Admin. Code § R2-17-110 Depositions

The Board may allow the deposition of a witness who cannot be subpoenaed or is unable to attend the hearing, in the manner and upon the terms designated by the Board. The party requesting a deposition shall bear the expense of the deposition.

History

• Adopted effective January 8, 1998 (Supp. 98-1). Renumbered from R2-17-111 by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Ariz. Admin. Code § R2-17-111 Motions

A. To obtain an order or other relief from the Board other than for rehearing or review as provided in R2-17-125, a party shall make a motion at least 15 days before the Board hearing. Unless the motion is made during a hearing, the party shall make the motion in writing. For all motions, the party shall state the grounds on which the motion is based and the relief or order sought. The Board shall decide prehearing motions based on the written materials submitted by the parties.

B. Any party may file a response to a prehearing motion within five days after service of the motion and serve the response on all parties. The moving party has two days after service of a response to file a reply.

C. For a written motion, a party shall state the grounds on which the motion is based and the relief or order sought in a supporting memorandum. A party's supporting memorandum shall not exceed 15 pages, exclusive of pages containing the table of contents, the table of cases, statutes or other authorities, and the appendix, if any. A reply memorandum shall not exceed five pages.

D. A party shall support motion documents by affidavit or other satisfactory evidence if they contain facts not apparent in the record or facts that are not cognizable through judicial notice.

E. When the Board directly conducts an administrative hearing, the Board shall rule on all motions. When the Board uses the services of the Office of Administrative Hearings, the administrative law judge shall rule on all motions.

History

• Adopted effective January 8, 1998 (Supp. 98-1). Amended and renumbered from R2-17-112 by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Ariz. Admin. Code § R2-17-112 Duties of the Board During a Hearing

A. The Board shall:

1. Conduct the hearing in an impartial, orderly, and informal manner;

Regulate the course of the hearing;

3. Rule upon procedural matters incidental to the hearing;

4. Designate the order in which parties introduce their evidence; and

5. Exercise the powers granted in A.R.S. § 41-1092.07.

B. The Board may:

1. Exclude a witness from the hearing so the witness cannot hear the testimony of other witnesses;

2. Set time limitations for arguments;

3. Exclude a person from the hearing who is disruptive to the proceedings;

4. Administer oaths and affirmations to witnesses; and

5. Issue any orders necessary for the impartial, orderly, and informal conduct of the hearing.

History

• Adopted effective January 8, 1998 (Supp. 98-1). Amended and renumbered from R2-17-113 by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Ariz. Admin. Code § R2-17-113 Location of Hearings

All hearings shall be held in Arizona, in Maricopa County, unless the Board finds that it will be more cost effective for the Board and the parties to hold a hearing elsewhere, in which event the Board shall set the location of the hearing.

History

• Adopted effective January 8, 1998 (Supp. 98-1). Renumbered from R2-17-114 by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Ariz. Admin. Code § R2-17-115 Consolidation

Upon the motion of a party, the Board may consolidate two or more appeals involving a common question of law or fact when consolidation will avoid unnecessary cost or delay.

History

• Adopted effective January 8, 1998 (Supp. 98-1). Amended and renumbered from R2-17-116 by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Ariz. Admin. Code § R2-17-116 Continuances

A. A party applying for a continuance of a hearing shall file a motion with the Clerk and serve all parties no later than 10 days before the scheduled date of the hearing. The Board may accept a motion filed later than 10 days before the hearing for good cause. The motion shall state why the continuance is being requested, why a stipulation from adverse parties was not obtained, and the amount of time requested.

B. Any opposing party may, within five days after service of the motion, file and serve a response. The Board may permit a reply.

C. The parties may stipulate to a continuance. The Board is not required to accept the stipulation.

History

• Adopted effective January 8, 1998 (Supp. 98-1). Amended and renumbered from R2-17-117 by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Ariz. Admin. Code § R2-17-117 Subpoenas

A. A party shall make a written request for a subpoena which clearly identifies the person, documents, or other evidence desired and the reason the evidence is relevant to the proceeding. The party requesting the subpoena shall file the request at least 15 days prior to the date set for hearing, provide the Board with a proposed subpoena for electronic signature, and ensure that any subpoena issued is served in the manner prescribed by the Arizona Rules of Civil Procedure.

B. The person to whom a subpoena is directed shall comply with its provisions unless:

1. The person serving the subpoena has failed to comply with subsection (A) of this rule; or

2. The person to whom the subpoena is directed, at least 10 days prior to the date set for the hearing, files a motion to quash or modify the subpoena and the motion is granted in whole or in part, prior to the hearing.

History

• Adopted effective January 8, 1998 (Supp. 98-1). Amended and renumbered from R2-17-118 by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Ariz. Admin. Code § R2-17-118 Prehearing Conferences

A. Upon a motion by a party or on the initiative of the Board, the Board may order a prehearing conference, if the Board finds that a prehearing conference will assist the Board to:

1. Conduct the hearing within the 60-day period prescribed by A.R.S. § 41-1092.05(A); or

2. Reach a just, speedy, and less expensive determination of the appeal.

B. If the Board takes any action at or after the prehearing conference, the Board shall prepare a written order reciting the action taken. The order shall become a part of the record of the appeal.

History

• Adopted effective January 8, 1998 (Supp. 98-1). Amended and renumbered from R2-17-119 by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Ariz. Admin. Code § R2-17-119 Hearing

A. The Board shall conduct a full evidentiary hearing. A party may introduce new evidence or evidence that was considered by the Department of Environmental Quality when it took the action being appealed.

B. The Board and the administrative law judge if the matter is referred to the Office of the Administrative Hearings shall use the standard of review prescribed in A.R.S. § 49-324(C) to decide an appeal.

C. Noncompliance with any order of the Board or disruption of any hearing is improper conduct and grounds for exclusion from the hearing.

History

• Adopted effective January 8, 1998 (Supp. 98-1). Amended and renumbered from R2-17-120 by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Ariz. Admin. Code § R2-17-120 Evidence

A. All witnesses at a hearing shall testify under oath or affirmation. All parties shall have the right to present evidence and to conduct cross-examination as may be required for a full and true disclosure of the facts. The Board shall receive relevant, probative, and material evidence, rule upon offers of proof, and exclude all evidence determined to be irrelevant, immaterial, or unduly repetitious.

B. Any party may call additional witnesses or introduce into evidence additional documents not disclosed by the party in its notice of appeal, answer, initial prehearing disclosure, or an additional or amended disclosure if that witness or document was not or could not reasonably have been known to that party at the time the party filed its notice of appeal, answer, initial prehearing disclosure, and additional or amended disclosure.

C. The Board may conduct a hearing in an informal manner and without adherence to the rules of evidence required in judicial proceedings or follow that portion of the Arizona Rules of Evidence that the Board deems appropriate.

D. The Board may question any witness.

E. The Board may take judicial notice of judicially cognizable facts. In addition, the Board may take notice of generally recognized technical or scientific facts within the board members' specialized knowledge. The Board shall notify the parties either before or during the hearing, by reference in a preliminary report or otherwise, of the material noticed, including any staff memoranda or data. The parties shall be afforded an opportunity to contest the noticed material. The board members' experience, technical competence, and specialized knowledge may be utilized in the evaluation of the evidence.

History

• Adopted effective January 8, 1998 (Supp. 98-1). Renumbered from R2-17-121 by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Ariz. Admin. Code § R2-17-121 Recording Hearings

A. The Board shall tape-record the hearing unless it determines there will be a court reporter and is able to obtain state funds for the cost of the court reporter.

B. Any party may use a court reporter to produce a record of the hearing, but that party shall pay for all costs of the court reporter. Where a hearing is recorded by a party's court reporter, the Board shall determine whether the tape recording or the court reporter's recording will be used to prepare the hearing transcript. The Clerk shall ensure that the proceedings are transcribed and provide copies of the transcript to the Board at the time the Board meets to consider its decision on the appeal.

C. Any party that requests a transcript of the proceeding from the Board shall pay the Clerk a fee for the cost of copying the transcript.

History

• Adopted effective January 8, 1998 (Supp. 98-1). Amended and renumbered from R2-17-122 by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Ariz. Admin. Code § R2-17-122 Ex Parte Communications

Ex parte communications with Board members and staff are prohibited as provided in A.A.C. R2-19-105 . The prohibition applies to any Board member, administrative law judge, or employee of the State of Arizona who is or may reasonably be expected to be involved in the decision making process.

A. In any appeal before the Board, except to the extent required for disposition of ex parte matters as authorized by law or these rules of procedure:

2. A Board member, administrative law judge, or employee of the State of Arizona who is or may reasonably be expected to be involved in the decision making process shall not make or knowingly cause to be made an ex parte communication relevant to the merits of the proceeding to any interested person.

B. A Board member, administrative law judge, or employee of the State of Arizona who is or may reasonably be expected to be involved in the decision making process and receives, makes, or knowingly causes to be made a communication prohibited by this Section shall place all written communications and all written responses to the communications in the public record of the proceeding and by oral testimony on the record state the substance of all oral communications.

C. Any interested person who receives a communication prohibited by this Section shall file a notice of the communication with the Clerk and serve a copy on the Solicitor General and all parties to the appeal. The interested person shall attach to the notice a copy of the communication, if written, or a summary of the communication, if oral.

D. When the Board is made aware under subsections (B) or (C) of a communication prohibited by this Section, the Board shall give all parties a reasonable opportunity to respond to the communication. The Board, to the extent consistent with the interests of justice and the policy of the underlying statutes and rules, may require the person responsible for the communication to show cause why the person's claim or interest in the proceeding should not be dismissed, denied, disregarded, or otherwise adversely affected because of the violation.

E. The provisions of this Section apply to an appeal from the date the notice of appeal is filed to the date on the Board's final administrative decision, unless the person responsible for the communication knew the appeal would be noticed, in which case the prohibition applies from the time that the person acquired the knowledge.

History

• Adopted effective January 8, 1998 (Supp. 98-1). Amended and renumbered from R2-17-123 by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Ariz. Admin. Code § R2-17-123 Notification of Decisions and Orders

The Clerk shall notify each party promptly by either delivering or mailing copies of all decisions and orders, including the findings of fact, conclusions of law, and the final administrative decision of the Board to each party's last known address.

History

• Adopted effective January 8, 1998 (Supp. 98-1). Renumbered from R2-17-124 by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Ariz. Admin. Code § R2-17-124 Decision of the Board

A. If the Board uses the services of the Office of Administrative Hearings, the Board will receive a copy of the administrative law judge's decision under A.R.S. § 41-1092.08. Within 30 days after receipt, the Board may review the decision and accept, reject, or modify it.

1. If the Board does not make a decision within 30 days, the Board has accepted the administrative law judge's decision as the final administrative decision.

2. If the Board reviews the administrative law judge's decision, it shall request the record of the hearing, described in A.R.S. § 41-1092.08(A), and may accept, reject, or modify the decision. If the Board rejects or modifies the decision, the Board shall file with the Office of Administrative Hearings a copy of the administrative law judge's decision with the rejection or modification and a written justification setting forth the reasons for the rejection or modification of each finding of fact or conclusion of law. If there is a rejection or modification of a conclusion of law, the written justification shall be sent to the president of the senate and the speaker of the house of representatives. Under the circumstances in this subsection, the decision of the Board is the final administrative decision.

B. If the Board directly conducts an administrative hearing, the Board shall meet and render its final administrative decision on the appeal in writing within 30 days after the hearing. The Board's decision shall contain its findings of fact and conclusions of law, separately stated, and its decision.

C. The Board's final administrative decision shall contain the following statement: "This is a final administrative decision of the Water Quality Appeals Board, made according to A.R.S. § 49-323. You may file a motion for rehearing or review of this decision under R2-17-126 . If you file a motion for rehearing or review, you shall file your motion within 30 days after service of this decision. You are not required to file a motion for rehearing or review before seeking judicial review. This decision may be reviewed by the Superior Court if you file a complaint in the manner prescribed in A.R.S. § 12-901, et seq."

D. The Board may incorporate by reference findings, conclusions, or a decision previously made by an administrative law judge.

E. When the Board has rendered a final administrative decision, it shall serve a copy of the decision on all parties and the Office of Administrative Hearings if an administrative law judge conducted the hearing.

History

• Adopted effective January 8, 1998 (Supp. 98-1). Amended and renumbered from R2-17-125 by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Ariz. Admin. Code § R2-17-125 Rehearing or Review of Decision

A. Except as provided in subsection (H), any party to an appeal before the Board may file a motion for rehearing or review within 30 days after service of the final administrative decision. The party shall attach a supporting memorandum, specifying the grounds for the motion. The party is not required to file a motion for rehearing or review of the decision in order to exhaust the party's administrative remedies.

B. Any other party may file a response within 15 days after service of a motion for rehearing or review. The party shall support the response with a memorandum, discussing legal and factual issues.

C. The moving party, the responding party, or the Board may request oral argument.

D. The Board may grant a rehearing or review for any of the following causes materially affecting a party's rights:

1. Irregularity in the proceedings of the Board, or any order or abuse of discretion, that deprived the moving party of a fair hearing;

2. Misconduct of the Board, its staff, an administrative law judge, or the prevailing party;

3. Accident or surprise that could not have been prevented by ordinary prudence;

4. Newly discovered material evidence that could not, with reasonable diligence, have been discovered and produced at the hearing;

5. Error in the admission or rejection of evidence or other errors of law occurring at the hearing or during the progress of the proceeding; or

6. That the findings of fact or decision is not justified by the evidence or is contrary to law.

E. The Board may affirm or modify the decision or grant a rehearing to all or any of the parties on all or part of the issues for any of the reasons in subsection (D). An order modifying a decision or granting a rehearing shall specify with particularity the grounds for the order.

F. When a motion for rehearing or review is based upon affidavits, they shall be served with the motion. An opposing party may, within 15 days after service, serve opposing affidavits.

G. Not later than 15 days after the date of the decision, the Board may grant a rehearing or review on its own initiative for any reason for which it might have granted relief on motion of a party. The Board may grant a motion for rehearing or review, timely served, for a reason not stated in the motion.

H. If the Board makes specific findings that the immediate effectiveness of a decision is necessary for the preservation of the public health and safety and that a rehearing or review of the decision is impracticable, unnecessary, or contrary to the public interest, the Board may issue a final administrative decision without an opportunity for rehearing or review. A party may seek judicial review of the decision under A.R.S. §§ 49-323(B) and 12-901, et seq.

I. The Board shall rule on the motion for rehearing or review within 15 days after the response to the motion is filed or, if a response is not filed, within five days of the expiration of the response period. If a rehearing is granted, the Board shall hold the rehearing within 90 days after the issue date on the order granting the rehearing.

J. If a motion for rehearing or review is denied, the Clerk shall serve a notice of denial on all parties within 15 days after the denial.

K. If the motion for rehearing or review is granted, the Clerk shall serve the Board's final administrative decision on all parties within 15 days after the Board renders the decision.

History

• Adopted effective January 8, 1998 (Supp. 98-1). Amended and renumbered from R2-17-126 by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Ariz. Admin. Code § R2-17-126 Judicial Review

The final administrative decision of the Board may be reviewed as provided by A.R.S. § 49-323(B) and A.R.S. § 12-901 et seq. (Title 12, Chapter 7, Article 6, Judicial Review of Administrative Decisions Act). The Clerk shall transmit the record to the superior court in all actions seeking judicial review under A.R.S. § 12-901 et seq., including when the Board uses the services of the Office of Administrative Hearings.

History

• Adopted effective January 8, 1998 (Supp. 98-1). Amended and renumbered from R2-17-127 by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Ariz. Admin. Code § R2-17-127 Record

The Clerk shall keep the record and ensure that it is preserved for a minimum of five years from the date of the final administrative decision.

History

• Adopted effective January 8, 1998 (Supp. 98-1). Amended and renumbered from R2-17-128 by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Ariz. Admin. Code § R2-17-128 Renumbered

History

• Adopted effective January 8, 1998 (Supp. 98-1). Renumbered to R2-17-127 by final expedited rulemaking at 27 A.A.R. 815, effective 5/5/2021.

Chapter 18 Government Information Technology

Article 1 GENERAL PROVISIONS

Ariz. Admin. Code § R2-18-101 Definitions

Unless the context requires otherwise, the following definitions apply:

"Accessibility Compliance Representative" is the budget unit's designated representative for Section 508 compliance matters to receive, investigate and process complaints that allege the budget unit's failure to comply with accessibility standards.

"Accessibility Standards" means the statewide accessibility standards adopted by the Department to address compliance with Section 508 in developing, procuring, maintaining or using electronic or information technology.

1. "Appeal" means a written request filed with the Information Technology Authorization Committee (ITAC) by a budget unit challenging a decision by the Arizona Department of Administration to reject the budget unit's proposed IT Plan or project.

2. "CEO" means chief executive officer.

"Comparable Access" means alternative means of access that allows the individual to use the information and data in accordance with applicable state and federal laws such as Title I and Title II of the Americans with Disabilities Act and Section 504 of the Rehabilitation Act.

3. "Critical information technology project," as used in A.R.S. Title 18, Chapter 1, means an IT project having total costs greater than $25,000 and requires monitoring, with monitoring frequency and duration left to the sole discretion of the Department.

a. Is complex,

b. Involves advanced technology not previously deployed in any budget unit, or

c. Requires technical expertise that is not available in the budget unit.

"Department" means the Arizona Department of Administration.

4. "Development costs" means the sum of IT project startup costs, as defined in the PIJ instructions.

5. "Disapprove" means reject.

"Expenditure and Activity Report" means a standard project status summary that is used by a budget unit to report progress and costs on IT projects.

6. "GITA" means GOVERNMENT INFORMATION TECHNOLOGY AGENCY.

7. "Incomplete IT Plan or PIJ" means an IT Plan or PIJ that is missing information, sections, or approvals, as determined by GITA.

8. "Information technology plan" or "IT Plan", as used in A.R.S. Title 18, Chapter 1, means a documented strategy for information technology resources and practices to support business direction over a specific period of time.

9. "Information technology project or "IT Project," as used in A.R.S. Title 18, Chapter 1, means a series of activities, events, and investments to develop and implement new or enhanced IT over a prescribed period of time.

10. "IT" means information technology.

11. "ITAC" means Information Technology Authorization Committee, which is established under A.R.S. § 18-121.

12. "Major information technology project," as used in A.R.S. Title 18, Chapter 1, means an IT project that has total costs greater than $1 million.

a. Is necessary to the state or budget unit mission;

b. Is necessary to protect health, welfare, or safety of the public;

c. Is necessary for homeland security;

d. Is legally mandated;

e. Is necessary to improve government efficiency and effectiveness;

f. Involves a political subdivision; or

g. Involves multiple budget units.

13. "PIJ" means project investment justification.

14. "Priority category," as used in A.R.S. Title 18, Chapter 1, means a grouping of approved GITA projects by GITA-defined criteria.

15. "PIJ template" means a standard set of forms and reporting formats to be prepared by a budget unit and submitted to the Department to describe an IT project and to identify resources, technologies, benefits, costs, goals, risks, financials, and other key factors, to establish specific milestones for development and implementation of the project.

16. Project status report" means a standard project status summary that is used by a budget unit to report progress on IT projects.

17. "Quality assurance," as used in A.R.S. Title 18, Chapter 1, means a budget unit's process of evaluating IT goals, objectives, and activities to promote successful implementation.

"Section 508" means Section 508 of the Rehabilitation Act of 1973 (29 U.S.C. 794d), as amended

18. "Standards" as used in A.R.S. Title 18, Chapter 1 means requirements associated with development, maintenance, use, and access to IT based on generalized industry benchmarks and best practices.

"Telecommunications," as used in A.R.S. § 18-101(6), does not include land mobile radio services.

19. "Temporarily suspend the expenditure of monies," as used in A.R.S. Title 18, Chapter 1, means an order from the Department to a budget unit to immediately cease expenditures of monies and related project activities.

20. "Total project costs" or "total costs," as used in A.R.S. Title 18, Chapter 1, means the IT development and implementation costs associated with an information technology project.

History

• Adopted effective July 9, 1998 (Supp. 98-2). Amended by final rulemaking at 10 A.A.R. 4449, effective December 4, 2004 (04-4). Amended by final rulemaking at 25 A.A.R. 1133, effective 6/7/2019.

Article 2 INFORMATION TECHNOLOGY PROJECTS

Ariz. Admin. Code § R2-18-201 Information Technology Project Justification and Monitoring

A. If an IT project requires Department or ITAC approval, under A.R.S. Title 41, Chapter 23 and Title 18 Chapter 1, a budget unit shall not commit or spend funds on the project and shall not enter into a project-specific contract or vendor agreement until the budget unit receives written Department or ITAC approval or unless the contract or vendor agreement is contingent upon receipt of such approval.

1. A budget unit shall submit a PIJ describing the value to the public and the state for the IT project, consistent with the approved budget unit IT Plan submitted to the Department under R2-18-301 . The budget unit shall use the current PIJ template and submit the completed PIJ to the Department.

If the PIJ is incomplete, the Department shall identify deficiencies and either request additional information or return the PIJ to the budget unit for completion and resubmission.

3. The Department or ITAC shall use the following general criteria to review each completed PIJ within its authority:

a. Whether the proposed solution addresses the stated problem or situation;

b. Whether the budget unit is competent to carry out the project successfully;

c. Whether sufficient sponsorship and support by budget unit leadership exists;

d. Whether cost estimates provided are accurate;

e. Whether the proposed solution is compatible with other budget unit solutions;

f. How likely unintended consequences are;

g e. Whether the proposed project aligns with the budget unit's Strategic IT Plan and

h f. Whether the proposed solution complies with statewide IT standards.

4. Based on the review, the Department or ITAC shall take one of the following actions:

a. Approve,

b. Conditionally approve, or

c. Disapprove.

4 5. The Department shall inform the budget unit of the review decision in writing.

5 6. If the Department or ITAC conditionally approves the IT project, it shall identify the conditions the budget unit shall satisfy to proceed with the project. Unless otherwise stated in the Department's communication to the budget unit, the budget unit may begin the IT project, with Department monitoring, while the identified conditions are in the process of being satisfied by the budget unit.

6 7. If the Department or ITAC disapproves the IT project, the budget unit shall not begin the IT project, nor commit or spend any funds nor enter into any project- specific contract or vendor agreement.

7. A budget unit may appeal GITA's the decision to disapprove an IT project in accordance with Article 4 of this Chapter.

B. If an IT project is within the jurisdiction of ITAC, in accordance with A.R.S. Title 18, Chapter 1, GITA shall process a budget unit's PIJ and recommend to ITAC approval, conditional approval, or disapproval of the IT project.

C. GITA shall determine if an IT project is critical or major. For critical or major IT projects, GITA shall monitor project progress.

D B. If the Department determines that an IT project is at risk of failing to achieve its intended results or does not comply with A.R.S. Title 18, Chapter 1, the Department shall

1. temporarily suspend the expenditure of monies and related activities for the IT project or

2. recommend to ITAC that ITAC temporarily suspend the expenditure of monies and related activities for the IT project.

C. Any temporary suspension under subsection (B) shall only be lifted by the Department or ITAC, as applicable, once the cause for the suspension has been adequately rectified as determined in the sole discretion of the Department or ITAC.

History

• Adopted effective July 9, 1998 (Supp. 98-2). Amended by final rulemaking at 10 A.A.R. 4449, effective December 4, 2004 (04-4). Amended by final rulemaking at 25 A.A.R. 1133, effective 6/7/2019.

Article 3 INFORMATION TECHNOLOGY PLANNING

Ariz. Admin. Code § R2-18-301 Information Technology Planning

A. Under A.R.S. Title 18, Chapter 1, each budget unit shall annually develop and submit to the Department an IT Plan containing goals, challenges, and plans, on or before September 1 each year.

B. If an IT Plan is incomplete, GITA shall identify deficiencies and return the IT Plan to the budget unit for completion and resubmission to GITA.

C B. The Department shall review the proposed budget unit IT Plan to determine whether:

1. Outcomes are measurable,

2. Quality assurance plan is included,

3. Disaster recovery plan is included, and

4. IT goals align with statewide IT standards.

D C. The Department shall either approve or disapprove the IT Plan and shall notify the budget unit of its decision. An approved budget unit IT Plan remains in effect until the end of the fiscal year for which it is submitted.

E. A budget unit may appeal a GITA decision to disapprove a budget unit IT Plan to ITAC, in accordance with Article 4 of this Chapter.

F. Modification of an approved budget unit IT Plan.

1. A budget unit may submit a modified, amended, or revised IT Plan to GITA for approval. An approved budget unit IT Plan shall remain in effect until a replacement IT Plan is approved by GITA or until the end of the fiscal year for which it is written.

2. GITA shall review a proposed modification of a budget unit IT Plan, in accordance with subsections (B) and (C).

History

• Adopted effective July 9, 1998 (Supp. 98-2). Amended by final rulemaking at 10 A.A.R. 4449, effective December 4, 2004 (04-4). Amended by final rulemaking at 25 A.A.R. 1133, effective 6/7/2019.

Article 4 APPEALS OF DECISIONS

Ariz. Admin. Code § R2-18-401 Appeals to ITAC

A. A budget unit, which appeals a decision by the Department regarding the disapproval of a budget unit IT Plan or a budget unit IT project, shall file a written appeal with ITAC within 30 days from receipt of notice of the Department decision being appealed.

B. An appeal shall include:

1. The decision being appealed,

2. The specific facts on which the appeal is based,

3. The associated errors in the Department's decision, and

4. The action requested of ITAC.

C. An appealed decision shall remain in effect during the appeal. An appealing budget unit shall not resume or initiate any project activity or expense unless instructed otherwise by the Director of the Department. ITAC shall inform a Budget Unit regarding its decision on any appeal within 90 days of receipt of the appeal and if ITAC does not do so, the appeal will be considered denied.

History

• Adopted effective July 9, 1998 (Supp. 98-2). Amended by final rulemaking at 25 A.A.R. 1133, effective 6/7/2019.

Article 5 ALTERNATIVE ACCESS TO ELECTRONIC OR INFORMATION TECHNOLOGY

Ariz. Admin. Code § R2-18-501 Accessibility Standards

A. The Department shall prescribe electronic or information technology accessibility standards as authorized by A.R.S. §§ 18-104 and 18-105. Electronic or information technology products covered by these standards shall comply with all applicable provisions. The Arizona Strategic Enterprise Technology (ASET) Office of the Department shall maintain the accessibility standards and make them available to the public.

B. Each budget unit shall designate an Accessibility Compliance Representative and ensure that their products comply with accessibility standards, unless an undue burden would be imposed on the budget unit. When a budget unit determines compliance with these standards imposes an undue burden, budget units shall provide individuals with disabilities the information and data involved that allows the individual comparable access.

C. Each budget unit shall evaluate the accessibility of any proposed electronic or information technology system prior to the expenditure of State funds. The budget unit shall include the results of the accessibility evaluation in a written report maintained with the solution documentation. If applicable, the report shall include a declaration that the budget unit has determined that an undue burden or exception exists along with an explanation of the undue burden and how it was determined.

History

• Amended by final rulemaking at 25 A.A.R. 1133, effective 6/7/2019.

Ariz. Admin. Code § R2-18-502 Complaints

A. Any individual may file a complaint alleging that a budget unit does not comply with accessibility standards in regard to its electronic or information technology with the Accessibility Compliance Representative of the budget unit. The written complaint must:

1. State the name and contact information for the complainant;

2. Identify the electronic or information technology in question; and,

Describe the non-conformance with the accessibility standards in sufficient detail as to enable a review.

B. Upon receipt of a complaint, the Accessibility Compliance Representative will review the complaint to respond to and make a good faith effort to resolve any complaint by determining whether the electronic or information technology listed in the complaint is subject to accessibility standards. The representative will conduct a review within 60 days from receipt of the written complaint.

C. Upon completion of the review, the budget unit shall provide written notice of the results of the review to the complainant and Department of Administration, which shall include at least one of the following:

1. Documentation that the technology conforms to all applicable accessibility standards;

2. A documented explanation that any non-conformance with accessibility standards was exempted due to an undue burden; or

3. An agreement in part or in whole with the written complaint that includes a plan with reasonable timelines for conforming to applicable accessibility standards.

History

• Amended by final rulemaking at 25 A.A.R. 1133, effective 6/7/2019.

Ariz. Admin. Code § R2-18-503 Complaint Review Process

A. If a complainant is not satisfied with the complaint response issued by a budget unit, the complaint and the budget unit response can be filed within 30 days of issuance with the Director of the Department.

B. The Director or the Department's representative or representatives shall evaluate the complaint and budget unit response and may gather additional information as necessary to render an independent decision within 60 days of receipt of the complaint.

1. If it is determined the technology does not comply with accessibility standards, a written notice shall be sent to the budget unit, with a copy to complainant, of such findings and a requirement for a plan of resolution to be sent within 60 days to the Department and the complainant.

2. If it is determined the technology does comply with accessibility standards or that an undue burden does exist and is therefore exempt from compliance, a written notice shall be sent to complainant, with a copy to the budget unit, of such findings.

History

• Amended by final rulemaking at 25 A.A.R. 1133, effective 6/7/2019.

Chapter 19 Office of Administrative Hearings

Article 1 PREHEARING AND HEARING PROCEDURES

Ariz. Admin. Code § R2-19-101 Definitions

The following definitions apply unless otherwise stated:

1. "Agency" means the department, board, or commission from which a matter originates.

2. "Matter" means a contested case or appealable agency action.

History

• Section adopted by final rulemaking at 5 A.A.R. 563, effective February 3, 1999 (Supp. 99-1).

Ariz. Admin. Code § R2-19-102 Applicability

A. These rules apply to any matter heard by the Office of Administrative Hearings.

B. An administrative law judge may waive the application of any of these rules to further administrative convenience, expedition, and economy if:

1. The waiver does not conflict with law, and

The waiver does not cause undue prejudice to any party.

C. If a procedure is not provided by statute or these rules, an administrative law judge may issue an order using the Arizona Rules of Civil Procedure and related local rules for guidance.

History

• Section adopted by final rulemaking at 5 A.A.R. 563, effective February 3, 1999 (Supp. 99-1).

Ariz. Admin. Code § R2-19-103 Request for Hearing

A. An agency requesting the Office schedule an administrative hearing shall provide the following information on a form provided by the Office:

1. Caption of the matter, including the names of the parties;

2. Agency matter number;

3. Identification of the matter as a contested case or appealable agency action;

4. In an appealable agency action, the date the party appealed the agency action;

5. Estimated time for the hearing;

6. Proposed hearing dates;

7. Any request to expedite or consolidate the matter; and

8. Any agreement of the parties to waive applicable time limits to set the hearing.

B. The Office may require the agency to supply information regarding the nature of the proceeding, including the specific allegations.

History

• Section adopted by final rulemaking at 5 A.A.R. 563, effective February 3, 1999 (Supp. 99-1).

Ariz. Admin. Code § R2-19-104 Assignment of Administrative Law Judge: Setting the Hearing

Within 7 days of the Office's receipt of a request for hearing, the Office shall provide the agency in writing with:

1. The name of the administrative law judge assigned to hear the matter;

2. The date, time, and location of the hearing; and

3. The docket number assigned by the Office.

History

• Section adopted by final rulemaking at 5 A.A.R. 563, effective February 3, 1999 (Supp. 99-1).

Ariz. Admin. Code § R2-19-105 Ex Parte Communications

A party shall not communicate, either directly or indirectly, with the administrative law judge about any substantive issue in a pending matter unless:

1. All parties are present;

2. It is during a scheduled proceeding, where an absent party fails to appear after proper notice; or

3. It is by written motion with copies to all parties.

History

• Section adopted by final rulemaking at 5 A.A.R. 563, effective February 3, 1999 (Supp. 99-1).

Ariz. Admin. Code § R2-19-106 Motions

A. Purpose. A party requesting a ruling from an administrative law judge shall file a motion. Motions may be made for rulings such as:

Consolidation or severance of matters pursuant to R2-19-109;

2. Continuing or expediting a hearing pursuant to R2-19-110;

3. Vacating a hearing pursuant to R2-19-111;

Prehearing conference pursuant to R2-19-112;

5. Quashing a subpoena pursuant to R2-19-113;

6. Telephonic testimony pursuant to R2-19-114; and

Reconsideration of a previous order pursuant to R2-19-115.

B. Form. Unless made during a prehearing conference or hearing, motions shall be made in writing and shall conform to the requirements of R2-19-108 . All motions, whether written or oral, shall state the factual and legal grounds supporting the motion, and the requested action.

C. Time Limits. Absent good cause, or unless otherwise provided by law or these rules, written motions shall be filed with the Office at least 15 days before the hearing. A party demonstrates good cause by showing that the grounds for the motion could not have been known in time, using reasonable diligence and:

1. A ruling on the motion will further administrative convenience, expedition or economy; or

2. A ruling on the motion will avoid undue prejudice to any party.

D. Response to Motion. A party shall file a written response stating any objection to the motion within 5 days of service, or as directed by the administrative law judge.

E. Oral Argument. A party may request oral argument when filing a motion or response. The administrative law judge may grant oral argument if it is necessary to develop a complete record.

F. Rulings. Rulings on motions, other than those made during a prehearing conference or the hearing, shall be in writing and served on all parties.

History

• Section adopted by final rulemaking at 5 A.A.R. 563, effective February 3, 1999 (Supp. 99-1).

Ariz. Admin. Code § R2-19-107 Computing Time

In computing any time period, the Office shall exclude the day from which the designated time period begins to run. The Office shall include the last day of the period unless it falls on a Saturday, Sunday, or legal holiday. When the time period is 10 days or less, the Office shall exclude Saturdays, Sundays, and legal holidays.

History

• Section adopted by final rulemaking at 5 A.A.R. 563, effective February 3, 1999 (Supp. 99-1).

Ariz. Admin. Code § R2-19-108 Filing Documents

A. Docket. The Office shall open a docket for each matter upon receipt of a request for hearing. All documents filed in a matter with the Office shall be date stamped on the day received by the Office and entered in the docket.

B. Definition. "Documents" include papers such as complaints, answers, motions, responses, notices, and briefs.

C. Form. A party shall state on the document the name and address of each party served and how service was made pursuant to subsection (E). A document shall contain the agency's caption and the Office's docket number.

D. Signature. A document filed with the Office shall be signed by the party or the party's attorney. A signature constitutes a certification that the signer has read the document, has a good faith basis for submission of the document, and that it is not filed for the purpose of delay or harassment.

E. Filing and service. A copy of a document filed with the Office shall be served on all parties. Filing with the Office and service shall be completed by personal delivery; 1st-class, certified or express mail; facsimile; electronically when filed through the Office's electronic submission system; or as ordered by an administrative law judge. A copy of a document filed with the Office shall be served on all parties.

F. Date of filing and service. A document is filed with the Office on the date it is received by the Office, as established by the Office's date stamp on the face of the document, or by the date and time shown on the electronically filed document or docket entry when filed through the Office's electronic filing system. A copy of a document is served on a party as follows:

On the date it is personally served.

2. Five days after it is mailed by express or 1st class mail.

3. On the date of the return receipt if it is mailed by certified mail.

4. On the date indicated on the facsimile transmission or email.

5. On the date and time shown on the electronically filed document or docket entry when served electronically on a party through the Office's electronic submission system.

History

• Section adopted by final rulemaking at 5 A.A.R. 563, effective February 3, 1999 (Supp. 99-1). Amended by final rulemaking at 30 A.A.R. 2207, effective 8/11/2024.

Ariz. Admin. Code § R2-19-109 Consolidation or Severance of Matters

A. Standards for consolidation. An administrative law judge may order consolidation of pending matters, if:

1. There are substantially similar factual or legal issues, or

2. All parties are the same.

B. Determination. When different administrative law judges are assigned to the matters that are the subject of the motion for consolidation, the motion shall be filed with the administrative law judge assigned to the matter with the earliest pending hearing date.

C. Order. The administrative law judge shall send a written ruling granting or denying consolidation to all parties, identifying the cases, the reasons for the decision, and notification of any consolidated prehearing conference or consolidated hearing. The administrative law judge shall designate the controlling docket number and caption to be used on all future documents.

D. Severance. The administrative law judge may sever consolidated matters to further administrative convenience, expedition, and economy, or to avoid undue prejudice. Severance may be ordered upon the administrative law judge's own review, or a party's motion.

History

• Section adopted by final rulemaking at 5 A.A.R. 563, effective February 3, 1999 (Supp. 99-1).

Ariz. Admin. Code § R2-19-110 Continuing or Expediting a Hearing; Reconvening a Hearing

A. Continuing or expediting a hearing. When ruling on a motion to continue or expedite, the administrative law judge shall consider such factors as:

1. The time remaining between the filing of the motion and the hearing date;

The position of other parties;

The reasons for expediting the hearing or for the unavailability of the party, representative, or counsel on the date of the scheduled hearing;

4. Whether testimony of an unavailable witness can be taken telephonically or by deposition; and

5. The status of settlement negotiations.

B. Reconvening a hearing. The administrative law judge may recess a hearing and reconvene at a future date by a verbal ruling.

History

• Section adopted by final rulemaking at 5 A.A.R. 563, effective February 3, 1999 (Supp. 99-1).

Ariz. Admin. Code § R2-19-111 Vacating a Hearing

An administrative law judge shall vacate a calendared hearing and return the matter to the agency for further action, if:

1. The parties agree to vacate the hearing;

2. The agency dismisses the matter;

3. The non-agency party withdraws the appeal; or

4. Facts demonstrate to the administrative law judge that it is appropriate to vacate the hearing for the purpose of informal disposition, or if the action will further administrative convenience, expedition and economy and does not conflict with law or cause undue prejudice to any party.

History

• Section adopted by final rulemaking at 5 A.A.R. 563, effective February 3, 1999 (Supp. 99-1).

Ariz. Admin. Code § R2-19-112 Prehearing Conference

A. Procedure. The administrative law judge may hold a prehearing conference. The conference may be held telephonically. The administrative law judge may issue a prehearing order outlining the issues to be discussed.

B. Record. The administrative law judge may record any agreements reached during a prehearing conference by electronic or mechanical means, or memorialize them in an order.

History

• Section adopted by final rulemaking at 5 A.A.R. 563, effective February 3, 1999 (Supp. 99-1).

Ariz. Admin. Code § R2-19-113 Subpoenas

A. Form. A party shall request a subpoena in writing from the administrative law judge and shall include:

1. The caption and docket number of the matter;

2. A list or description of any documents sought;

3. The full name and home or business address of the custodian of the documents sought or all persons to be subpoenaed;

4. The date, time, and place to appear or to produce documents pursuant to the subpoena; and

5. The name, address, and telephone number of the party, or the party's attorney, requesting the subpoena.

B. An Administrative Law Judge may require a brief statement of the relevance of testimony or documents.

C. Service of subpoena. Any person who is not a party and is at least 18 years of age may serve a subpoena. The person shall serve the subpoena by delivering a copy to the person to be served. The person serving the subpoena shall provide proof of service by filing with the office a certified statement of the date and manner of service and the names of the persons served.

D. Objection to subpoena. A party, or the person served with a subpoena who objects to the subpoena, or any portion of it, may file an objection with the administrative law judge. The objection shall be filed within 5 days after service of the subpoena, or at the outset of the hearing if the subpoena is served fewer than 5 days before the hearing.

E. Quashing, modifying subpoenas. The administrative law judge shall quash or modify the subpoena if:

1. It is unreasonable or oppressive, or

2. The desired testimony or evidence may be obtained by an alternative method.

History

• Section adopted by final rulemaking at 5 A.A.R. 563, effective February 3, 1999 (Supp. 99-1).

Ariz. Admin. Code § R2-19-114 Telephonic Testimony

The administrative law judge may grant a motion for telephonic testimony if:

1. Personal attendance by a party or witness at the hearing will present an undue hardship for the party or witness;

Telephonic testimony will not cause undue prejudice to any party; and

3. The proponent of the telephonic testimony pays for any cost of obtaining the testimony telephonically.

History

• Section adopted by final rulemaking at 5 A.A.R. 563, effective February 3, 1999 (Supp. 99-1).

Ariz. Admin. Code § R2-19-115 Rights and Responsibilities of Parties

A. Generally. A party may present testimony and documentary evidence and argument with respect to the issues and may examine and cross-examine witnesses.

B. Preparation. A party shall have all witnesses, documents and exhibits available on the date of the hearing.

C. Exhibits. A party shall provide a copy of each exhibit to all other parties at the time the exhibit is offered to the administrative law judge, unless it was previously provided through discovery.

D. Responding to Orders. A party shall comply with an order issued by the administrative law judge concerning the conduct of a hearing. Unless objection is made orally during a pre-hearing conference or hearing, a party shall file a motion requesting the administrative law judge to reconsider the order.

History

• Section adopted by final rulemaking at 5 A.A.R. 563, effective February 3, 1999 (Supp. 99-1).

Ariz. Admin. Code § R2-19-116 Conduct of Hearing

A. Public access. Unless otherwise provided by law, all hearings are open to the public.

B. Opening. The administrative law judge shall begin the hearing by reading the caption, stating the nature and scope of the hearing, and identifying the parties, counsel, and witnesses for the record.

C. Stipulations. The administrative law judge shall enter into the record any stipulation, settlement agreement, or consent order entered into by any of the parties before or during the hearing.

D. Opening statements. The party with the burden of proof may make an opening statement at the beginning of a hearing. All other parties may make statements in a sequence determined by the administrative law judge.

E. Order of presentation. After opening statements, the party with the burden of proof shall begin the presentation of evidence, unless the parties agree otherwise or the administrative law judge determines that requiring another party to proceed first would be more expeditious or appropriate, and would not prejudice any other party.

F. Examination. A party shall conduct direct and cross examination of witnesses in the order and manner determined by the administrative law judge to expedite and ensure a fair hearing. The administrative law judge shall make rulings necessary to prevent argumentative, repetitive, or irrelevant questioning and to expedite the examination to the extent consistent with the disclosure of all relevant testimony and information.

G. Closing argument. When all evidence has been received, parties shall have the opportunity to present closing oral argument, in a sequence determined by the administrative law judge. The administrative law judge may permit or require closing oral argument to be supplemented by written memoranda. The administrative law judge may permit or require written memoranda to be submitted simultaneously or sequentially, within time periods the administrative law judge may prescribe.

H. Conclusion of hearing. Unless otherwise provided by the administrative law judge, the hearing is concluded upon the submission of all evidence, the making of final argument, or the submission of all post hearing memoranda, whichever occurs last.

History

• Section adopted by final rulemaking at 5 A.A.R. 563, effective February 3, 1999 (Supp. 99-1).

Ariz. Admin. Code § R2-19-117 Failure of Party to Appear for Hearing

If a party fails to appear at a hearing, the administrative law judge may proceed with the presentation of the evidence of the appearing party, or vacate the hearing and return the matter to the agency for any further action.

History

• Section adopted by final rulemaking at 5 A.A.R. 563, effective February 3, 1999 (Supp. 99-1).

Ariz. Admin. Code § R2-19-118 Witnesses; Exclusion from Hearing

All witnesses at the hearing shall testify under oath or affirmation. At the request of a party, or at the discretion of the administrative law judge, the administrative law judge may exclude witnesses who are not parties from the hearing room so that they cannot hear the testimony of other witnesses.

History

• Section adopted by final rulemaking at 5 A.A.R. 563, effective February 3, 1999 (Supp. 99-1).

Ariz. Admin. Code § R2-19-119 Proof

A. Standard of proof. Unless otherwise provided by law, the standard of proof is a preponderance of the evidence.

B. Burden of proof. Unless otherwise provided by law:

1. The party asserting a claim, right, or entitlement has the burden of proof;

2. A party asserting an affirmative defense has the burden of establishing the affirmative defense; and

3. The proponent of a motion shall establish the grounds to support the motion.

History

• Section adopted by final rulemaking at 5 A.A.R. 563, effective February 3, 1999 (Supp. 99-1).

Ariz. Admin. Code § R2-19-120 Disruptions

A person shall not interfere with access to or from the hearing room, or interfere, or threaten interference with the hearing. If a person interferes, threatens interference, or disrupts the hearing, the administrative law judge may order the disruptive person to leave or be removed.

History

• Section adopted by final rulemaking at 5 A.A.R. 563, effective February 3, 1999 (Supp. 99-1).

Ariz. Admin. Code § R2-19-121 Hearing Record

A. Maintenance. The Office shall maintain the official record of a matter.

B. Transfer of record. Before an agency takes final action, the agency may request that the record be available for its review or duplication. Any party requesting a copy of the record or any portion of the record shall make a request to the Office and shall pay the reasonable costs of duplication.

C. Release of exhibits. Exhibits shall be released:

1. Upon the order of a court of competent jurisdiction; or

2. Upon motion of the party who submitted the exhibits if the time for judicial appeal has expired and no appeal is pending.

History

• Section adopted by final rulemaking at 5 A.A.R. 563, effective February 3, 1999 (Supp. 99-1).

Ariz. Admin. Code § R2-19-122 Notice of Judicial Appeal; Transmitting the Transcript

A. Notification to the Office. Within 10 days of filing a notice of appeal of an agency action resulting from an administrative hearing before the Office, the party shall file a copy of the notice of appeal with the Office. The Office shall then transmit the record to the Superior Court.

B.Transcript. A party requesting a transcript of an administrative hearing before the Office shall arrange for transcription at the party's expense. The Office shall make a copy of its audio taped record available to the transcriber. The party arranging for transcription shall deliver the transcript, certified by the transcriber under oath to be a true and accurate transcription of the audio taped record, to the Office, together with one unbound copy.

History

• Section adopted by final rulemaking at 5 A.A.R. 563, effective February 3, 1999 (Supp. 99-1). Amended by final rulemaking at 20 A.A.R. 1947, effective 9/8/2014.

Chapter 20 CITIZENS CLEAN ELECTIONS COMMISSION

Article 1 GENERAL PROVISIONS

Ariz. Admin. Code § R2-20-101 Definitions

In addition to the definitions provided in A.R.S. § 16-961, the following shall apply to the Chapter, unless the context otherwise requires:

1 "Act" means the Citizens Clean Elections Act set forth in the Arizona Revised Statutes, Title 16, Chapter 6, Article 2.

2 "Audit" means a written report pertaining to an examination of a candidate's campaign finances that is reviewed by the Commission in accordance with A.A.C. Title 2, Chapter 20, Article 4.

3. "Campaign account" means an account at a financial institution designated by a political committee that is used solely for political campaign purposes.

4 "Candidate" means a natural person who receives or gives consent for receipt of a contribution for the person's nomination for or election to any office in this state, and includes the person's campaign committee, the political committee designated and authorized by the person, or any agents or personnel of the person. When not otherwise specified by statute or these rules, "Candidate" includes a Candidate for Statewide Office or a Legislative Candidate.

5 "Candidate for Statewide Office" means: A natural person seeking the office of governor, attorney general, secretary of state, treasurer, superintendent of public instruction, or mine inspector.

6 "Current campaign account" means a campaign account used solely for election campaign purposes in the present election cycle.

7 "Direct campaign purpose" includes, but is not limited to, materials, communications, transportation, supplies and expenses used toward the election of a candidate. This does not include the candidate's personal appearance, support, or support of a candidate's family member.

8 "Early contributions" means private contributions that are permitted pursuant to A.R.S. § 16-945.

9 "Examination" means an inspection by the Commission or agent of the Commission of a candidate's books, records, accounts, receipts, disbursements, debts and obligations, bank account records, and campaign finance reports related to the candidate's campaign, which may include fieldwork, or a visit to the campaign headquarters, to ensure compliance with campaign finance laws and rules.

10 "Executive Director" means the highest ranking Commission staff member, who is appointed pursuant to A.R.S. § 16-955(J) and is responsible for directing the day-to-day operations of the Commission.

11 "Expressly advocates" means:

a Conveying a communication containing a phrase such as "vote for," "elect," "re-elect," "support," "endorse," "cast your ballot for," "(name of candidate) in (year)," "(name of candidate) for (office)," "vote against," "defeat," "reject," or a campaign slogan or words that in context can have no reasonable meaning other than to advocate the election or defeat of one or more clearly identified candidates.

b Making a general public communication, such as in broadcast medium, newspaper, magazine, billboard, or direct mailer referring to one or more clearly identified candidates and targeted to the electorate of that candidate(s) that in context can have no reasonable meaning other than to advocate the election or defeat of the candi-date(s), as evidenced by factors such as the presentation of the candidate(s) in a favorable or unfavorable light, the targeting, placement, or timing of the communication, or the inclusion of statements of the candi-date(s) or opponents.

c A communication within the scope of subsection (10)(b) shall not be considered as one that "expressly advocates" merely because it presents information about the voting record or position on a campaign issue of three or more candidates, so long as it is not made in coordination with a candidate, political party, agent of the candidate or party, or a person who is coordinating with a candidate or candidate's agent.

12 "Extension of credit" means the delivery of goods or services or the promise to deliver goods or services to a candidate in exchange for a promise from the candidate to pay for such goods or services at a later date.

13. "Family member" means parent, grandparent, aunt, uncle, child or sibling of the candidate or the candidate's spouse, including the spouse of any of the listed family members, regardless of whether the relation is established by marriage or adoption.

14 "Fair market value" means the amount at which property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or sell and both having reasonable knowledge of the relevant facts.

15 "Fixed Asset" means tangible property usable in a capacity that will benefit the candidate for a period of more than one year from the date of acquisition.

16 "Fund" means the Citizens Clean Elections Fund established pursuant to A.R.S. § 16-949(D).

17 "Future campaign account" means a campaign account that is used solely for campaign election purposes in an election that does not include the present or prior primary or general elections.

18 "Independent candidate" means a candidate who is registered as an independent or with no party preference or who is registered with a political party that is not eligible for recognition on the ballot.

19 "Legislative Candidate" means: A natural person seeking the office of state senator or state representative.

20 "Officeholder" means a person who has been elected to a statewide office or the legislature in the most recent election, as certified by the Secretary of State, or who is appointed to or otherwise fills a vacancy in such office.

21 "Person," unless stated otherwise, or having context requiring otherwise, means: A corporation, company, partnership, firm, association or society, as well as a natural person.

22 "Prior campaign account" means a campaign account used solely for campaign election purposes in a prior election.

23 "Public funds" includes all funds deposited into the Citizens Clean Elections Fund and all funds disbursed by the Commission to a participating candidate.

24 "Solicitor" means a person who is eligible to be registered to vote in this state and seeks qualifying contributions from qualified electors of this state.

25. "Unopposed" means in reference to state senate candidates and statewide candidates other than corporation commission, that the candidate is opposed by no candidates who will appear on the ballot. In reference to candidates for the House of Representatives and corporation commission, "unopposed" means that no more candidates will appear on the ballot than the number of seats available for the office sought.

History

• New Section adopted by exempt rulemaking at 6 A.A.R. 1567, effective June 21, 2000 (Supp. 00-2). Section repealed; new Section made by exempt rulemaking at 8 A.A.R. 588, effective October 17, 2001 (Supp. 02-1). Amended by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4). Amended by exempt rulemaking at 13 A.A.R. 2434, effective August 27, 2007 (Supp. 07-2). Amended by exempt rulemaking at 15 A.A.R. 1156, effective August 31, 2009 (Supp. 09-2). Amended by exempt rulemaking at 19 A.A.R. 3515, effective September 27, 2013. Amended by final rulemaking at 23 A.A.R. 113, effective 12/15/2016. Amended by final rulemaking at 28 A.A.R. 491, effective 2/7/2022.

Ariz. Admin. Code § R2-20-102 Repealed

History

• New Section adopted by exempt rulemaking at 6 A.A.R. 1567, effective June 21, 2000 (Supp. 00-2). Section repealed; new Section made by exempt rulemaking at 8 A.A.R. 588, effective October 17, 2001 (Supp. 02-1). Repealed by Exempt Rulemaking at 19 A.A.R. 3518, effective September 27, 2013.

Ariz. Admin. Code § R2-20-103 Communications: Time and Method

A. General rule: in computing any period of time prescribed or allowed by the Act or these rules, unless otherwise specified, days are calculated by calendar days, and the day of the act, event, or default from which the designated period of time begins to run shall not be included. The last day of the period so computed shall be included, unless it is a Saturday, a Sunday, or a legal holiday. The term "legal holiday" includes New Year's Day, Martin Luther King Jr. Day, President's Day, Memorial Day, Independence Day, Labor Day, Columbus Day, Veterans Day, Thanksgiving Day, Christmas Day, and any other day appointed as a holiday for employees of the state.

B. Special rule for periods less than seven days: when the period of time prescribed or allowed is less than seven days, intermediate Saturdays, Sundays, and legal holidays shall be excluded in the computation.

C. Whenever the Commission or any person has the right or is required to do some act within a prescribed period after the service of any paper by or upon the Commission by regular mail, three calendar days shall be added to the prescribed period.

D. Whenever the Commission or any person is required to do some act within a prescribed period after the service of paper by or upon the Commission by overnight delivery, the time period shall begin on the date the recipient signs for the overnight delivery.

E. The Commission shall use the address of the candidate that is provided on the application for certification filed pursuant to A.R.S. § 16-947. A candidate may designate in writing for the Commission to send written correspondence to a person other than the candidate.

F. If possible, the Commission shall furnish a copy of all communications electronically.

G. Delivery of subpoenas, orders and notifications to a natural person may be made by handing a copy to the person, or leaving a copy at his or her office with the person in charge thereof, by leaving a copy at his or her dwelling place or usual place of abode with a person of suitable age and discretion residing therein, by mailing a copy by overnight delivery to his or her last known address, or by any other method whereby actual notice is given.

H. When the person to be served is not an individual, delivery of subpoenas, orders and notifications may be made by mailing a copy by overnight delivery to the person at its place of business or by handing a copy to a registered agent for service, or to any officer, director, or agent in charge of any office of such person, or by mailing a copy by overnight delivery to such representative at his or her last known address, or by any other method whereby actual notice is given.

History

• New Section adopted by exempt rulemaking at 6 A.A.R. 1567, effective June 21, 2000 (Supp. 00-2). Section repealed; new Section made by exempt rulemaking at 8 A.A.R. 588, effective October 17, 2001 (Supp. 02-1). Amended by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4). Amended by exempt rulemaking at 12 A.A.R. 758, effective February 15, 2006 (Supp. 06-1). Amended by exempt rulemaking at 13 A.A.R. 2434, effective August 27, 2007 (Supp. 07-2).

Ariz. Admin. Code § R2-20-104 Certification as a Participating Candidate

A. A nonparticipating candidate who accepts contributions up to the limits authorized by A.R.S. § 16-941(B), but later chooses to run as a participating candidate, shall:

1. Make the change to participating candidate status during the exploratory and qualifying periods only;

2. Return the amount of each contribution in excess of the individual contribution limit for participating candidates;

3. Return all Political Action Committee (PAC) monies received;

4. Not have made expenditures exceeding the early contribution limit, or have spent any part of a contribution exceeding the early contribution limit;

Comply with all provisions of A.R.S. § 16-941 and Commission rules.

6. Return all contributions received from another candidate's candidate committee.

B. Money from prior election. If a nonparticipating candidate has a cash balance remaining in the campaign account from the prior election cycle, the candidate may seek certification as a participating candidate in the current election after:

1. Transferring money from the prior campaign account to the candidate's current election campaign account. The amount transferred shall not exceed the permitted personal monies, early contributions, and debt-retirement contributions, as defined in A.R.S. § 16-945(C), and shall contain contributions received from individuals only;

2. Spending the money lawfully prior to April 30 of an election year in a way that does not constitute a direct campaign purpose and does not meet the definition of "expenditure" under A.R.S. § 16-901(24); and the event or item purchased is completed or otherwise used and depleted prior to April 30 of an election year;

3. Remitting the money to the Fund;

4. Holding the money in the prior election campaign account, not to be used during the current election, except as provided pursuant to this Section.

C. Application for certification as a participating candidate. Pursuant to A.R.S. § 16-947, a candidate seeking certification shall file with the Secretary of State a Commission-approved application and a campaign finance report reflecting all campaign activity to date. In the application, a candidate shall certify under oath that the candidate:

1. Agrees to use all Clean Elections funding for direct campaign purposes only;

2. Has filed a campaign finance report, showing all campaign activity to date in the current election cycle;

3. Will comply with all requirements of the Act and Commission rules;

4. Is subject to all enforcement actions by the Commission as authorized by the Act and Commission rules;

5. Has the burden of proving that expenditures made by or on behalf of the candidate are for direct campaign purposes;

Will keep and furnish to the Commission all documentation relating to expenditures, receipts, funding, books, records (including bank records for all accounts), and supporting documentation and other information that the Commission may request;

7. Will permit an audit or examination by the Commission of all receipts and expenditures including those made by the candidate. The candidate shall also provide any material required in connection with an audit, investigation, or examination conducted by the Commission. The candidate shall facilitate the audit by making available in one central location, such as the Commission's office space, records and such personnel as are necessary to conduct the audit or examination, and shall pay any amounts required to be repaid;

8. Will submit the name and mailing address of the person who is entitled to receive equalizing fund payments on behalf of the candidate and the name and address of the campaign depository designated by the candidate. Changes in the information required by this subsection shall not be effective until submitted to the Commission in a letter signed or submitted electronically, by the candidate or the committee treasurer;

9. Will pay any civil penalties included in a conciliation agreement or otherwise imposed against the candidate;

10. Will timely file all campaign finance reports with the Secretary of State in an electronic format; and

11. Will file an amended application for certification reporting any change in the information prescribed in the application for certification within five days after the change.

D. If certified as a participating candidate, the candidate shall:

1. Only accept early contributions from individuals during the exploratory and qualifying periods in accordance with A.R.S. § 16-945. No contributions may be accepted from political action committees, political parties or corporations;

2. Not accept any private contributions, other than early contributions and a limited number of $5 qualifying contributions;

3. Make expenditures of personal monies of no more than the amounts prescribed in A.R.S. § 16-941(A)(2) for legislative candidates and for statewide office candidates;

4. Conduct all campaign activity through a single campaign account. A participating candidate shall only deposit early contributions, qualifying contributions and Clean Elections funds into the candidate's current campaign account. The campaign account shall not be used for any non-direct campaign purpose as provided in Article 7 of these rules;

5. Attend at least one candidate training class sponsored by the Commission. If the candidate is unable to attend a training class, the candidate shall:

a. Notify the Commission that the candidate is unable to attend a training class. The Commission then will send that person the Commission training materials; and

b. The candidate shall sign and send to the Commission a statement certifying that he or she has received and reviewed the Commission training materials; and

6. Limit campaign expenditures. Prior to qualifying for Clean Elections funding, a candidate shall not incur debt, or make an expenditure in excess of the amount of cash on hand. Upon approval for funding by the Secretary of State, a candidate may incur debt, or make expenditures, not to exceed the sum of the cash on hand and the applicable spending limit.

E. Loans. A participating candidate may accept an individual contribution as a loan or may loan his or her campaign committee personal monies during the exploratory and qualifying periods only. The total sum of the contribution received or personal funds and loans shall not exceed the expenditure limits set forth in A.R.S. § 16-941(A)(1) and (2). If the loan is to be repaid, the loans shall be repaid promptly upon receipt of Clean Elections funds if the participating candidate qualifies for Clean Elections funding. Loans from a financial institution or bank, to a candidate used for the purpose of influencing that candidate's election shall be considered personal monies and shall not exceed the personal monies expenditure limits set forth in A.R.S. § 16-941(A)(2).

F. A participating candidate may raise early contributions for election to one office and choose to run for election to another office.

G. Contributions to officeholder expense accounts are subject to the restrictions of A.R.S. § 41-1234.01, contributions prohibited during session; exceptions.

History

• New Section adopted by exempt rulemaking at 6 A.A.R. 1567, effective June 21, 2000 (Supp. 00-2). Section repealed; new Section made by exempt rulemaking at 8 A.A.R. 588, effective October 17, 2001 (Supp. 02-1). Amended by exempt rulemaking at 9 A.A.R. 3506, effective April 2, 2002 (Supp. 03-3). Amended by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4). Amended by exempt rulemaking at 12 A.A.R. 758, effective February 15, 2006 (Supp. 06-1). Amended by exempt rulemaking at 13 A.A.R. 3597, effective January 1, 2008 (Supp. 07-4). Amended by exempt rulemaking at 15 A.A.R. 1156, effective August 31, 2009 (Supp. 09-2). Amended by exempt rulemaking at 15 A.A.R. 1420, effective April 30, 2010 (Supp. 09-3). Subsection R2-20-104(C)(8) amended by exempt rulemaking at 19 A.A.R. 1685, effective October 6, 2011; Subsection R2-20-104(D)(5)amended by exempt rulemaking at 19 A.A.R. 1685, effective May 23, 2013 (Supp. 13-2). Amended by final rulemaking at 23 A.A.R. 115, effective 12/15/2016.

Ariz. Admin. Code § R2-20-105 Certification for Funding

A. After a candidate is certified as a participating candidate, pursuant to A.R.S. § 16-947, in accordance with the procedure set forth in R2-20-104, that candidate may collect qualifying contributions only during the qualifying period.

B. A participating candidate must submit to the Secretary of State, a list of names of persons who made qualifying contributions, an application for funding prescribed by the Secretary of State, the minimum number of original reporting slips, and an amount equal to the sum of the qualifying contributions collected pursuant to A.R.S. § 16-950 no later than one week after the end of the qualifying period. Any and all expenses associated with obtaining the qualifying contributions, including credit card processing fees must be paid for from the candidate&'s early contributions or personal monies. A candidate may develop his or her own three-part reporting slip for qualifying contributions, or one that is photocopied or computer reproduced, if the form substantially complies with the form prescribed by the Commission. The candidate must comply with the Act and ensure that the original qualifying slip is tendered to the Secretary of State, a copy remains with the candidate, and that a copy is given to the contributor.

C. A candidate may accept electronic $5 qualifying contributions for the elected office sought by the candidate. The Secretary of State's secured internet portal must be used to collect electronic $5 qualifying. A $5 contribution must accompany every $5 qualifying contribution form and must be submitted via the Secretary of State's portal using a private electronic payment service, specified by the Secretary of State's Office, bank account, credit or debit card. A non-refundable transaction fee may be assessed on electronic $5 qualifying contribution transactions. The transaction fee is not a contribution to the candidate's campaign and is paid by the contributor. If excess funds are accumulated by the candidate's campaign based on the transaction fee then all excess funds must be given to the Commission and must be entered into the candidate's campaign finance report in a manner that indicates the transaction fees have been accumulated and transferred.

D. A solicitor who seeks signatures and qualifying contributions on behalf of a participating candidate shall provide his or her residential address, typed or printed name and signature on each reporting slip. The solicitor shall also sign a sworn statement on the contribution slip avowing that the contributor signed the slip, that the contributor contributed the $5, that based on information and belief, the contributor&'s name and address are correctly stated and that each contributor is a qualified elector of this state. If a contribution is received unsolicited, the candidate or contributor may sign the qualifying contribution form as the solicitor and is accountable for all of the responsibilities of a solicitor. Nothing in this rule shall prohibit the use of direct mail or the internet to obtain qualifying contributions as long as an original signature is provided on the qualifying contribution form. The candidate may sign the qualifying contribution form as the solicitor and is accountable for all of the responsibilities of a solicitor. For qualifying contributions received in accordance with subsection (C) of this Section, the residential address and signature of the solicitor is not required.

E. The Secretary of State has the authority to approve or deny a candidate for Clean Elections funding, pursuant to A.R.S. § 16-950(C) based upon the verification of the qualifying contribution forms by the appropriate county recorder. The county recorder shall disqualify any qualifying contribution forms that are:

1. Unsigned by the contributor;

2. Undated; or

3. That the recorder is unable to verify as matching signature of a person who is registered to vote, on the date specified inside the electoral district the candidate is seeking.

F. The Secretary of State will notify the candidate and the Commission regarding the approval or denial of Clean Elections funds. A candidate who is denied Clean Elections funding after all of the slips are verified is eligible to submit supplemental qualifying contribution forms for one additional opportunity to be approved for funding pursuant to subsection (G) of this rule.

G. The amount equal to the sum of the qualifying contributions collected and tendered to the Secretary of State pursuant to A.R.S. § 16-950(B) will be deposited into the fund, and the amount tendered will not be returned to a candidate if a candidate is denied Clean Elections funding.

H. In accordance with the procedure set forth at A.R.S. § 16-950(C), if the Secretary of State determines that the result of the five percent random sample is less than 110 percent of the slips needed to qualify for funding, then the Secretary of State shall send all of the slips for verification. If the county recorder has verified all of the candidate&'s signature slips and there is an insufficient number of valid qualifying contribution slips to qualify the candidate for funding, the candidate may make only one supplemental filing of additional qualifying contribution slips and qualifying contributions to the Secretary of State if all of the following apply:

1. The candidate files at least the minimum number of additional slips needed to qualify for funding;

2. The slips are not receipts for duplicate contributions from individuals who have previously contributed to that candidate; and

3. The period for filing qualifying contributions slips has not expired.

I. The Secretary of State shall forward facsimiles of all of the supplemental qualifying contribution slips to the appropriate county recorders for the county of the contributors&' addresses as shown on the contribution slips. The county recorder shall verify all of the supplemental slips within 10 business days after receipt of the facsimiles and shall provide a report to the Secretary of State identifying as disqualified any slips that are unsigned by the contributor or undated or that the recorder is unable to verify as matching the signature of a person who is registered to vote, on the date specified on the slip, inside the electoral district of the office the candidate is seeking. On receipt of the report of the county recorder on all supplemental slips, the Secretary of State shall calculate the candidate&'s total number of valid qualifying contribution slips and shall approve or deny the candidate for funds.

History

• New Section adopted by exempt rulemaking at 6 A.A.R. 1567, effective June 21, 2000 (Supp. 00-2). Section repealed; new Section made by exempt rulemaking at 8 A.A.R. 588, effective October 17, 2001 (Supp. 02-1). Amended by exempt rulemaking at 9 A.A.R. 3506, effective April 30, 2002 (Supp. 03-3). Amended by exempt rulemaking at 13 A.A.R. 2434, effective August 27, 2007 (Supp. 07-2). Amended by exempt rulemaking at 16 A.A.R. 1200, effective February 28, 2008 (Supp. 10-2). Subsection R2-20-105(C) amended by exempt rulemaking at 19 A.A.R. 1688, effective October 6, 2011; Subsection R2-20-105(J)amended by exempt rulemaking at 19 A.A.R. 1688, effective May 23, 2013 (Supp. 13-2). Amended by final rulemaking at 23 A.A.R. 117, effective 1/1/2017.

Ariz. Admin. Code § R2-20-106 Distribution of Funds to Certified Candidates

A. Before the initial disbursement of funds, the Commission shall review the candidate's funding application and all relevant facts and circumstances and:

Verify that the number of signatures on the candidate's nominating petitions equals or exceeds the number required pursuant to A.R.S. § 16-322 as follows:

a. If the application is submitted before the March 1 voter registration list is determined, the Commission shall verify that the number of signatures on the candidate's nominating petitions equals or exceeds 115 percent of the number required pursuant to A.R.S. § 16-322 based on the prior election voter registration list as determined by the Secretary of State; or

b. If the application is submitted after the current year March 1 voter registration list is determined, the Commission shall verify that the number of signatures on the candidate's nominating petitions is equal to or greater than the number required pursuant to A.R.S. § 16-322.

2. Determine that the required number of qualifying contributions have been received and paid to the Secretary of State for deposit in the Fund; and

3. Determine whether the candidate is opposed in the election.

B. In making the determinations described in subsection (A)(3), the Commission shall consider all relevant facts and circumstances, and it shall not be bound by election formalities such as the filing of nominating petitions by others in determining whether an applicant is opposed. Among other evidence the Commission may consider is the existence of exploratory committees or filings made to organize campaign committees of opponents and other like indicia.

C. The Commission may review and affirm or change its determination that the candidate is or is not opposed until the ballot for the election is established.

D. Within seven days after a primary election and before the Secretary of State completes the canvass, the Commission shall disburse funds for general election campaigns to the participating candidates who received the greatest number of votes at each primary election, provided that the candidate with the highest number of votes out of the total number of votes, has at least two percentage points greater than the candidate with the next highest votes based on the unofficial results as of that date. In a legislative race for the Arizona House of Representatives, the Commission shall disburse funds for general election campaigns to participating candidates with the highest or second highest number of votes cast, provided such candidate received votes totaling at least two percentage points, of the total ballots cast, larger than the vote total cast for the candidate with the third highest vote total.

E. Promptly after the Secretary of State completes the canvass, the Commission shall disburse funds for general election campaigns to all eligible participating candidates to whom payment has not been made. If a participating candidate has received funds from the Commission pursuant to subsection (D) and the canvass or recount determines that the candidate is not eligible to appear on the general election ballot, the participating candidate shall return all unused funds to the Fund within 10 days after such determination is made. That candidate shall make no expenditures from general election funds from the date of the canvass.

F. The Commission may refuse to distribute funds to participating candidates in cases in which the Commission finds evidence of fraud or illegal activity committed by the participating candidate.

G. Pursuant to A.R.S. § 16-953, a participating candidate shall return to the Fund:

1. All primary election funds not committed to expenditures (1) during the primary election period; and (2) for goods or services directed to the primary election. A candidate shall not be deemed to have violated A.R.S. § 16-953(A) or this subsection on account of failure to use all materials purchased with primary election funds prior to the primary election, provided such candidate exercises good faith and diligent efforts to comply with the requirement that goods and services purchased with primary election funds be directed to the primary election. Subject to A.R.S. § 16-953(A) and this subsection, a candidate may continue to use goods purchased with primary election funds during the general election period.

2. All general funds not committed to expenditures (1) during the general election period; and (2) for goods or services directed to the general election.

H. All funds returned to the Commission pursuant to subsection (G) of this rule, shall be returned to the Fund by a cashier's check drawn on the candidate's campaign bank account. Any fee associated with the issuance of a cashier's check shall be deemed a direct campaign expenditure and reported on the candidate's campaign finance report.

I. If a participating candidate does not account for any outstanding expenditures in the amount of the funds returned to the Commission, the participating candidate must reconcile the outstanding expenditures with personal monies. Once funds have been returned to the Commission, no further reimbursements from the Clean Elections Fund shall be permitted. Participating candidates may not exceed the primary or general election spending limits.

J. Commission staff may waive the return of funds if:

1. The Commission staff determines the amount to be returned is de minimus;

2. The Commission staff determines the cost of recovery exceeds the amount of the return;

3. The funds to be returned shall not exceed $25; and

4. The Commission is notified of any waiver of the return of funds.

History

• New Section adopted by exempt rulemaking at 6 A.A.R. 1567, effective June 21, 2000 (Supp. 00-2). Section repealed; new Section made by exempt rulemaking at 8 A.A.R. 588, effective October 17, 2001 (Supp. 02-1). Amended by exempt rulemaking at 13 A.A.R. 2434, effective August 27, 2007 (Supp. 07-2). Amended by exempt rulemaking at 24 A.A.R. 107, effective 12/14/2017.

Ariz. Admin. Code § R2-20-107 Candidate Debates

A The Commission shall sponsor debates among statewide and legislative office candidates prior to the primary and general elections. Except as set forth in subsection (D) below, the Commission shall not be required to sponsor a debate if there is no participating candidate in the election for a particular office.

B In the primary election period, the Commission shall sponsor political party primary election debates for every office in which:

1. There are more candidates appearing on the ballot than there are seats available for the political party's nomination for general election candidates, and

2 At least one of the candidates is a participating candidate.

C The following candidates will not be invited to participate in debates as follows:

1 In the primary election, write-in candidates for the primary election, independent candidates, no party affiliation or unrecognized party candidates.

2 In the general election, write-in candidates.

D In the event that there is no participating candidate in a primary or general election but there is an election involving candidates who are not unopposed, a candidate may request that the Commission sponsor a debate pursuant to this rule. If the requesting candidate is the sole participant in the debate the format shall be as prescribed in R2-20-107(K) .

1. A nonparticipating candidate who requests a debate pursuant to this rule shall complete and return the invitation form sent to the candidate by the Commission by the deadline identified on the form. Forms received by the Commission past the deadline may still be considered at the discretion of the Commission. Commission staff shall notify all invited candidates if a debate will be sponsored by the Commission and which candidates will participate.

2 If a candidate requests that the Commission sponsor a debate and fails or refuses to attend the debate, or a candidate agrees to participate in a debate and subsequently fails or refuses to attend the debate sponsored by the Commission, each candidate who fails or refuses to attend the debate shall reimburse the Commission for the cost of debate preparations not to exceed $10,000 for a non-participating candidate for the legislature and $25,000 for a non-participating candidate for statewide office. In the event that a candidate requests a general election debate or agrees to participate in a general election debate but does not advance to the general election, the candidate shall not be liable for the reimbursement.

D. E Pursuant to A.R.S. § 16-956(A)(2), all participating candidates certified pursuant to A.R.S. § 16-947 shall attend and participate in the debates sponsored by the Commission. No proxies or representatives are permitted to participate for any candidate and no statements may be read on behalf of an absent candidate.

E. F Unless exempted, if a participating candidate fails to participate in any Commission-sponsored debate, the participating candidate shall be fined $500.00. For purposes of this Section, each primary or general election shall be considered a separate election.

F. G A participating candidate may request to be exempt from participating in a required debate by doing the following:

1 Submit a written request to the Commission at least one week prior to the scheduled debate, and

2 State the reasons and circumstances justifying the request for exemption.

H. After examining the request to be exempt, the Commission will exempt a candidate from participating in a debate if at least three Commissioners determine that the circumstances are:

a. Beyond the control of the candidate; or

b. Of such nature that a reasonable person would find the failure to attend justifiable or excusable.

H. I A participating candidate who fails to participate in a required debate may submit a request for excused absence to the Commission.

1 The candidate's request for excused absence shall:

a State the reason the candidate failed to participate in the debate, and

b State the reason the candidate failed to request an exemption in advance, and

c Be submitted to the Commission no later than five business days after the date of the debate the candidate failed to attend.

2. After examining the request for excused absence, the Commission may excuse a candidate from the penalties imposed if at least three Commissioners determine that the circumstances were:

a. Beyond the control of the candidate; or

b. Of such nature that a reasonable person would find the failure to attend justifiable or excusable.

I. J When a participating candidate is not opposed in the general election, the candidate shall be exempt from participating in a Commission-sponsored debate for the general election.

J. K In the event that a participating candidate is opposed in the primary election or general election but is the only candidate taking part in a primary election period or general election period debate, as applicable, the debate will be held and will consist of a 30-minute question and answer session for the single participating candidate. If more than one candidate takes part in the debate, regardless of participation status, the debate will be held in accordance with the procedures established by the Commission staff.

History

• New Section adopted by exempt rulemaking at 6 A.A.R. 1567, effective June 21, 2000 (Supp. 00-2). Section repealed; new Section made by exempt rulemaking at 8 A.A.R. 588, effective October 17, 2001 (Supp. 02-1). Section repealed by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4). New Section made by exempt rulemaking at 12 A.A.R. 758, effective February 15, 2006 (Supp. 06-1). Amended by exempt rulemaking at 13 A.A.R. 2434, effective August 27, 2007 (Supp. 07-2). Amended by exempt rulemaking at 15 A.A.R. 1156, effective August 31, 2009 (Supp. 09-2). Amended by exempt rulemaking at 19 A.A.R. 1690, effective October 6, 2011 (Supp. 13-2). Amended by exempt rulemaking at 19 A.A.R. 4213, effective November 21, 2013. Amended by exempt rulemaking at 21 A.A.R. 1627, effective 7/23/2015. Amended by final rulemaking at 23 A.A.R. 119, effective 12/15/2016.

Ariz. Admin. Code § R2-20-108 Termination of Participating Candidate Status

A. A candidate may voluntarily request termination of his or her participating candidate status at any time prior to notification by the Commission that such candidate has qualified for Clean Elections funding. To withdraw from participating candidate status, a candidate shall send a letter to the Commission stating the candidate's intent to withdraw and the reason for the withdrawal. The candidate shall not accept any private monies until the withdrawal is approved by the Commission. The Commission shall act on the withdrawal request within seven days. If the Commission takes no action within the seven-day time period, the withdrawal is automatic.

B. A candidate's participating candidate status shall automatically terminate if:

1. The candidate fails to make such submissions to the Secretary of State as prescribed in R2-20-105(B) within seven days after the end of the qualifying period, or

2. The candidate is denied Clean Elections funding by the Secretary of State and the candidate is ineligible to make a supplemental filing with the Secretary of State in accordance with R2-20-105(G).

C. A candidate whose participating candidate status has been terminated in accordance with this Section shall be ineligible to receive Clean Elections funding for that election cycle unless he/she reapplies for certification and is in compliance with R2-20-104(A) and (C).

D. In the event that a candidate who has collected qualifying contributions decides not to seek certification as a participating candidate, the candidate shall return all qualifying contributions received from contributors who have not given written permission to use their qualify contributions as campaign contributions. Written permission may include a check box on the original $5 form that authorizes a candidate to treat the qualifying contribution as a general campaign contribution if he or she decides not to participate in the Clean Elections system. If a good faith attempt to return the funds to the contributor is unsuccessful, the contributions shall be submitted to the Fund.

History

• New Section adopted by exempt rulemaking at 6 A.A.R. 1567, effective June 21, 2000 (Supp. 00-2). Section repealed; new Section made by exempt rulemaking at 8 A.A.R. 588, effective October 17, 2001 (Supp. 02-1). Amended by exempt rulemaking at 13 A.A.R. 2434, effective August 27, 2007 (Supp. 07-2). Amended by exempt rulemaking at 17 A.A.R. 1950, effective August 25, 2011 (Supp. 11-3).

Ariz. Admin. Code § R2-20-109 Independent Expenditure Reporting Requirements

A. In accordance with A.R.S. § 16-958(E), all persons obligated to file any campaign finance report under any provisions of Chapter 6, Article 2 of the Arizona Revised Statutes shall file such reports using the Secretary of State's Internet-based finance-reporting system, except if:

1. Expressly provided otherwise by another Commission rule; or

2. That system, or the necessary function on the system, is unavailable, in which case the executive director shall implement a suitable process.

B. Independent Expenditure Reporting Requirements.

1. Any person making independent expenditures cumulatively exceeding the amount prescribed in A.R.S. § 16-941(D) in an election cycle shall file campaign finance reports in accordance with A.R.S. § 16-958 and Commission rules.

2. Any person who fails to file a timely campaign finance report pursuant to A.R.S. § 16-941(D), A.R.S. § 16-958, shall be subject to a civil penalty as prescribed in A.R.S. § 16-942(B). Subsection R2-20-109(B)(4) does not apply to reports pursuant to A.R.S. §§ 16-941(D) and 16-958 or this subsection. Any expenditure advocating against one or more candidates shall be considered an expenditure on behalf of any opposing candidate or candidates. Penalties shall be assessed as follows:

a. For an election involving a candidate for statewide office, the civil penalty shall be $300 per day.

b. For an election involving a legislative candidate, the civil penalty shall be $100 per day.

c. The penalties in (a) and (b) shall be doubled if the amount not reported for a particular election cycle exceeds ten (10%) percent of the applicable adjusted primary election spending limit or adjusted general election spending limit.

d. The dollar amounts in items (a) and (b), and the spending limits in item (c) are subject to adjustment of A.R.S. § 16-959.

e. Penalties imposed pursuant to this subsection shall not exceed twice the amount of expenditures not reported.

3. A.R.S. § 16-942(B) applies to any entity including political committees that accepts contributions or makes expenditures on behalf of any candidate regardless of any other contributions taken or expenditures made and fails to timely file a campaign finance report under Chapter 6 of Title 16, Arizona Revised Statutes. Any expenditure advocating against one or more candi- dates shall be considered an expenditure on behalf of any opposing candidate or candidates. Penalties shall be assessed as follows:

a. For an election involving a candidate for statewide office, the civil penalty shall be $300 per day.

b. For an election involving a legislative candidate, the civil penalty shall be $100 per day.

c. The penalties in (a) and (b) shall be doubled if the amount not reported for a particular election cycle exceeds ten (10%) percent of the applicable adjusted primary election spending limit or adjusted general election spending limit.

d. The dollar amounts in items (a) and (b), and the spending limits in item (c) are subject to adjustment of A.R.S. § 16-959.

e. Penalties imposed pursuant to this subsection shall not exceed twice the amount of expenditures not reported.

4. For purposes of A.A.C. R2-20-109(B)(3) :

a. Subject to A.R.S. § 16-901(43) and notwithstanding any rule to the contrary of that section, an entity shall not be found to have the predominant purpose of influencing elections unless, a preponderance of the evidence establishes that during a two-year legislative election cycle, the total reportable contributions made by the entity, in any combination, in a calendar year exceeds $1,000 and is more than fifty percent (50%) of the entity's total spending during the election cycle.

i. For purposes of this provision, a "reportable contribution" or "reportable expenditure" shall be limited to a contribution or expenditure, as defined in title 16 of the Arizona revised statutes, that must be reported to the Arizona secretary of state, the Arizona citizens clean elections commission, or local filing officer in Arizona. A contribution or expenditure that must be reported to the federal election commission or to the election authority of any other state, but not to the Arizona secretary of state, the Arizona citizens clean elections commission or a local filing officer in Arizona, shall not be considered a reportable contribution or reportable expenditure.

ii. For purposes of this provision, "total spending" shall not include volunteer time or fundraising and administrative expenses but shall include all other spending by the organization.

iii. For purposes of this provision, grants to other organizations shall be treated as follows:

(1) A grant made to a political committee or an organization organized under section 527 of the internal revenue code shall be counted in total spending and as a reportable contribution or reportable expenditure, unless expressly designated for use outside Arizona or for federal elections, in which case such spending shall be counted in total spending but not as a reportable contribution or reportable expenditure.

(2) If the entity making a grant takes reasonable steps to ensure that the transferee does not use such funds to make a reportable contribution or reportable expenditure, such a grant shall be counted in total spending but not as a reportable contribution or reportable expenditure.

iv. If the entity making a grant earmarks the grant for reportable contributions or reportable expenditures, knows the grant will be used to make reportable contributions or reportable expenditures, knows that a recipient will likely use a portion of the grant to make reportable contributions or reportable expenditures, or responds to a solicitation for report-able contributions or reportable expenditures, the grant shall be counted in total spending and the relevant portion of the grant as set forth in subsection (v) of this section shall count as a reportable contribution or reportable expenditure.

v. Notwithstanding subsections (iii) and (iv) the amount of a grant counted as a reportable contribution or reportable expenditure shall be limited to the lesser of the grant or the following:

(1) The amount that the recipient organization spends on reportable contributions and reportable expenditures, plus

(2) The amount that the recipient organization gives to third parties but not more than the amount that such third parties fund reportable contributions or reportable expenditures.

b. Notwithstanding section a above, the commission may nonetheless determine that an entity is not a political committee if, taking into account all the facts and circumstances of grants made by an entity, it is not persuaded that the preponderance of the evidence establishes that the entity is a political committee as defined in title 16 of Arizona Revised Statutes.

History

• New Section adopted by exempt rulemaking at 6 A.A.R. 1567, effective June 21, 2000 (Supp. 00-2). Section repealed; new Section made by exempt rulemaking at 8 A.A.R. 588, effective October 17, 2001 (Supp. 02-1). Amended by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4). Amended by exempt rulemaking at 13 A.A.R. 3597, effective January 1, 2008 (Supp. 07-4). Amended by exempt rulemaking at 15 A.A.R. 1156, effective August 31, 2009 (Supp. 09-2). Amended by exempt rulemaking at 16 A.A.R. 152, effective January 29, 2010 (Supp. 10-1). Amended by exempt rulemaking at 19 A.A.R. 3519, effective September 27, 2013. Amended by exempt rulemaking at 20 A.A.R. 879, effective 5/22/2014. Amended by exempt rulemaking at 20 A.A.R. 1329, effective 5/22/2014. Amended by exempt rulemaking at 20 A.A.R. 2804, effective 9/11/2014. Amended by exempt rulemaking at 21 A.A.R. 3168, effective 10/30/2015. Amended by exempt rulemaking at 22 A.A.R. 2892, effective 1/1/2017. Amended by final rulemaking at 23 A.A.R. 121, effective 1/1/2017. Amended by exempt rulemaking at 24 A.A.R. 109, effective 12/14/2017. Amended by final rulemaking at 27 A.A.R. 1568, effective 9/14/2021.

Ariz. Admin. Code § R2-20-110 Participating Candidate Reporting Requirements

A. All participating candidates shall file campaign finance reports that include all receipts and disbursements for their current campaign account as follows:

Expenditures for consulting, advising, or other such services to a candidate shall include a detailed description of what is included in the service, including an allocation of services to a particular election. When appropriate, the Commission may treat such expenditures as though made during the general election period.

2. If a participating candidate makes an expenditure on behalf of the campaign using personal funds, the candidate's campaign shall reimburse the candidate within seven calendar days of the expenditure. After the 7 day period has passed, the expenditure shall be deemed an in-kind contribution subject to all applicable limits.

3. A candidate may authorize an agent to purchase goods or services on behalf of such candidate, provided that:

a. Expenditures shall be reported as of the date that the agent promises, agrees, contracts or otherwise incurs an obligation to pay for the goods or services;

b. The candidate shall have sufficient funds in the candidate's campaign account to pay for the amount of such expenditure at the time it is made and all other outstanding obligations of the candidate's campaign committee; and

c. Within seven calendar days of the date upon which the amount of the expenditure is known, the candidate shall pay such amount from the candidate's campaign account to the agent who purchases the goods or services.

4. A joint expenditure is made when two or more candidates agree to share the cost of goods or services. Candidates may make a joint expenditure on behalf of one or more other campaigns, but must be authorized in advance by the other candidates involved in the expenditure, and must be reimbursed within seven days. Participating candidates may participate in joint expenditures for the cost of goods and services with one or more candidates, subject to the following:

a. Joint expenditures must be allocated fairly among candidates. An allocated share of a joint expenditure paid by one candidate pursuant to such an agreement must be reimbursed within seven days.

b. Any violator of part (a) shall be liable for a penalty pursuant to R2-20-222, in addition to penalties prescribed by any other law.

c. If a fairly allocated share of any joint expenditure is not reimbursed to a candidate, the unreimbursed amount of the joint expenditure fairly allocated to that candidate shall be deemed a contribution to that candidate by the campaign committee of the candidate obligated to reimburse the share.

d. If a fairly allocated share of any joint expenditure is not reimbursed to a participating candidate, the candidate obligated to reimburse the share shall reimburse the fund for the unreimbursed amount of the joint expenditure fairly allocated to the obligated candidate, in addition to any penalty specified by law.

e. A candidate's payment for an advertisement, literature, material, campaign event or other activity shall be considered a joint expenditure including, but not limited to, the following criteria:

i. The activity includes express advocacy of the election or defeat of more than 2 candidates;

ii. The purpose of the material or activity is to promote or facilitate the election of a second candidate;

iii. The use and prominence of a second candidate or his or her name or likeness in the material or activity;

iv. The material or activity includes an expression by a second candidate of his or her view on issues brought up during the election campaign;

v. The timing of the material or activity in relation to the election of a second candidate;

vi. The distribution of the material or the activity is targeted to a second candidate's electorate; or

vii. The amount of control a second candidate has over the material or activity.

For the purposes of the Act and Commission rules, a candidate or campaign shall be deemed to have made an expenditure as of the date upon which the candidate or campaign promises, agrees, contracts or otherwise incurs an obligation to pay for goods or services.

B. Timing of reporting expenditures.

1. Except as set forth in subsection (A)(2) above, a participating candidate shall report a contract, promise or agreement to make an expenditure resulting in an extension of credit as an expenditure, in an amount equal to the full future payment obligation, as of the date the contract, promise or agreement is made.

2.In the alternative to reporting in accordance with subsection (A)(1) above, a participating candidate may report a contract, promise or agreement to make an expenditure resulting in an extension of credit as follows:

a. For a month-to-month or other such periodic contract or agreement that is terminable by a candidate at will and without any termination penalty or payment, the candidate may report an expenditure, in an amount equal to each future periodic payment, as of the date upon which the candidate's right to terminate the contract or agreement and avoid such future periodic payment elapses.

b. For a contract, promise or agreement to provide goods or services during the general election period that is contingent upon a candidate advancing to the general election period, the candidate may report an expenditure, in an amount equal to the general election period payment obligation, as of the date upon which such contingency is satisfied.

c. For a contract, promise or agreement to pay rent, utility charges or salaries payable to individuals employed by a candidate's campaign committee as staff, the candidate may report an expenditure, in an amount equal to each periodic payment, as of the date that is the sooner of

(i) the date upon which payment is made; or

(ii) the date upon which payment is due.

C. Reports and Refunds of Excess Monies by Participating Candidates.

1.In addition to any campaign finance report required by Chapter 6 of Title 16, Arizona Revised Statutes, participating candidates shall file the following campaign finance reports and dispose of excess monies as follows:

a. Prior to filing the application for funding pursuant to A.R.S. § 16-950, participating candidates shall file a campaign finance report with the names of the persons who have made qualifying contributions to the candidate.

b. At the end of the qualifying period, a participating candidate shall file a campaign finance report consisting of all early contributions received, including personal monies and the expenditures of such monies.

i. The campaign finance report shall be filed with the Secretary of State no later than five days after the last day of the qualifying period and shall include all campaign activity through the last day of the qualifying period.

ii. If the campaign finance report shows any amount unspent monies, the participating candidate, within five days after filing the campaign finance report, shall remit all unspent contributions to the Fund, pursuant to A.R.S. § 16-945(B). Any unspent personal monies shall be returned to the candidate or the candidates' family member within five days.

2. Each participating candidate shall file a campaign finance report consisting of all expenditures made in connection with an election, all contributions received in the election cycle in which such election occurs, and all payments made to the Clean Elections Fund. If the campaign finance report shows any amount unspent, the participating candidate, within five days after filing the campaign finance report, shall send a check from the candidate's campaign account to the Commission in the amount of all unspent monies to be deposited the Fund.

a. The campaign finance report for the primary election shall be filed within five days after the primary election day and shall reflect all activity through the primary election day.

b. The campaign finance report for the general election shall be filed within five days after the general election day and shall reflect all activity through the general election day.

In the event that a participating candidate purchases goods or services from a subcontractor or other vendor through an agent pursuant to subsection (A)(3), the candidate's campaign finance report shall include the same detail as required in A.R.S. § 16-948(C) for each such subcontractor or other vendor. Such detail is also required when petty cash funds are used for such expenditures.

History

• New Section adopted by exempt rulemaking at 6 A.A.R. 1567, effective June 21, 2000 (Supp. 00-2). Section repealed; new Section made by exempt rulemaking at 8 A.A.R. 588, effective October 17, 2001 (Supp. 02-1). Amended by exempt rulemaking at 19 A.A.R. 1693, effective May 23, 2013 (Supp. 13-2). Amended by exempt rulemaking at 21 A.A.R. 1629, effective 7/23/2015. Amended by exempt rulemaking at 22 A.A.R. 2897, effective 1/1/2017. Amended by final rulemaking at 23 A.A.R. 124, effective 1/1/2017.

Ariz. Admin. Code § R2-20-111 Non-participating Candidate Reporting Requirements and Contribution Limits

A. Any person may file a complaint with the Commission alleging that any non-participating candidate or that candidate's campaign committee has failed to comply with or violated A.R.S. § 16-941(B). Complaints shall be processed as prescribed in Article 2 of these rules. In addition to those penalties outlined in R2-20-222(B), a non-participating candidate or candidate's campaign committee violating A.R.S. § 16-941(B) shall be subject to penalties prescribed in A.R.S. § 16-941(B) and A.R.S. § 16-942(B) and (C) as applicable.

B. Penalties under A.R.S. § 16-942(B):

1. For an election involving a candidate for statewide office, the civil penalty shall be $300 per day.

2. For an election involving a legislative candidate, the civil penalty shall be $100 per day.

3. The penalties in (a) and (b) shall be doubled if the amount not reported for a particular election cycle exceeds ten percent (10%) of the applicable one of the adjusted primary election spending limit or adjusted general election spending limit.

4. The dollar amounts in items (a) and (b), and the spending limits in item (c) are subject to adjustment of A.R.S. § 16-959.

C. Penalties under A.R.S. § 16-942(C): Where a campaign finance report filed by a non-participating candidate or that candidate's campaign committee indicates a violation of A.R.S. § 16-941(B) that involves an amount in excess of ten percent (10%) of the sum of the adjusted primary election spending limit and the adjusted general election spending limits specified by A.R.S. § 16-961(G) and (H) as adjusted pursuant to A.R.S. § 16-959, that violation shall result in disqualification of a candidate or forfeiture of office.

D. Penalties under A.R.S. § 16-941(B): Regardless of whether or not there is a violation of a reporting requirement, a person who violates A.R.S. § 16-941(B) is subject to a civil penalty of three times the amount of money that has been received, expended, or promised in violation of A.R.S. § 16-941(B) or three times the value in money for an equivalent of money or other things of value that have been received, expended, or promised in violation of A.R.S. § 16-941(B).

E. The twenty percent reduction in A.R.S. § 16-941(B) applies to all campaign contributions limits on contributions that are permitted to be accepted by nonparticipating candidates.

F. Contribution limits as adjusted by A.R.S. § 16-931 shall be the base level contribution limits subject to reduction pursuant to A.R.S. § 16-941(B).

History

• New Section adopted by exempt rulemaking at 6 A.A.R. 1567, effective June 21, 2000 (Supp. 00-2). Section repealed; new Section made by exempt rulemaking at 8 A.A.R. 588, effective October 17, 2001 (Supp. 02-1). Amended by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4). Amended by exempt rulemaking at 13 A.A.R. 2434, effective August 27, 2007 (Supp. 07-2). Amended by exempt rulemaking at 13 A.A.R. 3597, effective January 1, 2008 (Supp. 07-4). Amended by exempt rulemaking at 15 A.A.R. 1156, effective August 31, 2009 (Supp. 09-2). Amended by exempt rulemaking at 21 A.A.R. 1631, effective 7/23/2015. Amended by exempt rulemaking at 22 A.A.R. 2899, effective 1/1/2017. Amended by final rulemaking at 23 A.A.R. 126, effective 1/1/2017. Amended by exempt rulemaking at 24 A.A.R. 111, effective 12/14/2017.

Ariz. Admin. Code § R2-20-112 Political Party Exception

A. Pursuant to A.R.S. §§ 16-901(5)(b)(v) and (8)(c), payment by a political party of the costs of preparation, printing, display, mailing or other distribution for slate cards, sample ballots, other written materials or listings of candidates that substantially promote three or more candidates for any public office for which an election is held, and other election activities not related to a specific candidate, shall not be considered a contribution or an expenditure for purposes of the Act or Commission rules. This exception is subject to the following limitations:

1. "Slate card" is defined as a list that contains only:

a. The names, party affiliations and offices sought by the candidates;

b. Photographs of the candidates; and

c. General information regarding the date of the primary or general election; and

d. The location of the recipient's polling place.

2. "Sample ballot" is defined as a facsimile of a ballot listing only the names, party affiliations and offices sought by the candidates, appearing substantially as they would on an actual ballot;

3. "Other written materials or listings of candidates that substantially promote three or more candidates" are defined as materials that contain one or more of the elements of a slate card, in addition to statements and/or images describing the platform of the sponsoring party and the position of the party's candidates, and does not feature, mention, or depict a candidate or candidates of another party;

4. "Other election activities not related to a specific candidate" includes invitations to party-sponsored events, issue canvassing, and voter-registration efforts;

5. "Billboards" are defined as outdoor signs that are larger than thirty-two square feet in size.

6. The exception set forth in Subsection (A) shall not apply to materials defined in 1-3 above when distributed or displayed prior to the general election period unless each candidate featured is unopposed in the primary election.

7. The exception set forth in this Subsection (A) shall not apply to costs incurred with respect to a display of the listing of candidates made on telecommunications systems, billboards, or in newspapers, magazines or similar types of general circulation advertising.

B. This Section is intended to establish, for purposes of the Act and Commission rules, circumstances under which the payment by a political party of certain costs described herein shall be excluded from the definition of contribution pursuant to A.R.S. § 16-901(5)(b)(v) or from the definition of expenditures pursuant to A.R.S. § 16-901(8)(c), as applicable. Nothing in this Section shall be construed to prohibit a political party from making any expenditure or contribution not otherwise prohibited by Arizona law.

C. The Commission shall treat as an expenditure of de minimis value the payment by a political party of the costs of:

1. Preparation and display on the political party's website of a slate card, sample ballot or other printed listing of three or more candidates for any public office for which an election is held; or

2. Preparation and distribution via email, to recipients who have subscribed to receive email from the political party and whose email addresses are not rented, purchased or otherwise obtained from a third-party source, of a slate card, sample ballot or other printed listing of three or more candidates for any public office for which an election is held. A political party that pays the costs of preparation, display and/or distribution of a slate card, sample ballot or other printed listing of three or more candidates, as described in this subsection, and which is otherwise required to file a campaign finance report in accordance with A.R.S. § 16-913, shall disclose such payment as an expenditure with a value of zero dollars.

The provisions of A.R.S. § 16-911(B)(4) shall apply to a candidate, whether participating or nonparticipating, who becomes a nominee as defined in A.R.S. § 16-901(38).

History

• New Section adopted by exempt rulemaking at 6 A.A.R. 1567, effective June 21, 2000 (Supp. 00-2). Section repealed; new Section made by exempt rulemaking at 8 A.A.R. 588, effective October 17, 2001 (Supp. 02-1). Section repealed by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4). New Section made by exempt rulemaking at 13 A.A.R. 3597, effective January 1, 2008 (Supp. 07-4). Amended by exempt rulemaking at 15 A.A.R. 1423, effective October 22, 2009 (Supp. 09-3). Amended by final rulemaking at 23 A.A.R. 128, effective 1/1/2017.

Ariz. Admin. Code § R2-20-113 Candidate Statement Pamphlet

A. The Commission shall publish a candidate statement pamphlet in both the primary and general elections as required by A.R.S. § 16-956(A)(1). Commission staff shall send invitations for submission of a 200 word statement to every statewide and legislative candidate who has qualified for the ballot. Statements submitted for the primary candidate statement pamphlet shall be used for the general candidate statement pamphlet unless otherwise stated by the candidate.

B. The following candidates will not be invited to submit a statement for the candidate statement pamphlet:

1. In the primary election: write-in candidates for the primary election, independent candidates, no party affiliation or unrecognized party candidates.

2. In the general election: write in candidates

History

• New Section adopted by exempt rulemaking at 6 A.A.R. 1567, effective June 21, 2000 (Supp. 00-2). Section repealed by exempt rulemaking at 8 A.A.R. 588, effective October 17, 2001 (Supp. 02-1). New Section made by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4). Amended by exempt rulemaking at 13 A.A.R. 2434, effective August 27, 2007 (Supp. 07-2). Amended by exempt rulemaking at 13 A.A.R. 3597, effective January 1, 2008 (Supp. 07-4). Amended by exempt rulemaking at 15 A.A.R. 1156, effective August 31, 2009 (Supp. 09-2). Amended by exempt rulemaking at 15 A.A.R. 1423, effective October 22, 2009 (Supp. 09-3). Amended by exempt rulemaking at 15 A.A.R. 1567, effective September 2, 2009 (Supp. 09-3). Amended by exempt rulemaking at 16 A.A.R. 1200, effective January 8, 2010 (Supp. 10-2). Repealed by exempt rulemaking at 19 A.A.R. 1694, effective October 6, 2011 (Supp. 13-2). Adopted by exempt rulemaking at 21 A.A.R. 1633, effective 7/23/2015. Amended by final rulemaking at 25 A.A.R. 2118, effective 7/29/2019. Amended by final rulemaking at 26 A.A.R. 335, effective 2/4/2020.

Ariz. Admin. Code § R2-20-114 Candidate Campaign Bank Accounts

A. Each participating candidate shall designate a single campaign bank account for conducting campaign financial activity. During an election cycle, each participating and nonparticipating candidate shall conduct all campaign financial activities through a single, current election campaign bank account and any petty cash accounts as are permitted by law.

B. A participating candidate may maintain a campaign bank account other than the current election campaign bank account described in subsection (A) if the other campaign bank account is for a campaign in a prior election cycle in which the candidate was not a participating candidate.

C. During the exploratory period, a candidate may receive debt-retirement contributions for a campaign during a prior election cycle if the funds are deposited in the bank account for that prior campaign. A candidate shall not deposit debt-retirement contributions into the current election campaign bank accounts.

History

• Adopted by exempt rulemaking at 22 A.A.R. 2902, effective 1/1/2017.

Ariz. Admin. Code § R2-20-115 Books and Records Requirements

A. All candidates shall maintain, at a single location within the state, the books and records of financial transactions, and other information required by A.R.S. § 16-904.

B. All candidates shall ensure that the books and records of accounts and transactions of the candidate are recorded and preserved as follows:

1. The treasurer of a candidate's campaign committee is the custodian of the candidate's books and records of accounts and transactions, and shall keep a record of all of the following:

a. All contributions or other monies received by or on behalf of the candidate.

b. The identification of any individual or political committee that makes any contribution together with the date and amount of each contribution and the date of deposit into the candidate's campaign bank account.

c. Cumulative totals contributed by each individual or political committee.

d. The name and address of every person to whom any expenditure is made, and the date, amount and purpose or reason for the expenditure.

e. All periodic bank statements or other statements for the candidate's campaign bank account.

f. In the event that the campaign committee uses a petty cash account the candidate's campaign finance report shall include the same detail for each petty cash expenditure as required in A.R.S. § 16-948(C) for each vendor.

2. No expenditure may be made for or on behalf of a candidate without the authorization of the treasurer or his or her designated agent.

3. Unless specified by the contributor or contributors to the contrary, the treasurer shall record a contribution made by check, money order or other written instrument as a contribution by the person whose signature or name appears on the bottom of the instrument or who endorses the instrument before delivery to the candidate. If a contribution is made by more than one person in a single written instrument, the treasurer shall record the amount to be attributed to each contributor as specified.

All contributions other than in-kind contributions and qualifying contributions must be made by a check drawn on the account of the actual contributor or by a money order or a cashier's check containing the name of the actual contributor or must be evidenced by a written receipt with a copy of the receipt given to the contributor and a copy maintained in the records of the candidate.

5. The treasurer shall preserve all records set forth in subsection (B) and copies of all campaign finance reports required to be filed for three years after the filing of the campaign finance report covering the receipts and disbursements evidenced by the records.

6. If requested by the attorney general, the county, city or town attorney or the filing officer, the treasurer shall provide any of the records required to be kept pursuant to this Section.

C. Any request to inspect a candidate's records under A.R.S. § 16-958(F) shall be sent to the candidate, with a copy to the Commission, 10 or more days before the proposed date of the inspection. If the request is made within two weeks before the primary or general election, the request shall be delivered at least two days before the proposed date of inspection. Every request shall state with reasonable particularity the records sought.

1. The inspection shall occur at a location agreed upon by the candidate and the person making the request. If no agreement can be reached, the inspection shall occur at the Commission office. The inspection shall occur during the Commission's regular business hours and shall be limited to a two-hour time period.

2. The requesting party may obtain copies of records for a reasonable fee. The Commission shall not be responsible for making copies. The person in possession of the records shall produce copies within a reasonable time of the receipt of the copying request and fees.

3. The Commission will not permit public inspection of records if it determines that the inspection is for harassment purposes.

4. If a person who requests to inspect a candidate's records under A.R.S. § 16-958(F) is denied such a request, the requesting party may notify the Commission. The Commission may enforce the public inspection request by issuing a subpoena pursuant to A.R.S. § 16-956(B) for the production of any books, papers, records, or other items sought in the public inspection request. The subpoena shall order the candidate to produce:

a. All papers, records, or other items sought in the public inspection request;

b. No later than two business days after the date of the subpoena; and

c. To the Commission's office during regular business hours.

5. Any person who believes that a candidate or a candidate's campaign committee has not complied with this Section may appeal to Superior Court.

History

• Adopted by exempt rulemaking at 22 A.A.R. 2904, effective 1/1/2017.

Article 2 COMPLIANCE AND ENFORCEMENT PROCEDURES

Ariz. Admin. Code § R2-20-201 Scope

These rules provide procedures for processing possible violations of the Citizens Clean Elections Act.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1).

Ariz. Admin. Code § R2-20-202 Initiation of Compliance Matters

Compliance matters may be initiated by a complaint or on the basis of information ascertained by the Commission in the normal course of carrying out its statutory responsibilities.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1).

Ariz. Admin. Code § R2-20-203 Complaints

A. Any person who believes that a violation of any statute or rule over which the Commission has jurisdiction has occurred or is about to occur may file a complaint in writing to the Executive Director.

B. A complaint shall conform to the following:

Provide the full name and address of the complainant; and

2. Contents of the complaint shall be sworn to and signed in the presence of a notary public and shall be notarized.

C. All statements made in a complaint are subject to the statutes governing perjury. The complaint shall differentiate between statements based upon personal knowledge and statements based upon information and belief.

D. The complaint shall conform to the following provisions:

1. Clearly identify as a respondent each person or entity who is alleged to have committed a violation;

2. Statements which are not based upon personal knowledge shall be accompanied by an identification of the source of information which gives rise to the complainant's belief in the truth of such statements;

Contain a clear and concise recitation of the facts which describe a violation of a statute or rule over which the Commission has jurisdiction; and

4. Be accompanied by any documentation supporting the facts alleged if such documentation is known of, or available to, the complainant.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Amended by exempt rulemaking at 9 A.A.R. 3511, effective May 21, 2002 (Supp. 03-3). Amended by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4).

Ariz. Admin. Code § R2-20-204 Initial Complaint Processing; Notification

A. Upon receipt of a complaint, the Executive Director shall review the complaint for substantial compliance with the technical requirements of A.A.C. R2-20-203, and, if it complies with those requirements, shall within 5 days after receipt of the complaint notify each respondent that the complaint has been filed, advise each respondent of Commission compliance procedures, and provide each respondent a copy of the complaint.

B. If a complaint does not comply with the requirements of A.A.C. R2-20-203, the Executive Director shall so notify the complainant and any person or entity identified therein as respondent, within the 5 day period specified in subsection A, that no action should be taken on the basis of that complaint. A copy of the complaint shall be provided with the notification to each respondent.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Amended by exempt rulemaking at 21 A.A.R. 1634, effective 7/23/2015.

Ariz. Admin. Code § R2-20-205 Opportunity for No Action on Complaint-generated Matters

A. A respondent shall be afforded an opportunity to demonstrate that no action should be taken on the basis of a complaint by submitting, within 5 days from receipt of a written copy of the complaint, a letter or memorandum setting forth reasons why the Commission should take no action.

B. The Commission shall not take any action, or make any finding, against a respondent other than action dismissing the complaint, unless it has considered such response or unless no such response has been served upon the Commission within the 5 day period specified in subsection A.

C. The respondent's response shall be sworn to and signed in the presence of a notary public and shall be notarized. The respondent's failure to respond in accordance with subsection A within 5 days of receiving the written copy of the complaint may be viewed as an admission to the allegations made in the complaint for purposes of the reason to believe finding pursuant to A.A.C. R2-20-206.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Amended by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4). Amended by exempt rulemaking at 21 A.A.R. 1636, effective 7/23/2015.

Ariz. Admin. Code § R2-20-206 Executive Director's Recommendation on Complaint-generated Matters

A. Following either the expiration of the 5 day period specified by A.A.C. R2-20-205 or the receipt of a response as specified by A.A.C. R2-20-205(A), whichever occurs first, the Executive Director:

1. may recommend to the Commission whether it should find reason to believe that a respondent has committed or is about to commit a violation of a statute or rule over which the Commission has jurisdiction;

2. may recommend that the Commission find that there is no reason to believe that a violation of a statute or rule over which the Commission has jurisdiction has been committed or is about to be committed, or that the Commission otherwise dismiss a complaint without regard to the provisions of A.A.C. R2-20-205(A); or

3. may close the complaint generated matter without a reason to believe recommendation from the Executive Director based upon Respondent complying with the statute or rule on which the complaint is founded and in such case shall notify the Commission.

B.Neither the complainant nor the respondent has the right to appeal the Executive Director's recommendation made pursuant to subsection (A) because the recommendation is not an appealable agency action.

C.If the complaint relates to a violation of A.R.S. § 16-941(B) by a non-participating candidate or that candidate's campaign committee, the Executive Director shall not proceed pursuant to R2-20-206(A) or R2-20-207(A), without first receiving Commission approval to initiate an inquiry.

D.The respondent shall not have the right to appeal the Commission's decision to authorize an inquiry pursuant to subsection (C) because the Commission's decision whether or not to authorize an inquiry is not an appealable agency action.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Amended by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4). Amended by exempt rulemaking at 12 A.A.R. 758, effective February 15, 2006 (Supp. 06-1). Amended by exempt rulemaking at 20 A.A.R. 885, effective 5/22/2014. Amended by exempt rulemaking at 20 A.A.R. 1332, effective 5/22/2014. Amended by exempt rulemaking at 21 A.A.R. 1638, effective 7/23/2015.

Ariz. Admin. Code § R2-20-207 Internally Generated Matters; Referrals

A. On the basis of information ascertained by the Commission in the normal course of carrying out its statutory responsibilities, or on the basis of a referral from an agency of the state, the Executive Director may recommend in writing that the Commission find reason to believe that a person or entity has committed or is about to commit a violation of a statute or rule over which the Commission has jurisdiction.

B. If the Commission finds reason to believe that a violation of a statute or rule over which the Commission has jurisdiction has occurred or is about to occur, the Executive Director shall notify the respondent of the Commission's decision and shall include a copy of a staff report setting forth the legal basis and the alleged facts which support the Commission's action.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Amended by exempt rulemaking at 13 A.A.R. 3524, effective January 1, 2008 (Supp. 07-3).

Ariz. Admin. Code § R2-20-208 Complaint Processing; Notification

A. If the Commission, either after reviewing a complaint-generated recommendation as described in R2-20-206 and any response of a respondent submitted pursuant to R2-20-205, or after reviewing an internally-generated recommendation as described in R2-20-207, determines by an affirmative vote of at least three of its members that it has reason to believe that a respondent has violated a statute or rule over which the Commission has jurisdiction, the Commission shall notify such respondent of the Commission's finding, setting forth the sections of the statute or rule alleged to have been violated and the alleged factual basis supporting the finding. In accordance with A.R.S. § 16-957(A), the Commission shall serve on the respondent an order requiring compliance within 14 days. During that period, the respondent may provide any explanation to the Commission, comply with the order, or enter into a public administrative settlement with the Commission.

B. If the Commission finds no reason to believe that a violation of a statute or rule over which the Commission has jurisdiction has occurred, or otherwise terminates its proceedings, the Executive Director shall so notify both the complainant and respondent.

C. The complainant may bring an action in Superior Court in accordance with A.R.S. § 16-957(C) if the Commission finds there is no reason to believe a violation of a statute or rule over which the Commission has jurisdiction has occurred or otherwise terminates its proceedings.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Amended by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4). Amended by exempt rulemaking at 12 A.A.R. 758, effective February 15, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-20-209 Investigation

A. The Executive Director or any other person designated by the Executive Director shall conduct an investigation in any case in which the Commission finds reason to believe that a violation of a statute or rule over which the Commission has jurisdiction has occurred or is about to occur.

B. The investigation may include, but is not limited to, field investigations, audits, and other methods of information gathering.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Amended by final rulemaking at 26 A.A.R. 111, effective 12/12/2019. Amended by final rulemaking at 26 A.A.R. 542, effective 3/9/2020.

Ariz. Admin. Code § R2-20-210 Written Questions under Order

The Commission may issue an order requiring any person to submit sworn, written answers to written questions and may specify a date by which such answers must be submitted to the Commission.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Amended by exempt rulemaking at 9 A.A.R. 3511, effective May 21, 2002 (Supp. 03-3).

Ariz. Admin. Code § R2-20-211 Subpoenas and Subpoenas Duces Tecum; Depositions

A. The Commission may authorize its Executive Director or Assistant Attorney General to issue subpoenas requiring the attendance and testimony of any person by deposition and to issue subpoenas duces tecum for the production of documentary or other tangible evidence in connection with a deposition or otherwise.

B. If the Commission orders oral testimony to be taken by deposition or for documents to be produced, the subpoena shall so state and shall advise the deponent or person subpoenaed that all testimony will be under oath. The Commission may authorize its Executive Director to take a deposition and have the power to administer oaths.

C. The deponent shall have the opportunity to review and sign depositions taken pursuant to this rule.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Amended by exempt rulemaking at 13 A.A.R. 3524, effective January 1, 2008 (Supp. 07-3).

Ariz. Admin. Code § R2-20-212 Repealed

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Section repealed by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4).

Ariz. Admin. Code § R2-20-213 Motions to Quash or Modify a Subpoena

A. Any person to whom a subpoena is directed may, prior to the time specified therein for compliance, but in no event more than five days after the date of receipt of such subpoena, apply to the Commission to quash or modify such subpoena, accompanying such application with a brief statement of the reasons therefore.

B. The Commission may deny the application, quash the subpoena or modify the subpoena.

C. The person subpoenaed and the Executive Director may agree to change the date, time, or place of a deposition or for the production of documents without affecting the force and effect of the subpoena, but such agreements shall be confirmed in writing.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Amended by exempt rulemaking at 13 A.A.R. 3524, effective January 1, 2008 (Supp. 07-3).

Ariz. Admin. Code § R2-20-214 The Probable Cause to Believe Recommendation; Briefing Procedures

A. Upon completion of the investigation conducted pursuant to R2-20-209, the Executive Director shall prepare a brief setting forth his or her position on the factual and legal issues of the case and containing a recommendation on whether the Commission should find probable cause to believe that a violation of a statute or rule over which the Commission has jurisdiction has occurred or is about to occur.

B. The Executive Director shall notify each respondent of the recommendation and enclose a copy of his or her brief.

C. Within five days from receipt of the Executive Director's brief, the respondent may file a brief with the Commission setting forth the respondent's position on the factual and legal issues of the case.

D. After reviewing the respondent's brief, the Executive Director shall promptly advise the Commission in writing whether he or she intends to proceed with the recommendation or to withdraw the recommendation from Commission consideration.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Amended by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4). Amended by exempt rulemaking at 12 A.A.R. 758, effective February 15, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-20-215 Probable Cause to Believe Finding

A. If the Commission, after having found reason to believe and after following the procedures set forth in R2-20-214, determines by an affirmative vote of at least three of its members that there is probable cause to believe that a respondent has violated a statute or rule over which the Commission has jurisdiction, the Commission shall authorize the Executive Director to so notify the respondent by an order, that states the nature of the violation, pursuant to A.R.S. § 16-957.

B. If the Commission finds no probable cause to believe that a violation of a statute or rule over which the Commission has jurisdiction has occurred or otherwise orders a termination of Commission proceedings, it shall authorize the Executive Director to notify both respondent and complainant by letter that the proceeding has ended. The Executive Director's letter also will inform the parties that the Commission is not precluded from taking action on this matter in the future if evidence is discovered which may alter the decision of the Commission.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Amended by exempt rulemaking at 9 A.A.R. 3511, effective May 21, 2002 (Supp. 03-3). Amended by exempt rulemaking at 13 A.A.R. 3524, effective January 1, 2008 (Supp. 07-3).

Ariz. Admin. Code § R2-20-216 Conciliation

A. Upon a Commission finding of probable cause to believe that the respondent has violated a statute or rule over which the Commission has jurisdiction, the Executive Director shall attempt to settle the matter as authorized by A.R.S. § 16-957(A) by informal methods of administrative settlement or conciliation, and shall attempt to reach a tentative conciliation agreement with the respondent.

B. A conciliation agreement pursuant to subsection (A) of this Section is not binding upon either party unless and until it is signed by the respondent and by the Executive Director upon approval by the affirmative vote of at least three members of the Commission.

C. If a conciliation agreement is reached between the Commission and the respondent, the Executive Director shall send a copy of the signed agreement to both complainant and respondent.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Amended by exempt rulemaking at 9 A.A.R. 3511, effective May 21, 2002 (Supp. 03-3).

Ariz. Admin. Code § R2-20-217 Enforcement Proceedings

A. Upon a finding of probable cause that the alleged violator remains out of compliance, the Executive Director may recommend to the Commission that the Commission authorize the issuance of an order and assessment of civil penalties pursuant to A.R.S. § 16-957(B).

B. The Commission may, by an affirmative vote of at least three of its members, authorize the Executive Director to issue an order and assess civil penalties pursuant to A.R.S. § 16-957(B).

C. Subsections (A) and (B) of this rule shall not preclude the Commission, upon request of a respondent, from entering into a conciliation agreement pursuant to R2-20-216 even after the Commission authorizes the Executive Director to issue an order and assess civil penalties pursuant to subsection (B). Any conciliation agreement reached under this subsection is subject to the provisions of R2-20-216(B) and shall have the same force and effect as a conciliation agreement reached under R2-20-216(D) .

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Amended by exempt rulemaking at 9 A.A.R. 3511, effective May 21, 2002 (Supp. 03-3). Amended by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4). Amended by exempt rulemaking at 12 A.A.R. 758, effective February 15, 2006 (Supp. 06-1).

Ariz. Admin. Code § R2-20-218 Repealed

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Section repealed by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4).

Ariz. Admin. Code § R2-20-219 Repealed

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Section repealed by exempt rulemaking at 9 A.A.R. 3511, effective May 21, 2002 (Supp. 03-3).

Ariz. Admin. Code § R2-20-220 Ex Parte Communications

A. In order to avoid the possibility of prejudice, real or apparent, to the public interest in enforcement actions pending before the Commission pursuant to its compliance procedures, except to the extent required for the disposition of ex parte matters as required by law (for example, during the normal course of an investigation or a conciliation effort), no interested person outside the agency shall make or cause to be made to any Commissioner or any member of any Commission staff any ex parte communication relative to the factual or legal merits of any enforcement action, nor shall any Commissioner or member of the Commission's staff make or entertain any such ex parte communications.

B. This rule shall apply from the time a complaint is filed with the Commission or from the time that the Commission determines on the basis of information ascertained in the normal course of its statutory responsibilities that it has reason to believe that a violation of a statute or rule over which the Commission has jurisdiction has occurred or may occur, and remains in force until the Commission has finally concluded all action with respect to the matter in question.

C. Nothing in this Section shall be construed to prohibit contact between a respondent or respondent's attorney and any staff member or other authorized representative of the Commission or the Commission staff in the course of representing the Commission or the respondent with respect to an enforcement proceeding or civil action. No statement made by a Commission representative or staff member shall bind or estop the Commission.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Amended by final rulemaking at 29 A.A.R. 994, effective 6/17/2023.

Ariz. Admin. Code § R2-20-221 Representation by Counsel; Notification

A. If a respondent wishes to be represented by counsel with regard to any matter pending before the Commission, respondent shall so advise the Commission by sending a letter of representation signed by the respondent, which letter shall state the following:

1. The name, address, and telephone number of the counsel; and

2. A statement authorizing such counsel to receive any and all notifications and other communications from the Commission on behalf of respondent.

B. Upon receipt of a letter of representation, the Commission shall have no contact with respondent except through the designated counsel unless authorized in writing by respondent. The Commission will send a copy of this letter to the respondent's attorney.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1).

Ariz. Admin. Code § R2-20-222 Civil Penalties

AIf the Commission has reason to believe by a preponderance of the evidence that a participating cand idate is not in com- pliance with the Act or Commission rules, then in addition to other penalties under law, the Commiss ion may decertify a candidate, deny or suspend funding, order repayment of funds, or impose a penalty not to exceed $1,0 00 for a participat- ing candidate for the legislature and $5,000 for a participating candidate for statewide office.

BIf the Commission has reason to believe by a preponderance of the evidence that a person other than a participating candi- date is not in compliance with the Act or Commission rules, then in addition to other penalties unde r law, the Commission may impose a penalty not to exceed $1,000.

C. A civil penalty negotiated by the Commission or imposed by a court for a violation of the Act shall not exceed the greater of $10,000 or an amount equal to any contribution or expenditure involved in the violation. In the case of a knowing and willful violation, the civil penalty shall not exceed the greater of $15,000 or an amount equal to 200 percent of any contribution or expenditure involved in the violation.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Amended by exempt rulemaking at 13 A.A.R. 3524, effective January 1, 2008 (Supp. 07-3). Amended by exempt rulemaking at 19 A.A.R. 1697, effective May 23, 2013 (Supp. 13-2). Amended by Exempt Rulemaking at 19 A.A.R. 3524, effective September 27, 2013.

Ariz. Admin. Code § R2-20-223 Notice of Appealable Agency Action

If the Commission makes a probable cause finding pursuant to R2-20-215 or decides to initiate an enforcement proceeding pursuant to R2-20-217, any person authorized to provide legal services on behalf of the Commission shall draft and serve notice of an appealable agency action pursuant to A.R.S. § 41-1092.03 and § 41-1092.04 on the respondent. The notice shall identify the following:

1. The statute or rule violated and specific facts constituting the violation;

2. A description of the respondent's right to request a hearing and to request an informal settlement conference; and

3. A description of what the respondent may do if the respondent wishes to remedy the situation without appealing the Commission's decision.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Amended by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4). Amended by exempt rulemaking at 21 A.A.R. 2921, effective 7/21/2011. Amended by final rulemaking at 29 A.A.R. 994, effective 6/17/2023.

Ariz. Admin. Code § R2-20-224 Request for an Administrative Hearing

A. The respondent must be file a request for a hearing with the Commission within 30 days of receipt of the notice prescribed in R2-20-223.

B. If the respondent requests a hearing, the AAG shall notify the Office of Administrative Hearings (OAH) of the appeal and shall coordinate a hearing date with the Commission's AAG and Commission staff that may be called as witnesses and OAH. The hearing must be held within 60 days after the notice of appeal is filed with the Commission.

C. The AAG shall prepare and serve a notice of hearing on all parties to the appeal at least 30 days before the hearing date, unless and expedited hearing is requested and granted. The notice of hearing shall be drafted in accordance with A.R.S. § 41-1092.05(D).

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1).

Ariz. Admin. Code § R2-20-225 Informal Settlement Conference

A. If the respondent requests an informal settlement conference, the informal settlement conference shall be held within 15 days after the Commission receives the request. A request for an informal settlement conference shall be in writing and must be filed with the Commission no later than 20 days before the hearing date. A person with the authority to act on behalf of the Commission must represent the Commission at the conference. The AAG shall attend the settlement conference, but shall not be the individual authorized to act on behalf of the Commission.

B. The Commission representative shall notify the appellant in writing that the statements, either written or oral, made by the appellant at the conference, including a written document, created or expressed solely for the purpose of settlement negotiations, are inadmissible in any subsequent administrative hearing. The parties participating in the settlement conference waive their right to object to the participation of the agency representative in the final administrative decision.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1).

Ariz. Admin. Code § R2-20-226 Administrative Hearing

A. If the matter continues to a hearing, the hearing shall be held in accordance with A.R.S. § 41-1092.07. The Administrative Law Judge (ALJ) must issue a written recommended decision within 20 days after the hearing is concluded.

B. If the enforcement action occurs within six months of the primary or general election, the Commission will request an expedited review of the matter

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1).

Ariz. Admin. Code § R2-20-227 Review of Administrative Decision by Commission

A. Within 30 days after the date OAH sends a copy of the ALJ's decision to the Commission, the Commission may review the ALJ's decision and accept, reject or modify the decision.

B. If the Commission declines to review the ALJ's decision, the Commission shall serve a copy of the decision on all parties. If the Commission modifies or rejects the decision, the Commission shall file with OAH and serve on all parties, a copy of the ALJ's decision with the rejection or modification and a written justification setting forth the reasons for the rejection or modification. If the Commission accepts, rejects or modifies the decision, the Commission's decision will be certified as final.

C. If the Commission does not accept, reject or modify the decision within 30 days after OAH sends the ALJ's decision to the Commission, the ALJ's decision will be certified as final.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1).

Ariz. Admin. Code § R2-20-228 Judicial Review

A party may appeal a final administrative decision pursuant to A.R.S. § 12-901 et seq. (Judicial Review of Administrative Decisions). A party does not have the right to judicial review unless that party first exhausts its administrative remedies by going through the above steps. After a hearing has been held and a final administrative decision has been entered pursuant to § 41-1092.08, a party is not required to file a motion for rehearing or review of the decision in order to exhaust the party' s administrative remedies.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1).

Ariz. Admin. Code § R2-20-229 Repealed

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Section repealed by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4).

Ariz. Admin. Code § R2-20-230 Repealed

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Section repealed by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4).

Ariz. Admin. Code § R2-20-231 Repealed

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Section repealed by exempt rulemaking at 12 A.A.R. 758, effective February 15, 2006 (Supp. 06-1).

Article 3 STANDARD OF CONDUCT FOR COMMISSIONERS AND EMPLOYEES

Ariz. Admin. Code § R2-20-301 Purpose and Applicability

A. The Commission is committed to implementing the Act in an honest, independent, and impartial fashion and to seeking to uphold public confidence in the integrity of the electoral system. To ensure public trust in the fairness and integrity of the Arizona elections process, all Commissioners and employees must observe the highest standards of conduct. This Article prescribes standards of ethical conduct for Commissioners and employees of the Commission relating to conflicts of interest arising from outside employment, private businesses, professional activities, political activities, and financial interests. The avoidance of misconduct and conflicts of interest on the part of the Commissioners and the employees through informed judgment is indispensable to the maintenance of these prescribed ethical standards. Attainment of these goals necessitates strict and absolute fairness and impartiality in the administration of the law.

B. This Article applies to all persons included within the terms "employee" and "Commissioner" of the Commission.

C. These Standards of Conduct shall be construed in accordance with any applicable laws, regulations, and agreements between the Commission and a labor organization.

D. Pursuant to A.R.S. § 16-955(I), for three years after a Commissioner completes his or her tenure, Commissioners shall not seek or hold any public office, serve as an officer of any political committee, or employ or be employed as a lobbyist.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1).

Ariz. Admin. Code § R2-20-302 Definitions

The following terms apply in all Citizens Clean Elections Act matters:

1. "Commission" means the Citizens Clean Elections Commission of Arizona.

2. "Commissioner" means a voting member of the Commission, appointed pursuant to A.R.S. § 16-955.

3. "Conflict of interest" means a situation in which a Commissioner's or an employee's private interest is or appears to be inconsistent with the efficient and impartial conduct of his or her official duties and responsibilities.

4. "Employee" means an employee or staff member of the Commission.

5. "Former employee" means one who was, and is no longer, an employee of the Commission.

6. "Official responsibility" means the direct administrative or operating authority, whether intermediate or final, to approve, disapprove, or otherwise direct Commission action. Official responsibility may be exercised alone or with others and either personally or through subordinates.

7. "Outside employment" or "outside activity" means any work, service or other activity performed by a Commissioner or employee other than in the performance of the Commissioner's or employee's official employment duties. It includes such activities as writing and editing, publishing, teaching, lecturing, consulting, self-employment, and other services or work performed, with or without compensation.

8. "Person" means an individual, corporation, company, association, firm, partnership, society, joint stock company, political committee, or other group, organization, or institution.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1).

Ariz. Admin. Code § R2-20-303 Notification to Commissioners and Employees

The Executive Director shall provide to each Commissioner and employee of the Commission, upon commencement of his or her term or employment and at least annually thereafter, a copy of this Article and such other information regarding standards of conduct as the Commission and/or applicable law may prescribe.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Amended by exempt rulemaking at 13 A.A.R. 3527, effective January 1, 2008 (Supp. 07-3).

Ariz. Admin. Code § R2-20-304 Interpretation and Advisory Service

Commissioners or employees seeking advice and guidance on questions of conflict of interest and on other matters covered by this Article shall consult with the Commission's Chair or Executive Director. The Commission's Chair or Executive Director shall be consulted prior to the undertaking of any action that might violate this Article governing the conduct of Commissioners or employees.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Amended by exempt rulemaking at 13 A.A.R. 3527, effective January 1, 2008 (Supp. 07-3).

Ariz. Admin. Code § R2-20-305 Reporting Suspected Violations

A. Persons who have information that causes them to believe that there has been a violation of a statute or a rule set forth in this Article or that a Commissioner should not participate in a Commission decision, shall report promptly, in writing, such information to the Commission's Chair or Executive Director.

B. When information made available to the Commission under subsection (A) indicates a conflict between the interests of a Commissioner or employee and the performance of his or her Commission duties, the Commissioner or employee shall be provided notice of the conflict issue and an opportunity to explain the conflict or appearance of conflict in writing. In the case of a Commissioner, the response shall be due five days from the issuance of the notice. The Commission's Chair or Executive Director may decline to require a response if the claim is clearly meritless and, in such event, no response is required. In such cases, the Commission's Chair or Executive Director shall state in writing why the claim is clearly meritless and provide the writing to the person who provided the information and the Commissioner.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Amended by final rulemaking at 29 A.A.R. 1549, effective 8/13/2023.

Ariz. Admin. Code § R2-20-306 Disciplinary and Other Remedial Action

A. A violation of this Article by an employee or Commissioner may be cause for remedial action or, if the matter involves a Commission employee, disciplinary action, which may be in addition to any penalty or enforcement mechanism provided by law.

B. When the Commission's Executive Director determines that an employee may have or appears to have a conflict of interest, the Commission's Executive Director may question the employee in the matter and gather other information. The Commission's Executive Director and the employee's supervisor shall discuss with the employee possible ways of eliminating the conflict or appearance of conflict. If the Commission's Executive Director, after consultation with the employee's supervisor, concludes that remedial action should be taken, he or she shall refer a statement to the Commission containing his or her recommendation for such action. The Commission, after consideration of the employee's explanation and the results of any investigation, may direct appropriate remedial action as it deems necessary.

C. Remedial action pursuant to subsection (B) of this Section may include, but is not limited to:

1. Changes in assigned duties;

2. Divestment by the employee of his or her conflicting interest;

Disqualification for particular action; or

4. Disciplinary action.

D. When the matter involves a Commissioner, the Commission's Chair and Executive Director may conduct an appropriate investigation or gather relevant information for consideration by the Commission. After review of relevant information and a response from the Commissioner, the Commission's Chair and Executive Director shall ensure that the matter is made part of the agenda for a Commission meeting for discussion and possible action no later than the next regular Commission meeting, unless there is less than one week before that meeting, in which case, the matter shall be scheduled at the next subsequent meeting. The Commission's Chair may call for an interim meeting regarding the matter at the discretion of the Commission's Chair.

E. After consideration of the relevant information and a Commissioner's response at an open meeting, the Commission may vote on an action for proper remedial action. Remedial action may include, but is not limited to:

1. An expression of the majority opinion of the Commissioners about voluntary remedial action the Commissioner at issue should take to resolve the conflict issues and ensure the appropriate level of impartiality in Commission proceedings; or

2. Disqualification of the Commissioner from participation in discussion or votes on any matter for which the Commissioner has, in the determination of a majority of the other non-disqualified Commissioners, a disqualifying conflict.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Amended by final rulemaking at 29 A.A.R. 1549, effective 8/13/2023.

Ariz. Admin. Code § R2-20-307 General Prohibited Conduct

A. A Commissioner or employee shall avoid any action whether or not specifically prohibited by this Section that might result in, or create the appearance of:

1. Using public office for unlawful private gain;

2. Giving favorable or unfavorable treatment to any person or organization due to any partisan or political consideration;

Impeding Commission efficiency or economy;

4. Losing impartiality.

5. Making a Commission decision without Commission approval; or

Adversely affecting the confidence of the public in the integrity of the Commission.

B. A Commissioner or employee of the Commission shall not solicit or accept, directly or indirectly, any gift, gratuity, favor, entertainment, loan, or any other thing of monetary value, from a person who:

1. Has, or is seeking to obtain, contractual or other business or financial relations with the Commission;

2. Conducts operations or activities that are regulated or examined by the Commission; or

3. Has an interest that may be substantially affected by the performance or nonperformance of the Commissioner or employee's official duty.

C. Subsection (B) of this Section shall not apply in the following circumstances:

1. When circumstances make it clear that obvious family or personal relationships, rather than the business of the persons concerned, are the motivating factors;

2. To the acceptance of food, refreshments, and accompanying entertainment of nominal value in the ordinary course of a social occasion or a luncheon or dinner meeting or other function where a Commissioner or an employee is properly in attendance;

3. To the acceptance of unsolicited advertising or promotional material or other items of nominal value such as pens, pencils, note pads, calendars; and

4. To the acceptance of loans from banks or other financial institutions on customary terms to finance proper and usual activities, such as home mortgage loans.

D. A Commissioner or an employee shall not solicit a contribution from another employee for a gift to an official superior, make a donation as a gift to an official superior, or accept a gift from an employee receiving less pay than himself or herself. However, this subsection does not prohibit a voluntary gift of nominal value or donation in a nominal amount made on a special occasion such as birthday, holiday, marriage, illness, or retirement.

E. This Section does not preclude a Commissioner or employee from receipt of reimbursement, unless prohibited by law, for expenses of travel and such other necessary subsistence as is compatible with this Article for which no state payment or reimbursement is made. However, this Section does not allow a Commissioner or employee to be reimbursed, or payment to be made on his or her behalf, for excessive personal living expenses, gifts, entertainment, or other personal benefits, nor does it allow a Commissioner or employee to be reimbursed by a person for travel on official business under Commission orders when reimbursement is prescribed by statute.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1).

Ariz. Admin. Code § R2-20-308 Outside Employment or Activities

A. A Commissioner or employee shall not engage in outside employment that is incompatible with the full discharge of his or her duties as a Commissioner or employee.

B. Incompatible outside employment or other activities by Commissioners or employees include, but are not limited to:

1. Outside employment or other activities that involve illegal activities;

Outside employment or other activities that would give rise to a real or apparent conflict of interest situation even though no violation of a specific statutory provision was involved;

3. Acceptance of a fee, compensation, gift, payment of expense, or any other thing of monetary value in circumstances where acceptance may result in, or create the appearance of, a conflict of interest;

4. Outside employment or other activities that might bring discredit upon the state or Commission;

5. Outside employment or other activities that establish relationships or property interests that may result in a conflict between the Commissioner's or the employee's private interests and official duties;

Outside employment or other activities which would involve any contractor or subcontractor connected with any work performed for the Commission or would involve any person or organization in a position to gain advantage in its dealings with the state through the Commissioner's or employee's exercise of his or her official duties;

Outside employment or other activities that may be construed by the public to be the official acts of the Commission. In any permissible outside employment, care shall be taken to ensure that names and titles of Commissioners and employees are not used to give the impression that the activity is officially endorsed or approved by the Commission or is part of the Commission's activities;

8. Outside employment or other activities which would involve use by a Commissioner or employee of his or her official duty time; use of official facilities, including office space, machines, or supplies, at any time; or use of the services of other employees during their official duty hours;

9. Outside employment or other activities which impair the Commissioner's or employee's mental or physical capacities to perform Commission duties and responsibilities in an acceptable manner; or

10. Use of information obtained as a result of state employment that is not freely available to the general public or would not be made available upon request. However, written authorization for the use of any such information may be given when the Commission determines that such use would be in the public interest.

C. Commissioners and employees shall not receive any salary or anything of monetary value from a private source as compensation for the Commissioner's or employee's services to the state.

D. Commissioners and employees are encouraged to engage in teaching, lecturing, and writing that is not prohibited by law or this Article. However, Commissioners and employees shall not, either with or without compensation, engage in teaching or writing that is dependent on information obtained as a result of his or her Commission employment, except when that information has been made available to the public or will be made available on request, or when the Commission gives written authorization for the use of nonpublic information on the basis that the use is in the public interest.

E. This Section does not preclude a Commissioner or employee from participating in the activities of or acceptance of an award for meritorious public contribution or achievement given by a charitable, religious, professional, social, fraternal, nonprofit, educational, recreational, public service, or civic organization.

F. An employee who intends to engage in outside employment shall obtain the approval of the Executive Director. The request shall include the name of the person, group, or organization for whom the work is to be performed, the nature of the services to be rendered, the proposed hours of work, or approximate dates of employment, and the employee's certification as to whether the outside employment (including teaching, writing, or lecturing) will depend in any way on information obtained as a result of the employee's official position. The employee will receive, from the Executive Director, written notice of approval or disapproval of any written request. A record of the decision shall be placed in each employee's official personnel folder.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1).

Ariz. Admin. Code § R2-20-309 Financial Interests

A. Commissioners and employees shall not engage in, directly or indirectly, a financial transaction as a result of, or primarily relying on, information obtained through the Commissioner's or employee's duties or employment.

B. Commissioners and employees shall not have a direct or indirect financial interest that conflicts substantially, or appears to conflict substantially, with the Commissioner's or employee's official duties and responsibilities, except in cases where the Commissioner or employee makes full disclosure, and disqualifies himself or herself from participating in any decisions, approval, disapproval, recommendation, the rendering of advice, investigation, or in any proceeding of the Commission in which the financial interest is or appears to be affected. Full disclosure by a Commissioner or employee will require that individual to submit a written statement to the Executive Director or Chair disclosing the particular financial interest which conflicts substantially, or appears to conflict substantially, with the Commissioner's or employee's duties and responsibilities.

C. Commissioners and employees shall disqualify themselves from a proceeding in which the Commissioner's or employee's impartiality might reasonably be questioned, such as in a situation where the Commissioner or employee knows that he or she, or his or her family member, has an interest in the subject matter in controversy or is a party to the proceeding, or has any other interest that could be substantially affected by the outcome of the proceeding.

D. This Section does not preclude a Commissioner or employee from having a financial interest or engaging in financial transactions to the same extent as a private citizen not employed by the Commission, as long as the Commissioner's or employee's financial interest does not conflict with official Commission duties.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1).

Ariz. Admin. Code § R2-20-310 Political and Organization Activity

A. Due to the Commission's role in the political process, the following restrictions on political activities are required:

1. Commissioners and employees shall not advocate for the election or defeat of a candidate, nor make contributions to a candidate, political party, or political committee subject to the jurisdiction of the Commission. Commissioners and employees, however, are not prohibited from signing candidate nomination petitions;

2. Commissioners and employees shall not provide volunteer or paid services for a candidate, political party, or political committee subject to the jurisdiction of the Commission; and

3. Commissioners and employees not shall display partisan buttons, badges, or other insignia on Commission premises.

B. Employees on leave, leave without pay, or on furlough or terminal leave, even though the employees' resignations have been accepted, are subject to the restrictions of this Section. A separated employee who has received a lump-sum payment for annual leave, however, is not subject to the restrictions during the period covered by the lump-sum payment or thereafter, provided he or she does not return to state employment during that period. An employee is not permitted to take a leave of absence to work with a political candidate, committee, or organization or become a candidate for office despite any understanding that he or she will resign his or her position if nominated or elected.

C. A Commissioner or employee is accountable for political activity by another person acting as his or her agent or under the Commissioner's or employee's direction or control if the Commissioner or employee is thus accomplishing what he or she may not lawfully do directly and openly.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1).

Ariz. Admin. Code § R2-20-311 Membership in Associations

Commissioners or employees who are members of nongovernmental associations or organizations shall avoid activities on behalf of those associations or organizations that are incompatible with their official positions.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1).

Ariz. Admin. Code § R2-20-312 Use of State Property

A Commissioner or employee shall not directly or indirectly use, or allow the use of, state property of any kind, including property leased to the state, for other than officially approved activities. Commissioners and employees have a positive duty to protect and conserve state property including equipment, supplies, and other property entrusted or issued to him or her.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1).

Article 4 AUDITS

Ariz. Admin. Code § R2-20-401 Purpose and Scope

This article prescribes procedures for conducting examinations and audits of participating candidates' campaign finances.

History

• New Section made by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4). Amended by exempt rulemaking at 19 A.A.R. 1699, effective October 6, 2011.

Ariz. Admin. Code § R2-20-402 General

The Commission may conduct an examination and audit of the receipts, disbursements, debts and obligations of each candidate. In addition, the Commission may conduct other examinations and audits as it deems necessary to carry out the provisions of the Act and regulations. Information obtained pursuant to any audit and examination may be used by the Commission as the basis, or partial basis, for its repayment determinations.

History

• New Section made by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4).

Ariz. Admin. Code § R2-20-402.01 Audits of Participating Legislative Candidates

To ensure compliance with the Act and Commission rules, the Commission shall conduct audits of all participating legislative candidates after each election. Candidates who win their primary election will not be subject to an audit until after the general election. Audits shall include the review of campaign finance reports for the entire election cycle and related documentation in accordance with procedures established by the Commission. The Commission may hire independent accounting firms to carry out the audits.

History

• New Section made by exempt rulemaking at 13 A.A.R. 3529, effective January 1, 2008 (Supp. 07-3). Amended by exempt rulemaking at 19 A.A.R. 1700, effective October 6, 2011. Amended by exempt rulemaking at 21 A.A.R. 1640, effective 7/23/2015. Amended by final rulemaking at 23 A.A.R. 130, effective 12/15/2016. Amended by final exempt rulemaking at 23 A.A.R. 2944, effective 9/28/2017.

Ariz. Admin. Code § R2-20-402.02 Audits of Participating Statewide Candidates

All participating statewide candidates shall be audited after each primary election period and each general election period.

History

• Adopted by final rulemaking at 23 A.A.R. 131, effective 12/15/2016.

Ariz. Admin. Code § R2-20-403 Conduct of Fieldwork

A. The Commission will provide the candidate two days notice of the Commission's intention to commence fieldwork on the audit and examination. The Commission will conduct fieldwork at a site provided by the candidate. During or after fieldwork, the Commission may request additional or updated information, which expands the coverage dates of information previously provided. During or after fieldwork, the Commission may also request additional information that was created by or becomes available to the candidate that is of assistance in the Commission's audit. The candidate shall produce the additional or updated information no later than two days after service of the Commission's request.

B. On the date scheduled for the commencement of fieldwork, the candidate shall facilitate the examination or audit by making records available in one central location, such as the Commission's office space, or shall provide the Commission with office space and records. The candidate shall be present at the site of the fieldwork. The candidate shall be familiar with the candidate's records and shall be available to the Commission to answer questions and to aid in locating records.

C. If the candidate fails to provide adequate office space, personnel or records, the Commission may seek judicial intervention to enforce the request or assess other penalties.

D. If, in the course of the examination or audit process, a dispute arises over the documentation sought, the candidate may seek review by the Commission of the issues raised. To seek review, the candidate shall submit a written statement within five days after the disputed Commission request is made, describing the dispute and indicating the candidate's proposed alternatives.

History

• New Section made by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4).

Ariz. Admin. Code § R2-20-404 Preliminary Audit Report

A. After the completion of fieldwork, the auditors may prepare a written preliminary audit report, which will be provided to the candidate after it is reviewed by the Executive Director. The preliminary audit report may include:

1. An evaluation of procedures and systems employed by the candidate to comply with applicable provisions of the Act and Commission rules,

2. The accuracy of statements and campaign finance reports filed with the Secretary of State by the candidate, and

3. Preliminary findings.

B. The candidate may submit in writing within 10 days after receipt of the preliminary audit report, legal and factual materials disputing or commenting on the proposed findings contained in the preliminary audit report. In addition, the candidate shall submit any additional documentation requested by the Commission.

C. If the preliminary audit report cannot be completed, the Commission shall notify the candidate in writing that the audit report will not be completed.

History

• New Section made by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4). Amended by exempt rulemaking at 16 A.A.R. 1200, effective February 28, 2008 (Supp. 10-2).

Ariz. Admin. Code § R2-20-405 Final Audit Report

A. Before voting on whether to approve and issue a final audit report, the Commission will consider any written legal and factual materials timely submitted by the candidate in accordance with R2-20-404 . The Commission-approved final audit report may address issues other than those contained in the preliminary audit report.

B. The final audit report may identify issues that warrant referral for possible enforcement proceedings.

C. Addenda to the final audit report may be approved and issued by the Commission from time to time as circumstances warrant and as additional information becomes available. Such addenda may be based on follow-up fieldwork conducted, or information ascertained by the Commission in the normal course of carrying out its responsibilities. The procedures set forth in R2-20-404 and subsections (A) and (B) will be followed in preparing such addenda.

History

• New Section made by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4).

Ariz. Admin. Code § R2-20-406 Release of Audit Report

A. The Commission will consider the final audit report specified in R2-20-405 in an open meeting. The Commission will provide the candidate with copies of the final audit report to be considered in an open meeting 24 hours prior to the public meeting.

B. Following Commission approval of the final audit report, the report will be forwarded to the candidate within five days after the public meeting.

History

• New Section made by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4).

Article 5 RULEMAKING

Ariz. Admin. Code § R2-20-501 Purpose and Scope

This Article prescribes the procedures for the submission, consideration, and disposition of rulemaking petitions filed with the Commission, establishes the conditions under which the Commission may identify and respond to petitions for rulemaking, and informs the public of the procedures the agency follows in response to such petitions.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1).

Ariz. Admin. Code § R2-20-502 Procedural Requirements

A. Any interested person may file with the Commission a written petition for the issuance, amendment, or repeal of an administrative rule implementing any of the Citizens Clean Elections Act.

B. The petition shall:

1. Include the name and address of the petitioner or agent. An authorized agent of the petitioner may submit the petition, but the agent shall disclose the identity of his or her principal;

2. Identify itself as a petition for the issuance, amendment, or repeal of a rule;

3. Identify the specific Section of the regulations to be affected;

4. Set forth the factual and legal grounds on which the petitioner relies, in support of the proposed action; and

5. Be addressed and submitted to the Commission.

C. The petition may include draft regulatory language that would effectuate the petitioner's proposal.

D. The Commission may, in its discretion, treat a document that fails to conform to the format requirements of subsection (B) of this Section as a basis for rulemaking addressing issues raised in a petition.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1).

Ariz. Admin. Code § R2-20-503 Processing of Petitions

A. Within 10 days of receiving a petition, the Commission shall send a letter to the petitioner acknowledging the receipt of the petition and informing the petitioner that the Commission will review and decide whether to deny or accept the petition. To assist in determining whether a rulemaking proceeding should be initiated, the Commission may publish a Notice of Availability on the Commission web site or otherwise post notice, stating that the petition is available for public inspection in the Commission's Office and that statements in support of or in opposition to the petition may be filed within a stated period after publication of the Notice of Availability.

B. If the Commission decides a public hearing on the petition would help determine whether to commence a rulemaking proceeding, it will publish an appropriate notice of the hearing on the Commission web site or otherwise post notice, to notify interested persons and to invite their participation in the hearing.

C. The Commission will consider all comments regarding whether rulemaking proceedings should be initiated.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1).

Ariz. Admin. Code § R2-20-504 Disposition of Petitions

A. After considering the comments and any other information relevant to the subject matter of the petition, the Commission will decide whether to initiate rulemaking based on the filed petition.

B. If the Commission decides to initiate rulemaking proceedings, it shall file a Notice of Proposed Rulemaking and the pro-posed rule, in the format prescribed in A.R.S. § 41-1022, with the Secretary of State's office for publication in the Arizona Administrative Register. After the Commission approves the proposed rule, the Commission will accept public comments on the proposed rule for 60 days. After consideration of the comments received in the 60-day comment period, the Commission may adopt the rule in open meeting.

C. If the Commission decides not to initiate rulemaking, it will give notice of this action by publishing a Notice of Disposition on the Commission web site, or otherwise post notice, and by sending a letter to the petitioner. The Notice of Disposition will include a brief statement of the grounds for the Commission's decision.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1).

Ariz. Admin. Code § R2-20-505 Commission Considerations

The Commission's decision on the petition for rulemaking may include, but will not be limited to, the following considerations:

1. The Commission's statutory authority;

2. Policy considerations;

3. The desirability of proceeding on a case-by-case basis;

4. The necessity or desirability of statutory revision;

5. Available agency resources; and

6. Substantive policy statements.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1).

Ariz. Admin. Code § R2-20-506 Administrative Record

A. The Commission record for the petition process consists of the following:

1. The petition, including all attachments on which it relies, filed by the petitioner;

2. Written comments on the petition that have been circulated to and considered by the Commission, including attachments submitted as a part of the comments;

3. Agenda documents, in the form they are circulated to and considered by the Commission in the course of the petition process;

4. All notices published on the Commission web site and in the Arizona Administrative Register, including the Notice of Availability and Notice of Disposition;

5. The transcripts or audiotapes of any public hearing on the petition;

All correspondence between the Commission and the petitioner, other commentators and state agencies pertaining to Commission consideration of the petition; and

7. The Commission's decision on the petition, including all documents identified or filed by the Commission as part of the record relied on in reaching its final decision.

B. The administrative record specified in subsection (A) of this Section is the exclusive record for the Commission's decision.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1).

Article 6 EX PARTE COMMUNICATIONS

Ariz. Admin. Code § R2-20-601 Purpose and Scope

This Article prescribes procedures for handling ex parte communications made regarding Commission audits, investigations, and litigation. Rules governing such communications made in connection with Commission enforcement actions are found at R2-20-220.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1).

Ariz. Admin. Code § R2-20-602 Definitions

A. "Ex parte communication" means any written or oral communication, by any person outside the agency to any Commissioner or any employee, which imparts information or argument regarding prospective Commission action or potential action concerning:

1. Any ongoing audit;

2. Any pending investigation; or

3. Any litigation matter.

B. "Ex parte communication" does not include the following communications:

1. Public statements by any person in a public forum; or

2. Statements or inquiries by any person limited to the procedural status of an open proceeding involving a Commission audit, investigation, or litigation matter.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1).

Ariz. Admin. Code § R2-20-603 Audits, Investigations, and Litigation

A. In order to avoid the possibility of prejudice, real or apparent, in Commission decision making, no person outside the Commission shall make, or cause to be made, to any Commissioner or employee, any ex parte communication regarding any audit undertaken by the Commission or any pending or prospective Commission decision regarding any investigation or litigation, including whether to initiate, settle, appeal, or any other decision concerning an investigation or litigation matter.

B. A Commissioner or employee who receives an oral ex parte communication concerning any matters addressed in subsection (A) of this Section shall attempt to prevent the communication. If unsuccessful in preventing the communication, the Commissioner or employee shall advise the person making the communication that he or she will not consider the communication and shall, as soon after the communication as is reasonably possible, but no later than three business days after the communication, or prior to the next Commission discussion of the matter, whichever is earlier, prepare a statement setting forth the substance and circumstances of the communication, and deliver the statement to the Executive Director for placement in the applicable case file.

C. A Commissioner or employee who receives a written ex parte communication concerning any matters addressed in subsection (A) of this Section shall, as soon after the communication as is reasonably possible but no later than three business days after the communication, or prior to the next Commission discussion of the matter, whichever is earlier, deliver a copy of the communication to the Executive Director for placement in the applicable case file.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1).

Ariz. Admin. Code § R2-20-604 Sanctions

Any person who becomes aware of a possible violation of this Article shall notify the Executive Director in writing of the facts and circumstances of the alleged violation. The Executive Director shall recommend to the Commission the appropriate action to be taken. The Commission shall determine the appropriate action by at least three votes.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1).

Article 7 USE OF FUNDS AND REPAYMENT

Ariz. Admin. Code § R2-20-701 Purpose and Scope

Notwithstanding any other provision of the rules to the contrary, a participating candidate shall not make any payment to a private organization that is exempt under section 501 fa) of the internal revenue code and that is eligible to engage in activities to influence the outcome of a candidate election, nor make any payment directly or indirectly to a political party; and subject to the foregoing, may spend clean elections monies only for reasonable and necessary expenses that are directly related to the campaign of that participating candidate.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Amended by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4). Amended by final rulemaking at 26 A.A.R. 886, effective 2/27/2020. Amended by final rulemaking at 26 A.A.R. 1259, effective 6/4/2020.

Ariz. Admin. Code § R2-20-702 Use of Campaign Funds

A A participating candidate shall use funds in the candidate's current campaign account to pay for goods and services for direct campaign purposes only. Funds shall be disbursed and reported in accordance with A.R.S. § 16-948(C).

B. A participating candidate may:

1. Make a payment from the candidate's campaign bank account:

a. To a political committee or civic organization including a person with tax exempt status under section 501(a) of the internal revenue code or an unincorporated association. The payment is not a contribution if the payment is reasonable in relation to the value received.

b. For customary charges for services rendered, such as for printing and obtaining voter or telephone lists, shall be considered reasonable in relation to the value received.

c. Of not more than $200 per person to attend a political event open to the public or to party members shall be considered reasonable in relation to the value received.

2. Only make an advanced payment to a political party for services such as consulting, communications, field employees, canvassers, mailers, auto-dialers, telephone town halls, electronic communications and other advertising purchases and other campaign services if an itemized invoice identifying the value of the service is provided directly to the participating candidate at the time of the advanced payment.

a. Payment in the absence of an itemized invoice or advanced payment for such services shall be deemed a contribution to the political party.

b. Payment may be advanced for postage upon the receipt of a written estimate and so long as any balance is returned to the candidate if the advance exceeds the actual cost of the postage.

c. Payment may be advanced for advertising that customarily requires prepayment upon the receipt of a written estimate and so long as any balance is returned to the candidate if the advance exceeds the actual cost of the advertisement.

d. A political party may not mark up or add any additional charge to the value of services provided to the particular candidate. All expenditures must be for the services used by the particular participating candidate.

e. The Commission shall be included in the mail batch for all mailers and invitations. The Commission shall also be provided with documentation from the mail house, printer or other original source showing the number of mailers printed and the number of households to which a mailer was sent. Failure to provide this information within 7 days after a mailer has been mailed may be considered as evidence the mailer was not for direct campaign purposes.

C. B A participating candidate shall not use funds in the candidate's campaign account for:

1 Costs of legal defense in any campaign law enforcement proceeding or for any affirmative claim or litigation in court or before the Commission regarding a campaign. This prohibition does not bar use of campaign funds for payments to attorneys or certified accountants for proactive compliance advice and assistance.

2 Food and beverages for staff and volunteers exceeding $11 for breakfast, $16 for lunch, and $27 for dinner, per person.

3 Personal use, which includes, but is not limited to, any item listed below:

a Household food items or supplies.

b Clothing, other than items of de minimis value that are used in the campaign, such as campaign "t-shirts" or caps with campaign slogans.

c Tuition payments, other than those associated with training campaign staff.

d Mortgage, loan, rent, lease or utility payments:

i For any part of any personal residence of the candidate or a member of the candidate's family; or

ii For real or personal property that is owned or leased by the candidate or a member of the candidate's family and used for campaign purposes, to the extent the payments exceed the fair market value of the property usage.

e Admission to a sporting event, concert, theater or other form of entertainment, unless part of a specific campaign activity.

f Dues, fees or gratuities at a country club, health club, recreational facility or other nonpolitical organization, unless they are part of the costs of a specific fund raising event that takes place on the organization's premises.

g Gifts or donations.

h Extended warranties or other similar purchase options that extend beyond the campaign.

4 Payment to a candidate or a candidate's family member, as defined in R2-20-101(13), or an enterprise owned in whole or part by a candidate or family member, for the provisions of goods or services to the extent the payments exceed the fair market value of the goods or services. All payments made to family members or to enterprises owned in whole or part by the candidate or a family member shall be clearly itemized and indicated as such in all campaign finance reports.

D. C. Participating candidates may purchase fixed assets with a value not to exceed $800. Fixed assets, including accessories, purchased with campaign funds that can be used for non-campaign purposes with a value of $200 or more shall be turned into the Commission no later than 14 days after the primary election or the general election if the candidate was successful in the primary. For purposes of determining whether a fixed asset is valued at $200 or more, the value shall include any accessories purchased for use with the fixed asset in question. A candidate may elect to keep an item by reimbursing the Commission for 80 percent of the original purchase price including the cost of accessories.

E. D During the primary election period, a participating candidate shall not make any expenditure greater than the difference between:

1 The sum of early contributions received plus public funds disbursed through the primary election period; less

2 All other expenditures made during and for the exploratory, qualifying and primary election periods.

F. E During the general election period, a participating candidate shall not make any expenditure greater than the difference between:

1 The amount of public funds disbursed during and for the general election period; less

2 All other expenditures made during and for the general election period.

G.F Transportation expenses.

1. Except as otherwise provided in this subsection (D), the costs of transportation relating to the election of a participating statewide or legislative office candidate shall not be considered a direct campaign expense and shall not be reported by the candidate as expenditures or as in-kind contributions.

2. If a participating candidate travels for campaign purposes in a privately owned automobile, the candidate may:

a. Use campaign funds to reimburse the owner of the automobile at a rate not to exceed the state mileage reimbursement rate in which event the reimbursement shall be considered a direct campaign expense and shall be reported as an expenditure and reported in the reporting period in which the expenditure was incurred. If a candidate chooses to use campaign funds to reimburse, the candidate shall keep an itinerary of the trip, including name and type of events(s) attended, miles traveled and the rate at which the reimbursement was made. This subsection applies to candidate owned automobiles in addition to any other automobile.

b. Use campaign funds to pay for direct fuel purchases for the candidate's automobile only and shall be reported. If a candidate chooses to use campaign funds for direct fuel purchases, the candidate shall keep an itinerary of the trip, including name and type of events(s) attended, miles traveled and the rate at which the reimbursement could have been made.

3. Use of airplanes.

a. If a participating candidate travels for campaign purposes in a privately owned airplane, within 7 days from the date of travel, the candidate shall use campaign funds to reimburse the owner of the airplane at a rate of $150 per hour of flying time, in which event the reimbursement shall be considered a direct campaign expense and shall be reported as an expenditure. If the owner of the airplane is unwilling or unable to accept reimbursement, the participating candidate shall remit to the fund an amount equal to $150 per hour of flying time.

b. If a participating candidate travels for campaign purposes in a state-owned airplane, within 7 days from the date of travel, the candidate shall use campaign funds to reimburse the state for the portion allocable to the campaign in accordance with subsection 3a, above. The portion of the trip attributable to state business shall not be reimbursed. If payment to the State is not possible, the payment shall be remitted to the Clean Elections Fund.

4. If a participating candidate rents a vehicle or purchases a ticket or fare on a commercial carrier for campaign purposes, the actual costs of such rental (including fuel costs), ticket or fare shall be considered a direct campaign expense and shall be reported as an expenditure.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Section repealed; new Section made by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4). Amended by exempt rulemaking at 13 A.A.R. 3606, effective January 1, 2008 (Supp. 07-4). Amended by exempt rulemaking at 15 A.A.R. 1423, effective October 22, 2009 (Supp. 09-3). Amended by exempt rulemaking at 17 A.A.R. 1267, effective April 12, 2011 (Supp. 11-2). Since language in subsections R2-20-702(C)(3)(d)(i) and (ii) and R2-20-702(C)(4) and (5) are substantively identical, the Commission requested to remove the redundant language in R2-20-702(C)(3)(d)(i) and (ii) under A.R.S. § 41-1011(C), Office File No. M11-345, filed October 3, 2011 (Supp. 11-2). Amended by exempt rulemaking at 19 A.A.R. 1702, effective October 6, 2011 (Supp. 13-2). Amended by exempt rulemaking at 19 A.A.R. 1702, October 6, 2011 amendment and recodification of R2-20-702(C)(6), effective May 23, 2013. Amended by exempt rulemaking at 22 A.A.R. 2906, effective 1/1/2017. Amended by final exempt rulemaking at 23 A.A.R. 2342, effective 1/1/2018. Amended by final rulemaking at 25 A.A.R. 2118, effective 7/29/2019. Amended by final rulemaking at 26 A.A.R. 1132, effective 5/11/2020.

Ariz. Admin. Code § R2-20-702.01 Use of Assets

A participating candidate may us e assets such as signs, pamphlets, and office equipment from a prior election cycle only after the candidate's current campaign pays for the assets in an amount equal to the fair market value of the assets, which amount shall in no event be less than one-fifth (1/5) the original purchase price of such assets . If the candidate was a participating candidate during the prior election cycle, the cash payment shall be made to the Fund. If the candidate was not a participating candidate during the prior election cycle, the cash payment shall be made to the prior campaign. If the prior campaign account of a nonparticipating candidate is closed, the payment shall be made to the candidate. Notwithstanding any other provision of the rules to the contrary, a participating candidate shall not make any payment to a private organization that is exempt under section 501(a) of the internal revenue code a nd that is eligible to engage in activities to influence the outcome of a candidate election, nor make any payment directly or indirectly to a political party.

History

• New Section made by exempt rulemaking at 12 A.A.R. 758, effective February 15, 2006 (Supp. 06-1). Amended by exempt rulemaking at 13 A.A.R. 3606, effective January 1, 2008 (Supp. 07-4). Amended by exempt rulemaking at 15 A.A.R. 1156, effective August 31, 2009 (Supp. 09-2). Amended by final rulemaking at 26 A.A.R. 887, effective 3/9/2020. Amended by final rulemaking at 26 A.A.R. 1261, effective 6/4/2020.

Ariz. Admin. Code § R2-20-703 Documentation for Direct Campaign Expenditures

A. In addition to the general books and records requirements prescribed in A.A.C. R2-20-111, participating candidates shall comply with the following requirements:

1. All participating candidates shall have the burden of proving that expenditures made by the candidate were for direct campaign purposes. The candidate shall obtain and furnish to the Commission on request any evidence regarding direct campaign expenses made by the candidate as provided in subsection 2 of this rule.

2. All participating candidates shall retain records with respect to each expenditure and receipt, including bank records, vouchers, worksheets, receipts, bills and accounts, journals, ledgers, fundraising solicitation material, accounting systems documentation, and any related materials documenting campaign receipts and disbursements, for a period of three years, and shall present these records to the Commission on request.

3. All participating candidates shall maintain a list of all fixed assets whose purchase price exceeded $ 200 when acquired by the campaign. The list shall include a brief description of each fixed asset, the purchase price, the date it was acquired, the method of disposition and the amount received in disposition.

B. Upon written request from a candidate, the Commission shall determine whether a planned campaign expenditure or fund-raising activity is permissible under the Act. To make a request, a candidate shall submit a written description of the planned expenditure or activity to the Commission. The Commission shall inform the candidate whether an enforcement action will be necessary if the candidate carries out the planned expenditure or activity. The Commission shall ensure that the candidate can rely on a "no action" letter. A "no action" letter applies only to the candidate who requested it.

C. Any expenditure made by the candidate or the candidate's committee that cannot be documented as a direct expenditure shall promptly be repaid to the Fund with the candidate's personal monies.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Section repealed; new Section made by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4). Amended by exempt rulemaking at 12 A.A.R. 758, effective February 15, 2006 (Supp. 06-1). Amended by exempt rulemaking at 21 A.A.R. 1641, effective 7/23/2015. Amended by final rulemaking at 23 A.A.R. 133, effective 1/1/2017.

Ariz. Admin. Code § R2-20-703.01 Campaign Consultants

A. For purposes of this rule "Campaign Consultant" means any person paid by a participating candidate's campaign or who provides services that are ordinarily charged to a person, except services provided for in A.R.S. § 16-911(6)(b).

B. A participating candidate may engage campaign consultants.

C. A participating candidate may only advance a campaign consultant for services such as consulting, communications, field employees, canvassers, mailers, auto-dialers, telephone town halls, electronic communications and other advertising purchases and other campaign service if an itemized invoice identifying the value of the services is provided directly to that particular candidate at the time of the advance payment.

1. Providing payment for such services as described in subsection (C) of this rule in the absence of an itemized invoice or advance payment for such services shall be deemed not to be a direct campaign expenditure.

2. A participating candidate may advance payment for postage upon the receipt of a written estimate and so long as any balance is returned to the candidate if the advance exceeds the actual cost of postage.

3. A participating candidate may advance payment for advertising that customarily requires pre-payment upon the receipt of a written estimate and so long as any balance is returned to the candidate if the advance exceeds the actual cost of the advertisement.

D. The Commission shall be included in the mail batch for all mailers and invitations. The Commission shall also be provided with documentation from the mail house, printer or other original source, showing the number of mailers printed and the number of households to which a mailer was sent. Failure to provide this information within 7 days after the mailer has been mailed may be considered as evidence the mailer was not for direct campaign purposes.

E. Notwithstanding any other provision of the rules to the contrary, a participating candidate shall not make any payment to a private organization that is exempt under section 501(a) of the internal revenue code and that is eligible to engage in activities to influence the outcome of a candidate election, nor make any payment directly or indirectly to a political party.

History

• Adopted by final exempt rulemaking at 23 A.A.R. 2344, effective 7/20/2017. Amended by final rulemaking at 26 A.A.R. 889, effective 3/16/2020. Amended by final rulemaking at 26 A.A.R. 1263, effective 6/4/2020.

Ariz. Admin. Code § R2-20-704 Repayment

A. In general, the Commission may determine that a participating candidate who has received payments from the Fund must repay the Fund as determined by the Commission.

1. A candidate who has received payments from the Fund shall pay the Fund any amounts that the Commission determines to be repayable. In making repayment determinations, the Commission may utilize information obtained from audits and examinations or otherwise obtained by the Commission in carrying out its responsibilities.

2. The Commission will notify the candidate of any repayment determinations made under this section as soon as possible, but not later than one year after the day of the election.

3. Once the candidate receives notice of the Commission's repayment determination, the candidate should give preference to the repayment over all other outstanding obligations of the candidate, except for any taxes owed by the candidate.

4. Repayments may be made only from the following sources: personal funds of the candidate, funds in the candidate's current election campaign account, and any additional funds raised subject to the limitations and prohibitions of the Act.

5. The Commission may withhold the portion of funds required to be repaid from future payments to a participating candidate if the Commission has made a repayment determination.

B. The Commission may determine that a participating candidate who has received payments from the Fund must repay the Fund under any of the following circumstances:

1. Payments in excess of candidate's entitlement. If the Commission determines that any portion of the payments made to the candidate was in excess of the aggregate payments to which such candidate was entitled, it will so notify the candidate, and such candidate shall pay to the Fund an amount equal to such portion.

2. Use of funds not for direct campaign expenses. If the Commission determines that any amount of any payment to an eligible candidate from the Fund was used for purposes other than direct campaign purposes described in R2-20-702, it will notify the candidate of the amount so used, and such candidate shall pay to the Fund an amount equal to such amount.

3. Expenditures that were not documented in accordance with campaign finance reporting requirements, expended in violation of state or federal law, or used to defray expenses resulting from a violation of state or federal law, such as the payment of fines or penalties.

4. Surplus. If the Commission determines that a portion of payments from the Fund remains unspent after all direct campaign expenses have been paid, it shall so notify the candidate, and such candidate shall pay the Fund that portion of surplus funds.

5. Income on investment or other use of payments from the Fund. If the Commission determines that a candidate received any income as a result of an investment or other use of payments from the Fund, it shall so notify the candidate, and such candidate shall pay to the Fund an amount equal to the amount determined to be income, less any federal, state or local taxes on such income.

Unlawful acceptance of contributions by an eligible candidate. If the Commission determines that a participating candidate accepted contributions, other than early contributions or qualifying contributions, it shall notify the candidate of the amount of contributions so accepted, and the candidate shall pay to the Fund an amount equal to such amount, plus any civil penalties assessed.

C. Repayment determination procedures. The Commission's repayment determination will be made in accordance with the following procedures:

1. Repayment determination. The Commission will send a repayment determination pursuant to Article 2, Compliance and Enforcement Procedures, and will set forth the legal and factual reasons for such determination, as well as the evidence upon which any such determination is based. The candidate shall repay, in accordance with subsection (D), the amount that the Commission has determined to be repayable.

2. Administrative review of repayment determination. If a candidate disputes the Commission's repayment determination, he or she may request an administrative appeal of the determination in accordance with A.R.S. § 41-1092 et. seq.

D. Repayment period.

1. Within 30 days of service of the notice of the Commission's repayment determination, the candidate shall repay the amounts the Commission has determined must be repaid. Upon application by the candidate, the Commission may grant an extension of time in which to make repayment.

2. If the candidate requests an administrative appeal of the Commission's repayment determination of this Section, the time for repayment will be suspended until the Commission has concluded its review of the Administrative Law Judge's (ALJ) decision. Within 30 days after service of the notice of the Commission's review of the ALJ's decision, the candidate shall repay the amounts that the Commission has determined to be repayable. Upon application by the candidate, the Commission may grant an extension of up to 30 days in which to make repayment.

3. Interest shall be assessed on all repayments made after the initial 30-day repayment period or the 30-day repayment period established by this Section. The amount of interest due shall be the greater of:

a. An amount calculated in accordance with A.R.S. § 44-1201(A); or

b. The amount actually earned on the funds set aside or to be repaid under this Section.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Section repealed; new Section made by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4). Amended by exempt rulemaking at 21 A.A.R. 1643, effective 7/23/2015. Amended by final rulemaking at 25 A.A.R. 2122, effective 7/29/2019. Amended by final rulemaking at 26 A.A.R. 337, effective 2/4/2020.

Ariz. Admin. Code § R2-20-705 Additional Audits or Repayment Determinations

A. The Commission may conduct an additional audit or examination of any candidate in any case in which the Commission finds reason to believe that a violation of a statute or regulation over which the Commission has jurisdiction has occurred or is about to occur.

B. The Commission may make additional repayment determinations after it has made an initial repayment determination pursuant to R2-20-704 . The Commission may make additional repayment determinations where there exist facts not used as the basis for any previous determination. Any such additional repayment determination will be made in accordance with the provisions of this Article.

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Section repealed; new Section made by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4).

Ariz. Admin. Code § R2-20-706 Repealed

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Section repealed by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4).

Ariz. Admin. Code § R2-20-707 Repealed

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Section repealed by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4).

Ariz. Admin. Code § R2-20-708 Repealed

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Section repealed by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4).

Ariz. Admin. Code § R2-20-709 Repealed

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Section repealed by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4).

Ariz. Admin. Code § R2-20-710 Repealed

History

• New Section made by exempt rulemaking at 8 A.A.R. 588, effective November 27, 2001 (Supp. 02-1). Section repealed by exempt rulemaking at 11 A.A.R. 4518, effective May 28, 2005 (Supp. 05-4).

Article 8 VOTER'S RIGHT TO KNOW ACT RULES

Ariz. Admin. Code § R2-20-801 Definitions and Rules of Construction

A. The definitions in A.R.S. § 16-971 shall apply to these rules.

B. For purposes A.R.S. § 16-971(2)(a)(vii), research, design, production, polling, data analytics, mailing or social media list acquisition or any other activity conducted in preparation for or in conjunction with any of the other activities described in A.R.S. § 16-971(2)(a) shall not be considered campaign media spending unless these activities are specifically conducted in preparation for or in conjunction with those other activities.

C. In response to a request pursuant to A.R.S. § 16-972(D), a person must inform that covered person in writing, of the identity of each other person that directly or indirectly contributed more than $2,500 in original monies being transferred and the amount of each other person's original monies being transferred up to the amount of money being transferred to the requesting person.

History

• New Section made by final exempt rulemaking at 29 A.A.R. 3523, effective 8/24/2023.

Ariz. Admin. Code § R2-20-802 Time

The following rules apply in computing any time period specified in these rules:

1. The day of the event or act shall be excluded.

2. If the deadline is five days or fewer, then Saturdays, Sundays, and legal holidays shall be excluded.

3. If the last day of the period is a Saturday, Sunday, or legal holiday, the last day is excluded, and the period runs until the next day that is not a Saturday, Sunday, or legal holiday.

4. The next day is determined by continuing to count forward when the period is measured after an event and backward when measured before an event.

History

• New Section made by final exempt rulemaking at 29 A.A.R. 3523, effective 8/24/2023.

Ariz. Admin. Code § R2-20-803 Opt-out Notices

A. Before a covered person may use or transfer a donor's monies for campaign media spending, the donor must be notified in writing that the monies may be so used. The covered person must give the donor an opportunity to opt out of having the donation used or transferred for campaign media spending.

B. The notice must:

1. Inform donors that their monies may be used for campaign media spending and that information about donors may have to be reported to the appropriate government authority in this state for disclosure to the public.

2. Inform donors that they can opt out of having their monies used or transferred for campaign media spending by notifying the covered person in writing within twenty-one days after receiving the notice that the donor prefers to opt-out of having their monies used or transferred for campaign media spending and that a receipt confirming their choice shall be provided upon request.

3. Opt-out information shall be provided in writing. If provided with other written information the opt-out information must be provided in a format at least the same size type as any other information provided in writing along with the notice. The information must be either the first sentence in a paragraph or itself constitute a paragraph. If the opt-out information is provided without additional writing it must be clearly readable. To be valid, the opt-out information must provide contact information to allow the recipient to contact the person who provided the opt-out information within 21 days. Upon request of the donor, the person responsible for providing the opt-out information must provide a receipt to the donor confirming the donor's choice. If the covered person regularly provides receipts for donations the receipt shall confirm the donor's choice. Nothing in this rule precludes providing a donor a receipt without waiting for a request.

C. Any person responsible for providing the opt-out information must keep a record of when the information was provided and maintain all related records including the written notice for five years.

D. If a donor does not opt out after the initial notice period, a covered person may make subsequent written notices to a donor of their right to opt out and may set a time for response of no less than 1 day from the date the donor receives the notice. To be valid, the optout information must provide contact information to allow the recipient to contact the person who provided the opt-out information within the time identified in the subsequent request. Upon request by the donor, the person responsible for providing the opt-out information must provide a receipt to the donor confirming the donor's choice. If the covered person regularly provides receipts for donations the receipt shall confirm the donor's choice.

E. A donor may request to opt out at any time after the initial notice period and the covered person must confirm the opt out to the donor in writing no later than 5 days after the request and subsequently that donor shall be treated as having opted out by the covered person. Upon request of the donor, the person responsible for providing the opt-out information must provide a receipt to the donor confirming the donor's choice. If the covered person regularly provides receipts for donations the receipt shall confirm the donor's choice.

History

• New Section made by final exempt rulemaking at 29 A.A.R. 3523, effective 8/24/2023.

Ariz. Admin. Code § R2-20-804 Request for Exemptions

A. An original source who has reason to believe their identity will or could be subject to disclosure under Chapter 6.1 of Title 16 may file a request for exemption pursuant to A.R.S. § 16-973(F) at any time. An original source who has not opted out of having their monies used for campaign media spending may file a request for an exemption with the Executive Director no later than 14 days after the notice to opt out is given. In the event an original source did not receive a notice to opt out, the person may file a request for exemption with the Executive Director no later than 21 days after discovering their monies may be or have been used for campaign media spending.

B. In the event the request provides documentation of a court order requiring confidentiality, the Executive Director shall confirm the validity of the court order in five days. If the order is confirmed, the Executive Director shall issue a letter to the requestor stating that their identity shall not be disclosed. In the event that the order is not confirmed, the Executive Director shall issue a letter to the requestor stating their identity may be disclosed.

C. In the event that the person making the request claims a statute provides for such confidentiality, the request shall include a citation to the statute and argument why the statute applies to require confidentiality. The Executive Director may make a recommendation to the Commission. The Executive Director shall place the item on an agenda no later than the next regular Commission meeting. The person and their counsel may appear. In order to protect the interests of the original source pending a determination, the Commission may vote to go into executive session to protect confidential information and if warranted for other reasons authorized by the Open Meeting Law. For purposes of this rule, the person and their counsel shall be deemed individuals whose presence is reasonably necessary in order for the public body to carry out its executive session responsibilities if the Commission votes to go into executive session pursuant to A.R.S. § 38-431.03(A)(2). No vote may be taken in the executive session. If the Commission decides that the statute applies by a roll call vote in public session in favor of the request, the Executive Director shall issue a letter to the requestor within five days stating that their identity shall not be disclosed. If the Commission does not vote that the statute applies by roll call vote in favor of the request, the Executive Director shall issue a letter to the requestor within five days stating that their identity may be disclosed.

D. In the event the person making the request claims that there is a reasonable probability that they or their family will experience threats of physical harm, the request shall provide such evidence. The request may also include argument in favor of the request.

The Executive Director may make a recommendation to the Commission. The Executive Director shall place the item on an agenda no later than the next regular commission meeting. The person and their legal representative may appear. In order to protect the interests of the original source pending a determination, the Commission may vote to go into executive session to protect confidential information and if warranted for other reasons authorized by the Open Meeting Law. For purposes of this rule, the person and their counsel shall be deemed individuals whose presence is reasonably necessary in order for the public body to carry out its executive session responsibilities if the Commission votes to go into executive session pursuant to A.R.S. § 38-431.03(A)(2). No vote may be taken in the executive session. If the Commission decides that the request should be granted by a roll call in public session in favor of the request, the Executive Director shall issue a letter to the requestor within 5 days stating that their identity shall not be disclosed. If the Commission does not approve the request by a roll call vote the Executive Director shall issue a letter to the requestor within five days stating that their identity may be disclosed.

E. The agenda shall not identify the requestor.

F. No records related to a request shall be subject to a public records request or any other type of request. The records shall not be produced absent a court order compelling disclosure.

G. All records except the Executive Director's letter shall be destroyed within 30 days after the determination, unless timely review of the Commission's action is sought. The Executive Director's letter shall not be made public except by a court order.

History

• New Section made by final exempt rulemaking at 29 A.A.R. 3523, effective 8/24/2023.

Ariz. Admin. Code § R2-20-805 Disclaimers

A. A covered person shall include the words "paid for by" on every public communication followed by the full legal name of the covered person making the public communication. The public communication shall also state whether it is:

1. Authorized by any candidate or their agents and any candidate's name who individually or through their agents participated in the authorization; or

2. That the public communication is not authorized by any candidate or their agents acting on the candidate's behalf.

B. Public communications by covered persons shall state the names of the top three donors who directly or indirectly made the three largest contributions of original monies in excess of $5,000 for the election cycle and who have not opted out pursuant to A.R.S. § 16972 or a rule of the Commission during the election cycle to the covered person as calculated by the covered person at the time the advertisement was distributed for publication, display, delivery, or broadcast. In the event a donor otherwise subject to disclosure pursuant to this section is protected under A.R.S. § 16-973(F) the disclaimer shall omit that donor's identity.

C. If it is not technologically possible for a public communication disseminated on the internet or by social media message, text message or short message service to provide all the information required by this section, the public communication must provide a means for viewers to obtain, immediately and easily, the required information without having to receive extraneous information. The public communication must always state the full legal name of the covered person.

D. If the public communication is:

1. Broadcast on radio, the disclosure shall be clearly spoken at the beginning or end of the advertisement.

2. Delivered by hand or by mail, the disclosure shall be clearly readable.

3. Delivered electronically, the disclosure shall be clearly readable.

Displayed on a sign or billboard, the disclosure shall be displayed at a height that is at least four percent of the vertical height of the sign or billboard.

5. Broadcast on television, in a video or film, both of the following requirements apply:

a. The disclosure shall be both written and spoken at the beginning or end of the advertisement, except that if the written disclosure statement is displayed for the greater of at least one-sixth of the broadcast duration or four seconds, a spoken disclosure statement is not required.

b. The written disclosure statement shall be printed in letters that are displayed in a height that is at least four percent of the vertical picture height, except that if the advertisement is paid for by a political action committee, the written disclosure statement shall be displayed in a height that is at least ten percent of the vertical picture height.

c. These disclosure requirements apply to any broadcast, video, or film format, whether distributed via airwaves, cable, the internet, or other delivery methods.

History

• New Section made by final exempt rulemaking at 29 A.A.R. 3523, effective 9/21/2023.

Ariz. Admin. Code § R2-20-806 Ex Parte Communications

A. No individual shall communicate with any Commissioner ex parte as defined in subsections E and F of this rule. No Commissioner shall communicate with any individual ex parte as defined in subsections E and F of this rule.

B. In the event of a Complaint, no Commissioner shall communicate with the Executive Director or any other commission staff or attorney who represents the Executive Director regarding the Complaint except in commission proceedings where the Respondent or Respondent's Counsel is present.

C. The Executive Director may communicate with a Respondent, a Respondent's counsel, a Complainant or Complainant's Counsel or any other person with information regarding a Complaint.

D. If a Respondent wishes to be represented by counsel with regard to any matter pending before the Commission, Respondent or Respondent's Counsel shall so advise the Commission by sending a writing to the Commission including the following:

1. The name, address, and telephone number of the counsel.

2. A statement authorizing such counsel to receive any and all notifications, service of process, and other communications from the Commission, its staff and attorneys on behalf of Respondent. Upon receipt, the Commission shall have no contact with Respondent except through the designated counsel unless authorized by Respondent.

E. Ex parte communication means any written or oral communication by any person outside the agency to any Commissioner or any member of a Commissioner's staff which imparts information or argument regarding prospective Commission action or potential action concerning:

1. Any proceeding involving a request for an exemption.

2. Any enforcement proceeding.

3. Any pending litigation matter, or

4. Any pending rulemaking, or

5. Any pending advisory opinion request.

F. Ex parte communications do not include the following communications:

1. Statements by any person publicly made in a public forum; or

2. Statements or inquiries by any person limited to the procedural status of an open proceeding, rulemaking, advisory opinion request, or a litigation matter.

G. In the event that a Commissioner receives an ex parte communication as defined in this rule, the Commissioner shall disclose receipt of such a communication in a public meeting of the Commission.

History

• New Section made by final exempt rulemaking at 29 A.A.R. 3523, effective 8/24/2023.

Ariz. Admin. Code § R2-20-807 Recordkeeping

A. All records required to be retained by Chapter 6.1 of Title 16 shall be kept in such order that a reasonable person could confirm the accuracy of transactions, transfer records, reports, opt out notices, and other information by review of the documents and other information.

B. Records may be kept in any media a person subject to Chapter 6.1 of Title 16 chooses, provided that the media is commonly available and not proprietary.

C. Failure to maintain records in a reasonable manner may give rise to factual presumption against the person in an enforcement proceeding or other action under Chapter 6.1 of Title 16.

History

• New Section made by final exempt rulemaking at 29 A.A.R. 3523, effective 8/24/2023.

Ariz. Admin. Code § R2-20-808 Advisory Opinions

A. Requests for advisory opinions.

1. Any person may request in writing an advisory opinion concerning the Chapter 6.1, of Title 16 or any regulation prescribed by the Commission pursuant to that chapter. An authorized agent of the requesting person may submit the advisory opinion request, but the agent shall disclose the identity of his or her principal.

2. The written advisory opinion request shall set forth a specific transaction or activity that the requesting person plans to undertake or is presently undertaking and intends to undertake in the future. Requests presenting a general question of interpretation, or posing a hypothetical situation, or regarding the activities of third parties, do not qualify as advisory opinion requests.

3. Advisory opinion requests shall include a complete description of all facts relevant to the specific transaction or activity with respect to which the request is made.

4. The Executive Director shall review all requests for advisory opinions submitted. If the Executive Director determines that a request for an advisory opinion is incomplete or otherwise not qualified, they shall, within 10 days of receipt of such request, notify the requesting person and specify the deficiencies in the request.

5. Advisory opinion requests must be sent to the Clean Elections Commission by email or as directed by the Commission staff. Procedures for advisory opinion requests shall be available on the Commission website.

B. Availability and Comments on Requests.

1. Advisory opinion requests which qualify under this section shall be made public at the Commission promptly upon their receipt.

2. A copy of the original request and any supplements thereto, shall be available for public inspection and may be obtained via a written request to the Executive Director.

3. Any interested person may submit written comments concerning advisory opinion requests made public at the Commission.

4. The written comments shall be submitted within 10 days following the date the request is made public at the Commission. Additional time for submission of written comments may be granted upon written request for an extension by the person who wishes to submit comments or may be granted by the Executive Director without an extension request. Comments on Advisory opinion requests must be sent to the Clean Elections Commission by email or as directed by the Commission staff.

C. Issuance and Reliance on Advisory Opinions

1. Within 60 calendar days after receiving a qualifying advisory opinion request, the Commission shall issue to the requesting person a written advisory opinion or shall issue a written response stating that the Commission was unable to approve an advisory opinion by the required affirmative vote of a majority of members present at a meeting of the Commission.

2. The 60 calendar day period is reduced to 20 calendar days for a qualified advisory opinion request provided the request:

a. Is submitted by a person within the 60 calendar days preceding the date of any election to which Chapter 6.1 of Title 16 applies;

b. Identifies the election by date and jurisdiction;

c. Presents a specific transaction or activity related to the election that may invoke the 20 day period if the connection is explained in the request.

3. An advisory opinion rendered by the Commission may be relied upon by any person involved in the specific transaction or activity with respect to which such advisory opinion is rendered, and any person involved in any specific transaction or activity which is indistinguishable in all its material aspects from the transaction or activity with respect to which such advisory opinion is rendered.

4. Any person who relies upon an advisory opinion and who acts in good faith in accordance with that advisory opinion shall not, as a result of any such act, be subject to any sanction provided in Chapter 6.1 of Title 16.

D. A request for reconsideration may be made by:

1. The person who made the request within 15 days of the opinion's approval but no later than 5 days before the Commission's next regular meeting; or

2. Any person who states a good faith basis for vacating or reversing a prior opinion subject to other rules in this section.

E. Any request for reconsideration shall meet all of the requirements otherwise required of an initial request.

History

• New Section made by final exempt rulemaking at 29 A.A.R. 3523, effective 8/24/2023.

Ariz. Admin. Code § R2-20-809 Complaint Procedures

A. Any qualified voter in this state may submit a complaint to the Executive Director if the person believes a violation of Arizona Revised Statutes Title 16, Chapter 6.1 or these rules has occurred. The complaint must be made in writing. Email submissions are acceptable.

B. Regardless of whether a complainant is represented by counsel, a complaint must contain the full name, email address, and mailing address of the complainant.

C. A complaint must:

1. Clearly recite the facts that describe a violation of Arizona Revised Statutes Title 16, Chapter 6.1 or these rules as specifically as possible. Citations to law are not required.

2. Clearly identify any person, including any individual, entity, committee, organization or group, that is alleged to have committed a violation.

3. Include any supporting documentation which the Complainant believes establishes the alleged violation, if available.

Differentiate between statements based on a complainant's personal knowledge and those based on information and belief. Statements not based on personal knowledge should identify the source of the information, and include supporting documentation if available. Contents of the complaint shall be sworn to and signed in the presence of a notary public and shall be notarized.

D. The Executive Director shall review the complaint within 5 days to determine if the Commission has jurisdiction to hear and rule on the complaint, and to ensure the complaint meets the criteria identified in subsection (C).

E. If the complaint does not meet the criteria, Commission staff shall notify the complainant of the deficiencies in the complaint and that no action shall be taken on the complaint unless those deficiencies are remedied.

F. If the complaint is deemed sufficient, Commission staff shall:

1. Assign the complaint a complaint number.

2. Confirm in a writing to the complainant and respondent that the complaint has been received.

3. Inform the complainant that the respondent shall be provided an opportunity to submit a response.

G. A complainant may withdraw the complaint by writing to the Executive Director no later than 14 days after filing the complaint or before the response, whichever is sooner.

H. The Executive Director may file a complaint if a person believes a violation of Arizona Revised Statutes Title 16, Chapter 6.1 or these rules has occurred. The complaint shall:

1. Clearly recite the facts that describe a violation of Arizona Revised Statutes Title 16, Chapter 6.1 or these rules as specifically as possible. Citations to law are not required;

2. Clearly identify any person, including any individual, entity, committee, organization or group, that is alleged to have committed a violation; and

Include any supporting documentation which the Complainant believes establishes the alleged violation, if available.

I. Any employee, agent or representative of another government agency or subdivision of Arizona, including the state, any Arizona county, or any Arizona city or town, may make a referral to the Executive Director under this subsection.

History

• New Section made by final exempt rulemaking at 29 A.A.R. 3687, effective 10/26/2023.

Ariz. Admin. Code § R2-20-810 Response Procedures

A. Within 14 days after receiving a complaint that complies with R2-20-809, a staff member shall send the respondent a copy of the complaint and a written communication describing the campaign finance processing procedures. The written communication shall:

1. Inform the respondent that the Executive Director has received allegations as to possible violations of campaign finance laws by the respondent.

2. Provide a copy of the complaint.

3. Gives the respondent an opportunity to respond in writing in a timely manner and setting forth a deadline of not more than 30 days after the respondent's receipt of the written communication. Extensions shall be granted on request at the discretion of the Executive Director.

B. The notification letter reflects no judgment about the accuracy of the allegations.

C. The response is the respondent's opportunity to demonstrate to the Executive Director why they should not pursue an enforcement action, or to clarify, correct, or supplement the information in the complaint or referral. Respondents are not required to respond to the allegations.

D. Respondents, if they choose, may be represented by counsel. Once the Executive Director receives a notification that the respondent is represented by counsel, the Commission staff shall communicate only with the counsel unless otherwise authorized by the respondent or the respondent's counsel.

E. The respondent's response shall be sworn to and signed in the presence of a notary public and shall be notarized. The respondent's failure to respond within the time specified in subsection A may be viewed as an admission to the allegations made in the complaint.

F. If a respondent provides a response, the response should address each and every reason why no further action should be taken, including any legal or factual basis for an assertion that the matter is not subject to the Commission's jurisdiction.

G. While not required, when possible, a response should provide documentation, including sworn affidavits or declarations under penalty of perjury from persons with first-hand knowledge of the facts.

H. The response may be submitted by email, and the respondent need not copy the complainant on the response.

I. A complainant may request a copy of the response.

J. Complainants other than the Executive Director are not parties to any enforcement matter that may arise as a result of the complaint and response.

History

• New Section made by final exempt rulemaking at 29 A.A.R. 3687, effective 10/26/2023.

Ariz. Admin. Code § R2-20-811 Investigation and Enforcement Procedures

A. Upon the expiration of the time for a response, the Executive Director or other Commission staff may conduct an investigation. The Executive Director or other Commission staff may engage attorneys pursuant to A.R.S. § 16-979(D).

B. Attorneys who do substantial work investigating the complaint or enforcing orders and other matters arising from the complaint shall not participate as attorneys for the Commission regarding the complaint. Such attorneys may represent the Executive Director or other Commission staff before the Commission.

C. The Executive Director or other Commission staff may subpoena witnesses, compel their attendance and testimony, administer oaths and affirmations, take evidence and require by subpoena the production of any books, papers, records or other items material to the performance of the commission's duties or the exercise of its powers. The Executive Director or Commission staff may utilize attorneys to effectuate any of these actions, including filing any action necessary to compel compliance. A person subject to a subpoena or other order pursuant to this subsection may appeal to the Commission by sending a written request to the Commission's attention. The Chair or a Commissioner designated by the chair may confer with an independent legal advisor and shall issue an order scheduling the appeal for a public meeting of the Commission and may set a schedule for any additional briefing.

D. Upon the completion of an investigation the Executive Director may prepare a report stating with reasonable particularity the nature of the violation, including the facts, laws, or rules substantiating the allegations in the complaint, and issue it to the respondent. The Executive Director may make a recommendation regarding the seriousness of violation, the appropriate remedy, and any other factors that the Executive Director and staff believe are relevant to the matter.

E. If the Executive Director determines that a consent agreement with the respondent is sufficient, the Executive Director and the respondent may agree to present the agreement to the Commission for acceptance. A consent agreement may include a penalty. The Commission may vote to accept, reject, or modify the proposed consent agreement at a public meeting. At this meeting, the Commission's commission attorney for independent advice shall serve as the legal advisor for the commission. That attorney must not have worked on the investigation, enforcement, or consent agreement.

F. The Executive Director may dismiss the complaint at any time. If, upon completion of an investigation, the Executive Director does not find sufficient facts to substantiate the allegations in the complaint, the Executive Director shall dismiss the complaint and issue a written report to the respondent stating that after completion of an investigation, the Executive Director did not find sufficient facts substantiating the allegations in the complaint to pursue the matter.

History

• New Section made by final exempt rulemaking at 29 A.A.R. 3687, effective 10/26/2023.

Ariz. Admin. Code § R2-20-812 Enforcement Hearing Procedures

A. Within 30 days after the issuance of the Executive Director's report and recommendations, a respondent may request a hearing before the Commission. The Commission shall be represented by counsel who have had no role in the investigation or enforcement.

B. No later than 14 days after the request, the Executive Director, other Commission staff or attorneys for the Executive Director shall meet with the respondent or their attorneys to develop a proposed hearing plan. At the conference the following matters shall be considered:

1. The possibility of a consent agreement, and possible terms;

2. Select at least three mutually-agreeable dates for the hearing to present to the Commission;

3. Discuss whether any additional written material shall be provided to the Commission. If additional written material is necessary, discuss deadlines for the parties to exchange those materials prior to the hearing;

4. Decide whether either side shall call live witnesses, disclosure of the witness' proposed testimony, and agree whether alternative procedures for providing the evidence are available and appropriate;

Determine how much time each side shall need at the hearing;

6. Any pre-hearing matters that must be decided by the Commission and a schedule for presenting such matters;

7. A schedule for any pre-hearing briefing; and

8. Each side may prepare a draft final order to be submitted to the Commission with other materials.

C. Following the Conference, the Executive Director and respondent shall provide a report to the Commission's Chair or other Commission member designated by the Chair. The Chair may consult with an independent legal advisor. The Chair or the independent legal advisor shall issue a scheduling order.

D. The complaint, the response, the report, and any additional documents shall be provided to the Commission no later than 14 days before the hearing.

E. At the conclusion of hearing of the Commission may:

1. Vote to issue a final order and assessment of penalties;

2. Vote to dismiss the matter; or

3. Vote to continue the matter to another meeting.

F. The Commission shall schedule the next hearing as soon as practicable, considering the schedules of respondent, respondent's counsel, the Executive Director, and any counsel for the Executive Director.

G. Following a vote in favor of a final order and assessment of penalties a respondent may seek timely judicial review.

H. At the expiration of the time for judicial review, the Executive Director or their representatives must seek compliance with the Commission's final order. This may include the Executive Director, Commission staff, or their attorneys seeking judicial enforcement of the order if necessary.

History

• New Section made by final exempt rulemaking at 29 A.A.R. 3687, effective 10/26/2023.

Ariz. Admin. Code § R2-20-813 Transactions and Structuring

A. A person, including an individual, may rely on records provided to the person as documentation of a transaction related to campaign media spending if the records are provided by an independent person who owns or controls the monies involved in the transaction. The person claiming reliance bears the burden of showing the reliance is reasonable by a preponderance of the evidence. The person claiming reliance must not have knowledge the records are false or misleading, and must not refuse to consider or produce information that indicates the records are false or misleading.

B. A person who is not a covered person may provide the notice prescribed by A.R.S. § 16-972(B) to another person who has given that person monies before transferring monies or making an in-kind donation to a covered person.

C. In order to establish structuring, the Executive Director shall provide evidence that a person acted willfully with regard to the transaction or other circumstance.

History

• New Section made by final exempt rulemaking at 29 A.A.R. 3687, effective 10/26/2023.